Having to deal with hospital bills and medical debt is unfortunately an all-too-common occurrence in the United States. With healthcare costs continuing to rise and insurance plans laden with high deductibles and uncovered services, many Americans find themselves overwhelmed by shocking medical bills. Faced with charges running into the tens or even hundreds of thousands of dollars, it’s no wonder people avoid hospitals and ask how exactly are you supposed to pay off these massive hospital bills?
The first thing to understand is that you don’t necessarily have to pay off the full amount that the hospital bills you. Hospitals massively inflate their charges knowing that insurance companies will negotiate them down. So whether you have insurance or not, there’s usually room for negotiating a much lower settlement.
Asking for an Itemized Hospital Bill
When you receive a hospital bill, the very first thing to do to save your pockets is ask for an itemized bill. This will list out each individual charge instead of just providing you with a summary total cost. Hospitals actually struggle to accurately account for the line item charges, so just asking for the breakdown often leads to substantially lower bills as unverified or erroneous fees get removed.
There have been cases where hospital bills dropped by 30-50% purely by asking for an itemization! So this simple step should always be your starting point when dealing with medical charges.
Appealing Denied Insurance Claims
If you do have health insurance, your next step should be filing an appeal if your provider denies covering any part of your hospital treatment. There is often wiggle room to contest improperly denied claims when there’s adequate documentation showing your care was medically necessary.
Have your doctor provide notes confirming you required urgent or emergency treatment and detail why certain tests, scans, medications or procedures were clinically indicated. Insurance company algorithms sometimes auto-reject claims that should qualify for coverage, but human review can override these erroneous denials.
Seeking Hospital Financial Assistance
If appealing to your insurance doesn’t suffice or you lack adequate health insurance, your next recourse should be applying for the hospital’s financial assistance program. Non-profit hospitals are actually required to provide financial assistance or charity care to uninsured or underinsured low-income individuals. This is part of the criteria to maintain their tax-exempt status.
Eligibility for full charity care or substantially discounted bills typically centers around whether your income falls below 200-500% of the Federal Poverty Level. However, even higher earning middle class families can sometimes qualify for partial assistance. So it’s always worth submitting an application detailing your financial situation to see if the hospital can lower or wipe out much of what you owe in medical bills. Also, find out if your state has Medicaid.
Negotiating with Medical Bill Collectors
If even after financial assistance you remain burdened with unaffordable medical debt, all hope is still not lost when the unpaid hospital bills get turned over to collections. Collectors purchase medical debts for pennies on the dollar hoping to collect a portion of what’s owed. This gives you leverage to negotiate a settlement for a fraction of the original billed amount.
It’s generally best to let medical bills progress to collections before attempting to settle. Once in collections, any payment made can potentially count as payment in full if you negotiate this stipulation upfront. Paying collectors 30-50% of the initial hospital bills often satisfies the debt entirely, saving you thousands.
Understanding Medical Debt Impacts
Now even if efforts to reduce or pay off hospital bills fail entirely, the impacts of unpaid medical debt are not as severe as other forms of consumer debt. While collections activity and legal judgements can certainly harm your finances short-term, medical debt generally falls off your credit report after 7 years even without payment or settlement.
Additionally, the three major credit scoring companies have pledged to stop counting paid or unpaid medical debt under $500 on credit reports. And even larger medical debts will have less negative influence on credit scores going forward.
This lesser credit impact makes strategically defaulting on unaffordable hospital bills an unfortunate necessity for many uninsured and underinsured Americans. The garnishing of wages or seizure of assets for unpaid medical debt remains relatively rare outside of a few states. So while nerve-wracking to endure collection harassment or damage to your credit, letting medical debt slide into nonpayment is sometimes the only financially rational choice.
Avoiding Medical Bankruptcy
That said, for those facing ridiculously astronomical hospital bills exceeding $100,000, declaring medical bankruptcy can provide the only “fuck that shit” path forward. While bankruptcy should never be entered into lightly given the decade long credit consequences, it does legally discharge all qualifying medical debt passed the exemption thresholds. This tabula rasa financial reset allows you to rebuild credit and savings rather than dedicate your life to fruitlessly repaying crushing debt.
