If you've recently received an explanation of benefits (EOB) from your health insurer or a bill from a medical provider that far exceeds your ability to pay, you may be wondering about how you can proceed. Although there may be some financing options available to you, navigating this system (while already dealing with the stresses that can be brought on by a sudden or severe medical condition) can be a challenging process for many. Read on to learn more about some of the options available when you find yourself struggling to pay a medical bill.
Medical credit card
Many doctor's offices have partnered with credit card companies that specialize in the extension of credit to individuals who have accrued medical debt. By collecting certain financial and personal information from you or your spouse, a doctor's office can even apply for this card on your behalf (and with your permission), allowing it to charge this card directly rather than sending you a bill.
Although these medical credit cards can carry higher interest rates than some others that may be available, the lower credit score thresholds required for approval (and the higher limits available) can make this an attractive option for those who might not otherwise have the available credit to carry a hefty medical bill.
Settlement in lieu of payment in full
In some situations, the amount charged to your insurance company (and passed along to you) can be negotiated down to a more manageable amount, particularly if the original amount charged is so high you're unlikely to ever be able to repay it while keeping up with your other bills; many medical bill collectors would rather obtain a certain agreed-upon amount rather than risk that the bill will never be paid, either through your default or bankruptcy.
While this can be a good option for bills that are too large to pay, negotiating and paying a lower amount than charged can be reported on your credit report; while the effect on your credit score won't be nearly as dramatic as a bankruptcy, series of delinquent payments, or mortgage foreclosure, it will have some impact and could affect your ability to take out low-interest credit in the future. As a result, it's important to explore your alternatives – including things like a medical credit card, cash advance, or even a personal loan – prior to approaching your medical provider for settlement.
For more information, contact companies like Premium Medical Billing Inc.