Book au­thors aim to pay off $1 tril­lion in med­i­cal debt

The Fresno Bee (Sunday) - - News - BY CATHIE ANDERSON can­der­[email protected]

With dona­tions from peo­ple across the na­tion, three health care in­dus­try veterans have been chip­ping away at abol­ish­ing Amer­ica’s $1 tril­lion med­i­cal debt, and they re­cently wrote a book that ex­plains the chal­lenges and re­wards of this mis­sion.

The co-au­thors – Craig An­tico, Jerry Ash­ton and Robert Goff – founded the non­profit RIP Med­i­cal Debt to buy med­i­cal debt for pen­nies on the dol­lar and then for­give it, re­mov­ing any blem­ishes on credit his­to­ries and giv­ing fi­nan­cial re­lief to mil­lions of Amer­i­cans. In a tele­phone in­ter­view with The Sacra­mento Bee, Ash­ton said they wrote the book (“End Med­i­cal Debt: Cur­ing Amer­ica’s $1 Tril­lion Un­payable Health­care Debt,” Hoku House, 196 pages, $25.95) for peo­ple who want to un­der­stand why this prob­lem ex­ists and how they can help to end it.

“It’s not like peo­ple are go­ing out and buy­ing big screen TV’s or book­ing va­ca­tions in Ber­muda,” Ash­ton said. “No­body elected to have can­cer. No­body chose to have an ac­ci­dent. Ninety-eight per­cent of all peo­ple are true vic­tims of a hor­ri­ble sit­u­a­tion.”

The three au­thors are do­nat­ing their roy­al­ties on the book to­ward end­ing med­i­cal debt. For ev­ery book sold, they say, $500 in med­i­cal debt is paid off. RIP’s co-founders es­ti­mate that Amer­i­cans owe about $1 tril­lion in med­i­cal debt. The non­profit has so far paid off a lit­tle more than $662 mil­lion, ac­cord­ing to the counter at www.ripmed­i­caldebt.org.

If the RIP Med­i­cal Debt name sounds fa­mil­iar, it may be be­cause you re­sponded to a call from The Bee and other McClatchy Co. news­pa­pers to help erase med­i­cal debt for veterans. In a 10-part se­ries called “The War Within,” McClatchy re­porters chron­i­cled how three Afghanista­n veterans were cop­ing with their rein­te­gra­tion into civil­ian life.

As part of that ef­fort, McClatchy asked read­ers to con­sider do­nat­ing to RIP. Dona­tions from McClatchy, its read­ers and the McClatchy Foun­da­tion were able to pay off more than $5 mil­lion in med­i­cal debt for veterans na­tion­wide. When the non­profit pays med­i­cal debt for some­one, that per­son gets no­ti­fied via a let­ter in­side a yel­low en­ve­lope.

Through the in­ter­view with Ash­ton and read­ing the book, The Bee dis­cov­ered a num­ber of things about med­i­cal debt. Here are five that might sur­prise you:

It is vir­tu­ally im­pos­si­ble to get out of pay­ing a med­i­cal debt, even if your doc­tor agreed to take what­ever your in­sur­ance com­pany pays, even if a hospi­tal said they wrote off your bill as bad debt, even if a provider changed its billing sys­tem and stopped send­ing you bills, even if you re­ceived care a decade or two ear­lier.

There are re­ally only four ways to erase your med­i­cal debt: Pay it. Get it dis­charged as part of a bank­ruptcy. Get the provider to is­sue a credit to you and thus for­give it. Or, leg­is­la­tors can pass a law es­sen­tially void­ing the con­tract.

Ash­ton said he’s of­ten asked, “How can veterans in­cur med­i­cal debt? Don’t they re­ceive free care at hos­pi­tals run by the De­part­ment of Veterans Af­fairs?”

“Our sys­tem is bro­ken,” he said. “VA hos­pi­tals aren’t open for emer­gen­cies on week­ends. If you’re a vet­eran and a med­i­cal prob­lem hits you on a week­end and you’re taken to an emer­gency ward … you will owe that bill. The hos­pi­tals at­tempt to col­lect money out of the VA, but not with a lot of suc­cess.”

U.S. mil­i­tary veterans owe $6 bil­lion in debt re­lated to am­bu­lances and emer­gency care, Ash­ton said, and the VA is not pick­ing up that tab. He said that means these veterans are be­ing chased down by bill col­lec­tors.

Sup­pose you “get lucky,” and af­ter decades of be­ing ha­rassed by bill col­lec­tors, a cred­i­tor agrees to for­give your med­i­cal debt. You may think you’re fi­nally in the clear, but think again. The U.S. govern­ment looks upon your good for­tune as or­di­nary in­come. Your cred­i­tor could very likely send you a 1099-C “Can­cel­la­tion of Debt In­come” with a copy to the In­ter­nal Revenue Ser­vice, and you will owe taxes on that “in­come.”

In­sur­ance com­pa­nies can take as many as seven years to pay a bill from a provider out­side your in­sur­ance net­work, An­tico wrote in a chap­ter on per­sonal and gen­eral med­i­cal debt so­lu­tions. Of­ten, peo­ple go to friends and fam­ily for help in pay­ing off these ex­penses be­cause non­pay­ment can af­fect their credit re­ports. (Friends and fam­ily con­trib­ute $55 bil­lion to help pay med­i­cal ex­penses and debt re­pay­ment. ) If you pay an out-of-net­work bill, be sure to file your re­quest for re­im­burse­ment with your in­surer. Do not rely upon the out-of-net­work provider to do it for you.

In the book, An­tico noted that RIP Med­i­cal Debt works di­rectly with com­pa­nies that buy debt on the sec­ond­hand mar­ket but also with doc­tors and hospi­tal lead­ers who would like to sell or do­nate ac­counts to the non­profit. Many have done so be­cause they are dis­pens­ing with ac­counts that of­fer lit­tle value in ex­change for chang­ing some­one’s life for the bet­ter. RIP also uses the pow­er­ful an­a­lyt­ics of the Tran­sUnion credit re­port­ing agency to iden­tify ac­counts that meet hos­pi­tals’ char­ity care re­quire­ments and to en­sure hospi­tal pa­tients get the peace of know­ing their debt is for­given.

‘‘ NO­BODY ELECTED TO HAVE CAN­CER. NO­BODY CHOSE TO HAVE AN AC­CI­DENT.”

Jerry Ash­ton, co-au­thor

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