Pinch Hitting

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Pinch Hitting

• Helping Beneficiaries with Billing Issues

Ellen Leitzer Mike Klug
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Workshop Goal

• Provide participants with basic knowledge of
• medical billing issues
• rights of debtors and creditors
• best practices in resolving billing issues
• role of SHIPs in assisting with medical billing
  issues
• resources to assist low income debtors

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Glossary of Terms

• Debtor an individual or business that has
  failed to pay money owed to another
• Creditor an individual or business owed money
  by another
• Credit Collection Agency a third party business
  entity that collects debts owed to a creditor
• Medical Debt money owed to a provider of health
  care services

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Context

• Medical debt problems handled by SHIPs
• Non-payment of Medicare Advantage or Prescription
  Drug Plan premiums
• Erroneous billing for duals
• Hospital billing problems
• Ambulance billing problems
• Advance Beneficiary Notice (ABN) billing problems

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Context (contd)

• SHIP enabling law, with respect to Medicare
• SHIPs shall provide assistance for the process of
  payment for services42 U.S.C.1395b-3(c)(1)(C)

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Debt Collection by Creditor or Collection Agency

• Advise client to
• Keep copies of all written communications
• Take notes on all oral/telephone communications
• Note any harassing or foul language used by caller

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Sample Collection Letters
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• Sample Collection Letter-Follow up Notice

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Defending Debt when Collector is the Creditor

• Do not ignore bills
• If appropriate, request a Suspension of
  Collection Efforts pending appeal of the incurred
  charges
• Seek payment solutions through public funding

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Defending Debt when Collector is the Creditor
(contd)

• Seek payment solutions through private funding
• Negotiation and lump sum payment
• If client is Judgment Proof, then he/she should
  send a Judgment Proof letter to the creditor (see
  next slide)

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• May 29, 2008
• ABC Pharmacy
• 24 Oak Street, SE
• Albuquerque, NM 87108
• Account No. 12345
• Dear Sir
• This letter is to advise you that,
  unfortunately, I am unable to make payments on
  the above-referenced account with you and that I
  am judgment proof under the laws of New Mexico.
• I am a senior citizen whose only source of
  income is from Social Security and a small
  pension. I have no assets of value, do not own a
  home, and drive a twelve year old automobile.
  Moreover, I do not plan to file for bankruptcy.
• Please do not call me about my account with you.
  Again, I deeply regret my inability to make
  payments on my account.
• Sincerely,
• Mary Smith

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Defending Debt when Collector is Collection
Agency

• Do not ignore collection efforts otherwise client
  will end up in court!
• Debtor protections against collection agency
  harassment

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Federal Fair Debt Collection Practice Act (FDCPA)

• Prohibits all forms of unfair, abusive, and
  deceptive collection practices
• Prohibits collection of debts not owed, time
  barred, or discharged
• Credit collection agency must provide debtor with
  notice of his/her right to challenge debt within
  five days of sending notice

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FDCPA Contd

• Debtor has the right to demand that credit
  collection agency cease contacting debtor
• Debtor has the right to require credit collection
  agency to validate the debt

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State Law Protections

• Most states have state fair debt collection laws
  similar to the federal law
• These laws protect consumers from harassment by
  credit collection agencies and creditors
  (including hospitals and other medical providers)
• States unfair or deceptive acts or practices
  (UDAP) laws also provide broad protections
  against a wide range of abusive behavior by debt
  collectors
• Special exemptions for medical debt exist in a
  very few states and protect consumers facing
  medical debt collection

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Credit Card Debt and Credit Counseling

• Many seniors charge necessities to their credit
  cards
• The average credit card debt of Americans over 65
  increased by 89 between 1992 and 2004 from
  2,143 to 4,907
• Medical debt for all ages accounts for one-half
  of all bankruptcies
• Monthly minimum credit card payments rarely
  reduce the principal amount owed
• Negotiation and lump sum settlement

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Credit Card Debt and Credit Counseling (contd)

• Seek assistance from a consumer credit counseling
  agency
• Consumer Credit Counseling Services (CCCS)
  established in 1960s by credit card industry
• Now many credit counseling services are
  unscrupulous and predatory
• Before referring a client to a CCCS, check with
  your local legal services program to ensure a
  referral to an appropriate agency

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Role of SHIP in Troubleshooting Medical Debt
Problems

• SHIP enabling law, with respect to Medicare
• SHIPs shall provide assistance for the process of
  payment for services
• What is the scope of SHIPs assistance role?
• When to refer to legal counsel?

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• Resources
• National Senior Citizens Law Center
• www.nsclc.org
• National Consumer Law Center
• www.nclc.org
• Legal Services Corporation
• www.lsc.gov
• The NCLC materials available online were very
  helpful in preparing this PowerPoint presentation