How to Negotiate Medical Bills

Even with adequate health insurance, steep medical bills can take you by surprise. In fact, medical debt is the country’s leading cause of bankruptcy, which is why it’s essential to keep your medical bills in check.

But specialists, diagnostic tests, emergency care, hospital stays, and medications add up quickly. Moreover, medical billing is complex and confusing, making it easy to miss billing errors.

Knowing how to negotiate medical bills is critical for every patient receiving care. This guide will cover what you need to know about negotiating hospital bills and medical debt.

How to reduce your hospital bills

Many patients don’t realize there are a few tricks for negotiating hospital bills. Here are a few tips to help people avoid overpaying for medical care:

Try negotiating your bill in advance

One way to get your hospital bill reduced is to negotiate the charges in advance.

For example, let’s say you’re scheduled to have surgery. The hospital billing department might offer a discounted rate if you pay for the entire procedure upfront. In some cases, they won’t disclose this option unless you ask, so it’s always good to inquire about the provider’s discount policy in advance.

If you don’t have enough savings to prepay your bill in full, consider an online loan to cover medical expenses. In some cases, borrowing money to make a lump sum payment on your medical bill upfront is worth any loan fees and interest charges.

Review the explanation of benefits (EOB)

It’s also important to know how to dispute hospital bill charges made in error.

After processing a claim from a healthcare provider, your insurance company will send you an “explanation of benefits,” or “EOB.” In an EOB, your insurance company outlines what your policy covers and what portion you’ll need to pay.

Review your EOB carefully to check for any billing mistakes. For instance, you’ll want to ensure you’re not being charged twice for a single service or charged for services you never received.

If there’s something in your EOB you don’t understand, contact your insurer’s customer service representative for clarification. You should also contact your healthcare provider directly to clear up any medical billing errors.

Request an itemized bill

Although an EOB explains charges and which party is responsible for payment, it’s not a bill. That’s why you should request an itemized medical bill from your healthcare provider to check for mistakes. Also, compare the itemized statement to your EOB for any discrepancies.

In addition, your bill should include payments you’ve already made, such as copays. Make sure these are accurately reflected in the billing statement.

Consider financial assistance programs

If you’re experiencing financial hardship, you may qualify for discounted services under your provider’s financial assistance policy.

Most hospitals have financial counselors who will review your circumstances and discuss options. In some cases, you may qualify to receive financial assistance from the hospital itself, charities, or government programs.

You can also pursue this option if your medical bill has already gone to collections. Just be sure to send the debt collection agency a copy of your assistance application to make them aware of the situation.

Request a payment plan

Even after negotiating your medical bill, you can still request to go on a monthly payment plan.

Medical providers often offer 0% or low-interest payment plan options regardless of a patient’s income or financial need. You simply need to enroll by either contacting the billing department or navigating to the website listed on your medical bill.

Payment plans are also an option if you’re struggling to figure out how to negotiate medical bills in collections. The collection agency should be willing to work out a payment arrangement you can afford. When setting up a medical payment plan, negotiate monthly payments you can afford.

This way, you're less likely to miss a payment and can pay extra whenever you’re able to do so.

How to cover your medical bills

After negotiating your medical bills down, you may still need help paying the debt. Here are a few options worth considering:

Get a personal loan

One of the quickest ways to resolve a medical bill is with a personal loan. Personal loans are great for covering unexpected expenses like hospital bills because you can often apply online, receive an instant approval decision, and get the funds in your bank account by the next business day.

Use your credit card

While credit cards are a convenient way to cover medical bills and offer perks such as fraud protection and rewards, it’s best to avoid maxing them out.

When you carry high credit card balances, your credit utilization ratio increases, which can have a negative impact on your credit score. So, if you’re trying to improve your credit score, you may want to use another payment method for your medical bills.

Get a medical credit card

Unlike traditional credit cards, a medical credit card can only be used for health-related expenses. While that may sound limiting, it’s worth noting that you can find flexible medical credit cards that cover a wide range of services, including dental, vision, chiropractic, and primary care.

When shopping around for a medical credit card, try to find one that offers health-related rewards, such as cashback on medical expenses and pharmacy purchases. You’ll also want to avoid any that come with an annual fee.

Pay with your HSA or FSA

If you have a Health Savings Account (HSA) or Flexible Spending Account (FSA), you may already have the funds to pay your medical debt.

Contributions to your HSA or FSA are made on a pre-tax basis. The main difference between the two accounts is that only the HSA is portable, meaning it can go with you if you switch jobs.

An HSA is paired with a high-deductible health insurance plan to help offset costs, and your account balance can be rolled over each year. With an FSA, you must use the balance by the end of the year, or you will lose the funds. However, you can use an FSA to cover various costs, including childcare.

What if I don’t pay my medical bills?

Ignoring your medical bills isn’t a good idea. When you avoid paying medical debt, you’ll start to rack up late fees and your debt will eventually go to a collection agency. Your credit score will also be negatively impacted.

At worst, the hospital or healthcare provider can take you to court to resolve the unpaid bill.

Try to lower your hospital bills

Knowing how to negotiate medical bills is easier than you might think. When possible, negotiate upfront, review the itemized charges, arrange a payment plan, and choose a payment method that works for you. Still, coming up short on funds to pay your medical debt? We can help! Apply for an Advance America emergency loan and get the money you need today.