When Cheryl Montgomery awoke in the hospital after a medical emergency, the last thing on her mind was the billing headache that would follow. Even with robust health insurance, Montgomery still owed $25,000 on a half dozen bills from an ambulance company, an out-of-network hospital, an anesthesiologist, a lab and various doctors. She hired a consumer advocate who negotiated the bills to a reduced amount, which she paid.
She assumed her medical financial crisis was over. Not even close, it turned out. In January 2022, a year and a half after her hospitalization, a collection agency representing a doctor she couldn't recall ever meeting billed her $1,700.
The collection agency pestered her with calls and letters and reported the debt to credit rating agencies that lowered her credit score the same month she was attempting to lease a new vehicle. "I was having a mini panic attack," said Montgomery, a Pennsylvania resident who lived at the time in a suburb of Salt Lake City. "I had gone through the stress of dealing with this already," before the unexpected collection notice arrived that January.
Montgomery's experience is an all-too-common scenario in a nation where 1 in 5 adults have some medical debt. Billing errors and disputes over insurance payments can compound problems for consumers and result in credit reporting agencies sharing inaccurate and often harmful information. Such reports not only damage a person's ability to borrow money for a car or home, they can scuttle j.