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Medical bills can be stressful to pay. People rarely save for an unexpected medical expense. The idea that bad things only happen to other people is one reason for this. Due to unpaid medical bills, this sense of invulnerability has driven many into bankruptcy. Don’t worry if you count yourself among these people. There is a choice. Starting with consolidating medical bills is a good idea.
Like any other option, consolidation may have distinct advantages and disadvantages. However, before you proceed, it is essential that you weigh the advantages and disadvantages of consolidation against other options. In general, you should think about consolidating your unpaid bills if you have exhausted all charitable funding options, like asking the hospital for discounts, applying for state medical assistance programs, or borrowing money at low or no interest from a wealthy relative.
You can consolidate your unpaid bills in two ways:
The first option is to obtain a loan from a financial institution or bank. Keep in mind that this type of loan is secured, so you may be required to provide collateral, such as your car, house, or other asset. This option has the advantage of having a lower interest rate than an unsecured loan. In essence, you are jeopardizing your credit history here. When times are tough, banks are reluctant to offer consolidation to people with credit scores below 600. Your unpaid medical bills will be rearranged during consolidation, allowing you to lower your monthly amortization payments. However, the process will stretch your principal loan and increase your interest rate over a longer payment term, both of which will increase your costs in the long run.
The second option is to seek assistance from a debt management company, which can negotiate with the credit collection agency attempting to recover money from the hospital or the hospital itself to reduce the amount of unpaid medical bills to a level that is more manageable. Even though you will be required to pay the debt management company for its troubles, this method has the advantage of not putting your credit history in jeopardy. You should be able to get details from the service provider, but you should still insist that they tell the credit bureau that your unpaid medical bills have already been paid in full or as agreed upon.
The most important thing to remember when dealing with unpaid bills is not to panic. Discuss it with your family, physician, friends, or even coworkers, and ask for advice to determine the best course of action. Be aware that you are not alone on an island. You’re not alone; millions of Americans are in your situation. Even though that thought may not offer any consolation, it does indicate that, with a little effort, you can settle unpaid medical bills.
M. Baylor, who grew up in Hurst, Texas, had both of his parents who were doctors. As he got older, his interest in medical care laws grew. Marcus is a paralegal at Allmand & Lee. He writes a blog that is full of useful information about medical debt, medical litigation, and the most recent health care reform bills and government programs.
