Logan Reid
Hospitals and healthcare providers are aware that medical bills can be expensive, and some people may struggle to pay them off in one go. This is where payment plans come in. Payment plans allow patients to pay off what they owe over time rather than in a lump sum. The arrangement can vary depending on the provider and the type of service. Acute care providers, for example, typically allow patients to receive treatment first and pay later, often with no-interest plans and generous terms. For non-emergency procedures, financing options can be more complicated. In such cases, patients may need to apply for financing through a third-party provider, although some hospitals may refer patients to third-party financing companies. Many hospitals also offer financial assistance programs to help people with low incomes and limited assets pay their bills. These programs may be called charity care, community care, or financial assistance.
| Characteristics | Values |
|---|---|
| Purpose | To make healthcare costs more affordable |
| Who is it for? | Patients who are unable to pay the full amount in one payment |
| Who offers it? | Hospitals, clinics, and healthcare providers |
| Cost | May be interest-free or low-interest; may have billing charges or other fees |
| Payment methods | Online, recurring payments from a bank account or credit card |
| Payment terms | Monthly payments over a few months until the total is covered; no fee for early payoff |
| Payment amount | Minimum payment amount may be required; based on bill amount and negotiated terms |
| Discounts | May be available for lump-sum or early payments |
| Eligibility | May require credit approval |
| Application | May require an application or referral; income-driven plans may require applying for Medicaid |
| Alternatives | Medical credit cards, loans, lines of credit, debt consolidation, or bankruptcy |
| Assistance | Medical bill advocates, financial assistance programs, and charity care |
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What You'll Learn
Ask about no- or low-interest payment plans
If you're facing a mountain of medical bills, you can ask about no- or low-interest payment plans. Many medical providers, including physicians, dentists, and hospitals, can work out a no- or low-interest payment plan for your medical bills. This is a common way to resolve a bill you can't afford to pay in one go. The minimum amount you can pay on your payment plan will depend on your bill amount and the terms you negotiate. Typically, you break the bill into multiple equal payments over a few months until the total is covered.
Be sure to ask about any billing charges or other fees associated with the payment plan so that you can assess the affordability. Hospitals may also offer to help you apply for medical credit cards. These often have an interest-free period of six to 12 months, but if you don't pay off the full amount within that period, you may be hit with a deferred interest rate that can make your debt more expensive.
If you're facing a large bill, it's worth asking about financial assistance or charity care that could reduce or cover the full cost of care. Nonprofit hospitals and some private hospitals must provide free or reduced-fee care. You should also check whether your insurance covers the procedure. There are also public programs and private organisations that can help you tackle your medical bills. These organisations can help you learn more about the kinds of financial assistance available to you, and they may offer resources for things like prescriptions.
If you're facing a large bill, it's also worth checking whether you've been billed correctly. Medical service providers may be willing to offer discounts or arrange interest-free payment plans if you've been overcharged.
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Consider a third-party provider
If you are unable to afford a lump-sum payment, you may need to consider a third-party provider to arrange a payment plan with the hospital. Third-party payers are organisations that are neither private nor public insurers, such as insurance companies or government programs. Examples include worker's compensation, managed care organisations, and veterans affairs. Self-insured health plans are another form of third-party payment, and these are most popular with large employers, labour unions, school districts, and municipalities.
Third-party patient financing companies can be a viable alternative to debt collection agencies, which can be costly and harmful to the patient experience. These companies allow healthcare providers to receive prompt payment, while patients can arrange their payment plans directly with the third party. Patient financing companies can offer flexible terms, including zero-interest plans, a range of lower monthly payment plans with low interest, and longer repayment terms than traditional credit programs.
For example, AccessOne is a third-party financing company that offers 0% interest, payment arrangements that are fully customisable, and a financial assistance policy. All patients qualify for AccessOne's programs with no credit reporting or negative outcomes. Another third-party provider is CareCredit, which offers payment plans that are often cheaper than using a credit card.
Third-party payers manage practically all the financial aspects of healthcare, including processing claims, facilitating financial transactions, and negotiating with healthcare providers to determine reimbursement rates and contracts for services. They can also help patients to learn more about the kinds of financial assistance available, and they may offer resources for things like prescriptions.
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Negotiate costs
Negotiating costs is a key part of arranging a payment plan with a hospital. Here are some steps to help you negotiate medical bills effectively:
Check for Errors
Before negotiating, carefully review your medical bill for any errors or discrepancies. Billing errors are common, and identifying them can help reduce your overall costs. Double-check the items or services listed on the bill and confirm coverage with your insurance provider. If you find any errors or discrepancies, contact the hospital's billing office to dispute the charges and request a corrected bill.
Research Insured Rates
If you are uninsured, research the insured rates for the services you received. Insurance companies often negotiate lower prices with healthcare providers. You can use online tools like FAIR Health Consumer or Healthcare Bluebook to estimate the cost of medical procedures in your area and determine if you have been overcharged. Knowing these rates will empower you to request a fair price from the hospital.
Contact the Billing Department
Reach out to the hospital's billing department to discuss your options. Be polite and express your concerns about the cost. Ask about possible discounts or reduced fees, especially if you can pay in full or within a short period. Hospitals are accustomed to negotiating, so don't be afraid to advocate for yourself.
