Don’t Let Medical Debt Push You into Bankruptcy: Know Your Rights

The level of medical debt in America has reached crisis levels, and is in fact the top reason that people in American file for bankruptcy. One of the reasons for such extreme amounts of medical debt is that medical bills in the U.S. are often fraught with mistakes. Unfortunately, many times these ‘mistakes’ made by doctors’ billing centers, are in favor of the doctors rather than the patients.

Although there have been some recent changes to the health insurance system in America, there is still a gigantic lack of transparency when it comes to how much you will ultimately be expected to pay out of pocket. This leads to patient confusion. Many times, you may be under the impression that your insurer will pay 100% of the costs related to a medical service, only to later discover that your insurer pays your physician a lower rate than s/he would like to be paid. Often, doctors will attempt to get you to pay the amount (or in some seedy cases, more than the amount) that your insurer did not pay.

This is called balance billing, and is not only frowned upon in New Jersey – it’s illegal. If your medical debt includes any balance bills from doctors, it’s important to know that you are NOT required to pay the balance between what your insurance provider pays and what your physician wishes they would pay. Bring the bill’s attention to your insurance provider – they need to be made aware of any potential insurance fraud practices that may be occurring within your medical network, and they are the best enforcers of the anti-balance billing law.

On the other hand, if you have mountains of medical debt because you’re uninsured, or were uninsured in the past, it’s still quite possible that many of your medical bills contain errors or overcharges. Because there aren’t currently any medical pricing standards in the U.S., it is possible to negotiate your medical bills, both before and after you’ve received treatment.

Almost every medical billing office will work with you to find a payment schedule that works. They essentially want any amount they can get (the more the better, of course), and some is always better than none. If your medical debt is beyond what you can sift through and negotiate on your own, hire someone to do the negotiating for you. Although it may seem counter-intuitive to pay someone when you’re already in debt, your return on investment will be MORE THAN worth it.

A debt negotiator, usually an attorney with a lot of experience negotiating with debt collectors, will be able to so significantly reduce the amount of money you owe, that his/her fee will seem paltry in comparison.

Once your past medical debt is settled, plan for the future. Always ask your medical providers about their fees before you receive services. You can negotiate discounts for yourself, but you have to advocate and speak up! Don’t let overpriced medical bills pile up ever again. Keep yourself out of bankruptcy by knowing all of your options and getting all of your negotiated medical rates in writing.

Image credit: Becky Wetherington