What Happens If I Don’t Pay a Medical Bill: Texas Laws & Consequences

If a medical bill has ever left you asking, “What happens if I don’t pay a medical bill?”, yes, there can be real consequences. You’re not alone. Nearly 1 in 5 Texans carries medical debt, and the confusion around non-payment of hospital bills keeps countless people awake at night.

But the reality isn’t always straightforward. In Texas, laws like the statute of limitations and timely-billing requirements create protections yet unpaid medical debt can still lead to serious consequences like collections, credit damage, or even legal actions. Whether you’re a patient trying to manage debt or a provider aiming for compliant billing, it helps to understand exactly what could and can’t happen.

Consequences of Not Paying a Medical Bill in Texas

Here’s what typically happens if you ignore a hospital or doctor bill:

1. First 30-60 days: Reminders & Late Fees

You may receive:

• Follow-up statements
• Phone reminders
• Notice of late fees or interest

A simple office visit with CPT 99213, for example, can quickly grow due to fees.

Tip: Request an itemized bill immediately. Errors in CPT (procedure) or ICD-10 (diagnosis) codes are common and can inflate your charges. For example, a simple office visit (CPT 99213) can become much more expensive if coded incorrectly.

2. 60-180 Days: Internal Collections

Most providers escalate the debt internally.

Under Texas Health & Safety Code § 185.001, hospitals must provide:

• An itemized bill
• Clear, plain-language descriptions
• Details of all charges

Providers cannot escalate your account until this is provided.

3. 180+ days: Collections Agencies

If unpaid, your bill may be sold to a third-party collection agency.

This is when:

• Collection calls begin
• Credit reporting becomes possible
• Stress increases

Pro Tip: Check codes like CPT 80061 (lipid panel) or J45.30 (asthma). Under Texas timely billing law, you have the right to understand every charge.

4. 6-12 Months: Credit Score Damage

This depends on:

• The size of your medical debt
• Whether it’s paid or unpaid
• How credit bureaus treat the debt

Texas Medical Debt Protection:

Your 4-Year Shield

In Texas, providers have up to four years from the treatment date to file a lawsuit over unpaid medical bills (Texas Civil Practice & Remedies Code § 16.004). This means a provider has exactly four years from the date of service to sue you for non-payment of hospital bills.

• Clock starts ticking on the date you received treatment, not when the bill was sent
• After 4 years, the debt becomes “time-barred”—they can still ask for payment, but can’t get a court judgment
• Partial payments restart the clock, so be strategic about acknowledging old debts

Facts: A 2025 study by Every Texan found medical debt disproportionately affects communities of color, with 29% of residents in neighborhoods of color carrying medical debt compared to 23% in white neighborhoods.

The 10-Month Billing Rule

Texas Civil Practice & Remedies Code Chapter 146 requires providers to bill patients within 10 months of service.

What this means for you:

• If you receive a bill 10 months after treatment, the provider may be prohibited from collecting certain charges
• This applies to charges your insurance could have reimbursed
• Non-profit hospitals must provide financial assistance before sending bills to collections (IRS Code § 1.501(r)-4)

Pro Tip: Before paying any old medical bill, always check the service date versus the bill date.

Medical Debt and Credit Scores

The Federal Court Decision Impact

In July 2025, a Texas court vacated the CFPB’s rule that would have banned medical debt from credit reports entirely. 

• Unpaid medical bills can still hurt your credit score
• Previously, the rule would have helped 15 million people carrying $49 billion in medical debt.

Current Texas Credit Reporting Rules

• 180-day waiting period: Collections agencies must wait 6 months before reporting
• 365-day grace period: You have one year from when the bill goes to collections before it appears on your report
• $500 threshold: Medical debts under $500 are not reported
• Paid collections are removed: Once paid, the collection account disappears from your credit report

HelloMDs Tip: Our payment posting services track exactly when claims are paid, helping providers avoid billing errors that lead to unnecessary collection accounts.

Can a Texas Hospital Sue You for Unpaid Bills

Yes, more frequently than you’d think. A Health Affairs study found hospital lawsuits increased 37% from 2001 to 2018, reaching 1.53 lawsuits per 1,000 residents.

What Happens When a Texas Hospital Sues:

1. You receive court documents notifying you of the lawsuit.
2. You have 30 days to respond to the court.
3. The court issues a judgment based on the case.

• Wage garnishment (up to 25% of disposable earnings)
• Bank account levy (seizing funds directly)
• Liens on non-homestead property

HelloMDS denial management services help providers resolve claim denials before they escalate to lawsuits, protecting both the practice and patients.

Smart Strategies If You Can’t Pay Medical Bills

Don’t ignore the problem.

Here’s your action plan:

1. Request an Itemized Bill Immediately

Check for:

• Correct ICD-10 codes matching your diagnosis
• CPT codes that reflect actual services
• Duplicate charges or services you didn’t receive

2. Confirm Insurance Processing

Insurance eligibility verification errors cause 30% of denials. Contact your insurer to confirm:

• Was the claim submitted with correct modifiers?
• Did they apply the right bundling rules?
• Was prior authorization on file?

3. Negotiate Payment

• Offer lump-sum settlement: Many providers accept 40-60% of the bill
• Request interest-free payment plans: Texas hospitals must offer reasonable terms
• Apply for financial assistance: Non-profit hospitals must provide charity care based on income

4. Use Professional Help

At HelloMDs, we primarily serve providers. Understanding how professional medical billing services work helps patients know what to demand:

• Medical billing services can identify coding errors that inflated your bill.
• Accounts receivable services track payment timelines to ensure compliance with timely billing laws.
• Credentialing & enrollment services confirm your provider was properly networked with your insurance.

Conclusion:

Unpaid medical bills in Texas trigger a cascade of consequences: collections, credit damage, potential lawsuits, and wage garnishment. But you have powerful legal protections 4-year statute of limitations on medical debt, a 10-month timely billing requirement, Balance billing prohibitions for emergency and out-of-network care, and Homestead protections against property liens

The key is acting quickly. Request itemized bills, verify insurance processing, negotiate payment plans, and know your rights. For healthcare providers, preventing these issues requires expert revenue cycle management like Hello MDs that ensures clean claims, proper authorizations, and timely reimbursements.

Disclaimer:

Informational purposes only; not intended as legal, financial, or medical billing advice. Confirm codes and procedures with qualified professionals. AI-generated images may be used for illustration.