What to do when you desperately need help with your medical bills

Unlike racking up credit card debt or borrowing to buy a house or car, medical debt usually builds up due to illness or injury beyond your control. And yet the debt can also be heavy and damaging to your finances.

What you might not realize is that many times you don’t have to pay off the entire balance. In fact, you could get a large chunk of your medical debt if you meet certain conditions.

Want to know more? Here are the steps to take if you have unmanageable issues medical bills.

Check your billing and insurance coverage.

Before you even think about paying back a dime, make sure you really owe the full amount you were charged.

“There is a disproportionate number of people who have medical billing errors,” said Janet Alvarez, personal finance expert at Sage Bread who has struggled with their own medical debt. According to Alvarez, it’s common to be overcharged, billed for things that didn’t happen, or double-billed.

In fact, an expert previously told HuffPost that he estimated that 30-40% of medical bills, excluding pharmacy bills, contain errors. “So the first thing you should do is go through your medical bills with a fine tooth comb and make sure they are correct; if in doubt, call your doctor, ”Alvarez said.

The second step is to verify that the invoice has been properly passed through your insurance if you are insured. “I can’t tell you how many times I have had a medical bill in which one of the medical assistants missed a number on my insurance card, or failed to bill my insurance correctly for some reason.” , she said.

Take a look at your insurance policy and make sure you understand your coverage. Then compare your coverage to the explanation of benefits you receive from your insurance company. If you find any discrepancies, “You should immediately contact the supplier’s billing department and ask for clarification,” said Carolyn McClanahan, physician, certified financial planner and director of financial planning at Life Planning Partners, a financial planning firm.

“If you think this is something that should have been covered by your insurance, and if it is not clarified by your provider, call your insurance company representative,” McClanahan said.

Alternatively, if you find that your invoices or policy is too complex to really understand, you can work with a lawyer medical bill. These attorneys are medical billing experts and can review documentation to find errors for you, as well as negotiate on your behalf. Just keep in mind that their services typically cost $ 100 an hour or more.

Examine medical debt forgiveness programs.

If the medical debt is legitimate and has been billed by your insurer, or if you don’t have insurance, your next step is to call the health care provider and discuss what kind of recourse you have. . “In some cases, especially if you owe money to a hospital or a large medical facility, they may offer you debt relief if your income meets certain threshold requirements,” Alvarez said.

And don’t assume you’re earning too much; Medical debt cancellation is often granted on a sliding scale, so even middle class people may be eligible for part of their debt forgiveness. “In my case, they forgave something like 75% or 80%,” Alvarez said.

Although the process for obtaining medical debt remission varies by medical institution, the application process is fairly standard. Hospitals will ask for documents like tax returns, pay stubs, etc., and give a discount based on factors like income, household size, etc.

“Generally speaking, anyone working in patient financial services in the billing office is equipped to help. And if the first person you speak to doesn’t seem to understand your question or doesn’t seem to be empowered, just ask to speak to their supervisor, ”Alvarez said.

McClanahan noted that when it comes to networked care, it can be difficult to negotiate after the fact, as they charge “insurance rates,” which are lower than self-pay rates, and you have to pay. your deductibles. and co-payer.

However, if the bills are for off-grid care, you can and should negotiate those bills with the provider and ask your insurer for help with the negotiation, McClanahan said. Off-grid charges have come under intense scrutiny lately, and many states are passing laws that regulate them. Federal legislation is also pending. “Learn your state’s rules on off-grid billing. If you’re having trouble with off-grid billing and organizations aren’t working with you, complain to your elected officials. They are tired of hearing about this, and I hope we will have meaningful legislation passed soon. “

Finally, if you are uninsured, McClanahan recommended that you bargain hard. “They charge you a very high fee like their ‘posted fee’ whereas regular insurance and Medicare pay a lot less for the same services,” she said, noting that offering to pay in cash helps. certainly. “Some hospitals have charitable care, so find out about their programs and see if you qualify.”

Negotiate a settlement or payment plan.

If you don’t qualify for debt relief, there are still other options for reducing what you owe. For example, offering to pay a lower amount all at once could reduce your bill by 20-40%, according to Alvarez. Paying your medical bills for less than what you owe usually works best when the amount isn’t very high, say a few hundred dollars.

If you owe a large amount of money, another option is to establish a payment plan. “They’re almost always interest-free, so there’s no penalty for paying over a period of time. This payment plan can also be as low as $ 20 to $ 30 per month, ”Alvarez said. “And if you find that you are able to speed up payments and pay them back faster, you can do it without a prepayment penalty. “

Alvarez shared that years ago she was billed $ 1,400 for a superior endoscopy procedure that she had to pay out of pocket. At the time, she couldn’t afford to pay it all at once, so she ended up negotiating a payment plan of $ 25 per month over a period of several years. Took a long time to pay off, but interest free it was an easy way to get rid of debt without affecting it credit rating.

Know your rights surroundings medical bills and your credit.

Speaking of credit score, leaving medical debt unpaid is one way to hurt yours. And a low credit score leads to problems borrowing money, finding a place to live, opening utility accounts, and more.

According to a recent survey by Consumer reports, nearly 3 in 10 insured Americans had an unpaid medical debt sent to a collection agency. Almost a fifth said their credit score was negatively affected by unpaid health care bills.

Having any type of debt sent to collections can wreak havoc on your credit. But in the case of medical debt, knowing your rights helps. Recent changes in law have made it more difficult for medical debt to negatively affect credit scores.

For example, the three major credit bureaus now have to wait 180 days before they can put an unpaid medical bill on your credit report. Additionally, if you had an unpaid bill that was then paid by your insurer, it should be immediately removed from your credit report so that it does not continue to hurt your score. If you find medical debt on your credit report that shouldn’t be there, you should dispute the error.

Raising medical bills can seriously ruin your financial situation. However, if you’re willing to spend the time navigating the complex business of medical billing and defending yourself (or paying someone else), there’s usually no reason to let medical debt to you. to hold onto. Even if you can’t get your debt canceled, you should be able to come up with some sort of plan. It is always worth a try.

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