Say you’re going in for surgery. You’ve done your research, your doc is among the best in the biz, and just as importantly, you’ve made sure that your insurance will cover the surgery. Your doctor is covered, your hospital is covered, and while you have a copay, you should be able to get through this with minimal expense.
And then a few weeks after surgery, the bills start to arrive. Your surgeon was in-network, your hospital was in-network, but for some reason, your anesthesiologist is out of network. Somehow, this relatively inexpensive procedure just got much more expensive.
And that’s the situation when you’ve been able to plan for the surgery. What happens if there’s an accident and you aren’t able to choose your hospital or surgeon? How do you keep the medical bills from sending you into bankrupcy?
Financial Assistance Programs
If your insurance isn’t covering your hospital expenses (or if you don’t have insurance), call the hospital’s billing department. Many hospitals also have a financial assistance department as well. Tell them your situation. Depending on your financial situation, they may be able to reduce your debt or eliminate it all together. You may or may not qualify, but it never hurts to ask.
Have you ever taken a look at the explanation of benefits from your insurance company? They will often say something like “Provider charged X, we paid Y.” I used to think that meant I was liable for the difference between X and Y. Nope, what it typically means is that even though the provider charged the higher amount, because of the setup they have with the insurance company, they’re going to accept the lesser amount. Programs like Medicare and Medicaid often pay even less than insurance companies. So even if you’re not on one of these plans, it never hurts to ask for a reduction in price. Maybe the hospital will be willing to accept a lower total payment from you.
Setup a Payment Plan
Once you’ve negotiated down your payment, work with the hospital to setup a payment plan. After all, getting some money from you is going to be better than getting nothing at all if you declare bankruptcy. I recently read about someone who is slowly paying off an emergency surgery with a $50 payment every month. That’s what he can afford so that’s what the hospital is willing to accept. As long as he keeps making payments, they won’t send him to collections. Frequently, hospitals are willing to accept this without an added interest payment, allowing you to slowly pay off your debt.
While it’s hard to plan ahead for an emergency, one of the best things you can do for yourself is to try to setup an emergency fund to help pay for situations like this. Additionally, try to take care of yourself. While being healthy doesn’t mean you won’t trip and break your arm, but preventative care may stop you from needing a major surgery down the road.
Megan is a 40-something government employee in the Washington, DC area. She got interested in Personal Finance when she got out of college and realized that her paycheck wasn’t going to go as far as she had hoped. Since starting this blog, she has managed to buy a house and make a solid start on her retirement goals, and hopes to help others do the same. Here is her story:
In 2007, I was a gainfully employed 20-something with no debt but not a lot of knowledge about personal finance. It was a co-worker’s comment about Roth IRAs that sent me to the internet, searching for information. It was then that I realized that I really didn’t know a whole lot about personal finance and that my current financial situation was due a lot to inherent frugal tendencies, generous family members, a fear of debt, and good luck. While that was working for me, clearly I needed a better plan.
While I had no debt, I was also pretty much living paycheck to paycheck and not worrying about going over budget (I say this as if I had a real budget) because I had an emergency fund set aside to cover any overages.
Except that’s not what an emergency fund is for.
So I did a lot of research, read a lot of blogs, and decided that I needed a plan. I needed to budget. I needed to know what I was spending my money on. I needed to prepare for the future.
I decided to create a blog not only to make myself accountable to others but also to share the knowledge that I gained along the way. I’ve learned so much from my fellow bloggers, and I hope that my readers can find something useful in what I have to share as well.
[…] When You Can’t Pay Your Medical Bills […]