No one plans on getting a significant illness. Nor do they have many choices when it comes to treating it – there may be a family to support and care for, a life with many goals left to fulfill, and the opportunity for a new lease on life.
The treatment was, fortunately, a success, but now the bills are due. Medical treatment, procedures and ongoing care can leave even those insured owing thousands of dollars.
Time to figure out the next step
Some critical strategies can help those facing this situation. The good news is that health care providers typically do not immediately report non-payment to credit bureaus. Then, there is a waiting period before debt appears on the credit report, so there is some time to take action:
- Do not ignore the bills: It is essential to monitor healthcare costs and try to address them as they fall due rather than letting matters worsen.
- Follow up with the insurance carrier: Medical bills are complicated, and sometimes insurers erroneously do not pay a bill covered in the plan. Check with the company to confirm that they do not cover the expense, particularly when the policy indicates that they would pay it.
- Medicaid: As a major provider of people in the U.S., Medicaid may cover these expenses, some even retroactively.
- Negotiate: It is better to pay a portion of the debt rather than nothing at all. The health providers may accept this offer of some money today rather than risk trying to collect the entire amount later.
- Consolidate: Instead of having several creditors, consolidate the debt into one loan payment with ideally better terms.
Still too much debt?
Medical debt is one of the most common reasons for filing bankruptcy. If none of the above strategies solve the issue, bankruptcy will help individuals and families address the debt and get back on their feet. After facing health challenges, filing Chapter 7 or Chapter 13 may not seem so daunting and offer another solution that everyone can live with.