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Interesting study/analysis:

"About 77 million Americans have a debt in collections, a new report finds.

That amounts to 35 percent of consumers with credit files or data reported to a major credit bureau, according to the study released Tuesday by the Urban Institute and Encore Capital Group's Consumer Credit Research Institute. "It’s a stunning number," said Caroline Ratcliffe, senior fellow at the Urban Institute and author of the report. "And it threads through nearly all communities.""


http://www.washingtonpost.com/blogs/wonkblog/wp/2014/07/29/a...
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Probably not as bad as it sounds.

The report analyzed 2013 credit data from TransUnion to calculate how many Americans were falling behind on their bills. It looked at how many people had non-mortgage bills, such as credit card bills, child support payments and medical bills, that are so past due that the account has since been closed and placed in collections.

I wonder how much of that 35% is the unemployed/underemployed unable to pay child support or medical bills? How much is someone who moved and didn't get their last utility bill?

The debts sent to collections ranged from $25 on the low end and to more than $125,000 on the high end. Many consumers were burned for relatively small amounts -- about 10 percent of the debts were smaller than $125, Ratcliffe says. But the median debt, $1,350, is still pretty substantial, she adds.

Half these debtors owe under $1350 pp. (And likely some of the debts aren't even owed!) Very sad for an individual unable to pay off such a sum over, say, a year's time or so, but as a national issue, not such a crisis. Or am I missing something?
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Very sad for an individual unable to pay off such a sum over, say, a year's time or so, but as a national issue, not such a crisis. Or am I missing something?

It generates clicks to read the article.

Because of the problems with proper notification of small medical bills, the owner of many of the small collections may not even know that the collection attempt exists.

<rant on> There has to be a better method of handling medical bills. Along with routine medical visits for my husband and myself, I have been through a trip through emergency, minor outpatient surgery, and physical therapy.

We are able to pay the deductibles and copays, but there are around 40 claims. Because one provider was out of network, I was paying cash price to one of providers, and then submitting the claim to insurance. The insurance company is now sending me checks for all providers and not just the provider for which claims were filed to pay to me.

The large co-pays are quickly billed. I haven't received bills for co-pays that are until $10. I only have EOBs. Without the information on a statement, they can't be paid.

I don't know how someone who is very ill would be able to track medical bills.

A co-worker's child was serious injured by being hit by a car. After having paid a specific provider multiple thousands, he received a call at work that a $6 co-pay would be sent to collections if he didn't immediatly provide a credit card. They weren't going to allow him access to records that could confirm if the bill was valid. He isn't a person that is eaily intimidated. The issue was deferred until he had a chance to verify the validity of the bill.

<rant off>
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Because of the problems with proper notification of small medical bills, the owner of many of the small collections may not even know that the collection attempt exists.

I bet this kind of thing accounts for a fair bit of this. I had a 5 dollar medical bill (the result of some confusion about my copay) that was sent to collections rather quickly before I had a chance to take care of it! And then you wonder if these people are legit, because they are not the people you actually owe and it can be a whole big mess.

Bottom line, they send everything to collections now.
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Half these debtors owe under $1350 pp. (And likely some of the debts aren't even owed!) Very sad for an individual unable to pay off such a sum over, say, a year's time or so, but as a national issue, not such a crisis.

I also wonder how many of those are from people who just don't keep track of paying their bills and therefore just don't pay them on time. Some people are really flakey, and if you're an responsible, organized person it can be surprising just what nit-wits some people are about simple things like bills.
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I also wonder how many of those are from people who just don't keep track of paying their bills and therefore just don't pay them on time

or after moving, a closing bill isn't forwarded.

When I closed my fathers telephone account, I was told that there might be a charge for three months of call forwarding. I received a bill for the last month without the forwarding charge. I never received an additional bill. The estate is closed, and mail forwarding expires after a year. If they decided at some time to try to charge it, I would have no way of knowing.
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I also wonder how many of those are from people who just don't keep track of paying their bills

I used to be really bad with my mail/bills. Just didn't have a good system for sitting down weekly, going through everything, and paying. I'm much better now, although online bill pay has helped tremendously.

This article actually reminded me that I need to call and pay my dentist copay. I keep trying to pay them at the doctors office, but they sort of actively encourage you to wait until you get it in the mail. And then I get a bill and it will have a dollar fee for something or other...Ugh. Annoying. I also usually get two or three letters on each appointment, becuase my insurance company will send a 'not a bill' note too.

I hate mail.
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or after moving, a closing bill isn't forwarded.

When I closed my fathers telephone account, I was told that there might be a charge for three months of call forwarding. I received a bill for the last month without the forwarding charge. I never received an additional bill. The estate is closed, and mail forwarding expires after a year. If they decided at some time to try to charge it, I would have no way of knowing.


That's a good reason to have electronic statements and online bill pay. You don't have to worry about closing bills being forwarded.

PSU
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That's a good reason to have electronic statements and online bill pay. You don't have to worry about closing bills being forwarded.

PSU


For a move it makes sense. When we moved, accounts that we couldn't change address online were converted to online statements only.

In the case of when someone needs to take over handling of accounts, they need to know what accounts exist. For both my father and aunt it was sudden and they weren't able to assist. My aunt destroyed all account paperwork. Her son had to wait for statements to arrive to locate her accounts.

My father never a saw a reason to have a computer. Having printed bills made it easier to handle his bills. His utilities were on auto pay, but closing bills aren't always processed as auto pay.
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Dinosaurs eventually went extinct.

PSU
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"Dinosaurs eventually went extinct."

You mean I'll eventually need to get rid of my vinyl record collection?
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