Reducing Medical Debt
November 28th, 2017 by Bunch & Brock
While there are several reasons for personal bankruptcy, one stands firmly on top of the list: medical bills. A Harvard study in 2007 showed that medical debt was responsible for more than 62 percent of all personal bankruptcies, despite the fact that 78 percent of those who filed had some type of insurance.
Health Care Debt
The overall number of bankruptcy filings, however, is on a downward trend. According to Yahoo Finance, personal bankruptcy filings dropped from 1,536,799 in 2010 to 770,846 in 2016, a downward turn of nearly 50 percent. One reason is the availability of health insurance under the Affordable Care Act (ACA), which insured more than 500,000 who had never before been insured. However, with the uncertainty of the future of the ACA, many experts fear a return to the higher numbers. And despite the lower numbers, a May story from USA Today reports that medical expenses remain at the top of the list as the cause of personal bankruptcies. Twenty percent of Americans 65 years of age and older and 30 percent of employed adults had trouble paying medical bills in the last year, even with insurance. According to the article, 63 percent emptied their savings, and 42 percent were forced to find extra employment.
Negotiate the Costs
There are some solutions that may help those with medical debt, and one possibility is negotiation. In September, the magazine Consumer Reports ran a story suggesting that, despite what most people believe, medical bills may not be set in stone. Based on their research, Consumer Reports lists six tips to help lower medical costs:
• Estimate Costs – If you know in advance that a medical procedure is necessary, check with your insurer to make sure all aspects of the procedure are covered. Ask your doctor or medical representative to make sure. And, if paying cash, ask for a rate comparable to what the health insurance companies pay for the same procedures.
• Check the Market – Do research and find what the average cost is for your procedure in your area. If the cost is excessive, point out the disparity.
• Be Persistent – Upon receiving a bill, check with the insurer to see what is covered. It’s expected that you will have to work your way up the hierarchy, but be persistent until you reach someone with the authority to negotiate.
• Pay Immediately – If you have the resources to pay most or all of a bill in cash, offer to do so as soon as possible. According to medical experts interviewed by Consumer Reports, this may often lead to a 15-20 percent discount.
• Explain your Situation – If you are unable to pay, discuss your circumstances. This may result in a discount, and some states require a reduction in fees for individuals within specific income categories.
• Ask for Help – Hospitals often have individuals available who can help find options for payment or discounts specific to your needs. Another option is to hire a medical advocate. While this may cost money up front, it could potentially save money in the long run.
Your Health is Worth the Money
While it’s easy to simply do without some expensive items, healthcare is not one of them. And while the costs may seem prohibitive, there are potential solutions to try to stay out from under the debt it causes.
For more than 35 years Bunch & Brock has been serving our community and the entire state of Kentucky with their legal needs from offices in Lexington. In that time, we’ve earned the experience, knowledge and resources to help with your legal needs. If you have legal questions regarding bankruptcy or would like to set up an appointment, contact us online or call us at 859.254.5522