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Medical debt collection laws set to help with overwhelming debt

Almost everybody at some point will experience an illness or injury. In more severe cases, this could lead to a visit to the hospital or doctor in Texas or in any other state. Unfortunately, the medical bills incurred by unexpected medical emergencies can lead to overwhelming debt which consumers may not be able to afford. This has led to medical providers aggressively pursuing medical debt through debt collection agencies. Now, some lawmakers have begun proposing new laws to regulate the collection practices for medical debt.

Medical providers as well as collection agencies recognize the signs of future regulating legislation being passed. Two of the largest groups from the medical industry and the collections industry are teaming up to create their own regulations ahead of lawmakers. The Association of Credit and Collection Professionals (ACA) and the Healthcare Financial Management Association (HFMA) presented a preview of their own proposed standards for medical debt collection.

The HFMA and the ACA joined together to form a Medical Debt Task Force, which has created a set of proposed standards of practice. Although the standards are not required by law, the task force believes they will eventually be adopted by all companies in the medical and collections industries. One of the proposed rules of the task force is to give patients at least 120 days to pay a medical bill prior to reporting the owed amount to a credit bureau.

The standards proposed appear to be an attempt to prepare for future regulations designed to help consumers avoid overwhelming debt resulting from medical bills in Texas or in any other state. However, despite these regulations, many will still find themselves being buried in debt from medical bills. Luckily, there are already options for people who find themselves in these situations to consider. One option is to file for bankruptcy protection, which could potentially discharge the debts or allow for a payment plan over a period of time.

Source: Forbes, "Hospitals And Debt Collectors Race To Head Off Medical Bill Collection Laws, Regs," Evan Albright, July 3, 2013

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