Strategies for Handling Future Medical Costs
Looking beyond the immediate medical collections or bankruptcy crisis, shoring up health insurance and personal savings provides the only reliable protection against repeat hospital debt pitfalls. While employer-provided health plans have steep premiums and deductibles, restoring coverage remains imperative to buffer against further uninsured medical calamities. Additionally, those earning under 400% of Federal Poverty Levels qualify for considerable subsidies under the Affordable Care Act Health Insurance Marketplaces making decent plans more affordable even outside employer sponsorship.
Learn about budgeting your potential payment plan. However costly, pouring extra income into an emergency health savings account allows ready access to funds when the next injury or illness strikes. Even with health insurance, out-of-pocket expenditures for deductibles, coinsurance and uncovered services quickly accumulate requiring hefty rainy day reserves. While short term sacrificing by diverting money away from dining out, entertainment, vacations or other indulgences proves painful, it pales in comparison to the stresses of healthcare costs throwing personal and household budgets into turmoil.
Struggling to Afford Surgery Without Insurance
Finding yourself needing major surgery without insurance proves terrifying on dual fronts – firstly obviously regarding your health prognosis, but secondly also threatening you with financial insolvency unable to fund the astronomical associated costs. Initial hospital bills for serious operations often span hundreds of thousands of dollars, impossibly beyond the means of all but the most affluent uninsured patients.
Of course first and foremost comes securing the urgently necessary medical care itself regardless of concerns over its expense. But with lives frequently hanging in the balance, delayed or discarded treatment poses unconscionable risk. Once stabilized post-surgery, patients feel righteously entitled to indignantly refuse to pay such ridiculous charges entirely despite understanding collections may pursue legal judgements in retaliation. But pragmatically, declaring bankruptcy often represents the only viable path forward after uninsured calamities rather than losing your house or dignity trying to pay sums that would take several lifetimes to repay.
Getting on Top of Health Costs
Without comprehensive insurance, easing anxieties over handling future health expenses and medical crises requires diligently scrimping to build savings. Scheduling regular checkups and lab tests out-of-pocket challenges already strained budgets. But establishing health savings funds means that serious illnesses get diagnosed early and minor procedures won’t break the bank nearly as easily.
Temporarily getting on an austere financial diet by cutting discretionary luxuries to invest in your health seems logical advice. But human nature makes implementing prolonged self-discipline regarding retirement planning or emergency health savings difficult. Splurging in the present too often overrides common sense calls for financially preparing for the inevitable future.
Navigating the Insurance Appeals Process
Far too commonly, even the insured receive inexplicably denied claims for obviously covered hospital visits and procedures. Suddenly you get billed stiff charges as if uninsured that your policy supposedly guards against. Most become so exasperated battling insurance bureaucracy that they just pay up reluctantly at great personal sacrifice.
But with perseverance and lawyerly advocacy on your behalf, denied coverage frequently gets overturned upon appeal. Though the back-and-forth submissions required give exacting detail on medical necessity from your physician often initially goes unheeded. Insurance first level adjudicators appear incentivized to reflexively reject without proper examination, hoping claimants simply accept the determination. But seeking sensible resolution through proper channels can peacefully overturn poor judgments in time. Just don’t expect overnight success navigating this regulated industry slowed by policies seemingly designed to discourage.
The unfortunate reality across America reflects a broken medical billing and insurance labyrinth miring patients in confusing financial despair. But through diligence and proactive self-advocacy, understanding your rights and strategically employing the step-by-step guidance outlined here can aid significantly in mitigating hospital debt crises. The moral travesty remains clear that no one should face economic ruination simply for seeking essential medical care in the wealthiest nation on Earth. So grassroots organizing and political activism to bend the arc away from such injustice remains an ethical imperative. In the meantime on an individual level, deploying these navigational tools provides some desperately needed relief against the systemic troubles ailing health care affordability across the United States of America.