My dentist sent a bill to collections that I should not have had to pay in the first place. How do I even start addressing this issue?

My dentist office gave me a “discount” because I am uninsured. I paid what they told me to upfront. But low and behold, they billed the amount of the discount and sent it to collections! I’m freaking out. My credit score tanked 55 points. Nothing like this has ever happened before. I have no received anything from the creditors (I found out from Credit Karma reporting a derogatory remark).

What should my next steps be? I don’t even know where to start. It’s for about $250. I would like to restore my credit as much as possible.