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Medical Bills and Minors – What You Need to Know

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It’s bad enough to owe medical debt you can’t pay. But what if you’re young and being hounded by collectors for medical bills that were incurred when you were just a kid? Our series of articles about medical collection accounts has continually been one of the most popular on our blog. As a result, we’ve been flooded with questions, some relating to medical bills and minors.

Scenario 1: A young person received medical treatment a few years ago when he or she was under 18 and under their parents’ care. The parents didn’t pay the bills and now collectors are trying to collect from the youth. What are his or her rights and responsibilities?

“In most, if not all states, a minor lacks the capacity or legal ability to enter into a contract,” asserts Ted Connolly, a bankruptcy and asset protection lawyer at Looney & Grossman in Boston. That’s why medical providers require their parents to sign financial responsibility agreements before providing care. “To attempt to collect the debt on which the creditor cannot show a contract or an underlying basis would violate the Fair Debt Collection Practices Act,” he says.

Specifically, he points to this section of the FDCPA:

Unfair practices [15 USC 1692f]

A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section: (1) The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.

Connolly’s advice here:

What a consumer should NOT do in this circumstance: Pay the bill. He or she is not legally obligated to a debt as a minor even though he or she has reached the age of majority. I can see a very remote possibility of the consumer having some responsibility on this debt under an unjust enrichment cause of action. But the creditor would have to sue in court asserting unjust enrichment and I don’t imagine that happening unless the amount owed is huge.

What a consumer should do in this circumstance: 1) Respond to the creditor demanding to see proof of the debt — the creditor must respond within 30 days and it could likely end the collection efforts because the consumer will not be party to the contract; 2) Send a letter mentioning the FDCPA and demanding to cease all correspondences regarding this debt; 3) If the creditor persists in its collection of this debt, the consumer should consider contacting his or her attorney general’s office and/or contacting a lawyer who would take on the case on a contingency basis. (Attorney’s fees and costs can be collected under the FDCPA.)

But there is still a small risk the collector could try to take legal action. It’s true that “minors usually do not have the legal capability to enter into contracts,” agrees Chi Chi Wu, staff attorney for the National Consumer Law Center. “However, in many states, the minor could be sued under the theory of ‘Quantum Meruit’, which is an equitable claim based on the idea that the minor received services from the provider, the minor benefited from the services, and the provider should receive the reasonable value of those services in compensation. No formal contract is required for a claim of quantum meruit, in fact, that’s the whole idea of the theory. It’s the same theory that holds a patient liable for a hospital bill even if he is brought in unconscious (and thus could not have consented to a contract).”

Atlanta bankruptcy attorney Jonathan Ginsberg agrees with both Wu and Connelly, saying that “there are two types of contracts at play in this situation, express written contracts and implied contracts.” The parents probably signed an express written contract when they took their child in for treatment, while the child perhaps could be held responsible under an “implied contract theory — in other words when you ask a physician to perform services there is a reasonable expectation that you will need to pay for those services. The question — can a minor child bind himself contractually if he is under the age of 18? The answer to this will depend on state law. Obviously if the child was 10 at the time of the treatment then the answer is “no.” If the child was 17 1/2 — maybe a closer call.”

Ginsberg says that if this were his client, he would advise them to ask the debt collector to verify the debt “and an explanation as to how a minor child can be bound to a contract that he did not expressly enter and that was created at the time the child was a minor.” That would likely be enough to get them to back down. ” My guess is that the collector would have an uphill battle collecting from a person on a debt incurred when that person was a minor and not legally competent to enter into contracts.”

Of course, Mom and Dad are not off the hook here: they are likely still responsible for the bills, either because they signed an agreement accepting financial responsibility or because they in many states parents are responsible for their minor children’s necessary medical care under what’s called “doctrines of necessaries.”

And that brings up another scenario raised by a reader:

Scenario 2: A father signed a financial responsibility agreement with his son’s dentist when his son was 17. Now it’s a few years later and his son received treatment as an adult but the dental office is still holding the father responsible for the unpaid bill saying that the financial responsibility agreement still applies. Is this something parents need to watch out for?

Parents need to be careful here, especially if their children continue to receive medical care as adults from the same providers they used as children.

“If the financial responsibility agreement is open-ended and would combine as a parental consent agreement coupled with an open-ended co-signing agreement, then Dad might still be on the hook,” warns Southern California consumer law attorney Robert Brennan. But “if it is pretty strictly limited to financial responsibility while the kid is a minor, or is limited to a specific term of treatment (i.e. until the kid is 18), then Dad should be off the hook.”

