4 Strategies of Dealing with Medical Debt

Medical bills were the leading cause of more than half of bankruptcy cases in 2007. More terrifyingly, more than 80% of people who filed for bankruptcy during that time had health insurance, and their debt was considerably low compared to those who did not have health insurance. Health debt is a grave problem in the United States.

Medical bills can cripple your finances; but hopefully, with the information here, you can deal with health debt before it pushes you over the edge and into bankruptcy. Here’s how you avoid falling into debt when are faced with medical bills.

Medical Debt

Don’t Ignore Medical Bills

Burying your head in the sand whenever you get medical bills won’t make them go away. In fact, most of time, ignoring bills makes the situation worse. Hospitals will only collect on your account for a few months before unleashing debt collection agencies on you. At this point, your defaulted medical bill goes into your credit report.

When that happens, your credit rating is ruined, making it extremely hard for you to borrow money in the future. Furthermore, the hospital can sue you for the debt which can result in you losing your property after a judgment.

Make Sure You Know Your Debt

When the hospital mails you your bill, make sure you know the exact amount of money you owe them. Some insurance companies send you an explanation of benefits detailing what has been paid on your behalf, instead of sending you an itemized invoice. The explanation gives you a heads-up to the medical bills that are about to follow. If the note shows that the insurance company paid only half of the medical expenses, expect the hospital to send you a bill soon. Click here to learn more of debt relief.

Verify the Expense Is Not Covered by Insurance

Medical bills are complex, and mistakes are bound to happen. You have to go through the bill to ensure that the doctors billed the insurance company for the right services. There are some services that insurance companies do not cover, such as beauty procedures. So if you had a facelift, and the doctors billed your insurance company, they will not pay. Sitting back and assuming your insurance covered you may get you into trouble with the hospital. Always follow up with the insurance company to make sure all expenses were paid.

Pay off Your Medical Expenses

If you are in a position to pay your medical bills, pay them off, especially if it’s a small amount. You can use money from your emergency fund or your savings account. All you need to do is write a cheque to the billing address indicated on the hospital bill. Make sure you write down the account number correctly. Try and pay off your bills as soon as you can so that you do not ruin your credit rating.

Make Payment Arrangements

If you cannot fully settle your bill, always talk to the hospital’s billing department to arrange for a payment plan. This lets the hospital know you are not just ignoring the bill, and you have every intention of paying it. However, do not be pushed into a plan; make sure you can afford it.


Simon Robert is a well known financial analyst.  He has over 10 years in the financial field. He has written many topics about debts in his blog. Click here to learn more of debt relief.