Is there a time limitation to collect on a medical debt?

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Is there a time limitation to collect on a medical debt?

My dad got a nasty call from a collection agency for a 5 year-old medical bill. I have reviewed his papers and insurance and find no record of receiving it. Can they still collect? The insurance company states that the claim must have been submitted within 2 years.

Asked on September 4, 2010 under Bankruptcy Law, Illinois

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

The time period in which a creditor can file in court on a debt is called the "statute of limitations".  At some point, the statute of limitation on the debt may run out, which gives you a defense if you’re sued. In IL the statute of limitation on unwritten contract debt, which includes most medical bills, it’s 5 years.  Additionally, the statutes of limitation run from the last payment made on the debt. That means that 5 years must pass from your last payment on your doctor bill for the limitation period to have run out, so you have a defense. New payments re-start the time period.

A statute of limitation doesn’t make it illegal for a creditor to sue you to collect on a debt. It just gives you a defense you can raise that will get the collection case against you dismissed, so that the debt can’t be enforced against you in the legal system. If you don’t raise the defense yourself, the creditor can go ahead and collect from you.

Finally, even if the statute precludes a creditor (or subsequent collection agency) from suing you in court, you still owe the debt because you never repaid it. Even if the business that you owed may have decided you weren’t going to pay, that doesn’t relieve you of a legal liability for payment. "Writing off” a debt doesn’t mean that you, the debtor, don’t owe it anymore. Therefore, a collector may still call and ask for payment even though they will no longer be able to sue you.


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