Dealing with medical debt is not easy – especially when you cannot afford all your medical bills. This is one of the expenses that you know that you should make even when the high cost of health care will compromise your finances. You just have to take it on because there is nothing more important than your health.
Some people would prefer to be in debt especially when the medical need is a matter of life and death. However, there are some who would forego the initial health care requirement because they do not want to compromise their already fragile finances.
With the increasing cost of getting medical attention, the latter’s decision is not surprising. According to the data taken from the CDC.gov (website of the Centers for Disease Control and Prevention), more than one out of four families feel the financial burden of health care. Most of these people are those who are in poverty and have children. The same site revealed that one out of ten households have admitted to their inability to pay back their medical bills – at all. This is dangerous because medical debt is something that might keep you from getting any future health care need.
What to do if you cannot afford to pay your medical debts
Not being able to afford any debt payment is stressful. Your medical bills might make recovery harder to come by. There are many things that scare people when it comes to medical expenses – even those with health insurance. According to a recent article from Credit.com, 62% of patients are unprepared for the out-of- pocket expenses. 54% said they are confused by these costs.
It is obvious that the payment procedure in the medical industry greatly affects how people look at health care in the country. These health-related debts can affect the credit score of consumers and that is why patients are sometimes torn between getting the appropriate medical care or not. But as we said, if the health care will make the difference between life or death and if it involves children, it is hard not to get any help at all.
But what can you do if you know that you cannot afford to pay off your medical bills?
- Face the bill. As scary as that piece of paper may be, you need to face it. Ignoring the debt will only prove to be more destructive than your current position. Refusing to pay the debt will have a huge and negative impact on your credit score. The longer you ignore it, the more stressful it will become. You will be harassed by debt collectors. You will also get a negative mark on your credit report. While credit scoring companies like FICO have changed their scoring formula to give more consideration for medical debt. After all, this is usually an unexpected debt that should not be judged as a financial blunder quite easily. But nevertheless, ignoring the bill will not make it go away. It will still be your responsibility.
- Check your bill thoroughly. A lot of people have claimed that they are billed for medical treatments and services that they never received. If this is you, then you should make sure that you contest these wrong entries. Do not pay for anything that you did not receive. It is bad enough to be ruined financially by high medical debt, it is worse if you are being billed for something you did not benefit from.
- Negotiate the cost. Yes you are allowed to negotiate your medical bills. You can simply call your healthcare provider and explain your situation to them. Explain to them your financial condition and ask if you can waive some of the fees that you are billed for. Perhaps they can slash the professional fee or put you in a charity program that will make your payments more affordable. If you are not insured, your bill is usually higher than those with negotiated packages. You can still ask them to lower this amount.
- Get professional help. If things get really tough to handle on your own, hiring a professional to help you negotiate is a great idea. There are non-profit organizations that can give you advice and assistance without demanding any payment. If you are really going through a tight financial situation, this can prove to be very useful. With a professional on your side, you will feel less stress in handling your medical bills.
- Set up a payment plan that you can afford. When you try to negotiate your debt, it will help you pay off what you owe if you set a payment plan. This plan can be something that you will negotiate personally with your healthcare provider or through the professional you will get in touch with.
Debt relief options to get out of medical expenses
There are a couple of debt relief options for medical bills. If you want to make lower monthly payments, here are some of your options.
Debt Consolidation Loan
Debt consolidation loans can be a great way for you to make your payments easier. If your medical debt hasn’t ruined your credit score yet, you may be able to borrow money for through a low interest personal loan. You can combine your medical bills with your credit card debt to make your overall debt payments more affordable. Or you can use your home’s equity to help pay off the medical bill. This can be a great option as long as you have a stable job to sustain the payments on the new loan that you took out.
Another option is debt management. This enlists the help of a credit counselor who will help analyze the financial situation of the one in debt. For a monthly fee of no more than $50, the credit counselor will help you create a debt management plan that will be sent to everyone you owe money to. The plan will basically contain your proposal for a lower monthly payment and possibly a lower interest rate. When approved, you can send a single payment to your counselor who in turn will distribute it to your healthcare provider, creditors and other lenders.
This debt relief program aims for debt reduction. You can negotiate on your own or you can enlist the help of a debt professional to negotiate on your behalf. The idea is to ask your healthcare provider to accept your payment proposal of pennies for a dollar. In most cases, you have to come up with a lumpsum amount that can be a smaller amount than what you originally owe. Then, you will negotiate to pay your debt with that amount and once paid, anything that is not covered will be forgiven. Since debt settlement records that you do not pay your debts in full, it will be a negative mark on your credit report – but not as much as bankruptcy.
If all else fails, you can always file for bankruptcy. If you do not see any improvement in your financial situation in the next few months, then filing for bankruptcy might be the only way to solve your problems with medical bills. In fact, FoxBusiness.com reported that medical debt is the number 1 cause of bankruptcy filings. This data came from the 2013 study of NerdWallet Health. Do not prolong the agony of being in debt if you really think that your unaffordable medical expenses cannot be paid off in any way.