Financial Advice

What to do if you’re wrongfully billed for Medicare costs

If you’re among the 7 million Americans enrolled in the Qualified Medicare Beneficiary (QMB) Program , doctors, suppliers, and other providers aren’t allowed to bill you for Medicare costs when you receive covered medical services, equipment, and supplies. Your Medicare premiums, as well as costs like deductibles, coinsurance, and copayments, are all covered by Medicaid. 

The Centers for Medicare & Medicaid Services (CMS) has heard from older consumers and people with disabilities who reported getting wrongful bills for medical care, even though they had QMB coverage. Older consumers have also submitted complaints to the Consumer Financial Protection Bureau (CFPB), reporting that debt collectors repeatedly attempted to collect these types of bills, or sent this information to credit reporting companies.

That’s why our agencies teamed up to give you these three tips to deal with wrongful bills:

1. Tell the provider or debt collector that you are enrolled in the QMB Program and can’t be charged for Medicare deductibles, coinsurance, and copayments.

Show your Medicare and QMB or Medicaid cards each time you get medical services or items. If the provider bills you anyway, explain that you are enrolled in QMB and can’t be charged for Medicare costs.  You have the right to a refund for any payments you’ve already made. 

2. Call 1-800-MEDICARE (1-800-633-4227) if the medical provider won’t stop billing you, or refuses to issue a refund. TTY users can call 1-877-486-2048.

The agent can confirm that you are enrolled in the QMB Program. Medicare can also ask the provider to stop improper billing and to refund any incorrect payments you made.

3. If you have a problem with debt collection, you can submit a complaint online or call the CFPB at 1-855-411-2372. TTY/TDD users can call 1-855-729-2372. 

We’ll forward your complaint to the company and work to get you a response from them.

You can get a printer-friendly version of this information to share with friends or clients. You can also go to AskCFPB to find out about your rights when responding to a debt collector or learn how to dispute an error on your credit report.

Stacy Canan is Assistant Director of the CFPB’s Office for Older Americans. To learn more about our work on behalf of older consumers, visit consumerfinance.gov/older-americans.

Tim Engelhardt is Director of the Medicare-Medicaid Coordination Office at the Centers for Medicare & Medicaid Services.

This article by was distributed by the Personal Finance Syndication Network.

Standard
Financial Advice

FTC Halts Scheme That Advertised Phony Rental Properties and ‘Free’ Credit Reports to Enroll Consumers in Costly Credit Monitoring Service

The Federal Trade Commission has charged Credit Bureau Center LLC and three individuals with luring consumers with fake rental property ads and deceptive promises of “free” credit reports into signing up for a costly credit monitoring service.

At the FTC’s request, a federal court temporarily halted the operation, which has raked in millions of dollars. The agency seeks to permanently stop the allegedly illegal practices and return money to consumers.

According to the FTC’s complaint, the defendants placed Craigslist ads for rental properties that did not exist or that they were not authorized to offer for rent. When people responded to the ads, the defendants impersonated property owners and sent emails offering property tours if consumers would first obtain their credit reports and scores from the defendants’ websites. These sites claimed to provide “free” credit reports and scores, but then enrolled consumers in a credit monitoring service with continuing $29.95 monthly charges. Many people did not realize they had been enrolled until they noticed unexpected charges on their bank or credit card statements, sometimes after several billing cycles.  

The complaint also alleges that consumers who obtained their credit reports and scores never got the promised property tours, and that their emails to the purported property owner to arrange the tours went unanswered.

The defendants are Credit Bureau Center LLC, formerly known as MyScore LLC and also doing business as eFreeScore.com, CreditUpdates.com, and FreeCreditNation.com; its owner, Michael Brown; and Danny Pierce and Andrew Lloyd, whose deceptive ads and emails allegedly drove consumers to Credit Bureau Center’s websites. All four defendants are charged with violating the FTC Act. Credit Bureau Center and Brown are also charged with violating the Restore Online Shoppers’ Confidence Act, the Fair Credit Reporting Act, and the Free Reports Rule, which requires that consumers be informed of their right to obtain free credit reports from AnnualCreditReport.com or 877-322-8228.

