Your health is the most important thing you have, and it’s important to take action to keep your health in check. For most, this means regular doctor visits and routine tests. Unfortunately, sometimes things are out of our control and we find ourselves facing a diagnosis or complicated recovery. Luckily, many of these costs are covered by Medicare.
However, what happens to medical bills that fall outside of this government-sponsored coverage? With a reported 11 million Australians struggling with out-of-pocket costs, you might be asking if you can consolidate your medical bills. With most out-of-pocket costs on non-hospital services like specialist visits, health costs are skyrocketing across the country. If you find yourself facing high medical debts, here’s everything you need to know about consolidation.
What Is Medical Bill Consolidation?
First, what is medical bill consolidation? This isn’t something talked about often in medical offices, so many people don’t realise how common it can be. Medical debt consolidation is when you combine various medical bills with a single, new loan. This new loan pays them off at once, giving you only one repayment to worry about.
However, unlike other types of debt, medical debt works a bit differently. There’s no interest attached to medical debt, and there is more flexibility when it comes to repayment. For example, credit card debt carries a much higher interest rate and steeper payment guidelines.
With that in mind, can you consolidate your medical bills? The short answer is yes, you can. You can always consolidate debt, whether it’s a personal loan, student loan, credit card debt, and so on. Still, it might not be the best idea to consolidate your medical bills if you have another option.
Ways to Consolidate Your Medical Bills
What options do you have when it comes to consolidating your medical bills? There are various methods, and they might not all be the right fit depending on your situation. It’s always a good idea to consider your big-picture financial goals.
- Personal loan: A personal loan is a loan that pays your combined medical debts, leaving you with a monthly payment and interest. If you find a good interest rate or no-rate intro period, this might be a good option.
- Home equity: Similarly, you can tap into your home’s equity. This lets you roll your medical debt into your mortgage, usually with a much lower interest rate. However, be careful putting your home on the line!
- Credit cards: Though likely the fastest way to eliminate your medical bills quickly, using credit cards is not a good idea. Even if you use a 0% balance transfer card, you will need to have a plan to pay your debt quickly in the intro period to avoid high fees.
Like all lines of credit, be sure to shop around. Local credit unions and banks often offer better discounts and rates. Consider your current credit score to see what might be a good fit for you. Remember, just because it’s easy doesn’t mean it’s the right decision!
What Happens If I Can’t Pay Medical Debt?
If you find yourself unable to pay your medical debt, what should you do? While it’s easy to ignore your bills, they won’t go away if you don’t take action. You have more options than you think. If you find yourself struggling to pay your medical bills, follow these steps below.
1. Check the charges.
To begin, always check your charges. Healthcare providers sometimes make mistakes, and they might fail to bill any supplemental insurance. Similarly, they might charge you for a service, test, or medication you didn’t receive. If you notice something off in your bill, contact your provider.
2. Contact your provider.
Believe it or not, all healthcare providers are willing to work with you on payment solutions. If you’re not able to pay, let them know. It’s in their best interest to make sure you find a way to pay back your debt over time. Many hospitals and doctors allow you to pay monthly, and these are usually interest-free payments.
3. Ask for discounts.
Did you know there are often hidden medical bill discounts? It’s true, and you should always ask about your options. Some hospitals give a one-time discount if you pay your bill promptly and in a single payment. You might also be able to negotiate a lower payment overall if you work with your provider.
4. Apply for assistance.
Even if you work with your provider, you might not be able to make ends meet to afford your medical bill. If this happens, it’s okay. Many providers and organisations provide financial assistance. Though you might need to apply, it’s worth the effort to find a discount or low-cost solution.
Handle Your Medical Bills with Confidence
Though having unpaid medical bills can be scary, it doesn’t have to be. The best thing you can do is to talk with your provider and let them know your situation. When you’re proactive, they’re more willing to work with you on a solution. While you can consolidate your medical bills, this isn’t usually the best choice.
Are you facing medical debt? If so, contact the financial experts at Debt Busters on 1300 368 322. We’re here to help you navigate these next steps with confidence.