In this day and age, a lot of Americans are struggling with medical debt. A study by Nerdwallet, a price-comparison website, revealed that in 2014, two million Americans suffered bankruptcies due to unpaid medical bills.
Recently, a similar study by the Harvard Medical School revealed almost the same. 62% of bankruptcies are caused by medical costs. Indeed, medical costs can become overwhelming and may overtake common Americans financially.
Medical emergencies, illnesses, accidents can give you those piling medical bills which are difficult to pay. With an average annual income of $50,000 for an American family, a high medical bill or a high insurance deductible may quickly become something difficult to pay.
Further, studies reveal that medical costs seem to be a problem not only of the uninsured. Even those with medical insurance undergo the same stress and anxiety as those without insurance.
According to the National Debt Relief, the average amount of medical debt owed by persons without insurance is $26,971. Those with insurance owe an average of $17,749.
Negotiating medical bills and doctor’s fees is quite a challenging task. It is not easy, but when you do it, it eases the burden of those unpaid and piling medical bills. These are the suggestions by experts when confronted with large amount of medical debt:
- Organize and review your medical bills. As they say, billing mistakes are quite common. You have to carefully organize and review your medical bills to make sure you were not double charged or you were not charged for services or medicines you did not avail of. Here are the more common billing mistakes so you have to be on the lookout for these items when reviewing your medical bills:
- When you are discharged in the morning, protest if you have been charged for a full day room rate on the day of your hospital discharge.
- If you brought your medications with you, make sure you were not charged for such medications by the hospital.
- Dispute if you have been charged for supplies like gowns, gloves, sheets and similar items because these items are already included or covered in your hospital daily room charge.
Experts further suggest it would be better if you organize all your medical bills together on a spreadsheet.
- Keep the lines of communication open and negotiate a reduced bill once you know how much you can afford to pay.
Your creditors will be much more willing to work with you and may even give you some discounts if you contact them and express your willingness to settle your debt.
Do not ignore medical bills.
Experts say it is always better to negotiate medical bills as soon as soon as possible. As a benchmark rule, within ninety days after incurring those bills.
Make sure you are able to provide explanation to your creditor that paying the entire amount would prove a hardship on your part. Work hard to get 20-25% discount and pay your balance immediately.
If this is not possible, offer to pay 50% of the balance immediately, and the rest, a month or two later. Negotiating with your creditor can be challenging.
Medical Debt Relief Programs
It needs your patience and determination to get things done. However, if you do not want to do the job yourself, you can engage the services of medical debt negotiators.
- Work out a payment plan if you do not have the ability to pay your medical debt immediately.
Explain your financial situation to your creditor and ask to stretch out the payment of your medical bill over the next six months to a year.
Your creditor-the doctor and/or the hospital will most likely agree to your request because there’s a good chance that you will do your best to make the payments. Make sure though that you will pay, as agreed.
If you find out that you cannot make payment in a given month, call your creditor immediately and try hard to renegotiate your payment plan.
- If your debt has been sold to a collection agent, deal with the debt collector.
- Find out if the bill has passed the Statute of Limitations (SOL). When the SOL is reached, creditors are no longer able to take you to court to collect payments. The SOL is between three to six years, depending on where you live. It varies across states. Take note that this period starts when your account becomes delinquent, not the date of service.
- Note also that if you make partial payment, the counting down period starts again. If you make a payment after the SOL has run out, you may be accountable for the entire amount owed. Thus, it is critical that you get a final agreement with the collection agency before you make a payment.
- Offer only as low as 25% of the entire medical bill with the collection agency. The agency will most likely agree to this because the collection agency purchased your account from your hospital or doctor at a very low amount.
- The collection agency is required by the state to file a cancellation of debt form. This is considered taxable income on your part. So on your part, be ready to pay additional taxes for the amount cancelled.
If you have medical debt that’s weighing on your mind, contact us today. We’re happy to talk with you about your options.
Kevin Fallon McCarthy
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