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John Oliver exposes problems with medical debt-buying industry

On his weekly television series "Last Week Tonight" comedian John Oliver takes on serious issues with biting satire. Recently he tackled the issue of medical debt -- something that impacts almost 43 million Americans. Specifically, he focused on companies that buy that debt from creditors for pennies on the dollar and then initiate collection efforts

The tactics they use, like those of many collection agencies, can involve intimidation and even threats. Moreover, as Oliver's team learned, it's easy to become part of the billion-dollar industry of debt buying because some states have a "shockingly low barrier of entry."

The "Last Night Tonight" team proved the point by setting up a company for just a $50 incorporation fee. Their "company" bought nearly $15 million in debt for under $60,000. They named their company Central Asset Recovery Professionals or CARP, "after the bottom-feeding fish."

For the almost 9,000 consumers whose debt was purchased by CARP, there was good news. Oliver's show paid off the debt that it purchased.

Oliver acknowledged that their gesture barely made a dent in the problem of medical debt that impacts millions of people's credit ratings. It doesn't take much for an unpaid hospital bill to wreak havoc on your credit score. According to the Consumer Financial Protection Bureau, one-fifth of all consumer credit report scores are negatively impacted by medical debt that's turned over to collection agencies.

As for these debt-buying companies, Oliver summed up the point of the show's exercise by saying that "we need much clearer rules and tougher oversight to protect consumers from potentially predatory companies like the one we set up."

Whether you're struggling with medical debt, collection agencies or inaccurate charges that won't go away, it may be wise to seek legal guidance before the situation spirals out of control. Pennsylvania bankruptcy attorneys can provide that guidance.

Source: Modern Healthcare, "John Oliver erases some medical debt with satirical touch," June 11, 2016

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