Tips for Negotiating a Lower Hospital Bill

by Reader Contributors

How to Negotiate a Lower Hospital Bill photo

Yes, sometimes you can negotiate a lower hospital bill. We get tips from people in the medical field as well as from readers who have successfully negotiated a lower bill.

Dear Dollar Stretcher,
My husband and I have unfortunately just had a miscarriage. If that were not enough, we are uninsured and the hospital bills look like they will be around $4,000.

Has anyone ever successfully negotiated with a hospital for a lower bill when paying cash? Are there any money saving suggestions in general to help deal with a one-time, totally unexpected cost like this?

Thanks for your help in advance for advice on reducing hospital bills.
Autumn in Michigan.

Tips for Negotiating a Lower Hospital Bill

We reached out to our readers for advice on negotiating lower medical bills. We received tips from professionals in the medical field as well as readers who have successfully negotiated a lower hospital bill. Hopefully some of their advice can help you if you’re struggling to pay a large medical bill.

Call Accounting

After my husband was in the hospital for chest pain, we ended up with several hundred dollars of deductibles, etc. Immediately upon receiving the bill, call the accounting office at the hospital and doctors offices (they send their own bills), explain that you do not have the funds to pay in full but would like to make monthly payments.

We are paying the doctor $25/month and the hospital $20/month. The important thing is not to ignore the bill or send partial payments without talking to them first. Otherwise your bill will show as delinquent.
G. H. RN

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A Doctor’s Advice

I am a primary care MD and have many patients with no insurance. All of the hospitals in my state (Massachusetts) have financial assistance offices to help patients with financial hardship. At the very least, they can come up with a very generous payback schedule (it is in their best interest as many people end up defaulting on big bills otherwise).

More often than not, many people without insurance will qualify for some degree of free care. In Massachusetts there is a “Free Care” fund which all of the hospitals pay into (with money earned from Paying/insured patients), and then hospitals can get money from this fund to pay for the care of people who fall between the cracks (no insurance and do not qualify for other government health assistance programs). I’ve been very surprised at how generous this fund has been and who can qualify. Many of my working, but uninsured patients (the “working poor”) have qualified to some degree (50-75% reduction in bills).

Anyway, the financial assistance office at their hospital should know the “scoop” for what is available in their state/community. I hope this is helpful. I feel really badly for that poor woman who not only lost a baby, but now has big bills to pay.

From a Hospital Employee

I have a few hints based on the policies at the hospital I work for (granted, they may be different at your hospital but it doesn’t hurt to check). First, look over every inch of your bill for double charges, treatments you didn’t receive, etc. These kinds of errors happen fairly frequently, but most people don’t know to check. Also, check your doctor’s bill for the same thing, especially for procedures normally done by nursing staff. One of my fellow nurses once had a baby in our unit and was billed by the attending physician for an IV start. Doctors don’t start IV’s in our unit, nurses do. She refused to pay that charge.

Secondly, see if there’s a financial counselor at the hospital. They often will negotiate the charges, especially if it’s a large hospital that normally serves indigent patients (they get money from the state to help make up the difference). Also, many physicians will do the same thing, especially if they know you don’t have insurance. Talk to your doctor and see if he/she will accept a lower payment. One of my mother’s doctors, knowing she was struggling to make ends meet, forgave her entire balance. Others will often accept the “usual and customary” payment that they would have received from an insurance company, which you can bet is lower than what you were billed.

Thirdly, remember that hospitals and doctors usually don’t charge interest. Once you’ve negotiated your lowest fee, do not be tempted to take out a loan or put the balance on your credit card. Every single hospital and doctor that I know of will leave you alone as long as you are making regular monthly payments, even if those payments are only $10 or $20. The key is REGULAR payments. If you let them know what you can afford to pay per month and keep your promise, they will not pursue legal means of collection.
Cindy, Newbury, OH

They Don’t Like Bill Collectors, Either

I used to work in hospital billing, and I know that most hospitals will negotiate a payment plan for the amount if you approach them. They don’t want to have to send you to collections. It’s much better for them to get the full amount, even if it takes longer (collection agencies take a percentage). I’ve seen payment plans as little as $25 a month. It can’t hurt to try. Good luck!

You Can Negotiate

My job requires me to negotiate with medical providers. I can assure you that hospitals can, and will, negotiate charges. They would rather get paid by you than turn the bill over to a collection agency, or worse, write the charges off.

I would explain your financial situation, and offer a lowball sum, maybe 25%. I would not expect to pay less than 50%. They will often discount to 2/3. If they want you to pay more than 75%, ask for the person’s supervisor.
Adam W.

Some Will, Some Won’t

I worked for the last 15 years in health insurance claims and one of the projects I started was to negotiate a discount in exchange for prompt payment. Some hospitals are pretty cooperative, others are definitely not. The only way to know is to ask. You will probably need to talk to the manager of Patient Accounts. I was getting discounts anywhere from 2% to 20% (but, hey, every little bit helps!). The catch is, you usually have to promise to pay the balance in full within 30 days. It’s best to call near the end of the month or quarter when they are trying to clear up their books.

Before you call to negotiate, you should get an itemized statement from them and go over it with a fine tooth comb. Because a lot of the terminology will be foreign to you, it’s really helpful if you can have a nurse friend look over it for you. You will be looking for anything that looks like it’s been double charged or charged to you in error. I have found as many as 10 charges for something that was only used once. Your nurse friend will be looking for things that look inappropriate such as heart medications when you don’t have a heart condition, etc.

