Medical collection is a type of collection in which medical institutions, insurance companies or health care providers attempt to collect outstanding debts. There are basically three types of medical collections: health maintenance organizations, health maintenance organization (HMO), preferred provider organizations (PPO) and pharmacy claims. All three types of collection involve the collection of money owed for medical services provided to the insured or policyholder. In some cases, medical debt refers to medical debt incurred due to out-of-pocket expenses and associated costs.
Types of Medical Collection
Health maintenance organizations or HMOs generally deal with insurance claims involving physicians, hospitals and other providers that are affiliated with their network. The main purpose of a health maintenance organization or HMO is to control health care spending and reduce health care utilization. In addition to controlling health care spending, health maintenance organization companies also collect premiums from policyholders. PPOs and Preferred provider organizations require policyholders to pay co-payments and deductible amounts as part of their monthly premiums. This means that if a policyholder does not pay their monthly premiums, they are subject to collection action by these providers.
A health maintenance organization company will collect outstanding medical debts in many ways. They can contact policyholders directly and try to negotiate with them on repayment plans, or they can use a third-party collection firm to collect the debt. If the company fails in negotiations with the policyholder, they may attempt to pursue collections against the policyholder’s assets. The most common method for collecting health care debts from policyholders is to apply for a garnishment order on their tax returns. In addition to garnishments, other legal means of collection include credit reports, tax liens, bankruptcy filings and seizures of assets.