Did you know a huge number of reports mention that billions of dollars in unpaid medical debt exist currently in the US? The AHA’s annual report in 2023 highlights that bad debt (uncollected payments) is a significant challenge for hospitals and providers in the USA. Moreover, the KFF* report specifies that 41% of adults in the US have some medical debt, which means more than 100 million US citizens are under medical debt! All these major reports highlight the fact that providers lose millions of dollars every year under unpaid medical bills. This blog post is the savior for providers in Texas and covers everything about the Texas law on unpaid medical bills.
Keep reading to learn the most important Texas laws on unpaid medical bills and how the implications of these laws can help providers recover their lost money. There are 3 most important laws that specifically deal with unpaid medical bills in Texas and inform providers what they should do to get their payment collections:
Timely Billing Texas Law on Unpaid Medical Bills
Time is crucial when it comes to medical billing as per the Texas law on unpaid medical bills. According to Texas Civil Practice & Remedies Code Section 146.002*, there is a timeframe within which healthcare providers in Texas must bill patients or responsible parties for medical services rendered by them. This law states that providers must send bills no later than the first day of the 11th month after the date services are provided, unless exceptions apply.
This timely billing rule is applied in general, and there are also some exceptions. For example, if a provider bills the insurance company directly, the deadline here is determined by the contract between the provider and the insurer, if one exists. If no agreement exists between them, then they will follow the general rule given above. Similarly, in the case of third-party payors such as Medicare/ Medicaid, providers will bill according to the contract with the payor or federal regulations, and in the absence of a contract or regulations, the general 11-month deadline applies.
Statute of Limitation for Texas Law on Unpaid Medical Bills
Texas Civil Practice & Remedies Code §* 16.004 states that the statute of limitation for medical debt collection lawsuits is four years. It means a healthcare provider generally has four years from the date of services provided to file a lawsuit to recover the unpaid amount. But this time limit doesn’t erase the debt. Even if the statute of limitations on medical bills bars a lawsuit for medical bill collection, the debt itself might not disappear. The healthcare provider can still report it to the debt credit bureaus.
Texas Health Care Billing Law
Outstanding payments get into medical bill collections when they are not paid by the patients or payors. Medical debt is similar to other debts in many ways, so it can be sent to collections if not paid. However, Texas law on unpaid medical bills offers some protection to both providers and patients. A new law requires healthcare providers to send patients or third parties a clear and detailed bill called an “itemized bill.” This bill contains a description of services rendered in plain language and is sent to the debtor before considering medical bill collections. This transparency in the collection process helps avoid misunderstandings, potential disputes, and unnecessary lawsuits.
According to Texas Health and Safety Code § 185.001*, a provider must submit the itemized bill not later than the 30th day after the provider receives a final payment on the provided service or supply from a third party. But in case of unpaid medical bills, a provider is required to send 3 physical statements with detailed bills to the patient or the debtor. After not receiving payment, the Texas law on unpaid medical bills allows providers to file a lawsuit in collection agencies against the patient or debtor. Here, an itemized bill plays a crucial role in helping you get reimbursement for the set of services you have rendered.
What Approach Should Providers Adopt to Avoid Unpaid Medical Bills?
Value based care model that focuses on patient-centered care and demands significant attention. With this time and attention-taking task, it is impossible for providers nowadays to compete with the payors’ deadlines or to keep check and balance on their collections. Priority patient care and revenue cycle management at the same time have become a huge challenge, resulting in thousands of unpaid medical bills.
The question is how providers can get rid of any medical bill sent to collections? How can they collect their deserved money from patients and payors with such a busy schedule? Here, professional medical billing companies come to the front to assist providers and take the burden of unpaid medical bills off their shoulders. Companies like Transcure, which has an experienced team of medical billing compliance experts and 1100+ certified medical billers and coders, can help you recover your accounts receivables in just 24 days.
Compliance experts at Transcure are well-trained and stay updated when it comes to Texas law on unpaid medical bills. Now, providers don’t have to worry about missing the dates Texas law has assigned for timely billings or filing lawsuits. This is because these experts have hands-on experience and thorough knowledge about all the medical billing laws in Texas.
They utilize technologies like RPA to automate your medical billing processes that generate reminders for outstanding bills approaching deadlines. This approach ensures that none of your bill claims cross their due date. These bots also create standardized templates that are customizable for itemized bills that clearly outline services provided, associated charges, and plain language descriptions. These ready-to-use bills can help you send itemized bills to your patients and payors at any time and within the required time limit by Texas law on unpaid medical bills. These bills also help you file a lawsuit and can be a witness for your provided services.
Transcure’s medical billing company in texas also has effective patient communication strategies that encourage timely payments and reduce the need for collections. In case your medical bills are still pending and things are going worse, they can still effectively communicate with your patients or payors to get you reimbursed in a timely manner.
Conclusion
The Texas law on medical bills offers protection for both patients and providers. Patients have the rights to clear bills and have limitations on collections, while providers are required to adhere to specific timeframes and limitations. These limitations and time-bound processes require professional assistance so providers don’t have to burden them with both patient care and paperwork. Medical billing companies like Transcure ensure you can take care of your patients while they handle your billing limitations and timeframes. This ensures timely billing, HIPAA-compliant itemized bills, and efficient AR recovery within legal limitations by the law of Texas. By partnering with a qualified medical company, providers can manage unpaid medical bills in Texas with greater clarity and security.
Frequently Asked Questions (FAQ)
Can a provider sue for medical debt a patient never receives a bill for?
According to Texas law on unpaid medical bills, Texas Civil Practice & Remedies Code § 146.002 requires providers to bill patients within a specific limit or timeframe, and if they don’t bill on time, they may not be able to collect certain charges.
What are surprise medical bills, and how can they affect patients and providers?
Surprise medical bills are unexpected charges to patients from out-of-network providers. No Surprise Act protects patients from surprise medical bills, and it also offers some benefits for providers in Texas. This law establishes a process for determining a fair payment amount for out-of-network services in case of a dispute between the provider and the health plan. This ensures providers receive compensation for their services even if the patient is out-of-network and eliminates lengthy disputes through standardized independent dispute resolution.
What Happens If a Medical Bill Goes to Collections?
Medical bills in collections can hurt your credit score and lead to wage garnishment as a result of the court’s order. The Texas law on unpaid medical bills offers some protection. But once your debt goes into collections, you must communicate with the agency, dispute errors, and explore payment plans or settlements to minimize the impact.
Do medical bills affect your credit in texas?
Yes, unpaid medical bills in Texas can still affect your credit if they go to collections. However, new rules now give you a year before unpaid medical debts are reported, and paid collections no longer show up on credit reports. Plus, debts under $500 aren’t reported at all, offering some relief.
