Indeed, you can go to jail even if you don’t owe any money if the collection company for your medical provider thinks you do:

A breast cancer survivor who was sent to prison over a mistaken $280 medical bill has highlighted the return of debtor’s prisons in the U.S.

Illinois resident Lisa Lindsay had received the medical bill in error and was told she did not have to pay up.

However, the bill was turned over to a collection agency and state troopers arrived at her home and took her away in handcuffs.

So, cancer survivor Lisa Lindsay eventually paid the bill she didn’t owe + $600 for legal and court fees just to be sure this never happened to her again, or at least for this non-existent debt. Better safe than sorry, right?

At this point you might be saying to yourself, WTF? I thought the US eliminated debtors’ prisons in the early 19th century. Silly rabbit. There’s more than one way to trick the justice system to skin people in debt using the power of the state to put them in jail as a way to coerce payments from people like Lisa.

The case of Lindsay as well as others suggests that more people than ever before in the U.S are being thrown in ‘debtor’s prisons’ for not being able to pay back loans. […]

Debt collectors have become so aggressive claim some that poor people who are behind on payments of as little as $25 a month are being sent to jail.[…]

How is this done? Well the collection company files a small claims lawsuit. If you fail to appear, or file a responsive pleading, or make some other common legal mistake, or simply have the collection agency claim they served you by mail (allowed in many cases where the claims are not large) when they really didn’t because you’ve moved, where in the hospital at the time, or they just flat out lied in their affidavit of service, the court can hold you in contempt of court. And that’s when the sheriff deputies or state troopers may show up at your door to place those handcuffs on you, sick, disabled or whatever.

Acting within the law, debtors aren’t arrested for nonpayment, rather for failing to arrive to court hearings thereby falling foul of contempt of court laws.

This results in a police arrest warrant being issued for ‘failure to appear’, the debtor is tracked down, packed off to jail and can only get out by paying the set bail bond which of course matches the amount owed.

Of course not every state allows such practices, but many do. And while it has been employed against many people who have fallen behind on paying their bills in this economy, the arrest of people who can’t pay their medical bills because they lost health insurance or their jobs, or simply they have student debt. they cannot repay because they can’t find a job, is particularly egregious.

And people wonder why privatization of prisons is increasing. Well, when you can toss people in jail for almost anything, including the inability to pay their debts, prisons become an even bigger profit center. Last year alone, thousands of individuals were jailed as a result of unscrupulous practices by collection companies like the one that sent Lisa Lindsay to jail for a $280 debt she didn’t even owe:

NPR reports that it’s becoming increasingly common for people to serve jail time as a result of their debt. Because of “sloppy, incomplete or even false documentation,” many borrowers facing jail time don’t even know they’re being sued by creditors …

Sean Matthews, a homeless New Orleans construction worker, was incarcerated for five months for $498 of legal debt, while his jail time cost the city six times that much. Some debtors are even forced to pay for their jail time themselves, adding to their financial troubles.

Stories of surprise arrests for unpaid debt have been reported in states including Indiana, Tennessee and Washington. In Kansas City, one man ended up in jail after missing only a furniture payment. The Federal Trade Commission received more than 140,000 complaints related to debt collection in 2010, and they’ve taken 10 debt collection agencies to court for their practices in the past three years.

Since the start of 2010, judges have signed off on more than 5,000 arrest warrants since in nine counties alone. Beverly Yang, a legal aid attorney, says many debtor’s — and judges — don’t know debtor’s rights, which results in the accused being intimidated into a pay agreement. She’s seen judges interrogate debtors about why they can’t pay more and whether they are trying hard enough to find a job.

From the NPR report:

Take, for example, what happened to Robin Sanders in Illinois.

She was driving home when an officer pulled her over for having a loud muffler. But instead of sending her off with a warning, the officer arrested Sanders, and she was taken right to jail.

“That’s when I found out [that] I had a warrant for failure to appear in Macoupin County. And I didn’t know what it was about.”

Sanders owed $730 on a medical bill. She says she didn’t even know a collection agency had filed a lawsuit against her.

“They say they send out these court notices, and nobody gets them,” Sanders says.

We are talking about collection companies, after all. The scum of the earth. They buy the debts for pennies on the dollar. Then they file lawsuits. They don’t care if they have to lie or present false paperwork to the courts, because in most cases they are never going to be found out. They file their affidavits and the justice system believes them, because they do not have the time or personnel to verify the accuracy of those affidavits, and the people they target do not have the money to fight the illegal practices by hiring a lawyer. And it is difficult to prove a negative, i.e., that you didn’t receive notice of the court date as we all know:

Washington state’s House of Representatives passed [in 2011] by a 98-0 vote a bill that would require companies to provide proof a borrower has been notified about lawsuits against them before a judge could issue an arrest warrant. All 42 Republicans voted for the legislation, which is expected to pass the state’s Senate and be signed into law by the governor. A trade group representing debt collectors supports the bill and says the changes are needed because some companies are abusing Washington’s existing law by improperly arresting borrowers.

Look for more of these abuses in the future, particularly in states where the legislature is controlled by Republicans and the governor is a Scott Walker (ALEC Model 2.0) clone.