The cost of health care has risen so dramatically, even routine procedures can place your personal finances at risk. Insurance may help, but even the remaining co-payments can become a crushing burden. Perhaps you used your credit card accounts to pay hospital bills and now you can't make timely payments on your credit cards. Whatever the scenario that led you to your financial situation, there are practical steps you can take to alleviate at least a portion of your debt burden.
Review Your Bills
Begin by reviewing your hospital bills. Tracking all expenses you incurred is a complicated task and your hospital may have made mistakes on your bill. Look for instances of being charged twice for the same service or procedure. Note items which you don't recall receiving. You may be surprised to find you never owed what the hospital said you did to begin with.
Financial Assistance
Many hospitals have procedures in place for making an application for financial assistance. This process often involves providing detailed documentation of your financial situation. You may be asked to supply paycheck stubs, signed tax returns, a list of your existing debts, bank information and investment account balances. If you can demonstrate true need, the hospital may reduce or even eliminate your remaining balance.
Explore Other Assistance
Some hospitals may offer flat percentage discounts for clergy, especially if the hospital was established or run by a religious organization. State government agencies may offer medical assistance programs for those who make too much for Medicaid but too little to pay their bills.
Credit Card Relief
While medical bills are often unavoidable, credit card debt usually is. Be wary of debt negotiation services that promise to reduce or eliminate most of your debt. These businesses are fertile ground for scam artists who charge a fee for doing next to nothing. Instead, consider consolidating your credit card into a lower interest loan based on a second mortgage or home equity loan. Be careful, as this option merely transfers your debt to a less costly financial instrument. Failure to make payments on loans secured by your home may result in losing your home.
Debt Management Plans
If your credit card debt is the result of personal spending habits, you may want to consult a certified credit counselor. A credit counselor will help you establish a budget, encourage eliminating your credit cards as a payment option and work with you to develop a realistic strategy to pay off your existing accounts.
Last Resort
Most drastic would be to declare bankruptcy. Thanks to the Bankruptcy Reform Act of 2005, writing off all your debts has become much more difficult. If you are ready to face the long term impact of filing for bankruptcy, the choice may lead to a significant reduction of amounts owed on your remaining bills.
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