The FTC would like to thank the California Attorney General’s Office and the Better Business Bureau of Los Angeles and Silicon Valley for their assistance in this case.

This article by the FTC was distributed by the Personal Finance Syndication Network.

Standard
Financial Advice

FTC Announces Crackdown on Two Massive Illegal Robocall Operations

Web of defendants blasted billions of robocalls, including more than 70 million to numbers on National Do Not Call Registry

The Federal Trade Commission today announced a crackdown on two massive robocall telemarketing operations, both of which have been blasting robocalls to consumers on the National Do Not Call (DNC) Registry since at least 2012.

Many of the defendants in the two cases, FTC v. Justin Ramsey, et. al. and FTC v. Aaron Michael Jones, et. al., have agreed to court orders that permanently ban them from making robocalls, making any calls to numbers listed on the Do Not Call Registry, violating the TSR, and/or assisting others in doing so. The settling defendants also will pay the Commission a total of more than $500,000.

“The law is clear about robocalls — if a telemarketer doesn’t have consumers’ written permission, it’s illegal to make these calls,” said Jessica Rich, director of the FTC’s Bureau of Consumer Protection. “The FTC will continue working hard to put a stop to telemarketers who ignore the law.”

The two ringleaders of the operations—Justin Ramsey and Aaron Michael (“Mike”) Jones—have previously been sued by state attorneys general for telemarketing violations and the FTC’s litigation against them continues.

According to the FTC’s complaint in the Ramsey action, the defendants illegally blasted millions of robocalls in 2012 and 2013 to consumers on the DNC Registry selling home security systems or generating leads for home security installation companies. In just one week in July 2012, the defendants allegedly made more than 1.3 million illegal calls to consumers nationwide, 80 percent of which were to numbers listed on the DNC Registry.

The FTC alleges that Ramsey continues to violate the TSR. For example, in April and May of 2016, the FTC alleges that he and his company, Prime Marketing LLC, placed at least 800,000 calls to numbers listed on the Do Not Call Registry.

Two of Ramsey’s former business partners and their three companies have agreed to settle. In addition to the bans on robocalling, DNC and TSR violations, the court orders impose a $1.4 million judgment, which is suspended based on the defendants’ inability to pay. The full amount will become due if they are found to have misrepresented their financial condition.

The FTC’s complaint in the Jones action charges nine individuals and 10 corporate entities with operating robocalling enterprises allegedly controlled by Mike Jones. According to the FTC’s complaint, between at least March 2009 and May 2016, the defendants made or helped to make billions of robocalls, many of which sold extended auto warranties, search engine optimization services, and home security systems, or generated leads for companies selling those goods and services. Many of those calls were to numbers on the DNC Registry.

In just the first three months of 2014, the FTC alleges that the defendants made more than 329 million robocalls to consumers in all 50 states, including 32 million to numbers on the Do Not Call Registry. In the first quarter of 2015, the FTC alleges that the defendants blasted out 222 million calls, including 40 million to numbers on the Do Not Call Registry.

Seven of the nine individual defendants and Local Lighthouse Corp. have agreed to court orders, which in addition to the bans on robocalling, DNC and TSR violations, include a $9.9 million monetary judgment, with all but $510,000 suspended based upon the defendants’ inability to pay. The full amount of the judgment will become due against any defendants found to have misrepresented their financial condition.

The Commission vote authorizing staff to file the complaints and proposed stipulated federal court orders in each case was 3-0. FTC staff filed the complaint and proposed orders in FTC v. Ramsey in the U.S. District Court for the Southern District of Florida and the complaint and proposed orders in FTC v. Jones in the U.S. District Court for the Central District of California.

This article by the FTC was distributed by the Personal Finance Syndication Network.

Standard
Financial Advice

My Manically Ill Son is Deep in Debt. What Should We Do?

