How to Negotiate to Settle a Hospital Bill

Medical bills can be devastating, especially for the uninsured. Treatment for a serious injury or illness can easily top $10,000. One point in your favor is that medical debt is unsecured, meaning there is room for negotiation. Unsecured debts, which also include credit cards, are not backed by collateral. Secured debts, such as mortgage loans and automobile loans, allow the lender to take the property if you cannot pay. Medical bills can be settled for less than the full amount owed, and you can handle the negotiations yourself.

Instructions

1

Offer to settle as soon after your illness or treatment as possible. Some hospitals and physicians will offer to discount your bill even before it becomes past due. Health.com reports you may receive a 20 percent discount just for asking.

2

Contact the billing department after receiving your statement and explain you simply cannot afford to pay. Offer to provide financial statements proving you do not have the money. Ask for a 50 percent discount with payments in installments over several months. Asking for such a large discount may seem bold, but it gives you room to negotiate.

3

End your conversation in a polite way if the representative balks at 50 percent. Call back weekly to continue negotiations until you have a deal. Yield a bit each time in your negotiations, but do not go below 20 percent. Keep offering to provide documentation of your financial situation such as a copy of your credit report.

4

Take a similar strategy if you are negotiating an old medical debt that has gone to a collection agency. The debt collectors are likely to be much more difficult to deal with; therefore, it may be helpful to negotiate with them only in writing. If necessary, get contact information for the debt collector from your credit report. A company name and address will appear on your report alongside the delinquent account. View and print your report from AnnualCreditReport.com, the only website the Federal Trade Commission (FTC) has authorized to offer free reports under the Fair Credit Reporting Act

5

Write a letter to the debt collector. Indicate that you noticed an old medical debt on your credit report you would like to resolve, though your finances are limited. Take a tougher stance now that the bill has been sent to a collection agency. Delinquent unsecured debts generally are settled for 20 to 70 percent of the balance. At this point, your goal should be to pay as little as possible. In your letter, offer to settle the bill for 20 percent of the balance in a lump sum or 50 percent with installments.

6

Continue the discussion by mail --- or telephone, if you prefer --- until you have a deal. Be patient. It is unlikely the debt collector will make his best offer right away. It may take several months before you receive the offer you want.