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Coping with Medical Bills

A single procedure or trip to the hospital can fill your mailbox with stacks of bills. These can come from hospitals, doctors, pharmacies, emergency rooms, labs, and many others. The stress involved with handling all of this paperwork can be almost as overwhelming as the illness or injury itself. If your medical bills start to pile up faster than you can pay them, don't wait for a crisis to occur before doing something about it.

Get organized

Don't throw anything away. Keep all receipts, insurance forms, bills, and anything else that relates to your medical care. Organize your bills so you can keep track of them. One way is to make a file for each provider. Inside each file, organize the bills by date of service. If you don't receive itemized bills, request them. Go over each bill when you receive it because errors are common. A simple mistake, such as the wrong computer code, can cause you much grief. Here are some things to check:

  • Is your personal and insurance information correct?
  • Were you charged twice for the same service?
  • Were you charged for something you refused or did not receive?
  • Is there anything that seems unreasonably high or questionable?

Don't ignore the explanation of benefits form

This form comes from your insurance company. It shows the medical service provided, date provided, how much your plan will pay, and how much you will have to pay yourself. If you don't understand what you owe and why, call your insurance company or agent.

What if you think there's a mistake?

Medical bills and the billing process can be complicated. If you think your doctor or hospital has made an error, here's what you should do:

  • Contact the appropriate billing office. Give it a reasonable amount of time to correct a mistake.
  • Don't refuse to pay a bill because you think it should have been paid by your insurance company. Most likely, any agreement you made with a hospital or doctor holds you responsible for payment, even if your insurance company doesn't pay.
  • Contact your insurance company to review the claim. Explain why you think the company's wrong. If the company needs to do something, find out when it will get done. If you have to do something, make sure you understand exactly what and when it must be done. Get the full name of the person you spoke to, and send a letter confirming your conversation.
  • Request a written explanation of denial if you're still unsatisfied. To save your credit rating, pay the bill yourself, or negotiate a payment arrangement with the medical provider. Then use the insurance company's appeal process as soon as possible to collect your money.

Suppose you just can't pay

If you're having financial problems and can't pay your medical bills, it's better to work directly with your medical provider. Contact the provider before it contacts you. Perhaps you can work out a payment plan.

Try to keep the bill from being turned over to a collections agency. You don't want to damage your credit report. If the bill does go to a collections agency, understand that the agency is not interested in hearing that the insurance company made a mistake. Don't expect the collections agency to call your insurance company. And don't expect your insurance company to call the collections agency. If your claim is denied, you will have to keep working with your insurance company until it's settled. In the meantime, write to the collections agency and explain the situation.

Collections agencies get paid only for what they collect. And they can get very aggressive for their clients. However, they must abide by laws that prohibit harassment and unfair practices. For example, if you tell a collections agency that you don't want to be contacted at work, it must stop calling you there. You can try to negotiate with the collections agency. You might be able to work out a long-term payment plan. See if that will stop the agency from reporting negative information about you to the credit bureaus.

In the meantime, don't let your health insurance coverage lapse. You may have recovered from your illness or injury and think you would be better off using those premium dollars to pay your medical bills. But if something were to happen again, your financial problems will only get worse. Furthermore, if you drop your current insurance and apply later for a new policy, your recent illness could be considered a pre-existing condition, which would prevent you from getting coverage.

Look for other ways to save on your health insurance premiums. Talk to your insurance agent about increasing your deductible or co-payments. Do you have a child in college? See if the college has a low-cost health insurance plan that would enable you to take your child off your plan.

Finally, do you have any secondary insurance coverage? A secondary plan might pay medical bills not covered by your primary plan. Your spouse's group plan may give you some benefits. Or if Medicare is your primary insurance, you may have a secondary policy through a retirement plan, another group plan, or an individual plan.

What to do next time

After all of your medical bills are paid, think about what you can do differently to keep from getting overwhelmed again.

  • Understand your health insurance policy's rules and benefits
  • Keep a record of where you received medical care and who gave it to you<
  • Keep a date chart of hospitalizations, lab tests, X rays, treatments, medications, and doctor's visits
  • If you ask for incidentals, like a toothbrush, slippers, or cot for a family member, understand that you will pay for them
  • If you don't know why a procedure or test is being done, ask