Essential steps before paying high healthcare costs

Receiving a substantial medical bill can be overwhelming. However, before reaching for your wallet, it's crucial to understand that medical bills are often more negotiable than you might think. This article will guide you through essential steps to take before paying a large medical bill, potentially saving you hundreds or even thousands of dollars.

The United States healthcare system is notorious for its high costs, with Americans collectively carrying billions of dollars in medical debt. Despite this, many people are unaware that they can challenge or negotiate their medical bills. A recent survey conducted by the University of Southern California (USC) found that less than two-thirds of people who received a problematic medical bill decided to challenge it.

The Power of Negotiation

Erin Duffy, a research scientist at USC specializing in health policy and economics, has been studying the little-known strategy of negotiating medical bills. Her research reveals that negotiation can be surprisingly effective. "We don't normally think about medical bills as something that you can negotiate, but it seems that sometimes you can," Duffy notes.

Steps to Take Before Paying Your Medical Bill

1. Review Your Bill for Accuracy

Before attempting any negotiation, it's crucial to ensure your bill is accurate. Request an itemized bill from your healthcare provider and carefully review each charge. Look for common errors such as:

• Duplicate charges
• Incorrect service dates
• Services you didn't receive
• Incorrect patient information

Patricia Kelmar, senior director of healthcare campaigns for the consumer advocacy organization PIRG, advises, "People should realize that AI is doing a lot of the denials and appealing gets human eyeballs on that denial".

2. Understand Your Insurance Coverage

Review your insurance policy to understand what should be covered. If you believe your insurance company has incorrectly denied a claim, don't hesitate to appeal. Many denials are overturned upon review.

3. Check for Financial Assistance Programs

Many hospitals and healthcare providers offer financial assistance programs for patients who meet certain income criteria. Kelmar suggests, "That might actually eliminate your bill or give you a big discount". Even if you don't think you qualify, it's worth checking as eligibility requirements can vary.

4. Consider Prompt Pay Discounts

Some healthcare providers offer discounts for immediate payment. Duffy shares an anecdote from a colleague who was offered a significant discount for paying over the phone: "They paid less than half of the original bill amount, just because they were paying right away over the phone".

5. Negotiate with the Billing Office

If you're unable to pay the full amount, don't be afraid to negotiate. Contact the billing office and explain your situation. Kelmar advises, "They should just say, 'I can pay this much today or by the end of the month — do you want me to pay that and forgive the rest?'".

Negotiation Strategies:

• Be polite but persistent
• Have a clear idea of what you can afford to pay
• Ask about available discounts or payment plans

Be prepared to provide documentation of your financial situation if necessary

6. Explore Payment Plans

If negotiation doesn't result in a reduced bill, ask about setting up a payment plan. Many providers offer interest-free payment plans that can make large bills more manageable. Kelmar recommends pushing for a low or no-interest plan.

7. Be Cautious with Credit Card Payments

While some billing offices may offer discounts for immediate credit card payments, be cautious. Kelmar warns that medical debt is subject to certain consumer protections that could be lost if you pay your medical bill with a credit card.

Why Negotiation Works

Healthcare providers are often willing to negotiate because their primary goal is to collect payment. As Duffy explains, "I suspect that billing offices are willing to offer you a discount if you pay on the spot in person or on the phone because it's so hard for them to collect patient payments".

According to the USC survey, among respondents who reached out to a billing office about an unaffordable bill, 49% received some form of price relief. Moreover, 62% of those who attempted to negotiate a lower bill due to affordability issues or perceived unfairness were successful in getting the cost reduced.

Overcoming Barriers to Negotiation

Despite the potential benefits, many people don't attempt to negotiate their medical bills. Common reasons include:

Lack of awareness: Many people don't realize negotiation is an option.

Complexity of the healthcare system: The intricacies of medical billing can be intimidating.

Time and energy constraints: Negotiation can be a time-consuming process, which can be challenging for those recovering from medical procedures.

Personality factors: Duffy's research found that more extroverted individuals were more likely to challenge problematic medical bills.

The Future of Medical Bill Negotiations

While negotiating medical bills can be effective now, the landscape may change in the future. Kelmar notes that increasing consolidation in the healthcare sector could reduce individual decision-making in medical billing offices, potentially making them less likely to offer discounts.

However, for now, attempting to negotiate remains a viable strategy. As Kelmar emphasizes, "Patients should have the confidence to ask for a lower price because we know that some people are getting a lower bill. It's always worth it to ask".

Facing a large medical bill can be daunting, but it's important to remember that you have options. By carefully reviewing your bill, understanding your insurance coverage, exploring financial assistance programs, and being willing to negotiate, you may be able to significantly reduce your healthcare costs.

Remember, as Kelmar advises, "Be confident in asking for what you need and you may very well see your bill go down". While the current healthcare system may be far from perfect, taking these steps can help you navigate it more effectively and potentially save you substantial amounts of money.