Hacker News Reader

I worked with somebody who at 23 was bitten by a cat and it got infected. She didn't want to seek medical treatment even though her hand swelled up like crazy--"I don't have insurance, I will get better". I basically forced her to go to the hospital and she ended up spending a couple of days in the ICU. They told her if she waited another day, she might not have made it.

Total cost, something around $23,000 I think. This is somebody who was making maybe $10/hr. They took a payment plan of around $15/month, so she will be paying it back for the next 128 years.

Another anecdote about my mom. A few months ago she was rushed to the hospital for symptoms of a pulmonary embolism. She spent 36 hours in the critical care unit. They couldn't determine what caused her episode; no clots, etc. They charged her $25k for that. That's how fucked up the situation is. A single night in a hospital that may save your life ends up costing almost what your kid/grandkid is paying for a year of college.

Recently she got a bill for $250 for the ambulance, which she paid, and another letter saying her bill for the hospital stay was settled. She told me she would have offered $15/mo had they held her to the $25k or told them to screw off if they didn't accept. They're not even bothering anymore.

> Medical debt is the least concerning type of debt for most lenders.

Just another data point, a large property management company I used to work for specifically exempted bankruptcies due to medical debt when calculating applicant credit scores.

I have a friend who sells debtor data for a living. He literally sells Excel spreadsheets of debtor data (name, address, SSN, amount owed, etc) to collections agencies for $5k-$25k a pop. He makes mid-six figures doing it. The quality of the data is what commands the price. He said the least desirable debt are debts older than a year and medical debt. He can't even give that crap away.

Also, if you're ever called by a collections agency, you should ask them to provide proof that they actually hold the debt you're obligated to pay. In some cases they've just bought the data, usually from another collections agency who couldn't collect, and they're trying to shake you down. Once you use the magic phrase "provide proof" they give up and stop hassling you, because they have no proof.

I used to worked at Wells Fargo and my friend in sales said the mortgage underwriters typically didn't blink at medical debt.

I wonder what would happen if it was widespread knowledge that the smart money was in never paying it.

I'm not sure I believe that debt over a year old is not pursued. Anecdotal, but...

I've had 4 different cell phone numbers in my lifetime. All of them were still getting debt collection calls or still are up to 15 years later. I've had my current number for over 15 years. I'd love to meet Tanya who ran up the bills for my current number.

Also, I had my appendix rupture right after getting laid off and going on COBRA. I am still getting occasional calls about that even though the insurance eventually paid off. That was over 10 years ago.

COBRA is another scam. $1650 per month that my employer was paying ~$600 for.

Scumbaggery is rife in the insurance industry. The Rainmaker should be required watching...

> COBRA is another scam. $1650 per month that my employer was paying ~$600 for.

COBRA is whatever the employer was paying + 2% administration fee.

Sorry, you're wrong, unless my former employer is lying to the gov't. I believed a similar story

If you tell them to stop calling you they are legally required to stop or you can sue them for statutot damages

The debt keeps getting resold. I'd have to be able to predict the future...

> Just let it go to collections. You'll get harassed for a little over a year. Debt older than a year is almost never pursued by collections agencies.

I don't understand. Is there no penalty to not paying other than a hit on your credit score? Can't you end up with wage garnishments or liens or something like that?

Where I live (Arizona) there's a statute of limitations on consumer debt, think it's 2 years for random bills and 3 years for recurring payments...or something similar.

That sounds like legalized theft. Why pay any non recurring bills ever?

It'll definitely show up on your credit report. The key is a lot of lenders supposedly will just look past it. Ultimately it's up to them if you get a loan or not, not just based on the number alone.

One caveat, you definitely want to contest the debt in writing regularly. If it goes away because the collector failed to respond you are fine. If it goes away because they "forgive" the debt, its seen as income by the IRS and you will pay taxes on it. So imagine the tax bill if 200K of "income" is added to your taxes one year.

Nope. Wage garnishments and liens only happen with debts to the government such as unpaid taxes, child support, or fines.

Ok but can't the hospital (or the collections agency) take you to court? Let's say you have 100k bill from the hospital that you just ignore. They sell it to a collections agency for 60k. You refuse to pay the collections agency. Now what happens?

Did some more research on this...

Yes, the hospital or collections agency can sue you to try to garnish your wages. If they win, you're boned.

If they lose, or they never sue for garnishment, it's unclear what happens if you refuse to pay. From what I can tell, the debt disappears from your credit report after seven years, but the debt is still valid and they can still try to recover the money from you, but they won't be able to use the courts to do it.

However, there's always the option of declaring bankruptcy. Even if they garnish wages, declaring bankruptcy will wipe it away. Obviously, that's the nuclear option and will destroy your credit rating for seven years.