Medical Debt: What to Do When You Can’t Pay

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People often feel ashamed of their medical debt, seeing it as their moral obligation to pay their bills and their personal failure when they can’t afford them. What if you can't pay your hospital bills? What if you have accumulated medical debt and have no way of paying it when it's due? On both accounts, the consequences can be serious.

People may forego the care they need, including doctor appointments, tests, treatments, and prescription medications, reports the Kaiser Family Foundation (KFF), a health policy analysis nonprofit. They may struggle to pay other bills, deplete their long-term savings, damage their credit, and even declare bankruptcy—all problems that can take years to overcome.

Medical Debt Is More Common Than You Think

It’s not a personal failure, however; it’s a common affliction. In the U.S. some people are not paying their medical bills because they literally can't afford them. According to a 2019 report from The Journal of General Internal Medicine, About 137.1 million U.S. adults faced financial hardship due to medical bills.

And the problem doesn’t just affect low-income households or uninsured consumers; those with robust incomes and insurance can face it, too. 

Key Takeaways

  • Medical debt is not a personal failure. 
  • Millions of Americans struggle with high medical bills.
  • Medical debt is a growing problem in the United States. 
  • Check all medical bills for errors and advocate for yourself if a bill is too high to pay. 

People commonly respond to medical debt by delaying vacations, major household purchases, cutting back on household expenses, working more, borrowing from friends and family, and tapping retirement or college savings accounts.

If you’re faced with medical debt you can’t pay, try these tips for reducing what you owe so you can minimize the effects of your bills on your finances, health, and future.

Check for Errors

Various sources will tell you that anywhere from 7% to 90% of medical bills contain errors. The true percentage is anyone’s guess, but the message is clear:

Because medical bills often contain costly mistakes, it may be a good idea to review them carefully.

So how do you find mistakes on your medical bills? Sean Fox, co-president of Freedom Debt Relief, a San Mateo, Calif.-based company that has helped over 450,000 million Americans get out of debt, says to start by reviewing the explanation of benefit statements from your insurer, ideally right after you receive them.

Look for duplicate items, services you didn’t receive, services you don’t recognize, and charges that your insurance should have covered. Also, review your healthcare providers’ bills to make sure your insurance has paid them accurately. Call your insurance company or your provider’s billing department to clarify anything you don’t understand or to look into any possible mistakes, he says.

A more advanced technique is to get copies of your medical records and attempt to compare them with charges for which you’ve been billed. You may need an expert’s help to secure those records and make sense of everything.

When you examine your debt, it is not about how to get out of paying medical bills, it is about making sure you have been billed correctly and for services you actually received.

Negotiate Your Bill

If you want to negotiate your bill, speak with your healthcare provider’s medical billing manager—the person who actually has the authority to lower your bill. Don’t wait until your bill is delinquent or in collections, at which point your credit score will be seriously damaged. Talk to someone as soon as you receive your bill and have verified its accuracy.

If you have a low income or are experiencing financial hardship—even if the hardship is due entirely to your medical bills—request hardship assistance. Hospital charity care may be available based on your income and savings. In fact, according to Fox, some hospitals are required by state law to provide free or reduced services to low-income patients. As soon as your bills arrive, let your providers know if medical problems have affected your income and ability to pay.

One strategy for justifying lower charges is to compare the price you were billed to an average or fair price charged by other providers in your area. Use a website such as New Choice Health or Healthcare Bluebook to get an idea of what you should be paying. If you have health insurance, your insurer’s website might also have a tool that lets you get an estimated cost of care for various procedures.

Advocate for Yourself

On its website, Medical Billing Advocates of America recommends starting by asking for an aggressive discount for immediate payment, saying something like, “If I pay you 30% right now, will you write off the rest?” This strategy can work because your provider will save time and money if it doesn’t have to pursue payment from you for months or years.

If you can’t afford to pay even a percentage of your full bill immediately, try asking for a 25% discount if you make a large down payment now. A less aggressive strategy is to ask if the provider will charge you the discounted fee that Medicare or Medicaid pays.

If you can’t arrange a reduced payment, ask about a zero-interest payment plan. Whatever terms your provider accepts, make sure to get them in writing.

Get Outside Help

Few are experts in medical billing. A savvy choice is to enlist the help of someone who is: a medical caseworker, debt negotiator, or medical billing advocate. These professionals might be able to reduce what you owe when you can’t or are too timid to try.

Medical billing advocates are insurance agents, nurses, lawyers, and healthcare administrators who can help decipher and lower your bills. They’ll look for errors, negotiate bills, and appeal excessive charges. Expect to pay an advocate around 30% of the amount by which your bill is reduced.

You can also ask to speak with a caseworker from your hospital or insurance company if you need help understanding your bills and resolving payment issues, says Fox. A caseworker may be able to refer you to charities, churches, community organizations, and government agencies that can offer financial assistance.

If your medical debt has caused you to incur other types of debt that you’re also struggling to pay, try using the American Fair Credit Council. This organization can help you find a reputable debt-relief company that can help reduce your principal balance and/or the interest rates on your debt to help you pay it off and restore your credit.

The Bottom Line

There’s no shame in not being able to pay your medical bills. No matter how high your income or how well insured you are, expensive medical problems from accidents, illnesses, and our country’s unfair health economics can afflict us all.

These problems are often completely beyond our control, so take control of what you can. Make sure your medical bills are accurate. Negotiate for lower bills and interest-free payment plans. And if you can’t manage these tasks on your own, get outside help from an expert.