Well, it happened. Despite your best efforts — using in-network providers, shopping around for lower medical costs and getting preventive care — you’re staring down a stack of medical bills you can’t afford.
Maybe you broke your leg and needed to go to the emergency room. Or you burned your hand while cooking dinner. Or your otherwise healthy child needed a procedure you didn’t plan for.
Whatever the reason, here you are: potentially owing hundreds, or even thousands, with no clue how you’re going to cough up the cash to pay for it all. If paying for medical bills has ever put you in a bind — as it has for some 20% of working Americans — then don’t panic. Instead, try these strategies.
4 Ways to Pay Your Medical Bills
Before your bill gets sent to a collections agency, you may have a chance to intervene.
1. Work With Your Insurance and Provider
Mistakes happen. Sometimes, medical bills are miscoded by providers or misinterpreted by insurers — and both scenarios can leave you owing more than you bargained for. If you think you’ve spotted an error on your explanation of benefits, call your insurance company and health care provider to discuss your concerns and ask about your options. You may even have an opportunity to file an appeal to the insurer for an uncovered service. However, there may be a deadline to do so, so call as soon as you see the mistake.
2. Ask for a Payment Plan
Doctors’ offices, hospitals and other providers may have affordable and flexible payment plans available, some of them with zero interest — but you’ll never know if you don’t ask. In fact, a recent survey showed that more than 50% of patients with medical bills exceeding $1,000 chose a payment plan.
3. Use a Health Savings Account
Certain high-deductible insurance plans are eligible for health savings accounts (HSAs), although 66% of HSA holders don’t take full advantage of those funds. Depending on whether your insurance qualifies you for an HSA, you can use your card to pay for your medical bills — and reap the tax savings. If your account has a low balance, consider depositing some funds into it before you pay your bills so that you can enjoy the tax benefit of those dollars.
4. File a Supplemental Insurance Claim
If you already have a supplemental insurance plan, either individually or through your work, now’s the perfect time to assess your policy and file a claim. For example, if you have accident insurance and had a fall or broke a bone, there might be a lump-sum payout with your name on it. Call your supplemental insurance provider to see if it makes sense to file a claim.
Other Options for Handling a Large Bill
None of the above work for you? You still have options. They just might come with more strings attached. For one, you could always dip into your emergency savings, if you have them. But that leaves you without a safety net, and if your funds are tied up in certificates of deposits, money markets or similar accounts, you may have to pay extra fees to access them.
Another option that’s technically open to you: Put it on plastic. While you may be able to get credit cards for medical expenses that tout promotional interest-free rates, doing so risks just turning your medical debt into credit card debt. Breaking into your retirement savings is another alternative, but not a very good one: It comes with potential costs and fees, along with tax implications.
You could try to get a loan from friends or family, but things could get awkward quickly, and there may be tax implications here as well. It’s best to avoid this option unless you really have no other way to scrape together the cash. Even then, keep a few personal loan guidelines in mind first.
What Not to Do
The worst thing you can do is to tuck the bills away and ignore them. Medical debt collectors aren’t likely to forget that you owe them money, so at least attempt to work with your insurance and doctor’s office to explore your options for paying for medical bills. Just know that managing medical debt often requires you to be the first one to pick up the phone and call, so don’t be afraid to negotiate for your own financial interests. You’ve got this!