Report Predicts Rise in Sales of Healthcare Debt
According to Kaulkin Ginsberg’s recent Healthcare ARM Report, 2006, approximately $4 billion of delinquent healthcare debt was sold last year. These debt sales happen when healthcare providers sell the right to receive payment on a debt. The buyer pays less than the full amount of the debt, taking into account the time and expense of collecting on the debt and the possibility that the debt will not be collected.
The report notes that healthcare providers set aside $129 billion each year to cover bad debt. From these numbers the report forecasts an increase in the sale of healthcare debt in future years. Given that more and more consumers are purchasing medical care on credit (because they are U-N-I-N-S-U-R-E-D, Congress), healthcare providers will increasingly be forced into the role of lenders. Selling the debt makes sense for healthcare providers because it provides them with immediate cash (they have their own expenses to pay) and gets them out of the unsavory business of debt collection.
What effect would an increased market in healthcare debt mean for consumers? It’s not clear, but I think it’s safe to assume that professional debt collectors will be more aggressive than healthcare providers in collecting this debt. Stay tuned...
Re: Given that more and more consumers are purchasing medical care on credit (because they are U-N-I-N-S-U-R-E-D)
A quibble here: a lot of folks paying paying for healthcare with credit cards are actually insured: they are uysing plastic to pay for copays which are becoming increasingly large. I just charged an $82 Rx copay (for two prescriptions). I have a FSA at work so I will recoop that in short order, but the point is that even for the insured out of pocket costs are past the point of being easy to pay.
February 8, 2007 6:30 PM | Reply | Permalink
Your $82 dollar co-pay may be more that the insurance company is paying for the drug!
My previous senators staff member said that they could not find out how much the drug companies rebated under private contract to the insurance company because it was done under private contract. What bullshit.
My brother had an operation for a thymoma in the chest. Ten thousand doctors bills were redacted to two thousand dollars on his billing records that the insurance company paid for.
Reduced is inappropriate concept here.
Medical and especially drug prices are priced high at retail only to have a high starting point to negotiate discounts from.
I say again what BS. Over 100k in bills reduced by 80%, but with no insurance company they take your house with over a 100,000 bill. Robbery...
Where is the passion contributors………?
Give us some more information you may be acquiring about these subjects. Don't tell us how sharp the knife is becoming, we know we are being had, where are the points we can influence for relief.
We die because of this!
What a system!
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Today, are we searching for I deals or Ideals?
-Thinking
February 8, 2007 10:03 PM | Reply | Permalink
Whether health care providers hire collection agencies to collect their debts or sell the rights to collect the debts to investors who hire collection agencies to collect their debts seems to be a distinction without a difference.
What's your point?
February 9, 2007 8:38 AM | Reply | Permalink