Tips and Advice

How to Pay Medical Bills

Unexpected medical bills can cause real stress just when you least need it. Learn how to pay for medical bills if you lack savings.
By Peter Andrew
Updated on: November 10th, 2022

how to pay for medical bills

It’s bad enough to have to scramble to pay medical bills when you’re recovering from a sickness. But doctors’ offices and hospitals are increasingly demanding payment before they’ll begin treatments. Forcing you to deal with how to pay medical bills when you’re at your weakest and most vulnerable.

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Paying for healthcare upfront: an emerging nightmare

A few years ago, NPR told the story of Tai Boxley from Tulsa, Okla. She had an acutely painful condition and desperately needed immediate relief through an expensive surgery. Luckily, Tai had health insurance through her employer. But it came with a significant deductible, and she faced bills of up to $5,000 — money she simply didn’t have.

And Tai wasn’t alone. NPR spoke to an expert who reckoned roughly three-in-four hospitals and health care systems practice “point-of-service collections,” meaning they want money from uninsured patients and those with big deductibles before they begin treatments.

Related: Personal Loan Interest Rates (How to Pay Less)

Putting treatments on your credit cards

If you have credit cards with limits to support your medical treatment, you can save time. But probably not money. Credit card interest rates average about 17% as of this writing. And maxing your credit limits out will likely harm your credit score, making future borrowing harder and more expensive.

However, you can use your cards to set your appointments. Then shop for a better deal before you have to pay your medical bills.

Help from hospitals

If your medical treatment isn’t optional and your income is low, you may qualify for discounted care. The nearly 3,000 not-for-profit hospitals in the US pay no taxes. And for that privilege, they must benefit their communities by providing free or discounted care to patients with low income.

Some medical systems also support patients with ombudsmen who help them structure affordable repayment plans for care.

Hospitals may not tell you about these options unless you ask, however. If you face an expensive treatment, find a not-for-profit hospital and ask about the programs they offer. Even if there are only for-profit hospitals in your area, many offer financial assistance for charity cases. You don’t know unless you ask.

Help from the government

For those who need help and can’t afford it, there are many government programs designed to make medical care more affordable. These include Medicaid and the Children’s Health Insurance Program (CHIP).

Check with your local or state government offices to see if you’re eligible before going into debt to pay for healthcare..

Help from charities

There are non-profit organizations for patients with many diseases — societies to help those with more common ailments like lymphoma, for instance, as well as organizations for those with rare diseases or “orphan” disorders. To qualify, you must meet income eligibility thresholds and have a confirmed diagnosis.

Doctor financing: Watch out for “deferred interest”

Beware of finance deals offered in doctors’ offices and hospitals. It can be a costly mistake to sign up for these, whether you’re being offered a medical credit card or loan.

You may be offered a zero-interest deal for up to 24 months on qualifying treatments. Or a low-interest rate for a longer period. And all you have to do is make the minimum payment promptly each month and repay the debt completely by the end of the term. Probably a good deal.

But if any tiny thing goes wrong and you don’t comply with every single clause in your agreement, you’ll be in for a big shock. If you make a late payment, for instance, or there is even a $10 balance after your term runs out, you could nearly double the cost of your treatment in two years.

Because then you’ll have to pay interest at (as of this writing) 26.99%. And that’s not just on the late payment or the $10. You’ll have breached your contract, and that penalty rate is applied to all the money you borrowed backdated to the day you borrowed it.

Related: What Is a Personal Loan, Unsecured Loan or Signature Loan?

Pay for medical treatment with a personal loan

One alternative to these deferred-interest loans is a straightforward personal loan. True, they typically come with a higher headline interest rate than those. But ask yourself why that is. Is it because they don’t have “gotcha” clauses to prop up the lender’s profitability?

Of course, personal loans are generally an affordable way to borrow — and almost always much less expensive than credit cards. If you have great credit, they can have exceptionally low rates. And they’re often available to consumers with lower credit scores as well.

Crucially, you may also use them to settle the medical debt that you already owe. You can bring all those existing debts together (adding in a new one, if you wish) into one manageable loan and spread the payments over a period that suits you.

But the great thing about personal loans is that they’re safe and predictable. You know from day one when your debt will be paid down. And you generally pay the same amount each month. Set up an automatic debit payment and you can pretty much forget it — without risking a 26.99% penalty rate if your bank messes up. Isn’t peace of mind what you need when you’re sick?

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