Unexpected medical bills are a common issue in the United States, impacting many households. According to the Consumer Financial Protection Bureau, one in five Americans faces medical debt, totaling $88 billion.
A 2022 study revealed that around 20% of U.S. households have medical debt, with 43 million credit reports showing collections. As of mid-2021, 58% of all bills in collections were medical.
Medical debt disproportionately affects different demographics. It is more common among Black and Hispanic individuals compared to white and Asian individuals. Additionally, medical debt is more prevalent in the Southern U.S., partly due to the lack of expanded Medicaid coverage in some states.
Despite the frustration and time required to address high medical bills, experts advise patients not to be discouraged. Here’s what you need to know if you receive an unexpected medical bill:
1. Check for Charity Care Eligibility
If you receive a surprise medical bill, check if you qualify for charity care. For instance, Luisa, 33, received a bill over $1,000 after an emergency visit for a viral infection. She was able to have the bill fully covered by the hospital after appealing to their financial assistance policy.
“I thought it was just a cold, but it turned out to be more serious,” Luisa said, requesting anonymity for privacy reasons. “It was really bad by the time I went to the ER.”
Luisa learned about Dollar For, a patient advocacy organization, through a viral video. She filled out the organization’s online form, which led to the hospital contacting her and covering the bill. Dollar For also managed to refund payments she had already made.
Nonprofit hospitals are required by law to offer financial assistance based on income. To find out if you qualify, search online for the hospital’s “charity care” or “financial assistance policy.” Dollar For also offers a tool to check eligibility.
“Federal law mandates hospitals to provide these programs to maintain their tax-exempt status,” explained Jared Walker, CEO of Dollar For. “If you meet their income criteria, they should write off, waive, or reduce your bills.”
Even if you have already made payments, hospitals are required to refund them if you qualify for financial assistance.
2. Utilize the No Surprises Act
Protections against surprise bills now extend beyond Medicare, Medicaid, and Tricare to include private and marketplace insurance plans under the No Surprises Act. This federal law requires insurance companies to cover out-of-network services related to emergency and some non-emergency care reasonably.
If you receive an unexpected bill for in-network services, it may be illegal. To address this, use the free help desk and hotline provided by the Centers for Medicare and Medicaid Services. Many states also offer free consumer assistance programs.
You can also contact the hospital’s billing department in writing, stating that you believe the bill violates the No Surprises Act and asking the hospital to resolve the issue with your insurance company.
“The complexity of the system is as big a problem as affordability,” said Kaye Pastaina from KFF, a health policy organization. “The fragmented system, complex rules, and lack of awareness about federal protections contribute to the problem.”
3. Request an Itemized Bill
Even if charity care is not an option or your bill doesn’t fall under the No Surprises Act, you can still potentially reduce your charges.
Medical billing often includes errors. When you receive a bill, ask for an itemized statement with billing codes for all services. The Health Insurance Portability and Accountability Act (HIPAA) requires providers to share this information.
Check the accuracy of the billing codes by searching online. If you find discrepancies, contest the bill with the provider or physician’s office. You can also compare the bill with your insurance company’s estimates of fair charges. If your bill exceeds average costs, you might be able to lower it or take the provider to small claims court.
Lastly, compare the bill with your insurance company’s “explanation of benefits.” Ensure that it matches the hospital’s bill. If not, use this as a reason to contest the bill and request further review from your insurance company.
4. Stay Persistent
While navigating these steps can be challenging, they can save you significant money. You can also appeal health claims with your insurance company if you believe the bills should be covered fully or more comprehensively.
Contact your state insurance commissioner for additional support.
“Our research shows that those who appeal their bills, though few, often see a high level of successful overturns,” Pastaina added.
