If I pay a small amount each month toward a hospital debt, what can I do if I received a notice from a collection agency?

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If I pay a small amount each month toward a hospital debt, what can I do if I received a notice from a collection agency?

I spoke with the hospital and they want larger payments. I already pay them $45 toward another account. They want $108 a month for this new account and refused to combine the 2 debts. Also, I have other hospital accounts to pay off, plus I have health insurance to pay.

Asked on June 7, 2012 under Bankruptcy Law, Wisconsin

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Unfortunately, a creditor does not need to accept smaller payments, or take account of your other financial obligations: they are entitled to be paid either as per the payment agreement or terms of service, or if you have defaulted (failed to pay when the money was due), they can ask for all the money at once. If they choose to accept less than all the money at once, that's up to them, and they can decide on what amount of monthly payment they will consider acceptable. Since you owe them the money, they are the ones who get to decide how large a monthly payment will satisfy them--you have no control over it. You can try to convince them to accept a smaller payment, but it is voluntary on their part whether to do so.

You may need to consider bankruptcy as an option, if you owe more money than you can pay. Bankruptcy works particularly well on unsecured debts (or debts where there is no property serving as collateral), like the typical health care or hospital debt. You should consult with a bankruptcy attorney to see if this is a good option for you.


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