Question:

Dear Steve,

My 43 year old son has had 3 manic episodes this year and is finally on medication & realizing his life has turned upside down. He is living with us and in a daytime treatment center. In a manic phase he purchased an expensive 4 wheel drive vehicle and a travel trailer. He has debt to IRS and $1000 alimony payments. He lost his job because he was unable to function in it. He is on total disability for 3 months, perhaps it will be extended. Unsure at this time. He has insurance but has quite a lot medical expenses.

What can he do to get out of these debts? Is there any help for the mentally ill who run up debts?

Janis

Answer:

Dear Janis,

The least expensive solution that will produce the best results is going to be if he files bankruptcy. This will discharge his consumer debt.

I would also suggest you put a freeze on his credit reports to prevent access for future credit inquiry requests.

In my world it is not that uncommon to have mental illness result in problem debt. The manic phase of a bipolar episode is the most common time. Your son is not alone, click here to read these.

While you might be able to make an argument that he was mentally incapacitated at the time he entered into the purchase agreements, bankruptcy will be a cheaper and easier that will give him better legal protection moving forward. You might want to read How to Find a Great Bankruptcy Attorney.

If the IRS debt was more than three years old after he filed his returns, it is probably not dischargeable in the bankruptcy. You should talk to your tax preparer this year about if your son is eligible for the IRS disabled tax credit.

If you were able to run interference for your son for several years you could turn the car and trailer back in, they will come after him for the balance due but if he has no assets then they can sue him and attempt to garnish his wages but as long as he is disabled and unable to work, they won’t be able to. It’s a more painful route to take but there are options in case the bankruptcy attorney talks you out of an immediate bankruptcy to eliminate the truck and trailer debt.

Alimony debt is not dischargeable in bankruptcy. But again, getting payment on that will come back to if your son can work, is working, and is earning money.

Steve Rhode
Get Out of Debt GuyTwitter, G+, Facebook

If you have a credit or debt question you’d like to ask, just click here and ask away.

This article by Steve Rhode first appeared on Get Out of Debt Guy and was distributed by the Personal Finance Syndication Network.

Standard
Financial Advice

CFPB Survey Finds Over One-In-Four Consumers Contacted By Debt Collectors Feel Threatened

WASHINGTON, D.C. – A Consumer Financial Protection Bureau (CFPB) report released today found that over one-in-four consumers contacted by debt collectors felt threatened. The report was drawn from the first-ever national survey of consumer experiences with debt collectors. Over 40 percent of consumers who said they were approached about a debt in collection requested that a creditor or collector stop contacting them. Of these consumers, three-in-four report that debt collectors did not honor their request to cease contact. The CFPB is also releasing a study of potential risks in the online debt marketplace, where consumer debts and personal information are for sale for fractions of pennies on the dollar. Finally, the CFPB is unveiling an online series of consumers’ stories about their debt collection experiences.

“The Bureau today casts light on troubling problems in the debt collection industry,” said CFPB Director Rich Cordray. “More than one-in-four consumers report feeling threatened by a debt collector, and a majority of those contacted about debt say the calls persist even after requests to stop. The Bureau is working to clean up abuses in this industry, and to see that all consumers are treated with fairness, decency, and respect.”

Debt collection is a multi-billion dollar industry affecting 70 million consumers who have or are contacted about a debt in collection. Banks and other original creditors may collect their own debts or hire third-party debt collectors. When they fail to collect debts on their own, they often sell these debts to debt buyers. The buyers may try to collect on these debts, or hire third-party debt collectors to do so. More than 6,000 debt collection firms are estimated to operate in the United States.

Consumer Survey of Debt Collection Experiences

The CFPB survey, the first of its kind, provides an in-depth analysis of consumers’ encounters with the debt collection industry. The national survey is part of an ongoing CFPB effort to explore industry practices and consumer experiences with debt collectors. Consumers were asked about their encounters with debt collectors for loans and unpaid bills. Questions included whether consumers had been contacted by debt collectors in the past year, how frequently, and the nature of the debt.