While this isn’t the kind of problem most parents would anticipate, parents of children who are not managing their finances well may want to avoid future problems by notifying medical providers that they will no longer pay for their care. “The father needs to send written notice to the dentist stating that he disclaims future responsibility for his now adult son’s treatment. By putting the dentist on notice, he would have an argument that the original contact has been canceled and no longer binds him,” advises Ginsberg.

“This is definitely something every parent should keep in mind when signing financial responsibility agreements,” Connolly warns.

Finally there is a third scenario that has reared its ugly head more than once: separated parents who refuse to pay their share of their children’s medical bills.

Scenario 3: Divorced parents have agreements spelled out as to which spouse pays the medical bills, or how they are allocated. The parent who should be paying those bills per that agreement doesn’t and the other spouse is being contacted by collection agencies. What is that parent’s rights, responsibilities and options?

“The controversies in divorces never seem to cease,” observes Connolly. He says that both parents are responsible to the creditor (the medical provider). “The settlement agreement, even if approved by the court, does not stop the creditor’s ability to collect from either parent if both are liable at the time of the debt. What this means to parents: even though one parent may not be responsible under the divorce settlement, he or she will still have to pay in order to avoid collection efforts, negative impact on the credit score, and potential legal action. Both are legally obligated to pay the debt. However, if a parent pays these bills for which he or she was not obligated under the settlement, he or she should collect from the other parent, even if it means going to divorce court to do so.”

“This happened to me personally when I got divorced,” says Michelle Dunn who worked in debt collections for over 25 years, including experience in medical collections. “This is very common. All the person that is not responsible has to do is make a copy of the portion of their divorce decree that shows the other parent is responsible, and send that to the agency.”

If that doesn’t work, Ginsberg suggests that the spouse who is “being dunned go back to the divorce court and file a motion to hold the other parent in contempt. If the dunned parent gets sued, she could cross claim the other parent on the basis of the non-paying parent’s contractual obligations.”

Image: Alex E. Proimos, via Flickr

Please note that our comments are moderated, so it may take a little time before you see them on the page. Thanks for your patience.

  • http://www.credit.com/ Credit.com Credit Experts

    We are sorry to hear about your difficulties and hope your daughter is now healthy. Showing your daughter as guarantor is almost certainly a mistake. If you made arrangements with one creditor to pay a certain amount monthly with an in-network provider, it’s unlikely that the out-of-network provider is bound by it. Here are a couple of Credit.com posts addressing the issue:
    Four Medical Bill Myths That Can Cost You Dearly
    Can I Pay a Creditor Less Than I Owe?
    Good luck in getting the financial part of your daughter’s surgery behind you

  • http://www.credit.com/ Credit.com Credit Experts

    Although we are not lawyers and can’t give you legal advice, we can tell you there is a very good chance that you are responsible for those bills. In many states, the parent/parents are required to cover their children’s health care. This post may be useful in understanding how the laws work:
    Help! My Ex is Trying to Stick Me with the Kids’ Medical Bills

  • http://consumerrecoverynetwork.com/ask-a-question/ Michael Bovee

    Are you able to pay anything toward the bill?

  • http://www.credit.com/ Credit.com Credit Experts

    Chelsey —
    You will need to dispute the information in your credit reports with all three credit-reporting agencies. This article tells you how: A Step-By-Step Guide to Disputing Credit Report Mistakes. In your case, you should dispute by mail, and include a copy of your birth certificate. Send it certified mail, and keep copies of everything (your letters and receipts). You can do the same with the collectors, and you may also tell them to stop contacting you about the debt, explaining that you do not owe it (also keep documentation). If you continue to have problems, you can report it to the Consumer Financial Protection Bureau or consider hiring a consumer-law attorney. You are right; you are not responsible for medical bills incurred when you were 16, and they should not be harming your credit now that you are an adult.

    Good luck to you, and please let us know what happens.

  • Kevin

    The section regarding Ted Connolly’s statements
    could you reply with the correct citation for me? I intend to cite it on my behalf to dispute a bill wrongfully placed in my name, similar to chelsea below me.

    • http://www.Credit.com/ Gerri Detweiler

      I’m sorry I don’t have that information and it may vary by state. But if you are just disputing it with the provider or the collection agency I don’t think you need to cite specific laws. You can just state in plain English why you don’t believe the bill is yours. If they dispute that you can always file a complaint with the Consumer Financial Protection Bureau or get an attorney involved.

  • http://www.Credit.com/ Gerri Detweiler

    Have you tried disputing it with the collection agency? Send them a certified letter, explain that you were a minor at the time and your father was responsible, and asked them to stop collecting the debt and remove it from your credit reports. If they don’t, I’d suggest you file a complaint with the Consumer Financial Protection Bureau.

