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Medical debt

Paying off a mountain of medical debt can be a very daunting task to deal with.  Especially if you’re living on a limited income with which to pay off that debt.

The thing that really stinks about medical debt is, unlike consumer debt, it can’t always be prevented.  Sure, you can do your best to live a healthy lifestyle to prevent large medical bills in the first place.  But no matter how much you do toward prevention, it’s still likely that at some point in your life you’ll incur medical bills that could potentially add up to tens, or even hundreds of thousands of dollars.


Medical Debt Can Happen Unexpectedly

I know this from personal experience.

Just 3 weeks ago, I had a heart attack at the age of 45.  I have no family history and keep myself in great shape, so this was totally unexpected.  Most of the bills are not in yet, but the cost is very likely to exceed $100,000.  Thank God we have great insurance that should cover most of the cost!

But these huge bills got me thinking, “What about those people that end up in huge amounts of medical debt and don’t really know everything they should about dealing with it?”  That’s what inspired me to write this post.

So if you suddenly find yourself swimming in a sea of medical debt, here are some of the things you should do to keep the great white shark of medical bills from swallowing you whole (cue the “Jaws” music).


What Not to Do

First, let’s talk about what NOT to do when you have a large amount of medical debt:

Don’t Ignore It

It can be really easy to shut down emotionally and just ignore the fact that the bills are rolling in.  It can be emotionally taxing to deal with on top of the medical problems you’re already going through.  But you have to realize that this debt is not going to magically go away if you ignore it.  The quicker you contact the hospital and start making a plan to pay your bills, the better off you’ll be.  Take control of the situation.


Don’t Put it on a Credit Card

The interest rate on most cards is high and can cost you a ton of money in interest while you try to get the debt paid off.  However, even if you put your medical debt on a zero interest credit card, it’s still not a wise move because if you run into trouble paying off the debt, it can be much more difficult to deal with a credit card company than it is to deal with a hospital to work something out.


Don’t Take Out a Loan

Again, you’ll be charged interest on the balance that can cost you hundreds, or even thousands of dollars.  A Hospital typically doesn’t charge interest on your balance unless you have been sent to collections.  Hospitals are also easier to deal with than a bank or other lender if you can’t pay off the balance.


Don’t EVER Take Money Out of Retirement Accounts

The collection coordinator for the hospital may suggest this as an option to get your bill paid.  But seriously, is it wise to compromise your future to pay off bills in the present?  I don’t think so!  If you take money out of these accounts, you’ll pay your normal tax rate on your withdrawal, plus a 10% penalty on top of that.

For example: If you were to take $10,000 out of your 401k or IRA to pay off your medical debt, you would pay $2,500 or so in taxes (Depending on your tax bracket), plus an additional $1,000 in penalties.  That means you will only have $6,500 to put toward the debt.  Not a smart way to use your money!


Use Common Sense

These options may sound good at the time when you’re deep in debt and you want to get the hospital paid off, but thinking with a clear head and using some good ole’ common sense will help to ensure that you don’t exchange one kind of debt for worse kinds of debt that can be even harder to overcome.

There are so many ways to make your situation with medical debt much worse if you don’t know all the facts or are not thinking with a clear head because you’re stressed out and worried.  Avoiding these four mistakes can save you some serious money and heartache that you just don’t need when you’re having medical problems and dealing with the mountain of medical debt that can go along with it.

In the next post I’ll show what you should be doing to pay your medical debt as quickly as possible.

Until next time…

Question: Have you had any experience with medical debt?  Any more things that should be avoided?  Let me know in the comments.


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Comments on this entry are closed.

  • kim

    What Christine Coleman said is very true though i may not know her. I experienced it first hand also. It was this organization called fidelity loan Finance (f.l.f)that really helped me to pay my medical bills when i was in dare need of money because i am a widow. A friend of mine also directed me to them. when i was about to do a major operation and i had no money at that time, they came to my rescue and in less than 48 hours, i got my loan. But to say the truth, i was nervous and scared at first because i have been scammed twice. But when i summoned up courage and follow their lending policies along with my friends advice, at the end i found myself smiling. If not for them, maybe i would have been dead by now. I have even taken another loan from them start my business after my recovery which i am also paying back now. My only advice now is that any body who is really in need of loan should contact them with their email via, fidelityloanfinanc(at)Aol(dot)com and get a loan from them. Thanks

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  • Kathie Roper


    Hello everyone, am writing this Testimony because am really grateful for what Mason Diego did for me and my family, when I thought there was no hope he came and make my family feel alive again by lending us loan at a very low interest rate of 2%. Well I have been searching for a loan to settle my debts for the past three months all I met scammed and took my money until I finally met a God sent Lender. I never thought that there are still genuine loan lenders on the internet but to my greatest surprise i got my loan without wasting much time so if you are out there looking for a loan of any amount i would advise you to email Mr Diego via: { diegoloancompany@yahoo.com } or call (608) 728-8913 and be free of internet scams. thanks… Kathie Roper from California, USA.

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  • JD

    Indeed we have been through the experience of being left with enormous medical debt after insurance paid. The amount we had to pay to various Doctors, hospitals and labs amounted to a roughly $70,000. One thing I did was carefully review each bill for accuracy and keep each bill and the record of payments made. More than once we were double billed or insurance had not been billed. I had a notebook where all the medical bills were kept so I could easily access them and a master sheet showing the amount of each debt and to whom it was owed. After the bill was paid in full I noted the paid status and date. Saved me a lot of hunting and headaches in trying to gain control of a mountain of paperwork.

    • Awesome! Sounds like you were very organized and made sure to keep track of every detail. That’s what you need to do when you have to deal with all those bills and EOB’s coming in. The more you’re able to stay on top of it, the better you’ll be able to find discrepancies and save some money. Glad to see you were able to get it paid in full!

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  • Great point Kevin. I’m currently experiencing that situation as we speak. Insurance is denying benefits, so I have to go through a grievance process to get it covered. Thanks for the comment!

  • Get a copy of your health insurance policy handbook and get to know the ins and outs. Many time medical debt is assigned as your responsibility, when the insurance carrier really needs to make payment. Also, many practices bill for out of network charges when they should be accepting the contract rate.

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