Coping with Medical Bills and Debt

Understand your bill | Dispute your bill | Paying your debt | Collection agencies | Bankruptcy | Legal help

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Understanding your bill

Review your medical bills carefully to check for any mistakes.  Even if you are covered by insurance, the cost of billing errors may come out of your pocket in the form of higher co-payments and drug costs.

Here are some resources to help you make sense of your medical bills.

• Medical Billings: Information from the Bureau of Consumer Protection in the Wisconsin Department of Agriculture, Trade and Consumer Protection.
• Understanding your Medical Bills:  Information from the American Academy of Family Physicians to help you understand billing statements from your doctor and explanation of benefits (EOB) reports sent by your health insurance company.

Disputing your bill

If you are unable to resolve a billing dispute with a hospital, clinic, or doctor's office, contact the Wisconsin Department of Agriculture, Trade and Consumer Protection at (608) 224-4960 or 1-800-422-7128 (in Wisconsin only).

Paying off your debt and protecting your credit

Unless you have successfully challenged your bill, you are responsible for paying all of your medical bills.  If you cannot pay, here are some things to consider.

1. Try to negotiate a payment plan. Your hospital or provider may be willing to accept smaller monthly payments. Keep in mind that your payments generally need to be reasonable and you must keep up with your payments. In its advice to parents of chronically ill children, the American Academy of Family Physicians recommends the following: 
   • Notify the appropriate offices quickly.
   • Keep in touch with your creditors.
   • Record the names and phone numbers of the people you are dealing with.
   • Document the date, time, and results of your phone calls.
   • Pay something - even a small amount - on each bill each month as a gesture of good faith.
2. Get information on charity care in Wisconsin hospitals.
3. Apply for Medicaid. If you are eligible, Medicaid may pay for some of your existing medical bills. Wisconsin Medicaid coverage can begin as early as the first day of the month, three months before the month you apply, if you would have been eligible in those months, so apply as soon as possible.
4. Go for credit counseling. Be aware, though, that some services charge high fees and do nothing to really help reduce your debt. Make sure you are working with a credit counseling service (also known as an adjustment service agency) that is licensed by the Wisconsin Department of Financial Institutions.
   
   • A list of licensed credit counselors can be found at the Department of Financial Institution's website. If you have questions or complaints about a particular agency, call their Licensed Financial Services Section at (608)-261-7578.
     
   • Information on how to choose a credit counselor is available from the Federal Trade Commission.
     
   • The National Foundation for Credit Counseling (NFCC) accredits credit counseling agencies that provide free or low-cost services. You can search for an NFCC member credit counseling agency from the NFCC website or by calling 1-800-388-2227.
     
5. Be creative about finding help from outside sources.  Charitable foundations, civic organizations and churches and community groups might be able to help. The Patient Pal (PDF, 197 KB) from the Patient Advocate Foundation includes some fundraising ideas for those with high medical bills.
6. Don't ignore bills. Though tempting, this is not a good strategy. Hospitals and providers are more likely to negotiate with you if you contact them immediately.
   
7. Don't transfer debt to a credit card. Most experts warn that this is a poor choice for paying off medical debt for two reasons:
   

   • The interest rates on your credit card will add significantly to your total payment. 

   • Transferring medical debt to a credit card may affect your eligibility for Medicaid. Some medical costs can be deducted from gross income to determine your Medicaid eligibility. Medical debt on a credit card may no longer qualify as medical debt.

Dealing with collection agencies

If your hospital or other health care provider has turned your bill over to a collection agency, you are protected against harassment by the Fair Debt Collection Practices Act (FDCPA).  

• Disputing a Debt, from the Wisconsin Department of Financial Institutions, provides information on how to deal with collection agencies.
• Debt Collection, also from the Wisconsin Department of Financial Institutions, provides information on your rights.

If you have questions about your rights or the conduct of a collection agency, contact the Department of Financial Institutions at (608) 264-7969, or  1-800-452-3328 (in Wisconsin only).

Bankruptcy

The decision to file for bankruptcy should be last resort. More information on how bankruptcy works and the different types is available from the Wisconsin Department of Agriculture, Trade and Consumer Protection.

Legal help

If you find that you need legal help to deal with your medical debt, the Wisconsin State Bar Association's Legal Explorer Web site provides general information on finding a lawyer and information on finding a lawyer if you have a low income. 

The Legal Service Corporation Services, a private, non-profit corporation established by Congress, allows you to search for a local legal aid program from its Web site.

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Last Revised: November 08, 2007