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Removing Medical Debt Collections Previously Paid by Medicaid or Other Insurance Providers

Cynthia, a debt collections removal enthusiast, wants everyone to know the ins and outs of having inaccurate account information removed.

Have a collection account for a previously paid medical bill? It is possible to get the credit bureaus to remove these collections.

Have a collection account for a previously paid medical bill? It is possible to get the credit bureaus to remove these collections.

Do you have Medicaid or other insurance coverage and notice a debt collection on your credit reports? You can often remove these collections off of your credit reports.

It's common for medical debt collections to be reported in error, even with insurance companies you have through employers. Over the years I have successfully removed "double dipping" collections for previously paid medical debts.

Inaccurate Reporting Is a Serious Matter

Though "double dipping" or attempting to collect on medical debt that has already been paid is common, credit bureaus take inaccurate reporting seriously, and in most cases will swiftly remove these erroneous collections.

When dealing with my father's estate we were overwhelmed with collection attempts for medical debts, even though he was covered through Medicaid and other supplemental insurances. And for the past 10 years I have been battling my own medical debts that were paid from a car wreck settlement. Even this many years later they pop up as new collections from time to time despite being paid in full.


The procedures below aren't meant for people who don't want to pay debts they actually owe, or just want to improve their credit scores without spending money.

But if you legitimately don't owe the deficiency reported then these steps are effective. Supplying the credit bureaus with supporting documents makes the removal much faster.

First Steps to Remove Debts

Don't pay collections that were already paid by insurance; remove them. Medical debts that were paid in full but still go to collection are relatively easy debts to remove. But first you need to gather some documentation.

Documents Needed for Disputing a Collection

  • Receipts
  • Balance statements from insurance
  • Copy of original bill/statement

If you had coverage that paid the debt in full, you need to contact Medicaid if you have no documents showing it is not in default. They can help you if they have an original statement or bill for the debt in order to look it up.

We all hate piles of bills sitting around, but hanging onto doctor bills and Medicaid statements can be useful.

If You Cannot Find a Bill or Statement

If you can't find a copy of the original bill or statement you will need to contact the collection agency. Their contact information is included with the debt on your credit reports.

A simple email requesting an original copy or billing statement to work with your insurance to determine validity of the debt will suffice. Alternatively you can call, if you like, and request they mail one to you. Let them know you need to confirm with your insurance that you owe the deficient balance.


Disputing Previously Paid Medical Debt

Sometimes just the inquiry for an original bill results in removal of the debt, but not always. If you already have copies of statements from insurance providers then you can begin the dispute process. If you have to contact the collection agent to pursue an original billing statement, the process will take longer.

Drafting a Dispute to The Credit Bureaus

Next you need to draft a dispute letter and make copies of the billing statements and supporting documents. Since this debt was paid, you can skip disputing with the collections agent. Instead dispute directly with credit bureaus for removal.

Tips When Directing Disputes to Credit Bureaus

  • Write in your own words
  • Don't use templates found on the internet
  • Describe why you are disputing in a short paragraph
  • Only Include necessary information

Avoid using any templates you find on the internet or by Google for a pre-made solution. These templates will often flag with software used by the bureaus. Then they often deny the request and you have to start once more. Never copy and paste a dispute letter found on the internet.

Instead just write in your own words. Keep it simple, especially if you have documentation to send. There isn't a need for a lengthy description.


Debts Once Removed Can Show Up Again

I always save a copy of all my disputes because these inaccurate debts often pop up more than once. There have been several times that I submitted the same info for disputes over the years, along with the credit bureaus' decisions.

I've managed to submit the same information later when the same collection attempts showed on my reports again. Thus I showed that the bureaus had already removed this debt when previously disputed.

Save the documents and statements you receive from insurance coverage: any bills or statements showing payment confirmation, what was paid, and what if anything you owed out of pocket.

Often the medical debts reported can show inaccurate amounts as well. Don't pay debts that were already paid by insurance or that report any false details such as balance due.

Why do debts often show up again? Debt collectors are not always honest or reputable. I often look up the collection agencies that show up on my reports, and I find most have horrible reviews, including attempt to collect debts already paid.

Searching the Better Business Bureau complaints can be eye opening regarding collection agencies. There may be instances that your details were included in a data breach. Sometimes this can result in not so reputable debt collectors attempting to claim you owe them and your account is in collections with them.

Never pay any debt you can't validate and do not owe. This is what collection agents hope for, but don't pay them, dispute them. Keeping good records of medical services, dates, and statements can help you clear them up fast.


Record-Keeping Tips

Dealing with creditors, collections and credit profiles is often time consuming and a headache. To eliminate some of the stresses of trying navigate debts and their removal stay organized.

What to Keep Copies of

  • Billing statements from original debt holder (doctor's office/lab)
  • Any statements from insurance providers
  • Copay/out of pocket payments

Keep the paper trail. When disputing medical debt this can save time. If you ever pay cash for co-pays at the doctor's office, rather than running a debit or credit card be sure you have a receipt showing whom and what you are paying for, the amount paid, and the date.

Juggling paperwork is never fun. Lucky for us it's the digital age. Instead of keeping mountains of paper records laying around you can scan copies and save them to files on your laptop or computer.

I use a Printer with Scanner/Copier built in. Whenever I get statements I scan them and save to the appropriate provider's file. Since I have a family of four, I keep files for each person. It makes it easier to navigate when needing to validate or dispute medical debt collections.

The printer was relatively inexpensive and is really worth the investment. Keeping copies of all things medical-expense-related can save you headaches in the long run.

This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

© 2020 Cynthia Hoover