How Negotiating Medical Bills Can Save You as Much as 25 Percent (With Video)

October 03, 2012

Negotiation is slowly becoming a lost art form. There use to be a time when your old man would haggle with a department store salesman on almost anything. It could’ve been a new color TV, a pair of slacks or one of those new-fangled microwaves. Nothing was off limits, the listed retail price was treated more as a suggestion than a hard-and-fast rule. Nowadays we have become a much more accepting society, possibly due to our constantly shrinking attention spans, or our desire to simply cut to the chase. Regardless what has caused this shift, we forget that sometimes all you have to do is ask.

In a time where health care costs are perpetually skyrocketing to an average of $3,949 per day in the hospital and $15,734 per visit in the U.S. during 2011, according to the Comparative Price Report. There couldn’t be a better time to tighten your belt and make your doctor give you his best offer.

Not only are you paying more for your medical treatment, you are also paying more for your health insurance. The total premiums for family coverage through an employer rose 50 percent from 2003 to 2010, to nearly $14,000 a year, a recent study by the Commonwealth Fund found.

In Ohio, it was slightly less at 43 percent for families and 37 percent for individuals over that seven year span. The average family deductible also nearly doubled over that time to almost $2,000. See the chart below:

Here is what you can do to give your wallet a break next time you go under the knife.

Prompt Payment

This is where you are going to have the opportunity to save the most money. If your doctor or hospital offers a prompt pay discount, you are going to want to pay the bill as soon as you get it. Generally you will have 30 to 60 days to make your payment for it to be considered prompt. If it’s not clearly labeled on the bill, call the billing department to find out. If you do, on average, you can save 10-25 percent on the total bill. That means a $97.00 lab bill magically becomes $72.75, just for paying the bill within a socially acceptable timeframe. Not bad.

It’s Never Too Early To Start Negotiating

If you are able to schedule a medical procedure in advance, it’s never too soon to start negotiating. Actually, you will probably see better results if you are able to beat down the price beforehand. Doctors and hospitals have been stiffed on so many checks that they turn cartwheels anytime someone agrees to pay them anything. Don’t be afraid to ask for that same 10-25 percent (I bet you start with 25) prompt pay discount. It never hurts to ask.

Establish a Payment Plan

This will not save your bank account as much as it will your credit score. If your bill is still a little too steep after all the nickel and diming is complete, ask the hospital to put you on a payment plan. It’s very important that both you and the hospital are aware of this plan. Throwing a couple extra bucks a month at a $5,000 bill will certainly not get you in the black fast enough to avoid being put into collection. If your DIY payment plan has not been agreed upon by the hospital they will expect your bill to be paid within a certain time frame, usually between six to 12 months.

A Few Final Things to Remember

You will be surprised how willing a doctor or hospital is to work with you on negotiating a payment. If they aren't, don’t be afraid to shop around. Take full advantage of the size of your insurance companies network. You will find that prices could vary greatly from facility to facility for the same procedure. If you are ever unsure about any of the items we outlined above, be sure to contact your hospital's financial services department to to make sure everything is in order.

Have you tried negotiating one of your medical bills before? If so, how much were you able to save?