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5 tips to negotiate a hospital bill

A reader says a hospital is threatening to turn her over to collections unless she begins paying off a $7,000 bill right now.

By MSN Money Partner Aug 21, 2012 1:48PM

This post comes from Christopher Maag at partner site on MSN MoneyTwo years ago, Michelle received treatment at a hospital and racked up a $7,000 bill. Now the hospital is threatening that it wants to get paid -- immediately -- or it's going to damage Michelle's credit.


Image: Medical doctor (© Digital Vision/Getty Images)"They told me today that I had to pay them $200 a month to keep out of collections," she wrote in response to a story, and the hospital wants its first payment "by the end of the week."


Michelle says she is disabled and lives on a limited income, so she can't afford to spend $200 a month on a medical bill. Also, "this is the first statement I received from this hospital," she says.


It appears that whomever Michelle is talking to at the hospital is trying to rush her into paying too quickly, and possibly too much, says Gerri Detweiler,'s consumer credit expert.


"I think she's dealing with a billing clerk who doesn't have a lot of incentive to help her, and may not be aware of all the assistance that may be available," Detweiler says.


But first a note of warning to other former patients who find themselves in a similar position: Michelle may actually be lucky. Many hospitals don't send reminders or make phone calls regarding unpaid bills. They simply send the bills to a collection agency, which hurts the consumer's credit automatically.


"They don't have to warn you, even," says Barry Paperno,'s credit scoring expert. "It's good that they're calling, because that gives you a chance to work it out before they send it to collections. And the fact that they're willing to work out a payment arrangement is even better."


So the bad news is that the payment plan offered by the hospital is not much of a deal for someone in Michelle's position. The good news is that it hasn't yet been handed over to a collections agent, which means Michelle still has time to negotiate before this unpaid bill damages her credit. (Post continues below.)

What can she do now? Here are some steps consumers can follow to slow down the bill collection process, learn their options and possibly negotiate their way into paying less.


Get the bill. The whole bill.

The first thing Michelle should do, Detweiler says, is get an itemized copy of the hospital bill. After that, she should read it line by line. Are there procedures on the bill that were never performed? Was she charged for an entire box of surgical gloves? If so, she can get those overcharges removed. "The fact that she hasn't even gotten a bill concerns me," Detweiler says. "The bill is probably too high to begin with."


Get help.

If it's a nonprofit hospital, it has programs to give free or reduced-cost care to people who are low-income and disabled. Since Michelle is both, she probably qualifies. "She may not have to pay any of that bill," says Detweiler.


Go up the chain.

At this point, it sounds as if Michelle is dealing with a low-level hospital employee whose only job is to collect unpaid bills. Michelle needs to be dealing with someone else. She should ask to talk to a hospital employee who works in the programs for low-income and disability assistance. If the person fails to respond adequately, demand to speak to his or her manager. If she finds mistakes on her bill, she may have to speak to a manager in the billing department, too.


This is one of those cases where being a little more assertive could make a big difference. "Go to someone higher up in the hospital," Detweiler says.


Explore your state's options.

A nonprofit hospital should be able to tell Michelle if she qualifies for similar aid programs for the low-income and disabled in her state. But if hospital employees don't, she can contact those programs directly.


Know your rights.

Under the Affordable Care Act, hospitals must establish written policies regarding who is eligible for free and reduced-cost care and financial assistance programs, and must make those policies available to patients and the public, according to a recent story for by health care and medical billing expert Mark Rukavina of Community Health Advisors. Hospitals must refrain from pursuing collections actions until they have screened patients to find those who qualify for financial assistance.


And for patients who receive aid, hospitals cannot charge any more for services than they charge Medicare or the lowest amounts negotiated by insurance companies.

"If you believe you are the subject of aggressive billing and collection practices after receiving treatment at a nonprofit hospital, contact the billing department and ask for information on their financial assistance and billing and collection policies," says Rukavina. "It is your right."


The final rules to enforce the act have not yet been written, Rukavina says. Still, these protections are part of federal law, and Michelle can use them to slow down the hospital bill collection process and negotiate for a lower bill.


