How to Negotiate Medical Debt
Less than 15% of consumers have asked their physician to negotiate their medical bills. Approximately 40% of people who ask for a discount get one. Many medical providers and hospitals offer programs where patients who can prove they have a financial hardship are offered discounts, some of which are significant. The medical provider will either deny the discount, grant a steep discount, or write-off the balance completely. For wealthier cash-paying customers who can pay immediately, discounts range from 20% and 50% off of the normal charge. Discounts may still apply for people who pay off their medical bills over a short period of time.
Here are three helpful rules to keep in mind when negotiating medical debt:
1) Cash-Flow is King
Medical providers care about their cash flow and want to receive payments quickly. You can negotiate with your medical provider by stating you will pay immediately if you are offered a discount now. This is usually effective. Medical providers know there is risk in receiving full payment on a patient balance because many people and insurance companies take too long to pay or do not pay at all. They will work with people who are willing to pay something.
2) Negotiate Carefully
You probably do not want to negatively impact your relationship with a provider you see frequently. If requests to the billing office do not give you your intended result, tactfully ask your physician directly. This may be more effective. But weigh the cost of losing the relationship if you insist on a discount. See Six Steps To Successful Negotiation below to learn how to negotiate tactfully.
3) Do Your Research
Sometimes the most effective method of receiving a discount from your medical bill is to do a little bit of research. If you can prove that your physician bills higher than other similar providers in the area or that you are being asked to pay more than what a health plan would pay for the same service, then this could help you reduce your bill. This information would be helpful in your negotiations because you would claim that you would like to pay the going rate for the medical procedure based on what other physicians bill in the area, and/or that you do not wish to pay more than what a normal health plan would pay.
These three rules apply to medical providers. You need to know the six general rules for successful negotiations that work in all situations.
Six Steps To Successful Negotiation
Follow these six steps whenever you need to negotiate almost anything with anyone.
1) Be Polite
Politeness gets you further than anything else when negotiating with a creditor, or anyone else for that matter. After all, creditors are humans too. Some in the service business spend most of their time dealing with angry and difficult customers, so you may find that by being courteous the person you speak to will be more likely to give you what you want.
Want proof politeness matters? Think of the last time you gave a big tip to a rude waiter or waitress.
2) Be Specific
Let the creditor know that your goal is to resolve the bill. The medical provider is under no obligation to give you a steep discount or a payment plan. However, if you do not ask, the answer is always no.
3) Be Flexible
Let the creditor know you are willing to accept a reasonable compromise. Medical offices need to pay their bills, too. If you present a “win-win” situation, then the medial provider can feel good about the negotiation.
4) Be Realistic
Some creditors refuse to negotiate initially. Don’t take it personally and try again at a later date.
5) Be Persistent and Methodical
Negotiation takes time and effort. As with many things in life, hard work and persistence will help improve your chances of success. Record the names and phone numbers of the people you speak to. Document the date, time, and results of each phone call.
6) Get It In Writing
If the discount you negotiate is significant, get the agreement in writing before submitting your payment. This is the proof you’ll need in cases where a creditor fails to properly note the agreement in your file, and later tries to make additional claims on your account. You can ask them to send the agreement letter by mail or fax. Or, if the billing office is local, stop by and pick up the agreement in person and make an immediate payment. Make sure the offer letter is on the provider’s letterhead and is signed.
Other Options For Medical Debt
If you are unable to negotiate the medical bill by yourself, you have other options available. The most common are debt consolidation loans, consumer credit counseling, and debt settlement. The Bills.com Debt Coach offers non-nonsense information about your debt relief options, and will give you the pluses, minuses, and costs for each of your options.