Hi, so here is my situation,
I was in a car accident a few years ago now. Injuries I suffered put a good amount of medical bills in collection. I am finally nearing a settlement offer from the other parties insurance company and I am debating how to handle the collections accounts and making sure they are removed. After attorney fees the settlement amount will not be much more than I owe for the bills so ideally I would like to settle with collection agencies for less, but obviously the most important thing would be clearing my credit report.
Should I try and settle myself for less or full amounts? OR, Should I just have my lawyer pay off the accounts in full and send letters to the agencies explaining that I was not at fault and accounts should be deleted? My lawyer says he can send letters for me, I am just not sure how much "pull" he will have removing the accounts or if the agenecies will not give a S#!# and just take the money. Do I stand a better shot sending letters myself so its more personal?
Any help/advice would be greatly appreciated!!
AAAARRRGGHHHH!!!! Garbage like this is why I HATE insurance companies. We pay them, often under penalty of law, to "insure us against financial injury" as a result of someone elses mistake/negligence, and they, in turn BALK AT EVERY STEP in making good on the claims, until we ARE in financial ruin!
The problem is that from a legal standpoint, the individual is responsible for the bills, no matter who is going to end up paying, and the providers and collection agencies for the most part, JUST DON'T CARE. They just want their pound of flesh, and they want it NOW.
OK, end of rant.
How you approach each individual bill depends on who actually owns the bill. If the provider owns the bill, and has only assigned it to collections, often you can get them to 'pull it back' from collections with a promise to pay. Just make sure they pull it back BEFORE paying, other wise the CA may continue to report the collection, even after its paid. In this instance letters from the lawyer may help, though they may not want to settle for less than full payment.
If OTOH, the CA's have purchased the debt, they are probably not going to be responsive to the lawyer as that indicates you have an ability to pay. The ones that have purchased the debt may be willing to settle for less, but less willing to delete the accounts when settled.
It most likely has nothing to do with the insurance company. People always say they hate insurance companies (and attorneys make sure you keep thinking that).... truth is most people have no idea how the process works and have unreasonable expectations, so they just get frustrated and then get an attorney who takes a huge amount from your settlement. The insurance industry is extremely regulated and you could have simply asked the insurance company representative how the process works and handle it yourself. If you have unpaid bills, you probably did not have health insurance, or not enough auto medical payments coverage to pay your bills, or the treatment you had was not an approved. I blame your attorney for not handling these bills and negotiating them with the providers. You, or your attorney should have, asked the providers to submit liens on our claim so they are paid at the time settlement is reached. Remember, you're paying your attorney 30-40% of any settlement, make them earn it. Many attorneys merely order your records and a demand letter asking for a ridiculous amount of money and dragging out the settlement time with unrealistic demands. Some attorneys hope they can file suit so they can increase their fees to 40% or more.
You can, as most people, can resolve theses types of claims direclty with the insurance company without paying enormous fees to an attorney and end up with more money in their pocket. If you are not the type to be able to negotiate, or able to order records and bills from providers, you are probably better off paying an attorney to handle it for you, its what your paying them to do.
I would talk to the original creditor (provider of the service) . Explain your situation and offer them payment in full if they will pull the account from the collection agency. If thye do not accept it then try for a pay for delete with the collection agency.
The CRAs are not arbitrors of whether or not a debt is valid.
If you pay the debt, either in full or via a settlement for less, sending letters to the CRAs demanding deletion will have no effect.
CRA policy is that collections should not be deleted based on payment of the debt.
You need agreement from the debt collextor to delete their collection once it is paid. The normal process is to make a PFD offer.
If you wish to continue to contest the debt, you can take suggestions offered and try to work with the OC, or you can initiate legal action and get finding by the court.
I wont share details, but my case had some very unique circumstances that delayed the process and caused the need to hire a lawyer and ultimately file a suit in order to receive a settlement. I am not, and was never looking to make a fortune. I just want to pay off my medical bills. I now realize I could have handled my bills differently, but I was young and stupid with my finances. I let the bills go to collection before I ever even hired a lawyer.
Regardless, I am where I am, and it sounds like my best bet is to try and handle myself with PFD's assuming that no liens were ever put on the claim?
In theory, had the providers placed liens on the case they would not have gone to collections? is that true? next question, can the collection agencies still place liens on the case or sue me if I do not pay them? (FYI, not saying I wont pay them, but want the to agree to delete)
Boonie - You are right that tossing lawyers in the mix only slows things down even more. The problem, as I see it, is that the insurance companies (even your own medical insurance) will often flat out REFUSE to pay the provider if they believe someone else is responsible. And we as the consumer get stuck in the middle, not knowing how to handle these things. So we end up dragging in the lawyers.
The problem is that we EXPECT the insurance companies to promptly pay the providers and then work out the details (as to responsibility) amongst themselves. That seldom happens. If the insurance companies would just work together reasonably without dragging the lawyers in (or forcing us to), a whole lot of money would be saved by all.