More on and MSN Money:


Aug 23, 2012 9:18AM
I had a huge hospital bill after my insurance paid their part.So I set up payment arrangements. I paid them monthly and they still reported on my credit report. Sometimes the billing is confusing to the customer. Oh and please the hospitals rip patients off. 5 dollars for an aspirin? It pisses me off because illegals come in the hospital get treated and dont have to pay a damn dime.
Aug 23, 2012 7:05AM

Aas an uninsured individual, I call dealing with the medical community as going down the rabbit hole.  I had to go to an emergency room due to a medical scare and the nearest hospital was a for-profit one.  When I finally got the hospital bill (nearly a month after) it was a simple -- "here's the amount you owe, pay it".  I called the number on the bill (not a local #) to request an itemized list which I received several weeks later.  I called the number and asked for a discount.  They offered 10%.  I told them they could do better, but they said no.  This went on for 2 more months.  When they threatened to "turn it over to collections", I called them again and again they said 10% was the best they could do.  When I pointed out that why would they turn it over to collections and get pennies on the dollar rather than talk to me?  Suddenly a supervisor came on and offered 30% -- which I accepted.  BTW -- I called the hospital to ask to talk with a billing person and was told that they had no authority to do anything about the bill.  So it turns out from day one I was never dealing with hospital on this -- I was always dealing with a collection agency.  And that threat about my credit -- unless you are young (or youngish) and trying to buy a house -- don't worry about it.   Let it go "to collections"  -- it ain't the end of the world.

Aug 23, 2012 8:19AM
I got turned over to a collection agency after giving birth to my son.  I owed $0 .... never got a bill from the hospital, only the threatening letter from the agency.  Sent them a check for "no sense" with a letter commending them on operating their agency as efficiently as the hospital runs it's billing department.  Never got my cancelled check back.  Had to get an attorney and threaten legal action 3 years later to have the $0 owed removed from my credit report.  I'm convinced the collection agencies and the blood sucking scum attorneys who operate them are one level below the dog crap on my shoes.
Aug 21, 2012 4:04PM
Evidently insurance companies are notariously slow about paying hospital bills. My daughter broke her leg over a year ago and we are still trying to get it settled. The hospital is not pressuring us, but says they are waiting to see what the insurance pays before billing us the balance. We have talked to reps of both but to no quick end.
Aug 23, 2012 9:50AM
My husband had ACL surgery to correct a surgery done 9 months before, so we got out of our small town and went to Nashville.  We got the surgery pre-certified through the insurance company, he had the surgery and then we received a bill for $47,000 because we went "out of network".  I sent a letter to the insurance company, the KY and TN insurance commissioners and the hospital CEO.  The next bill we received was for $0 and an apology from the insurance company for their "error".  I certainly didn't expect them to waive the entire bill, but it just goes to show you that insurance companies will do almost anything to get out of paying.
Aug 23, 2012 6:41AM

According to the FCRA they are required to notify you before they turn the bill over to a debt collector.  If they don't they can be sued in small claims court for $1000.  Each violation of the FCRA is $1000 fine or you can get that money thru small claims court.

The autor of this article needs to learn a bit more before he reports of publishes articles.

Aug 23, 2012 9:21AM

The trouble I have seen with these large hospital bills being written off to supposedly low income people is that we out here that pay for our medical insurance still have relatives and friends that hides a lot of their income SELLING ON E-BAY, SELLING DRUGS, FULL TIME FLEA MARKET DEALERS, and I have personally seen very large hospital bills these people have racked up being completely wiped clean. Been told personally by hospital collection payment staff that we have different funds for these people!!  Then myself by not being declared low income am told that all we can take off your bill is 10% and the only way to get that is too pay the bill off completely!!!!!!