Oh, and when you look at your bill you will be disgusted by the amounts that they charge for each individual item (aspirin for $3 each, $2 band-aids, $6 toothbrushes, etc.). Save yourself some stress and put it out of your mind. Hospitals are free to charge whatever they deem ‘appropriate’ for their supplies and there is nothing anyone can do about that.
Sherry B.

Expect to Provide Financial Info

I worked in the credit area of a clinic and have counseled many people in such a situation. If you are unable to make the monthly 10% of balance payments (usually required), then typically the hospital will request a completed financial statement. If the hospital determines that you are financially strapped (usually a 40% debt to income ratio or higher), then a settlement will benefit both parties.

Be aware you will be closely scrutinized as far as your spending and other bills outstanding. Suggestions such as “cancel your cable TV” or “sell your recreational vehicles” will be made. They are usually willing to work with you to avoid a collection agency involvement. It is always best to face the music and clear up the debt without any legal action. I have myself agreed to a settlement of up to 50% of the total bill IF the remaining balance is paid in full and in cash at the time of the discount.

In addition to the above, many programs to reduce or eliminate a hospital bill are available in many states for people unable to afford health insurance. If at all possible, get health insurance. Its worth cancelling the cable TV.

The Law Is On Your Side

Yes, you certainly can negotiate. First though, if your income is low, a financial program called the “Hill-Burton” Act may help. The hospital will know of this. Years ago, two men with the last names of Hill and Burton created a bill which passed. This assists people with medical expenses who are unable to pay them. Please remember, it is only for people of limited financial means.

If you do not qualify for this, find out what is the least amount they will accept on a weekly, monthly basis and either make arrangements to pay this way or ask if they will negotiate for a lower cost if you can pay in cash, all at once. Most hospitals do not want to work with piddly payments so they may negotiate. If they don’t, then by making the least amount, you are honoring your obligation, thus not hurting your credit history. And put the rest of what you would have paid them into a money market account or certificate of deposit and do not touch it until you have paid off the entire hospital bill. You will be surprised at how much you can save this way.
Jane C

Build an Emergency Fund

With these simple tips and tools, you can build an emergency fund, even while living paycheck to paycheck.

Ask for a Bill Audit

My local hospital has an audit department and when a co-worker of mine asked them to audit her mother’s hospital bill, it was lowered from around $7,000 to close to $4,000. She was told that the hospital does not audit their bills before they send them and they are only audited if a patient requests it.

My Experience

I went to the emergency room late at night and was charged extra for a lot of the lab work because the technician had to be called in. Here’s what I did:

  • Talked to my doctor. She looked at the hospital bill and noted on each charge how much she would have charged for the same services. A lot of the charges were 4-5 times the normal rate.
  • Called the billing department to let them know I thought the bill was too high.
  • Once I could see that the billing department wasn’t going to help me, I asked for the head of the department. She told me that the charges were standard and couldn’t be adjusted. I told her that even my doctor verified the charges were not standard. She persisted and I asked to talk to her supervisor. She took my name and number.
  • The next day I called her back to refresh her memory.
  • The next day her supervisor (the vice-president) called me back. I explained the situation. He said he would check into it.
  • The next day he called me back and they cut the charges in half.

So, I learned to work my way up, never take “no” for an answer, don’t lose your cool, get credibility by talking to doctor or lab, the customer IS always right.

A Win/Win Solution

I don’t remember where I read about this idea, but it was recently in a magazine or newspaper. It was about several people in different cities that had trouble paying for their hospital bills. They did not have the cash but used the barter system. One lady did data processing 2 nights a week for several hours and in 8 months had her hospital bill paid. Another lady did gardening work to pay off her bill and a man did some other type of work needed by his hospital.

Everyone won. The hospital got labor and jobs completed and the people did not have to come up with cash. The hospitals are actually going to incorporate this barter system in their future plans as their are always some people without insurance or even who are underinsured. Instead of bankrupting families or stiffing the hospital, the patients can feel proud that they are doing their part to be responsible.
Jana L

A Negotiation Plan

To negotiate debt you must first do the following:

  1. Look at how much money you can offer the creditor and/or when you will be getting the money.
  2. Write a summary about your current situation, with what you can realistically afford to pay and make an offer to settle or make payment arrangements. Usually the creditor will accept 50 – 60 cents on the dollar or a reasonable payment arrangement.

Remember, don’t promise what you can’t pay. Sometimes, it also helps to have a mediator to help stand in for you, especially if you are uncomfortable with negotiation.

Advice From a Hospital Collection Rep

I used to be a collection representative for a hospital, and one thing that I learned is this: If you are making reasonable (meaning, agreed-upon by both parties, and proportional to the amount of debt) payments to the institution, not only will they not send you to the collection agency, they won’t charge interest! This can save you money and keep you from putting yourselves in an uncomfortable position financially if you can’t afford to pay it all off.

Another option would be to ask for a discount for paying the bill off in full. Keep in mind, you need to pay it off by a certain time to be eligible for this at most institutions. Speak to the cashier at the hospital, or call and speak to a collection representative. Believe me, they are human, and they really want to help you! They will be much more amenable to helping you if you show good faith and if you are really sincere about paying your bill. And, if you do make a promise to pay and set up a payment plan, do everything you can to honor it. If you’re going to be late, or have to send only partial payment, by all means, call and tell a representative. In fact, start dealing with one particular individual, and continue to deal with him/her throughout the life of the agreement. You may make a valuable friend and contact who can help you with future transactions at this hospital (for instance, when you have a baby).
Kris C. in Newark, OH

Reviewed March 2021

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