5 Tips For Gen Y’ers to Avoid and Manage Medical Debt

Editor’s note: This is a guest post from Kairol Rosenthal, author of Everything Changes: The Insider’s Guide to Cancer in Your 20’s and 30’s.

I travel the country writing and blogging about twenty-somethings living with cancer, many of whom are facing astronomical debt. But, it does not take an illness as catastrophic as breast or thyroid cancer to rack up serious medical bills. Even healthy Gen Y’ers have ginormous amounts of medical debt from routine care. Consider these statistics:

• Out of every age group in the United States, 18-34 year olds have the most medical debt.
• More than 35% of all young adults have problems with medical bills including getting calls from collection agencies, paying off medical debt, or having to seriously alter their life to accommodate for medical expenses.

While researching and writing my book Everything Changes: The Insider’s Guide to Cancer in Your 20’s and 30’s, I collected myriad tips to help young adults – both healthy and ill – manage their healthcare and finances. Here are five:

Ask For a Discount

Fifty-percent of people who ask for reduced medical costs get them. Make the ask face-to-face rather than in writing or over the phone. Approach your doctor, or the office or billing manager. Red tape is infuriating and their response might be as well, but remember to be polite; hostility will get you nowhere.

A discount might not be granted with your first ask. Be persistent and don’t take no for an answer. If you are dealing with a hospital, work your way up the chain of command. Many staff are not familiar with their own hospital’s policies and will deny a request simply out of ignorance. With my own cancer care and medical disputes, I never had qualms about calling the CEO of a hospital. You should not either.

Build your argument. Obtain a copy of the hospital’s free and discounted care policy. Check to see if they have signed on to The American Hospital Association’s Billing and Collections Practices Policy. If so, they have agreed to assist patients who cannot pay for all or part of their care. Use this ammo to your advantage. If you are at a non-profit hospital, try contacting your State Attorney General, who can help enforce the institution’s commitment to providing charity care.

Scour Bills for Errors

Eighty-percent of medical bills contain errors. Read your medical bill carefully and dispute any incorrect charges. I recently received a comment on my Everything Changes blog from a breast cancer patient with a high tab that her insurance was not covering. When she investigated further, she learned they had accidentally used the billing code for a sex change operation.

Read carefully to find duplication of charges or charges for services not used. Check for simple accounting errors. If you have health insurance, make sure your company is accurately calculating your deductible and out-of-pocket expenses. If you find an error, dispute it relentlessly and keep meticulous records of your phone conversations with billing departments.

Avoid Credit Cards

The worst thing you can do with medical debt is to put it on your credit card. Once you put a medical bill on a credit card that bill is subject to compounding interest fees with no recourse for further dispute with your doctor or hospital. Hospitals are getting craftier at persuading patients to pay debts with credit cards. Resist their pressure.

Negotiate A Payment Plan

Instead of using a credit card, talk with the billing department to negotiate a payment plan. Hospitals are more receptive to this than you might think; they would rather work out a way to get some money from you over time than no money at all. Payment plans are so attractive to some hospitals that you can use them to leverage a deduction in your total bill, especially if you offer to make your payments in cash.

One of the people I interviewed was Nora, a 24 year-old cancer patient who could not afford her chemotherapy. She thought, “Wow, I’m going to die because I have no money?” Then, she sat down with the financial department of her hospital and was shocked when they suggested working out a payment plan. When you take the initiative to show that you want to pay off your debt, and are not just ignoring your bills, you can buy yourself a lot of leeway.

Get Credit Counseling Now

Billing departments, collections agencies, and bankruptcy lawyers can make the horrifically complicated world of medical debt even more stressful. Get counseling from a non-profit organization whose mission it is to advocate for patients. The National Foundation for Credit Counseling is an excellent place to start.

In the current economy, twenty-somethings are struggling even more so with joblessness, staggering COBRA payments and premiums, and high deductibles. As we wait around for government and industry to resolve the healthcare crisis, we needn’t sit idle succumbing to medical debt statistics. Fighting large medical institutions is a time consuming drag. But so is a future with the ball and chain of medical debt.