Bill never sent to me, sent to collections

My wife underwent a procedure at a hospital in PA in end of 2003. We used to have Fortis as our Health Insurance company at that time. We gave the insurance company's Id when asked for insurance information. We never received any communication from the hospital about it since then. We are planning to buy a home. The mortgage lender asked us to provide our credit report when we ran the credit and were surprised to see the name of a collection agency. It was sent only this week to the collection agency. I did not understand why they sent to collections and why it should appear now in her credit report. When contcacted the hospital they say the record has been purgerd and that they can not do anything about it now. They explained to us that the bill they sent to the insurance company came back after they sent it to them and that when they tried to send it to us it came back as well which is why they had to send it to the collection agency.

When tried to search for the insurance company I came to know it was acquired by another company. I do not have any problem paying up to the hospital now although I know the insurance company had to pay it and I do not know why they did not pay it. But the hospital says they have no way of accepting it as they do not have the record in their system. I do not like the record to appear in my wife's credit report. What is my option now? When contacted the collection copany says they have no way of taking the item from the credit report but it will appear as zero balance if we pay it up instead of the $155 that is shown in the report as owed to a collection agency.

I request wheover has experience and knowledge about collections to please advise me on what I should do now.

Thanks in advance.

Best bet is to contact the 3 major reporting repositories (TransUnion, Equifax and most likely Beacon) in writing or even on the Internet to officially dispute the account. They're required by law to investigate within a certain timeframe, usually about 30-60 days. If the collection agency can't provide them with valid information, the adverse information should, by law, be removed from your credit history. "Unable to find a record" is NOT a valid reason to post this information; they must provide names, dates, circumstances, etc directly to the repositories which doesn't sound to be very likely, given your post. I would also request (in writing) that the hospital put into writing why they cannot accept any monies from you .. you can include a copy of that letter in your written requests to the credit repositories, but they will have to investigate on their own. Check your credit regularly (once every 60 days or so) until the information has been deleted. Be prepared to be vigilant; sometimes they're a bit sluggish in taking action. Also forward a copy of the hospital's letter to your mortgage lender, to show the information on their report is incorrect.

Hope this helps. Good luck.

Thank you very muc, that was very informative. I will do what is suggested, in the meantime is it advisible to pay the amoubt to the collection agency so it will show up in the credit report as zero balance or does it( paying off) mean that I had accepted that it was a mistake of ours?

Thanks in advance...

If neither the hospital or the collection agency can present you with a legitimate bill at this point in time, you don't owe anyone anything (in my opinion) and they are required by law to delete the adverse information. Personally, I wouldn't recommend you pay ANYTHING unless you have a demand for payment in hand and acknowledge the debt is in fact yours. Paying off the collection now does in fact imply responsibility, and regardless of whether it's paid off or not, the collection itself will have an impact on your wife's credit report. This kind of credit "black mark" is pretty common; thousands are reported in error on a regular basis, and unless you take steps to clear this up on your own, will remain on record for up to 7 years.

The decision, of course, is up to you. Good luck.

1) you need all three separate credit reports not the 3 n 1. find out which bureau reported the negative tradeline.
2) dispute with credit bureaus that reported the negative tradeline. Experian, Equifax, &/or Transunion
3) do not dispute online because it gives the credit bureaus 45 days to respond vs. 30 days. do it by certified mail return receipt
4) Never call a credit agent over the phone they tell lies & violate. get their violations in writing
5) don't pay a dime until they validate. a paid collection is still a COLLECTION
6) check your state statue of limitations on debts to see if the debt is time barred.
7) After the steps BELOW fail (if they fail) if the debt is not time barred and they can validate negotiate a pay for delete in writing.
8) if the credit agency verifies with the credit bureaus immediately send them a debt validation ltr (google it), by certified mail return receipt
9) in that letter they must show proof the debt is yours with signed docs, something with your signature on it, original statements, & show how they calculated the dollar amount they say you owe, in some states collectors must be licensed & bonded to collect (check your state laws they are online)
10) it sounds to me like a junk debt buyer purchased your bad debt and is trying to get you to pay triple the amount they paid which is pennies on the dollar.
11) once you receive the (green card) certified mail return receipt signed by the collection agency, dispute the tradeline with credit bureaus again. or ask for a reinvestigation.
A) at this point the credit agency has to mark the tradeline as in dispute or they are in violation.
B) the credit agency has to provide you with adequate validation of the tradeline within 30 days or cease and desist all collection activity.
C) that means they can not verify with the credit bureau that tradeline or they violate.
D) if they do not verify with the credit bureau within the 30 days under the FCRA the credit bureau much delete the tradeline
E) it's a catch 22 verify & violate or don't verify & delete
F) you might want to google Hipa laws concerning credit reporting. Hipa have specific rules on reporting medical bills, you might try that route also.
good luck!