Debt isn’t always due to having made financial missteps. The most cautious, savvy savers among us can see their plans quickly undone by unexpected costs. Medical debt is among the most unexpected and urgent costs anyone can have. The question of how to pay for medical bills can cause enormous stress when there’s no money in the bank to pay hospital and doctor expenses, up front or later on.
There’s no question that medical bills can go from tedious to terrifying fast. Fortunately, if you feel unable to afford medical bills, there are strategies to find relief.
Make Sure the Charges Are Accurate
If you haven’t already, go through each bill line by line to make sure you received the services and medications listed. Mistakes happen — providers can make billing and coding errors, and insurers sometimes deny coverage — so don’t just accept what you see.
It’s important to be prepared to make some phone calls, maybe even write some letters, if you can’t get answers or satisfaction. Yes, your insurance company and service provider should be figuring out all of this for you, but if they don’t, it will be up to you to do so.
You’ll probably find yourself talking to a different person every time, so making a note of each person’s name and the date and time that you spoke will help make your records more complete. Ask for a supervisor if you aren’t getting the help you need.
Don’t Ignore Your Bills
You may have run out of ideas when thinking about how to pay medical bills you can’t afford. But pushing those medical statements into a drawer so you don’t have to look at them is not the answer.
If the billing statements have started to accumulate — or worse, a collection agency is calling — it can be tempting to ignore the situation altogether. But those paths of least resistance can lead to negative consequences.
If your debt goes to collection, that record can stay on your credit report for up to seven years. And to recoup what is owed, the owners of the debt may opt to sue you. If they win their court case, they could garnish your wages or place a lien on your property.
Don’t Use Credit Cards to Pay Off Your Bills
So what to do if you can’t afford medical bills? Even if you’ve decreased your medical debt through negotiation or by having billing mistakes removed, you’ll have to pay the portion of the remaining balance you’re responsible for.
If you have enough available credit on a credit card, that’s one way to pay a medical bill — but unless it’s a very low-interest card, it probably isn’t an ideal option.
• Interest will accrue each month until the balance is paid in full, which will increase the total amount paid.
• If you miss a payment or make a late payment, your next billing statement will include a late-payment fee and accrued interest.
• And if your payment becomes 60 days past due, your interest rate may go up.
Medical Credit Cards
Some providers might offer a medical credit card as a way to manage your payments. That’s not the same thing as a payment plan, so be cautious before signing on. The card may come with a no-interest promotional rate that allows you to make payments without interest for a designated period of time, but you’ll likely be required to pay the full balance by the end of the promotional period or you’ll be charged interest retroactively.
That’s because the interest is typically deferred, not waived, on medical credit cards. And even if you’re just a wee bit short of making full payment, the penalty could be significant.
Balance Transfer Credit Cards
Financial institutions tend to make balance transfer credit cards sound like the answer to every financial problem, but keep in mind that if you can’t pay off the balance within the designated introductory period, your account will revert to the annual percentage rate (APR) you agreed to when you signed up.
Ask Your Provider or Hospital for a Discount
If the costs are, indeed, all yours to pay and you just don’t have the money, you still may be able to get some help.
Nonprofit hospitals are required by federal law to have a written financial assistance policy for low-income patients. The law does not require a specific discount, nor does it specify eligibility criteria, but nonprofit hospitals are required to offer such financial assistance and make their patients aware of it.
Some states also require nonprofit hospitals to offer free or discounted medical services to patients with certain income levels.
With nonprofit or for-profit hospitals, you may be able to work out a payment plan, which, for medical debt, is often interest free. If you’re able to pay the bill, just not all at once, this could be an option to consider.
Negotiate
Negotiating medical bills is possible and often successful. Be prepared to meet with someone in the provider’s financial or billing department. When you’re worried about how to pay off hospital bills, making an appointment to meet someone in person can be a smart move — this is someone who might have the authority to reduce at least some of your balance, and they might offer other options for how to pay medical bills you can’t afford.
