Legal Question in Credit and Debt Law in Pennsylvania

You leave out an important piece of data. Even though the insurer was never billed, that is not the issue. Did you ever receive a bill? If so, what did you do in regard to it? If you knew about this problem and did nothing then I don't see how sending to collections was improper. You received the medical treatment. It does not matter that the hospital did not bill the insurer. The fact is that the bill was not paid so this was properly sent for collection. Its a shame that you did not discover this earlier as the time ha no w passed to see if your insurance can pay.

When was the treatment given to you in 2012? Depending on the date, the statute of limitations either has already expired or will soon expire. It also depends on what else is on your credit report and what you want to do. There is no virtue or benefit to be had in paying a debt that is barred by the statute of limitations. It will not improve your credit any. But in your case, there were a lot of screwups, and maybe you can fashion an argument.

You indicate that the debt collector is now out of business. That is strange - you sure about this? I know one collector of medical debts that simply changed its name. And the collector should not be on your credit report if they are no longer in existence because if you disputed it and there was no answer then the credit bureau would need to remove it. When did you dispute the debt? More than 45 days ago? Did you do it by certified letter? Before you can sue you need to dispute via certified letter with the credit bureau and when that does not work the creditor listed. If they are truly out of business I would try to find out more information about this company - do research and contact the corporate offices. Someone has to be in charge of winding things up. I once tracked down a corporate officer to release a lien where the company no longer did business.

If you do not want to do that, the more immediate way would be to contact the health care provider directly. If they sold the debt to a junk debt buyer or have another collector, they will refer you to the correct entity. If the heatlhcare provider still owns the debt then ascertain the treatment date and whether or not it was 4 or more years ago (statute of limitations is 4 years in Pennsylvania). If the statute has expired, then offer to resolve the debt for something like 25% 50% (start at 25% and negotiate to no more than 50%), lump sum if you have the funds available. Explain all of their errors and tell that in exchange for your lump sum payment see if the healthcare provider will update your credit report to reflect debt paid as agreed or remove the item altogether. If they will not, at least get them to indicate that the debt is now resolved for less than the amount owed.

Of course, you have lived with this long. If they refuse to settle, then I would not pay and let this drop off the credit report in another 3 years. Find another way to obtain the credit you need - other than a mortgage lender, I find it hard to believe that an old medical debt is resulting in the denial of credit.

If you cannot possibly do this on your own, I can help you resolve the debt for a reasonable fee. Please contact me at [email protected] if interested. If its just your credit you want fixed, try calling New Day Credit at 800-771-3533.