Ever wondered how negotiating medical bills over the phone (and by letter) works?
Our incentive to haggle at the doc's increased greatly when half of our household was laid off last Halloween (the half with access to an employer-sponsored health care plan).
To stay on our old plan through COBRA would have cost us a staggering $1,837.82 per month, or an entire months' worth of unemployment pay and then some.
Obviously not an option for most (us included).
Up until November 1st of last year when we started on a $193.80, high-deductible health plan, I figured that a doctor's price was sort of like the extra value menu at McDonald's: a bunch of non-negotiable dollar amounts written on a fluorescent stone.
Sure, I'd gotten a glimpse into the world of medical negotiation when I shopped around for a hernia operation and found that different doctors charge wildly different prices for the same procedures. But I didn't know that you could actually haggle the prices whether you have insurance or not.
Here are the lessons I've learned from negotiating medical bills, of which has saved us $257 so far (and here we shaved $942 off of one of our pregnancy medical bills…though I take it as a ‘kinda' win):
Lesson #1: Not Having Insurance Gives you Almost Guaranteed Leverage
Wondering how to get out of paying medical bills? Well, you probably can't do so altogether (and, in most cases, it makes sense that you can't!).
But, if you do not have insurance, then by all means tell your doctor's office before you go in for your visit to see about a discount. Negotiating medical bills ahead of time is always easier than doing it after the fact, and by telling them up front that you don't have insurance, they'll often slap on a discount to you.
For example, when I called up one of our doctors and told them our high-deductible plan does not offer the type of insurance that would cover them, they gave a pretty canned response of, “we offer a 35% discount for patients without insurance”.
This works in hospitals as well.
Lesson #2: The Least Expensive Options are Not Often Prescribed Unless You Ask
Our prescription deductible is $500, which means that our insurance company will not pay one dime of the cost until we pay $500 out of pocket for the year.
Since we are fortunate enough to rarely need a prescription, this means that we have a lot of incentive to not hit that $500 point (once we do, it'll probably be the end of the year when we enroll in a metallic-plan, so the deductible will start over).
This strategy of cheap prescriptions on an as-needed basis worked well for the first six months of our year when we had only needed one $19-antibiotic.
And then came the unexpected dermatology needs. When I rolled up to our local CVS to find that the the called-in prescription came to $400, glimpses of the beautiful weekend getaway we'll no longer be able to afford danced through my head.
So I got smart, and had Paul call the dermatologist back. He told them that we would have to pay for the prescription entirely out of pocket, and that there had to be a cheaper option.
And guess what? That simple request brought our cost down to $168!
Lesson #3: Cash is King
Many doctors' offices will make you pay for the services up front or after the appointment (specifically when you don't have insurance). They want to make sure they get paid, and rightfully so.
However, if you are able to pay for something in cash such as a medical procedure, then you have more sway in negotiations. Think about it: what doctor office looks forward to the task of nagging their patients to pay their bills, or keeping up with patients on a monthly payment plan?
So if you can pay cash, then ask for a discount.
Lesson #4: Even Crappy Health Plans Now have some Great Benefits
With the new healthcare laws in place, even if you are in some sort of transition plan until open enrollment period (like we are), you can still take advantage of a few great benefits that will cost you nothing. Nada. Not even one cent.
- Women's annual wellness exam
- Annual physical for both men and women
The only kicker is that even though these appointments cost nothing to a person who has some sort of healthcare plan, you still need to find a doctor who takes your specific insurance. I found this out when I tried to book one with my doctor of 5 years, only to find out that he does not accept our new insurance and so even though the exam itself was covered 100% no matter what type of insurance we were on, I had to find a doctor who took ours.
Lesson #5: You Can Outsource to a Medical Bill Negotiation Service
Feeling squeamish about negotiating with the medical industry? The good news is that there are medical bill negotiation services out there who will haggle on your behalf for a percentage of the amount they save you.
For example, MedicalCostAdvocate.com will either negotiate a medical bill you've received that exceeds $300, or pre-negotiate a medical bill for you. Their cut is 35% commission on any savings gained. If they are unsuccessful in negotiating, then you pay them nothing.
Remember that medical staff are probably more used to negotiating medical costs than most of us think. I found this out after unknowingly stumbling into a negotiation at my dentist's office. They had scheduled two initial meetings, with the copay being $35 for the first one. When I got up to the front counter to pay for the second appointment expecting a $35 tab, she told me it was $75. Grimacing as a natural reaction made the staff member react quickly. “The cheapest I can accept is $50”, she volunteered. Just like that, without even asking, I had negotiated a $25 discount. And that was with dental insurance! Who knew?