  • http://www.Credit.com/ Gerri Detweiler

    If he is an adult, then the medical bills are his responsibility not yours. Did you try to find out whether he is eligible for financial assistance? If not, I’d suggest you get on that as soon as possible because otherwise he could be stuck with a very large bill he can’t pay and bad credit at a time when he’s just supposed to be starting out building credit. I am sure this is a whole new process for him, so you probably need to help him stay on top of these bills and find a way to deal with them.

  • http://www.Credit.com/ Gerri Detweiler

    As we wrote in the article, parents are typically held responsible for their minor children’s necessary medical expenses, even if they didn’t explicitly sign something to that effect.

    This is a very large bill, so yI would suggest you consult with a consumer law attorney with experience in medical debt. (That may be a bankruptcy attorney.) Unfortunately, if you can’t come to an agreement with the provider, you may be sued in this large debt could be enough to push you into bankruptcy if you don’t have the ability to cover it.

  • http://www.credit.com/ Credit.com Credit Experts

    Did she actually become an emancipated minor?

    Parents are typically held responsible for medical expenses of children who have not reached their 18th birthday.

  • http://www.Credit.com/ Gerri Detweiler

    Sure – let me know how this turns out. Sure sounds like a nightmare but I hope your son’s okay.

  • Sheri

    My mom refused to allow me to take care of any of my medical bills until i moved out in October of 2012. All of the medical bills on my credit score are from early that year or before. I turned 18 in Feb of that year. who is liable for those accounts? most of which are from the year before.

    • http://www.credit.com/ Credit.com Credit Experts

      Your parents are presumably responsible for bills you incurred when you were a minor. Are the bills showing up on your credit reports?

      • Sheri

        yes. there’s a total of seven of them. one is from after i was 18 but my mom insisted she’d take care of it. the rest are all from before but went into collection after. i never got an actual bill for any of them.

      • Sheri

        yes, they are. what can i do? what about the ones after i turned 18 that i didn’t receive a bill for because my mom insisted she’d take care of it?

        • http://www.credit.com/ Credit.com Credit Experts

          What a mess this is for you.
          The bill from after you were 18 would be your responsibility, though it’s easy to see how you were not aware of it. We’re so sorry things worked out the way they seem to have.

          Have you tried to contact the health care provider about the situation? In the case of your credit reports, you can dispute the reports from before you were 18, and those should be removed from your credit reports. You will need to send your birth certificate, and do it certified mail. Here’s how: A Step-By-Step Guide to Disputing Credit Report Mistakes

          And are these bills ones that you can reasonably afford to pay?

          • Sheri

            some of them possibly but it would take me a long time. my husband and i can barely make ends meet now with me being in college.

          • http://www.credit.com/ Credit.com Credit Experts

            Have you been in touch with the health care provider? It’s possible you could negotiate a payment plan (or even a smaller bill). It can’t hurt to ask.

  • http://www.credit.com/ Credit.com Credit Experts

    Dave —
    Bills incurred when you were younger than 18 are almost always your parents’ responsibility. However, it’s a good idea to check your free annual credit reports to make sure the debt is not listed. Check the reports from each of the three credit reporting bureau. If you should find it, you will need to dispute it with the credit bureaus, sending a letter explaining that you were under 18 when the debt was incurred, and a copy of your birth certificate. Here’s how to do that: A Step-By-Step Guide to Disputing Credit Report Mistakes. Good luck to you.

  • http://www.Credit.com/ Gerri Detweiler

    If you were 15 at the time you received the services, then your parents were probably responsible not you (as you couldn’t enter into a contract at the time). But I’d suggest you double check with a consumer law attorney. If you are on your own now, you may be eligible for help from you local Legal Aid. Will you let us know what they say?

  • lisa

    I have a 15 year old son who recently was arrested and received a public defender. I am recently unemployed, and he’s father is decreased. I am now being told that the court is trying to holdt his step father legally responsible for my son’s legal costs. Can they do that.
    Reason I ask is because he has a bioligical son and when he was going to court for child support the court told him supporting my children didn’t count because they weren’t his kids. But now that they want money they want them to be his kid’s.

    • http://www.credit.com/ Credit.com Credit Experts

      Lisa —
      We’re sorry to hear you’re going through this with your family.

      We aren’t lawyers, though, and it sounds like you and your husband need to talk with one. Given that you are unemployed right now, your best bet is probably a local legal aid society.

  • http://www.Credit.com/ Gerri Detweiler

    Ayesha –

    I wish I could answer your question but I don’t know the answer. It’s not a scenario we’ve run across before. We are going to have to suggest you talk with a consumer law attorney. If you can’t afford one, you may want to see if you are eligible for help from Legal Aid. I wouldn’t just rely on what the creditor or collector is telling you.

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