According to the CFPB debt collection survey, about one-third of consumers – or more than 70 million Americans – were contacted by a creditor or debt collector about a debt in the previous 12 months. Consumers are most often contacted about medical and credit card debt. The CFPB survey also found that:

  • Over one-in-four consumers report threatening contact: Twenty-seven percent of consumers approached about debt said they felt threatened by the conduct of the creditor or collector who most recently contacted them. Debt collectors are generally prohibited from tactics that tend to harass, abuse, or oppress consumers.
  • Three-in-four consumers report that debt collectors did not honor a request to cease contact: About 40 percent of consumers contacted about a debt in collection said they asked at least one debt collector or creditor to stop contacting them. Of these consumers, three-in-four said the debt collector did not honor the request to cease contact attempts.
  • More than half of consumers report incorrect contact for at least one debt: Fifty-three percent of consumers contacted about a debt in the year prior said at least one collection effort was mistaken in some way. These consumers reported that the creditor or collector sought the incorrect amount, that the debt was not owed, or that the person owing the debt was a family member.
  • Over one-third of consumers report being contacted at inconvenient times: Thirty six percent of consumers contacted about a debt in collection said that the creditor or collector who most recently contacted them called between 9 p.m. and 8 a.m. Debt collectors generally cannot call at times they know to be inconvenient unless the consumer specifically agrees to it.
  • Nearly 40 percent of consumers report that a debt collector attempted contact four or more times per week: Thirty seven percent of consumers contacted about a debt in collection report that the most recent creditor or collector to contact them usually did so four or more times in a week. About 20 percent of consumers approached by debt collectors reported contact attempts by debt collectors usually four to seven times per week. Another 17 percent said a creditor or debt collector tried contacting them eight or more times per week.
  •  One-in-seven consumers contacted about a debt report being sued: Fifteen percent of consumers contacted about a debt in collection over the prior year report being sued. The share ranges from 6 percent sued among those contacted about a single debt to 35 percent sued among consumers contacted about five or more debts. About 75 percent of those sued do not go to the court hearing, which generally makes them responsible for the debt.

The Consumer Experiences with Debt Collectors report is available at: http://files.consumerfinance.gov/f/documents/201701_cfpb_Debt-Collection-Survey-Report.pdf

To illustrate consumers’ experiences with debt collection, the CFPB today is sharing personal debt collection stories from consumers. It is part of an ongoing effort to highlight issues in the debt collection marketplace and to inform consumers about their rights. These online videos highlight consumer stories about being pursued for debts that weren’t owed, consumers who felt they were contacted too often, and consumers who were threatened with jail by debt collectors. The Bureau is encouraging more consumers to tell their stories.

The consumer debt collection stories are available at:  http://www.consumerfinance.gov/consumer-tools/everyone-has-a-story/debt-collection/

CFPB Report On Risks in the Online Debt Sales Market

As a further effort to inform public understanding of the debt collection industry, the Bureau is also releasing a white paper highlighting potential risks to consumers’ personal information posed by debt sales online. Many debts sold in online marketplaces come with sensitive personal information attached, and are easily available at extremely low prices. The report raises questions about protections for that information and the dangers of it falling into the wrong hands.

When original creditors fail to collect debts on their own, they may sell the debt, sometimes for fractions of a penny on the dollar, to realize some return. The new debt owner has legal rights to seek to collect the full amount of the original debt or to resell debts that are uncollected. Some of these debts are sold online, through small internet marketplaces. This marketplace is made up of websites and, in at least one instance, through social media, where written-off bundles, or portfolios, of consumer debt are put up for sale. Typically, these debt portfolios contain the sensitive personal and financial information of consumers. This information can include names, social security numbers, account numbers, and dates of birth. In some instances, unencrypted, identified personal information has been available to any visitor to a debt marketplace website.

