Medical debt is a financial burden that can balloon literally overnight. The debt may eclipse a debtor's income and render him unable to pay the cost of his medical service. In Nevada, a creditor attempting to collect a medical debt must operate within a specific statute of limitations. This is the total amount of time a creditor has to compel the debtor to repay the medical debt.
Medical Debt Definition
In Nevada and other states across the country, a medical debt is considered a written contract for the purposes of collection and repayment regulations. This is a contract for service with the primary creditor being the service provider. A medical debt may have multiple service providers, including a hospital providing the medical facility and a physician performing medical care. Usually, the hospital serves as the primary debt collector on behalf of the physician administering care.
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Statute of Limitations
A creditor has six years in Nevada to collect on a medical debt. A creditor may no longer successfully obtain a judgment to force a debtor to repay a medical debt after the expiration of this statute of limitations. The expiration doesn't bar a creditor from filing a lawsuit, but all a debtor must do at the subsequent court hearing is point out the expiration of the statute of limitations in order to win a dismissal. This does not prevent a creditor from continuing collection practices by other means, including making phone calls and sending letters to the debtor requesting payment.
As of April 2011, wage garnishment is legal in Nevada for the collection of most debt, including a delinquent medical bill. A creditor must sue a debtor in civil court to obtain a wage garnishment judgment against the debtor before the six-year statute of limitations expires. Once obtained, up to 25 percent of gross weekly income or up to 30 times the federal minimum wage of weekly income may be taken -- whichever is less. Alternatively, a creditor may obtain a bank levy against a debtor to force him to pay. A bank levy entitles a creditor to seize the funds in a debtor's bank account to pay the balance of a debt.
Collection of Medical Debts
The collection of medical debt in Nevada is governed by the Nevada Fair Debt Collection Practices Act. This state law restricts the means by which a creditor may pursue a consumer for a debt owed. It is illegal for a creditor or collection agency to threaten or harass a consumer for the purposes of collecting any debt. It is also illegal to present paperwork to a creditor that appears like an official legal document but is in fact not a legitimate legal document.