How To Negotiate Your Medical Bills

We negotiate lots of things: the price of a car, our salary at a new job, and what we'll pay for a flea-market find. But what about our medical bills? Yes, it can be done.

"The billing departments of health care facilities and medical offices are used to negotiating," said Michelle Rice, chief external affairs officer at the National Hemophilia Foundation. "So don't hesitate to ask for a reduction if a medical bill is too high for you or your family."

Here's how you can negotiate your amount due.

Don't Pay the Bill…Yet

Put that wallet away. You don't want to pay any part of that bill until you've completed your negotiations, according to the National Consumer Law Center. Don't worry: The three major credit reporting agencies don't report nonpayment on medical bill information for 180 days. And a hospital cannot deny you treatment because of unpaid medical bills.

Plus, medical debt is treated differently than other types of debt. Yes, you should plan to negotiate sooner rather than later, but you can take a deep breath.

Check the Bill for Accuracy

"The first step when negotiating medical bills is to ensure there aren't any mistakes," said Andrew Latham, personal finance counselor, a finance analyst, and the managing editor of SuperMoney.com.

Nearly 80% of medical bills contain erroneous charges, according to Becker Hospital Review. "Billing errors are common, and they are rarely in your favor," Latham said.

While scouring your bill, also keep an eagle eye out for duplicate charges and procedures that weren't even performed, Latham said. If you find an error, call your healthcare provider and ask them to recode and re-bill your insurance company.

See if You're Medicaid-eligible

If your high bill results from not having health insurance and you can't afford coverage, see if you qualify for Medicaid. Medicaid is a program that provides free or low-cost medical coverage to people who have low income, are pregnant, are older adults, or have disabilities. In some states, Medicaid coverage works retroactively and can pay for medical bills incurred for the past three months.

To be eligible for Medicaid, you must be a citizen of the United States, a resident of the state you are applying for, and your financial situation must be considered low-income.

Ask for a Reduced Fee

Reach out to your healthcare provider's billing office. You can usually find this number right on your medical bill. "Ask if you qualify for charity care or financial assistance programs," suggested Latham. "Just asking for this can often cut your debt in half. It is worth noting that all nonprofit hospitals are legally required to have these programs, and many for-profit hospitals have them also."

The billing department may decide on a reduced fee based on your income level, so have a recent tax return handy when you call. "Even if your income is too high to qualify for charity care," Latham added, "you can still get a reduction of your bill if you can show the medical bills are causing you financial hardship."

If you want to arm yourself with additional information before you call, Latham recommended researching the average cost in your state of the specific medical procedure you received. "Websites like the Healthcare Cost and Utilization Project and the Healthcare Bluebook provide valuable data on the fair price of medical services throughout the United States," Latham said. "Use that information to negotiate a reduction if you are being overcharged."

If your bill isn't reduced, and you cannot afford the amount due, ask about the hospital's or clinic's appeal process, and then file an appeal.

Seek Help From an Advocacy Group

"If the billing department can't lower a charge to a rate that's acceptable to your budget, reach out for help," Rice said. "Patient advocacy groups often have programs and financial assistance resources to help patients who are facing financial burdens."

Ask for a Payment Plan

Healthcare is expensive. So even if your medical bill is reduced—especially if it isn't—you may still feel overwhelmed by what you owe. Your next step is to negotiate a payment plan. Ask for a payment plan directly with the provider.

"If you have medical bills you can't afford," Latham said, "don't put them on your credit card. You will always get lower interest rates when you negotiate directly with the healthcare provider."

In many cases, hospital and clinic bills are interest-free. But a credit card can charge you extra money in interest, according to the National Consumer Law Center. So if you plop a medical bill balance on your credit card, you will pay even more for it in the long run. But there's no reason to do that anyway.

Negotiate with the provider's billing department until they offer you a monthly payment in an amount you can afford without stretching your budget. Your other major bills like rent or mortgage, utilities, car payments, and most other forms of debt should always be treated as a higher priority than a medical bill, according to the National Consumer Law Center. Not paying your rent or mortgage could result in an eviction or a foreclosure, whereas nonpayment on a medical bill won't result in an immediate negative consequence.

If your medical bill has already gone to collections, don't panic. You can negotiate with a creditor for a low-interest or interest-free payment plan with affordable monthly installments. Again, do not pay a creditor with a high-interest credit card just to get out from underneath the debt.

A Quick Review

After any procedure, hospital stay, or appointment, it may be stressful to think about that upcoming medical bill. Luckily there are resources, like advocacy groups and Medicaid, that can help you tackle that debt. Keep in mind you don't have the pay the bill right away, and you should double-check for any errors on the bill.

Even though medical debt can be stressful, there are ways to pay it off. Remain calm, and chip away at it bit by bit. You'll get there.