AILSA CHANG, HOST:
For a lot of people in the U.S., a medical crisis is also a financial one. Americans owe at least $220 billion in medical debt, according to the U.S. Census Bureau. As part of our series The Cost of Living: The Price We Pay, we're going to talk about how to handle medical debt. Marielle Segarra, host of NPR's Life Kit podcast is here to share more on that. Hi, Marielle.
MARIELLE SEGARRA, BYLINE: Hey, Ailsa.
CHANG: OK, so let's start with the moment that we are all familiar with - the medical bill comes and maybe it's, like, way more expensive than we expected. What is the first thing to do at that point?
SEGARRA: Pause.
CHANG: OK.
SEGARRA: So even if it says due upon receipt in all caps, which I have seen a lot, you actually have time to figure this out. And that's because unpaid medical debt under $500 will not show up on your credit report, first of all. And you have a full year until any unpaid medical bills over that amount will show up on your credit report. Also, a doctor's office or hospital generally is not going to charge you interest on your medical debt. So this...
CHANG: Right.
SEGARRA: ...Isn't the same situation like with a credit card - right? - where you're accruing a bunch of interest every passing day.
CHANG: Exactly. The clock is ticking in that scenario. But all right, so medical bill comes. Take a pause. You do have time. Don't just automatically reach for your credit card to make this number go away. What next?
SEGARRA: You want to see if you qualify for something called financial assistance, which is also called charity care. Nonprofit hospitals in the U.S. have to offer this, and it's based on an income threshold which varies from hospital to hospital. Sometimes, for-profit hospitals offer it too. But in general, hospitals won't always tell you that they offer this. They'll just send you a bill. So, unfortunately, it's on you to go online and see if you qualify. You can look up your hospital's name plus financial assistance or charity care, and you can also call the billing office, and you might be able to get your bill lowered or wiped out entirely.
CHANG: Wow. I had no idea. But what if you don't qualify for financial assistance, but, you know, you're still hit with a bill that you can't cover, or you think the number on this bill is just unreasonable?
SEGARRA: You have options. I talked to Jared Walker, the founder of a nonprofit called Dollar For. They teach people how to lower or eliminate their hospital bills. And he suggests that next you ask for an itemized bill.
JARED WALKER: So a certain scan that you have or whatever it may be, it'll have, this is the code that is associated with that. And you can look up what those are and see if that actually happened 'cause a lot of times you'll get a bill, and it'll say, oh, you got this scan, and it never actually happened.
SEGARRA: Yep. You also want to confirm that the doctor's office actually submitted a claim to your insurance...
CHANG: (Laughter).
SEGARRA: ...Because sometimes they don't.
CHANG: Yeah, that is so true. OK, and what if you find your doctor's office actually did submit a claim to your insurance and, yes, the number is accurate? Do you have any other options at that point?
SEGARRA: Totally. You can actually negotiate still. So you can call the billing office and say, one phrase is, what's the settlement amount? Which basically means, what is the amount I have to pay you today to make this bill go away? And often, they'll cut it by, like, 30%.
CHANG: Wow.
SEGARRA: Yeah. You can also say, I'm struggling financially. Can I get a discount? You can say, I think this is an unreasonable amount to pay for this consult that I had. I've done that, and it worked. They cut, like, $150 off of it.
CHANG: Really? I had no...
SEGARRA: Yeah.
CHANG: ...Idea. I'm totally going to try this next time.
SEGARRA: You should. And I would just say, with whatever's left, don't put it on a credit card. Get on a payment plan with the medical billing office because, most likely, you won't need to pay interest on it that way, like you would with a credit card.
CHANG: That is Marielle Segarra of NPR's Life Kit podcast. Thank you so much, Marielle.
SEGARRA: Thanks, Ailsa.
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