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How to Pay for Unplanned Medical Expenses

Unexpected medical expenses are inevitable and always seem to show up at the most inopportune time. Being that these costs are often relatively high, you may wonder how you will ever pay for them.

In a perfect world, you’d have an emergency fund to pay for any surprise expenses. However, with the current economy, that’s becoming harder to accomplish for many families. If you do have funds available, it’s often difficult to watch the money you worked so hard to build up be depleted overnight.

While facing unforeseen medical expenses can be challenging, several options are available to make paying these bills more manageable.

Check for Medical Bill Errors
First and foremost, always review any medical bills you receive thoroughly. Errors sometimes do occur and catching them early is best. Go through each line on your itemized bill to confirm you did receive the services being charged. Be sure to report any discrepancies to your healthcare provider right away. In some cases, you can ask the healthcare billing department to place your bill on hold for 30 days while you review it for accuracy.

You can also check with your health insurance provider to see if they offer medical billing advocates. These professionals help patients understand their bills, identify inaccurate billing, negotiate costs, and ensure insurance claims are processed correctly. Some hospitals, if not most, provide a medical billing advocate for patients. Or you can contact the Alliance of Claims Assistance Professionals in your area.

Inquire About Hospital Discounts
Did you know that many hospitals offer discounts, regardless of insurance coverage? Most hospitals and healthcare providers understand the impact medical expenses can have on patients and their families. Because of these fiscal challenges, they may offer a discount on your bill to assist you.

For example, you may be offered a discounted rate on bills paid in full rather than by monthly payments. While you may ask yourself, "How do I pay a bill in full that I cannot afford in the first place?", the discount they provide will often be significant. If this is the case, several payment options could help while saving you money. 

Review Payment Options Available
When looking to pay a medical bill in its entirety in exchange for a discount from the healthcare provider, patients have several possibilities. Here are a few of the most common and easily accessible options:

  • Credit Cards: Depending on your total medical expenses, you may be able to pay your bill with a credit card. Most people turn to this form of payment first because of convenience. However, always use a credit card with the lowest interest rate and devise a plan to pay off the debt as soon as possible. With credit cards, if you cannot repay the balance quickly (within a month or two), the interest accrued could quickly offset any discount you received. The last thing you want is to end up paying even more than the original amount owed. 
  • Personal Loans: A signature loan, often referred to as a personal loan, is one of the most overlooked repayment options. However, it is one of the better choices for short-term borrowing. Signature loans have lower rates than most credit cards and come with set monthly payments, so you know exactly when you will repay the loan. Unlike a credit card, where you only have to make a minimum monthly payment, personal loans keep you on schedule to repay the debt quicker.
  • Home Equity Loans: A home equity line of credit (HELOC) may be the best option if you are diagnosed with a more serious medical condition requiring ongoing care.
    A HELOC allows you to tap into your home’s equity and use the funds for just about anything, including medical expenses. Since these are secured loans (your home is used as collateral), they typically have much lower interest rates when compared to other options. With this type of loan, you’re approved for a specific dollar amount, similar to a credit card limit. You can then use the funds whenever you need to, but you don’t have to spend the entire balance at once. Once you repay what you spent, the money is available to borrow again should you need it – making it an ideal solution for ongoing, costly medical expenses.
  • Hospital Payment Plans: If you prefer not to pay the bill upfront in exchange for a discount, help is still available. Most hospitals offer payment plans to assist patients with their financial obligations. Depending on the amount owed and your ability to repay, these payment plans can be quite generous. Plus, they rarely charge interest or fees unless you start missing your agreed-upon terms. The greatest challenge with this option is that it can be dragged out over an extended period – putting a lingering bill over your head for months or even years. If your medical care is ongoing, it can become challenging to manage and repay numerous bills.

Payment Options to Avoid
While certain payment options are more favorable than others, there are some you should avoid altogether. Payday lenders fall into this category due to their costly nature. While these short-term loans may seem advantageous, they can quickly become expensive if you cannot repay the borrowed amount quickly. If your medical bills are ongoing, this can become financially disastrous as you try to juggle multiple payments and due dates. Plus, they tend to charge the highest interest rates and fees of all the payment options.   

We’re Here to Help!
Medical debts can make it difficult to see the light at the end of the tunnel, but several repayment options are available to help ease your financial burden. If you’re facing unexpected medical bills, we’re ready to help.

Please stop by the Credit Union or call 410-687-5240 to schedule an appointment with one of our team members. 


Each individual’s financial situation is unique and readers are encouraged to contact the Credit Union when seeking financial advice on the products and services discussed. This article is for educational purposes only; the authors assume no legal responsibility for the completeness or accuracy of the contents.