The report is based on a Bureau review of 298 portfolios of debt that surfaced among three online marketplaces the Bureau monitored between January and August 2015. All told, these portfolios were advertised as containing information on more than 1.2 million consumers, with a combined face value of almost $2 billion. The asking price for these debts was only about $18 million, or less than a penny on the dollar on average. Almost half of the accounts offered were payday loan debts and another 25 percent were credit card debts. These online marketplaces list debts that the sellers claim were originated by at least three of the largest credit card lenders.

Most of the debt for sale in these online marketplaces, along with the attached personal information, cost very little. Of the 214 portfolios that listed both the asking price and the number of accounts for sale, 25 cost less than $1 per consumer account. Another 37 portfolios were priced between $1 and $2. More than half of these debt portfolios were priced less than $5 per consumer account. Some portfolios, including one with a face value of $156 million on sale for $125,000, had asking prices lower than one-tenth of a penny per dollar. Most of the debt sold is at least five years old and 75 percent had been previously pursued by at least two other collectors.

The Online Debt Sales report is available at: http://files.consumerfinance.gov/f/documents/201701_cfpb_Online-Debt-Sales-Report.pdf

More consumers complain to the CFPB about debt collection than any other financial product or service. To date, the CFPB has taken several steps to improve the debt collection marketplace and study the industry. Since 2011, the Bureau has brought more than 25 debt collection cases against first- and third-party collectors. These cases allege violations of the Fair Debt Collection Practices Act, or unfair, deceptive, and abusive collection tactics that violate the Dodd-Frank Wall Street Reform and Consumer Protection Act. These cases have brought a total of $100 million in civil penalties against debt collectors, more than $300 million in restitution to consumers, and $4 billion in debt relief for consumers.

In October 2012, the CFPB issued a larger participant rule establishing supervisory authority over nonbank debt collectors with more than $10 million in annual receipts from consumer debt collection. This covers about 175 debt collectors that generate more than 60 percent of the industry’s annual receipts. The Bureau has also ordered creditors and debt collectors to stop collecting on debt based on bad information, and to refund hundreds of millions of dollars for unlawful debt collection. The CFPB is continuing to consider proposals to reform the debt collection industry.

This article by was distributed by the Personal Finance Syndication Network.

Standard
Financial Advice

Make the Most of Your Savings with These 3 Options

We all know that we’re supposed to save a portion of our money but where are we supposed to put it? Conventional wisdom would suggest that a plain savings account is a good, safe option however, with the rates big banks offer on most account, you’d almost get as much from your piggy bank. So if you’re looking for a smart place to stash your cash and earn a little extra on top, here are three option for making the most of your savings.

Online savings account

If you like the simplicity of traditional savings accounts but hate the rates, you may want to look online for a better deal. While many large institutions only give a paltry .01% annual percentage yield on their savings account products, some online banks such as Ally offer savings accounts with 1% or better APYs. Granted you won’t have all of the same conveniences that bank branches offer but, with rates that are literally 100 times greater, you may find that putting at least a portion of your savings in an online account is good move. Just be sure that whatever bank you decide to go with is FDIC insured so that your money will be protected, and also be advised that online accounts do have some limitations in the number of transactions you can make per month.

Certificates of deposit (CDs)

Another great option for securing a better return is what’s known as a certificate of deposit or CD. These accounts are actually fairly similar to regular savings accounts but with one major difference: you can only take out your money at certain times without penalty. That’s because CDs have term lengths that determine how long you need to wait before you can withdraw your money. These can range from one month to as long as 10 years. In most cases a longer term length will yield you a greater return and, once again, going online might also allow you to get an even better rate. 

As mentioned, if you do need to access your money before the term length is up, you can do so but at a price. According to Bankrate a typical early withdrawal penalty for a CD can start at three months’ interest on a short term length CD up to 12 months’ interest on a longer one. For that reason you’ll likely want to keep some other more accessible savings on hand so you don’t end up having to give some of your earnings back if you need fast access to your money.

Money market accounts

Not to be confused with money market funds, money market accounts might also seem suspiciously similar to average savings accounts. The big differences here are in how much money you need to open an account and how you access your money. First, opening a money market account may mean making a larger initial deposit. Additionally, depending on your bank, your account may require a higher daily minimum balance that you’ll need to maintain or face fees.