You may have to show paperwork proving your current income (a tax return or paycheck) and you should come with an amount in mind that you’re comfortable paying either in a lump sum or over time.
Finding Additional Help Paying for a Medical Bill
Government Benefits
Medicaid and the Children’s Health Insurance Program (CHIP) help to insure families who can’t afford health insurance or can’t get it through their employer. Both programs are joint federal/state programs, but may be called by different names in different states. To apply, you’ll need to provide accurate information about your income and any government benefits you already receive.
Recently, several government agencies jointly issued a rule banning surprise billing and balance billing. This ban, which already applied to Medicare and Medicaid billing, is being extended to employer-sponsored and commercial insurance plans.
• Surprise billing happens when a patient is seen by a provider who, unknown to the patient, is not in their insurance network of covered providers and bills for their services at an out-of-network rate.
• Balance billing is when a provider bills the patient for the remainder of a medical bill after the patient and the patient’s insurance company has paid their respective portions.
State Sponsored Programs
Each state has a program to help with medical bills and costs. Search by state on the State Health Insurance Assistant Programs site for details. Some states do offer programs other than Medicaid or CHIP, but it might take some research to find the right fit for your situation.
Private Assistance Programs
Some nonprofit financial assistance programs help pay certain medical expenses for specific conditions, such as cancer, leukemia, and others. There are also organizations that provide financial assistance with general medical costs like copays, deductibles, or prescriptions.
Medical Loan
Another solution for how to pay for medical bills may be an unsecured personal loan, which might have a lower interest rate (depending on the rate you’re approved for) and more flexible repayment terms than a credit card.
One advantage of a personal loan for medical expenses is that it might give you some leverage when you’re trying to negotiate a medical bill. You may be able to negotiate a discount for a lump-sum payment rather than stretching out the payment over time.
Some disadvantages of using an unsecured personal loan to pay medical bills are you’ll still have to pay interest on the loan, and loan approval may be difficult if you have poor credit.
The Takeaway
Taking a step back and looking at all your options is the best way to get started figuring out how to pay medical bills you can’t afford. You can often deal with these sometimes unexpected costs by using multiple methods and resources: checking your bill for accuracy, negotiating the balance due, and seeking out financial assistance if you can’t afford to pay what is owed.
If a personal loan is an option you choose, consider a SoFi Personal Loan. An unsecured personal loan from SoFi has competitive, fixed rates and a variety of terms. The loan application can be completed online, and you can find your rate in just a few minutes.
Check out SoFi Personal Loans to help pay for medical debt
FAQ
How long do I have to pay a medical bill?
Typically, doctors, hospitals, and other healthcare providers give a billing statement with a due date, often within 30 days. However, payment terms can vary, depending on insurance coverage, individual agreements, and local regulations.
If you’re unable to pay the bill in full by the due date, it’s a good idea to contact the healthcare provider or billing department to discuss possible payment arrangements or ask about financial assistance programs that may be available.
What is the minimum monthly payment on medical bills?
The minimum monthly payment depends on the provider and agreed terms. Some providers allow payments based on affordability, while others set a fixed amount or percentage of the total balance.
What happens if you don’t pay your medical bills?
Initially, the healthcare provider may send reminders or contact you to request payment. Late fees or interest charges may be applied to the outstanding balance. If the bill remains unpaid for an extended period, the healthcare provider may transfer the account to a collection agency. The collection agency will then pursue the debt, which can include phone calls, letters, and reporting the delinquent debt to credit bureaus.
Do medical bills affect your credit score?
Unpaid medical bills can potentially impact your credit, but not right away. Health care providers typically don’t report to credit bureaus, so your debt would have to be sold to a collection agency before it appears on your credit report. Generally, this doesn’t happen unless your bill is 60, 90, or 120+ days past due.
Even after your bill goes to collections, the consumer credit bureaus give you a full year to resolve your medical debt before the collection account is added to your credit history. And, if the unpaid bill is under $500, they won’t add the account to your credit report and it won’t impact your score.
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