Compare Costs
Compare the cost of your healthcare services to those listed online or in publications like Healthcare Bluebook. This comparison will help you identify if the charges are excessive or unreasonable. If you find significant discrepancies, use this information to negotiate a lower rate.
Explore Financial Assistance Programs
Inquire about financial assistance programs offered by the hospital or external organizations. Many hospitals have charity care or financial assistance programs for patients facing financial hardship. They may also be able to direct you to external resources, such as Medicaid, advocacy groups, or nonprofit organizations that can help with medical costs.
Offer to Pay Upfront
If you can afford to pay a discounted rate in full or within a short period, such as 30 to 60 days, offer to do so. Hospitals are often willing to accept a lower fee if it means receiving payment sooner. This approach can benefit both parties by reducing your overall costs and providing the hospital with prompt payment.
Remember that negotiating medical bills can take time and persistence. Start the process early, be organized, and don't be afraid to ask for help if needed. By following these steps, you can effectively negotiate your hospital costs and arrange a payment plan that works for your financial situation.
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Seek financial assistance
Seeking financial assistance is an important step in managing hospital payments. Here are some ways to seek financial help:
Payment Plans
Payment plans are a common way to make healthcare costs more affordable. Many medical providers, including hospitals, offer no- or low-interest payment plans that allow patients to pay off their medical bills over time. These plans can be tailored to your financial situation, with the bill divided into equal payments over several months. It is important to confirm the interest rates and any associated fees to ensure the plan is affordable for you.
Financial Assistance Programs
Hospitals often have financial assistance programs or charity care programs to help patients struggling with medical debt. Nonprofit hospitals are required to offer financial assistance to eligible patients who cannot afford to pay their bills. These programs may provide discounts or completely forgive medical bills for those in need. Contact the hospital's billing department to inquire about their financial aid policies and how to apply.
Government Programs
Depending on your location, there may be government programs that can help with medical costs. These programs often consider factors such as income, age, employment status, and qualifying health issues to determine eligibility. Look into programs like Medicaid, Medicare, and the ACA Marketplace, which can provide coverage and support for medical expenses. Additionally, some states have laws that limit hospital charges for patients who meet low-income criteria.
Pharmaceutical Assistance
If you require assistance with prescription drug costs, contact the pharmaceutical companies directly. They may offer low-cost options, samples, or discounts on medications. Generic drugs are also an option to consider, as they can significantly lower your prescription drug expenses.
Medical Bill Advocates
You can also hire a medical bill advocate to negotiate your medical debt on your behalf. These advocates are experts in medical billing and can help identify potential errors, overcharging, and opportunities to reduce your overall debt. They can guide you in navigating the complex world of medical billing and ensure you receive fair treatment. However, be cautious when selecting a billing advocate to ensure they are reputable and that the savings outweigh any fees charged.
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Check for billing errors
When faced with a mountain of medical bills, it is important to check for billing errors and confirm coverage with your insurance provider before committing to a payment plan. Here are some ways to do that:
Review your medical bills for errors
Request an itemized list of all payments from the hospital or clinic and cross-reference these with your own records. Check that you were only billed for charges not covered by your insurance policy. If you notice any discrepancies, contact your insurance provider for clarity. For instance, your insurance provider could have declined coverage if the doctor's office used an incorrect code.
Understand your insurance coverage
Refer to your insurance policy documents to understand what is and isn't covered. Contact your insurance company to confirm whether they have received and acted on the bill and how much they will be paying. This is especially important if you receive a bill before your insurance company has had a chance to pay.
Be aware of your rights
If you are contacted by a medical debt collector, you have certain rights under the federal Fair Debt Collection Practices Act. For example, if you receive a collection notice, you have 30 days to send the collector a letter asking them to substantiate the debt if you do not believe you owe it. Upon receipt of your letter, the collector must stop contacting you unless and until they can substantiate the debt. You also have the right to speak with the hospital directly regarding your medical debt.
Consider hiring a medical bill advocate
Medical bill advocates are experts in medical billing who can spot potential errors or overcharging and help you reduce the amount you owe. However, be careful when selecting a billing advocate to ensure they are legitimate and that any fees charged would be outweighed by the savings.
Look into financial assistance
Before committing to a payment plan, inquire about financial assistance options at your hospital, especially if you have a low income. All nonprofit hospitals offer some form of charity care, and many states have laws that limit how much a hospital can charge low-income patients.
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Frequently asked questions
Contact the hospital or clinic's billing office to discuss a payment plan. Hospitals are required to offer a reasonable payment plan to patients who are unable to pay the full amount in one payment.
Payment plans allow patients to pay off what they owe over time rather than in a lump sum. Payment plans can be interest-free, but they may also accrue interest over time, so be sure to ask about this.
You could consider a medical credit card, which often has an interest-free period. You could also look into financial assistance programs, which vary from hospital to hospital and may be called "charity care," "community care," or "financial assistance."
Ask the hospital for an itemization of all payments, including any payments made by you or your insurance company. You can then compare these to the original charges to identify any discrepancies.
If you are struggling to make payments, you can ask the hospital about financial assistance programs or income-driven hardship plans, which may reduce the amount you owe or forgive the debt altogether.