While that might sound like a savings account, money markets also maintain some attributes akin to checking accounts. For example many accounts allow you to write checks and maybe even use a debit card to access your funds while still earning relatively significant interest. However there are still limitations on how many transactions you can make per month and you’ll want to be careful about dipping below that aforementioned daily balance requirement. Otherwise this could be a good option for those wanting to accrue interest but also tap their reserve when needed.


Regular savings accounts can be great when you are just starting to put money away but there are better options for earning money on your funds. While there are certain inconveniences and disadvantages associated with online accounts, CDs, and money markets, there is also a lot to like. Ultimately the best plan may be to diversify your savings among the three products and beyond, allowing you the greatest amount of flexibility and hopefully some nice earnings.

This article by Jonathan Dyer first appeared on Dyer News and was distributed by the Personal Finance Syndication Network.

Standard
Financial Advice

Can I Get More Federal Loans for Grad School if I’m Behind on My Private Loans?

Question:

Dear Steve,

I have about $20,000 of private debt from my undergrad degree, that went into collections when I lost my job due to the 2008 recession, and literally had to choose between my loan payment and putting food on the table. I’ve been getting calls from various collection agencies every since. My federal loans are in Income Based Repayment, and I make so little money that my monthly payments there are $0.
I want to go to grad school to get a professional degree so that I can make more money and get out of this cycle.

Will this unpaid private debt, which has been in collections since 2009, prevent me from getting the financial assistance I need in order to afford grad school?

What steps do I need to take to remedy the situation?

Odessa

Answer:

Dear Odessa,

If you were hoping to get Direct PLUS graduate loans for your graduate studies, then your delinquent private loans could prevent you from getting more federal loans. One of the eligibility requirements to receive a Direct PLUS Loan is that the applicant must not have an adverse credit history. A credit check is performed to determine whether a Direct PLUS Loan applicant meets this requirement.

The Department of Education says you are considered to have adverse credit if:

1. you have one or more debts with a total combined outstanding balance greater than $2,085 that are 90 or more days delinquent as of the date of the credit report, or that have been placed in collection or charged off (written off) during the two years preceding the date of the credit report; or

2. during the five years preceding the date of the credit report, you have been subject to a

  • default determination,
  • discharge of debts in bankruptcy,
  • foreclosure,
  • repossession,
  • tax lien,
  • wage garnishment, or
  • write-off of a federal student aid debt.

To get around this requirement you would need to drag someone down into this pit with you. You’d have to find someone dumb enough willing to cosign for the loan and be 100 percent responsible for the debt.

If you have adverse credit the Department of Education says you can qualify for mroe unaffordable loans these ways:

“First, you can receive a Direct PLUS Loan if you obtain an endorser (similar to a cosigner) who does not have an adverse credit history. (A credit check will be performed on the endorser.) An endorser is someone who agrees to repay the Direct PLUS Loan if you do not repay it. If you’re a parent Direct PLUS Loan applicant, the endorser can’t be the child on whose behalf you are borrowing.

Second, you have the option of trying to qualify by documenting to the satisfaction of the U.S. Department of Education that there are extenuating circumstances related to your adverse credit history.

If you qualify by obtaining an endorser or by documenting to the satisfaction of the U.S. Department of Education that there are extenuating circumstances related to your adverse credit history, you’ll also be required to complete PLUS counseling before you can receive a Direct PLUS Loan.

If you apply for a Direct PLUS Loan and are notified that you have an adverse credit history, you’ll be given detailed information on the options for qualifying by obtaining an endorser or submitting documentation of extenuating circumstances, along with instructions on how to complete the required PLUS counseling.”

Steve Rhode
Get Out of Debt GuyTwitter, G+, Facebook

If you have a credit or debt question you’d like to ask, just click here and ask away.

This article by Steve Rhode first appeared on Get Out of Debt Guy and was distributed by the Personal Finance Syndication Network.

Standard