A Toll on Medical Debt

All humans get sick at least once in their lives. Whether this illness is chronic or acute, money becomes a crucial issue for the cure. Addressing medical expenses can either make or break you, depending on your compliance to pay. But remember, what can be a small and harmless medical bill now can be the source of your financial struggle and worse, your bankruptcy in the future. This is the experience that many Americans go through today—facing the battle of medical debt. The surest and fastest way to avoid this financial catastrophe is to settle your medical debt immediately.

The Fine Print Rule

Immediately paying off your medical debt is not easy. The reason why many Americans get stuck in the rut of paying this debt for long periods is largely due to exorbitant charges health care providers impose. For people who are uninsured or underinsured, this is a major issue. There are times that debtors become victimized by failure to read the fine prints laid out in the hospital or medical waiver. The usual practice for hospitals is they sell discounted collectible debts to collecting agencies, which gets your medical debt "financed". The consequence makes the collecting agency your new creditor, without you even knowing it.

Video: Truths About Hospital Bills

The above video shows that patients are frequently overbilled for there medical expenses. There are tips in the video to hire a medical bill investigator or call your state's attorney general. Click the video for more details.

When to Consolidate Your Debt

If you find yourself being unable to pay even before the debt becomes due, take the initiative on bargaining for a payment plan with your collecting agency. This is known as consolidating your debt. Another is to pursue a consolidation loan. This may give you lower rates and enable you to pay your first loan but banks extend this type of credit with the requirement that you put your home as collateral. Also check if the policy of the hospital to which you are indebted to qualifies you for debt reduction. The welfare department of hospitals can reduce a huge portion of your medical bill or even foots your bill. But hospitals would usually require you to exhaust all your remedies before you apply for welfare. Part of exhausting your remedies is applying for Medicaid in your state. Medicaid, depending on the policy of the state, can shoulder your outstanding medical debts.

Nonpayment, Garnishment, and Bankruptcy

While some may treat nonpayment of medical debts lightly, they might be losing more than what they would be willing to risk. Nonpayment of medical debts can lead to garnishment of your wages, decrease your credit score, and possibly bankruptcy. If you fail to pay your medical debts on time, collecting agencies can file a claims suit to constitute lien over your property (Financial Exploitation, By Seifert ), meaning your home and your salary. If awarded, you would be losing all you had to live on. Failure to comply with your agreed payment plan can also affect your credit score once the collecting agency reports the same to credit institutions. As a result, you will forfeit your chances in securing future mortgages. Filing for bankruptcy, on the other hand, should be your last option. While this may free you from unsecured debts, your right to pursue this remedy is only once every 6 years and can negatively affect your credit score. So if after a successful bankruptcy claim you find yourself needing medical care, you cannot invoke this remedy due to the prescriptive period.

Government Agencies That Could Help You

If you need help or consultation regarding your medical debt, there are non-profit organizations and government agencies that can help you win the battle over medical debts. Government agencies such as the U.S. Federal Trade Commission and the U.S. Department of Health and Human Services can offer you resources and guides as you go through the process of settling your medical bills.

How To Reach The Listed Government Agencies Concerning Medical Debt Issues

Below is a list of the government agencies' phone numbers so you can direct your questions to the right office, instead of being caught in a web of call transfers.

Federal Trade Commission

Office of Public Affairs (Press Office)
(202) 326-2180

Bureau of Consumer Protection
(202) 326-2042

U.S. Department of Health and Human Services

Telephone: (202) 619-0257
Toll Free: 1-877-696-6775