Whether or not you have health insurance, medical expenses can be a real issue. You are likely already worn out from whatever ailment stuck you with that hospital bill in the first place, and the last thing you want to do is deal with owing for your treatment. Your first step out of this situation is to get educated on medical debt and what it means for your financial situation.

Can I negotiate medical bills?

Nothing is set in stone, even your annoyingly high hospital bills. Negotiation is definitely an option. If you currently have a medical bill – not a medical debt in collections – you can talk directly to your provider’s billing department and/or your insurance company to try to work it out. In addition, even if the bill has passed to collections, you can still try contacting the original medical service provider to negotiate. Medical service providers may be willing to work with you directly, so you can avoid the stress of trying to deal with a collector.

medical debt settlement; stethoscope on top of paper medical bill

Review your bill to make sure it’s correct

Just because it looks official doesn’t mean that all the information is correct. Take some time to review your health care bill. Did you receive all of the procedures listed? Or were some of them added by mistake? Checking for errors can save you thousands of dollars if you find out you’re being charged for a procedure that you didn’t receive.

Know what your insurance covers

When looking through your bill, make sure to check the column that shows how much your insurance company put toward each item. Health insurers make mistakes, too, and there may also be errors here. If you have any questions about what’s covered, what’s not covered, and how much should be covered, call your insurance company directly and ask.

Talk to your medical provider first

Before you get a lawyer or debt settlement company to intervene, talk to your medical provider directly. Even if they already sent the bill to collections, you still may be able to discuss your payment arrangement with them. You may even be able to reduce the amount of your bill.

Ask about a payment plan

In the end, all that matters to the medical providers is that they get their money. You may be able to negotiate a payment plan with monthly payments that will be easier on your wallet than paying everything in a lump sum up front.

How does medical debt settlement work?

So, your medical bill went overdue for a little too long and now it’s in collections. You’re experiencing some kind of hardship and you don’t think you’ll be able to pay the full amount. It may be time to consider debt settlement.

The first thing you need to do is check whether or not your debt is still within the statute of limitations. This is the period during which a lender can still take you to court for what you owe. Find out if you are still within this period before you pay your lender anything.

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Next, you can choose to either settle your medical debt yourself or work with a settlement company. Negotiating medical debt settlement on your own means working with the collections agency to lower the amount of your debt you have to pay back. Offer to pay a percentage of your debt and enter into a settlement agreement. You may be able to make monthly payments on this settled amount until it’s paid off. As long as you pay as agreed, you should be in the clear. If you can’t make a monthly payment for whatever reason, call and try to renegotiate. This might work, but probably only once. You can’t call to renegotiate every month.

Working with a debt settlement company is a little different. Basically, they negotiate with the debt collectors on your behalf and you make payments to the settlement company instead of to the collection agency directly. Going this route can be especially helpful if you have multiple medical debts (or any other unsecured debts besides student loan debt) that you need to eliminate.

Are there more options besides debt settlement?

medical debt settlement; bottle of pills on top of a dollar billIf you have a good credit score that you want to maintain, you may want to avoid debt settlement since it could negatively affect your score. Don’t worry – there are more options besides settling your medical debt.

Debt Consolidation Loans

If you have good credit, then you should be able to qualify for a debt consolidation loan. This is an unsecured personal loan that you can use to pay off other debts, including unpaid medical bills. This will allow you to pay off the medical bills in a lump sum to avoid the hassle of setting up repayment plans.

Payment Plans

Like we mentioned above, it’s worth a try to negotiate medical bills. This also applies to past-due bills and medical debt. Before even considering debt settlement, call the original service provider to discuss setting up a payment plan that will allow you to pay off all of your medical debt. Paying in full is better for your credit than settling.

Credit Counseling

Certified credit counselors help you find the best way for you to pay off your debt. Often, this involves enrolling in a debt management program (DMP) in which your counselor consolidates your debt payments and guides you along the path toward debt relief. Like negotiating your own payment plan, a DMP will help you pay off your debt in full.


If your medical debt has put you in a really bad situation, bankruptcy is not something to be afraid of. You will get rid of the debt fast and start building toward a better financial future.

Do medical bills affect your credit score? Does settling a medical debt hurt credit?

When you first get your medical bill, it’s not a debt that will show up on your credit report. It’s just a bill. However, when you fail to pay it on time, your medical provider could send that account to collections as a debt. This collection account will show up on your credit report, not the medical bill. Nothing about your personal health records will be on your report.

If you’re having trouble paying off this debt, you may choose to enter into a debt settlement program. There are some DIY settlement methods, but they can be risky, so we recommend finding a reputable settlement company.

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In general, debt settlement may hurt your credit score and be on your credit report for set period of time. When the account is paid off, it will stay on your credit report for seven years, though there are ways to get around this. When it comes to medical bills, an account will show up on your credit report if you miss your due date and the medical debt is sent to collections. Even then, it will only show up after it has been in collections for 180 days. This gives you plenty of time to deal with the debt collections agency and prevent it from ever becoming a negative item on your credit report.

Why does the account take so long to show up on your credit report? Shady practices in the medical billing and debt industry led to the creation of the National Consumer Assistance Plan. The three major credit bureaus (Experian, Equifax, and TransUnion) created the plan together in an effort to make credit reports more accurate. Since medical bills were often moved to collections very quickly without the knowledge of the debtor, they decided it was best to add a 180-day grace period for any medical account that may end up on a credit report.

If the damage has already been done and you need help fixing your credit, we recommend that you go through a credit repair service.

Don’t risk your financial wellbeing trying to fix your credit on your own. We can connect you to the right credit repair service for you!

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Can you go to jail for not paying a medical bill?

Absolutely not. There is no longer such a thing as a debtors’ prison. If you don’t pay a medical bill, it will likely be sent to collections, may leave a bad mark on your credit report, and could lower your overall credit score, but you will not go to jail.

NOTE: Watch out for medical debt settlement scams

Medical debt can put you in a vulnerable state, making you more likely to believe the lies of someone claiming they can get you out of debt for “pennies on the dollar.” This is almost never true. Debt settlement scams are unfortunate things you need to watch out for when trying to settle medical debt. You also need to keep your eyes open for signs of medical identity theft.

Article last modified on September 25, 2019. Published by Debt.com, LLC