Medical expenses can be crippling. But, there are several ways to deal with medical debt. Ignoring bills can only make the problem worse. Health care providers will collect on bills for a few months before the account is turned over to a collection agency. When that occurs, the debt is placed on credit reports, which can impair a person’s ability to borrow money. There may be lawsuits which could lead to a judgment, wage garnishment or bank levy.
An explanation of benefits, which is not a bill, should be reviewed carefully. An “EOB” identifies what has been paid by insurance and gives notice on bills that may come soon. Likewise, bills should be closely scrutinized. Assure that the doctor’s office billed the insurance company correctly and follow up with the insurance company if a bill was appropriately paid.
It may be possible to negotiate for a lower bill. If an insurance company will not pay for an expense, it may be unreasonable. Advise providers that bills may not be paid unless they are fully explained and there are negotiations.
Medical bills, especially smaller ones, may be paid in a single payment from funds in a savings account or emergency account. The account number should be placed on the check to avoid double-billing. If the balance is not fully paid, set up payment arrangements with the doctor’s office so they are aware that their bill is not being ignored and before the debt is sent to a collection’s agency. Set up a reasonable payment plan and make timely payments.
Parents should not ignore bills from a child’s doctor or emergency room visit because they are responsible for any expenses that are not covered by insurance. Non-payment can harm credit. As a last resort, people can place the bill on a credit card to avoid collection agency referral. Credit cards should be selected based upon their interest rate. Medical credit cards or loans from the medical office typically should not be selected without comparing them to other options.