How To Handle A Large Medical Bill

Summary

You’ve been hit with a medical bill you can’t afford. Now what?
 

How should you handle an unexpectedly high medical bill?

Nothing can derail your financial progress and growth quite like an unexpectedly high medical bill from an emergency room visit, or surprise diagnosis. Life happens; we can’t foresee every possible scenario or outcome. Insurance can be helpful to a degree, but if you’re on a high deductible health plan (HDHP), you may still be on the hook for quite a large sum of money before meeting your deductible for the year.

First and foremost, stay calm. The billing statement from the hospital will likely say something like “DUE UPON RECEIPT” in big bold letters near the top of the bill, giving you this false impression of urgency. Unfortunately, some people see this, panic, call the hospital and put the bill on a credit card. That is likely the worst way to handle this. Hospitals are generally lenient with payments, they charge no interest, and are happy to work with patients (as opposed to your credit card company which probably charges over 20% interest and has rigid payment plans). Stay calm and feel empowered to take this slow. You as the consumer/patient hold most of the power in this situation.

Once you’ve gathered yourself, check to see if you qualify for your hospital’s charity care program. Every non-profit hospital is required to give away a certain amount of free care to lower income patients to maintain their non-profit status. “Low income” will vary hospital-to-hospital, but it is usually some factor based on household size and the Federal poverty line. If you make below the income threshold for that particular hospital you may qualify to have your bill either partially or totally forgiven. Even if you earn slightly above the stated income threshold, it’s still worth applying for.

If you don’t qualify to have your bill forgiven, call your hospital and ask for an itemized bill showing the individual charges and CPT codes. This will give you a chance to make sure you aren’t being charged for a service you didn’t receive, which happens more often than you might think. A high percentage of medical bills contain accidental charges for services that did not actually occur. If you do see a charge that shouldn’t be listed, call the hospital, explain that you did not receive that service, and have them remove it.

If you’ve taken all the above steps, now is the time to put on your negotiator hat. Remember that the figure on the billing statement is not hard and fast. Most hospitals will settle a bill for much less than the stated amount and are happy to receive any amount at all. Call the hospital, explain that you want to settle your bill, but can’t pay the full amount. Then ask what amount they’d be willing to settle the bill for. You probably shouldn’t go straight to playing “hard ball.” Be friendly, polite, and professional during this process; people will likely be more willing to work with you if you are.

If they aren’t willing to work with you or aren’t happy with the figure/answer you’ve been given, it is okay to hang up and try again another day. You may be surprised to hear the different answers you get from different people. Be prepared to make a payment once you’ve settled on a figure you can afford, and once payment is made, be sure to ask for a receipt that shows the balance as paid in full and settled.

Another important note on discussing billing with the hospital is that they usually will offer a zero-interest repayment plan if you’re unable to pay in a lump sum. This is again why you should absolutely not put this bill on your high-interest credit card. Doing so will be a costly mistake that can drastically extend the time and cost of paying off this medical bill.

In our increasingly complex medical and insurance system, it’s important to know your consumer rights and protections. For further information, see the link below for a concise yet comprehensive list of consumer rights and protections for medical and insurance related issues.

MedLine Plus

Consumer rights and protections

https://medlineplus.gov/ency/article/001947.htm