Aug 23, 2012 9:47AM
Have never had a problem with billing or insurance.  After a visit or procedure the provider sends into BCBS, they pay their share (we get an EOB) then in a week or 2 we get a bill from the provider for what we may owe.  I am getting tired of paying inflated rates for insurance, Dr visits, prescription etc, because all these providers are passing along, in the form of higher costs, those people they end up treating for free.   It seems a bit outrageous that the BCBS approved amount for a basic Dr. visit is around $100.
Aug 23, 2012 9:32AM

To delo 776 Michelle may not be lying, I received a bill this past April for 90.00 for a service from March 2011,I thought everything was settled from the past year however I sent 50.00 towards the bill which was marked due immediately] in the meantime I had some tests done next month I get a bill for 220.00 [ 180.00 new charges plus 40 from last bill ] due immediately. I send in 60.00 and a few days later I get a call from hospital billing stating this is -------- hospital calling in an attempt to collect a debt....When I called they were not happy with my payments and threatened a collection agency.I told them go ahead rather give the collection agency a few bucks than this idiot hospital which is probably stuck for thousands by deadbeats every year.. Another call threatening collections so I told them I was taking the bills and the story to the local newspapers and to our congressman and representatives offices to take a look at their billing practices. Well a few more tests later and a bill up to 475.00 always due immediately , i am paying 50.00 a month no more calls and I know most credit agencies do not take a hard look at medical bills and their nonsense. Hospitals are fools to deal with especially when they don't realize someone is making the effort to pay their bills.

Aug 23, 2012 12:00PM
Offer them half.  If they don't take, tell them good-bye and let them give it out to a collection agency.  Then, offer half again.
Aug 23, 2012 10:39AM
If you have insurance keep bugging them to pay the bill. The longer you dont bug them they are hoping you give up and pay it yourself. If you dont have insurance ask to speak with a care manager. For instance if you have a 20,000 dollar bill tell them you can pay 1,000 dollars now or maybe 500.00. They will be very aggressive or stupid about what you will pay. Just tell them this----I know about all the illegals coming thru the ER and who pays for them. I want treated like everyone else including people not supposed to be here. If they wont move, and they might not, tell them i will pay 1.00 on every bill for every because there is no minimum payment and no insurance on hospital bills because of COBRA and other plans.     They would rather have some money than turn you over to collections and pay more for the collection and get nothing. I know this because I am an RN.
Aug 23, 2012 8:30AM
Michelle needs to check out Medical Assistance.  She most likely would qualify and the bill may be taken care of in full for her. 
Aug 23, 2012 10:31AM
this happened to my husband,they wanted the money before anything was done to him.He told them he would pay after he found out what the insurance paid and we would get it from his 401 k..Well the kept sending him notices and then this stupid man kept calling him and threatend him.When we got the money i called the hospital and said we have the money and wondered if i could send it to them not that guy who threatend him they said he did what? She then said yes you can pay it to us and screw that ugly foul mouthed man,he got very mad.
Aug 23, 2012 7:42AM

Getting sick of the American mentality! I work first hand in the medical field, take care of peoples healthcare in the trenches! I pay through the **** for health insurance, for the 70-80% who dont! Who do ya think who pays for those that dont ? The  truth is health care is not cheap.If it were my life i would want the best ? Majority of people who complain are the people whom have received to much government cheese! I know my tax dollars are wasted on these welfare recipiants, the days of a free lunch are drawing near!

Aug 23, 2012 12:18PM
 I had an emergency room visit which cost me $100.00. I paid it then by debit card. 5 months later I get a refund for $100.00 from the hospital for my copayment.....and in the SAME STACK of mail, a bill for $100.00 for the copay I "didn't pay". So, I deposited the check they sent me and sent them a check. Billing errors happen often!!
Aug 23, 2012 11:36AM

Pay it. You got the service you needed or wanted. So, pay up.


Another sob story for all to reflect upon the glorious benefits of what Obamacare can provide. BS!

Aug 23, 2012 8:06AM
Michelle is lying.. She has probably recieved may statements and  just threw them away.  How would she feel if she did work and someone refused!! to pay her?  Surely the billing office offered to help her  prior to being turned over to a collection agency.  All !!! hospitals have a charity program but you have to apply for  it.  Hospitals may not make calls to collect the money OWED but their system is set up for billing on a regular basis.    Credit scoring is PROFILING.. and isn't that illegal??  Hospitals normally do not turn over to collections  for at least 90 days. 
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