Medical bills can fast overtake budgets and emergency funds, even with the help of insurance coverage.

Without health insurance, debt can mount at exponential rates, leaving patients reeling long after the anesthesia's worn off.

Worse, if you don't pay, you can quickly find that the medical providers who were supposed to help you have now turned you over to a collection agency and deep-sixed your credit rating.

Don't make the mistake of giving them a credit card number or borrowing on the home equity line; instead, take a breath, and consider your options.

Double-Check Medical Bills
Put Away The Credit Cards
Pay Insurance Company Prices
Pay Average Prices
Negotiate Installment Plans
Assistance Options
Collection Agency Options
Escalating Medical Costs

  1. Double-Check Medical Bills

    Don't be fooled by the high-tech software systems and automated billing. Errors in medical bills are at least as common as they ever have been.

    Before you do anything, reexamine those bills, and check to make sure that all the charges listed are accurate. Look for duplications, erroneous amounts, inflated billing codes or other inaccuracies that add to the bill.

    If you are insured, carefully check any correspondence you receive from your insurance provider. Make sure deductibles and out-of-pocket expenses are 100% correct.

    Remember, insurance and healthcare companies are in the business of turning a profit. If they can get you to pay more than your share without objection, they won't complain.

  2. Put Away The Credit Cards

    Be warned. Those medical bills have nice little boxes for you to simply list your credit card number. Even when you speak with medical billing representatives, they may suggest that you pay by credit card.

    That may seem like an easy option, but while charging your bills to a credit card may make the medical provider go away, you cannot negotiate with credit card companies.

    Putting medical expenses on a credit card will only dig your pit of debt deeper unless you can pay the balance in one fell swoop, without accruing 8 to 25 percent (or more) of interest charges.

    Chances are, if you had the money on hand to pay off your credit card balance, you wouldn't be struggling with the medical bill. Put your credit cards away, and put on your negotiator hat.

    The only time using a credit card to pay for medical bills makes sense is if you actually have the money to cover the bill.

    In that case you can use a cash back credit card to pay and earn cash back on your medical payments (up to 2% with some credit cards). You would then repay the credit in full by the due date to avoid paying interest.

  3. Pay Insurance Company Prices

    Unfortunately, uninsured patients pay higher prices than insured ones do thanks to the negotiating power of corporations versus lone patients.

    Especially if you have a history with a medical provider under prior insurance coverage, the doctor's billing office may be willing to reduce the current balance to what your insurance company would have paid.

  4. Pay Average Prices

    Since uninsured patients pay higher prices than insured ones, your medical bills will most likely be higher than the average cost of any particular procedure or treatment.

    You may want to research what your medical care would cost on average and compare that figure to what you're being charged. A number of websites contain average costs by region, and that average figure may prove a valuable point of reference in reducing your end cost.

  5. Lump Sum With Discount

    Medical providers face the same cash flow issues as any other business. You may be able to negotiate a 20-percent reduction or more if you offer to pay the balance as a lump amount. The larger the bill, the greater the discount you may be able to negotiate.

    After all, some is better than none, and the doctor would have to pay the collection agency on average 25 to 30 percent of any recovered fees if push comes to shove. Most physicians would rather retain a loyal patient and allow a discount.

  6. Negotiate Installment Plans

    Many times, hospitals and doctors are thrilled if you're willing to set up a payment plan with regular installments that you can afford. It keeps money flowing to them, and they don't have to resort to a collection agency.

    Plus, you can usually continue any needed treatments. Try working out an interest-free payment schedule with the billing department. Just be sure to be as good as your word, and stick to the payment plan.

  7. Assistance Options

    You may be eligible for financial assistance even if you don't think you are. Most states have medical assistance programs, and even the federal government understands that healthcare fees can leave patients gasping for relief.

    Most hospitals have social workers and patient advocates experienced in financial assistance. A number of charities, philanthropic organizations and nonprofit associations also offer help. Patients have even received contributions from crowd-funding sites.

    The National Association of Healthcare Advocacy Consultants and the Alliance of Claims Assistance Professionals both specialize in billing assistance and financial advocacy for patients. In many cases, all you have to do is ask.

  8. Collection Agency Options

    Even if your medical provider turns your case over to a collection agency, you should try to renegotiate payment options, this time with the collections representative who contacts you.

    The collections agency may be willing to discuss payment options simply so that they can declare your case a success and collect something.

    Don't be afraid to ask for discounts or apply any of the other options listed above. This is your money and your credit.

    Learn more about dealing with collection agencies in our guide to Collections Agencies And Medical Bills.

  9. Bankruptcy

    Sometimes, if the sums outstanding are formidable and you simply don't have the resources to pay them, bankruptcy becomes your only option. In fact, health care expenses are one of the leading causes of bankruptcy in the US.

    If you earn less than your state's median income, you may be able to declare Chapter 7, which forgives hospital debt.

    Otherwise, you may have to file Chapter 13 and repay the debt through an installment plan based on a certain percentage of income (anywhere from 15 to 25 percent) after allowable deductions, such as taxes, insurance and dependent support.

  10. Escalating Medical Costs

    No easy answers exist to medical bills that demand tens or even hundreds of thousands of dollars for life-saving care.

    Don't be shy about being up front with your doctor and discussing medical costs, requesting an in-advance estimated bill or asking about financial assistance options.

    Never allow yourself to be manipulated or intimidated into receiving treatment or staying in a hospital when you know it isn't necessary. Remember, health care providers run businesses, not charities. While they are there to help you, turning a profit is still the bottom line.

    If you don't feel that a procedure is necessary, discuss this up-front with your doctor, or get another opinion from an independent doctor before agreeing to the "purchase".

    Consider, too, that some procedures can be done on an outpatient basis, often more than halving costs. Recognizing and evaluating options beforehand can at least prepare you for that envelope that is sure to arrive in the mail, and maybe you'll even have something to put in it.

With the implementation of fines for uninsured Americans that came with the Affordable Care Act (read our Guide to the Affordable Care Act here), you might find that remaining uninsured is no longer worth it.

Even if you can't really afford health insurance, the way the fines are going, you may end up paying just as much in penalties as you would pay for basic health insurance coverage, for nothing!

A Health Savings Account (HSA) can be an invaluable asset in preparing yourself for medical expenses, although it won't make a big dent on serious medical bills.

You can place money in an HSA, up to an annual limit, which you can use to cover medical bills at a later date. 100% of these contributions can be deducted from taxes on gross income.

In 2016, the maximum amount you can contribute to your HSA is $3,350 for an individual or $6,750 for a family. If you're 55 years old or more, you can place up to $4,350 for an individual or $7,750 for a family in your HSA account.

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