Money Rehab with Nicole Lapin - How To Get Your Medical Debt Canceled

Episode Date: January 12, 2024

Nearly 1 in 10 adults in the U.S. owe significant medical debt, totaling $195 billion nationwide. Today, Nicole gives three tips to help you manage— or even cancel— your medical debt.

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To get started, visit bofa.com slash newprosmedia. That's B-O-F-A dot com slash N-E-W pros, P-R-O-S, media. Bofa.com slash newprosmedia. I'm Nicole Lappin, the only financial expert you don't need a dictionary to understand. It's time for some money rehab. So I think about this meme all the time. If you watch Breaking Bad, it's going to make sense to you. The meme goes something like Breaking Bad in Canada. Walter White gets diagnosed with cancer, gets treatment, the end. If you watch the show, you'll get the joke. The premise of Breaking Bad is that the main character, Walter White, gets diagnosed with cancer but can't afford treatment on his teacher's salary, so he picks up a side hustle of cooking and selling meth. It is crazy to me. In the United

States, we watched a show, and we're like, yep, that's an acceptable storyline. I'm sorry, what? Are we so numb to how broken our healthcare system is that we think it's normal for someone, albeit a character on TV, to have to sell meth to receive life-saving care? Alright, I know, I came in a little hot there, but it is something that I feel very, very strongly about. Nearly one in 10 adults in the United States owe significant medical debt. The total amount of medical debt nationwide is about $195 billion. So that means if you fill SoFi Stadium in Los Angeles with random people off the street, almost 7,000 of those people would be in medical

debt. Maybe you're that one in 10. And if you are or know someone who is, here are three steps to help you manage or even cancel your medical debt. Number one, fact check your hospital and get an itemized bill. I'm going to give you a stat that gets me as fired up as when I was talking about Breaking Bad. Research shows that four in five medical bills have at least one error in them. So there's a chance that you're being asked to pay more than you actually should. Or even worse, you might be getting a bill for charges you don't even know. Needless to say, we should all be checking and double checking our medical bills. And the easiest way to spot an error is to get an itemized bill from your provider, which your doctor won't necessarily give you automatically. But be sure to ask for one.

And if something doesn't look right, the first call you should make is to the doctor's office. Because small errors are common on the provider's side, it's a decent bet that any issues you find are just honest mistakes and your doctor's office will be able to send you a new bill. Easy peasy. So how often should you check your doctor's billing work? Literally every time. And it's 1000% within your rights to ask for an explanation for any charges that you don't recognize or just feel odd. When I tell people to double check their doctor's work, I can see how

resistant they are. And the reason we're resistant is because if we're lucky, we trust our doctors, which is a good thing. But that trust can bite us in the you-know-what if we start to blindly assume every time we get a bill from our providers that it is accurate and that their doctor's office would never make a mistake because, well, it's a doctor's office, home of the most detail-oriented professionals out there. But at the end of the day, it's a doctor's office, home of the most detail-oriented professionals out there. But at the end of the day, it's just humans. And it's human error in every profession. And thankfully, the human error that we're talking about happens in the billing department and not in the OR. So if you're having a hard time working yourself up to make the call to the doctor's

office, imagine your bill is a diagnosis. If your doctor diagnosed you with a condition you had never ever heard of, you wouldn't just smile and nod, right? You would ask a lot of questions, or at least I'd hope so. So think of your bill like a financial diagnosis and ask every single question you can think of until the billing is crystal clear. If something is not looking right on your bill and your doctor confirms that there are no errors, then let's move right along to tip number two. Use your hospital as an ally. If your provider assures you that there aren't any errors on your medical bill and your bill is a lot fatter than you were expecting, it's likely that your insurance company, if you have health insurance, denied the claim. The first step here is to find out why the claim was denied.

This is an actual conversation that you have to have with your insurance provider on the actual phone. Sorry, millennials. Claims commonly get denied when an insurance company deems that a procedure or an appointment that you had wasn't necessary. If that happens to you, you have every right to bring in your doctor's A-team. You should ask your doctor for a letter that explains why he or she believed the procedure to be necessary, and that's something that you can submit to your insurance to dispute the denial

claim. The most important thing to remember here is that insurance moves at the speed of paperwork, which is slower than slow. hospitals move relatively quickly and they will send unpaid bills to collections if the issue isn't resolved in 60 to 90 days we definitely want to avoid that because that's when the credit bureaus get a heads up that you haven't paid your bills and your credit score takes a hit so what you should do is ask your provider not to send your bill to collections while you're still working things out with your insurance company to figure out the billing issue. That request is totally within your rights, so don't feel like you're asking for anything big here, and your credit score will totally thank you. Number three, know your rights and make them

your bestie. Here's the problem with how we approach medical stuff. We think that when it comes to a procedure or a checkup, there are only three steps. You make the appointment, you show up, and you pay the bill. But that is super problematic. There's actually one really important step that everyone should be taking too before even showing up to your appointment. And no one does this, and it makes me crazy. Okay, so before you go into the appointment, ask for an estimate of how much you'll be charged and get that in writing. There was a federal law passed in 2022 called the No Surprises Act, which says that if you get billed for more than $400 of the good faith estimate of a medical procedure or an appointment, you can dispute the charges through a patient-provided dispute resolution process.

But you don't know if you're getting billed more than an estimate if you don't ask for an estimate. So do this every single time you see a doctor. I'm actually in the process of a patient-provider dispute resolution right now, which you better believe I have recorded every step of the way. So you'll be able to listen to the behind the scenes of my experience with that very soon. So stay tuned. For today's tip, you can take straight to the

bank. Before your next round of doctor's appointments, make sure your providers are still in network for your health insurance plan. This has been an issue for me in the past. A couple of years ago, I found a doctor who accepted my health insurance. And then after a few appointments, the office stopped accepting my health insurance, but didn't tell me. So I didn't find out until I was sent this huge out-of-network bill. Let this be your cautionary tale. Spare yourself that big bill and give your primary care provider a call. Money Rehab is a production of Money News Network. I'm your host, Nicole Lappin. Money Rehab's executive producer is Morgan Lavoie. Our

researcher is Emily Holmes. Do you need some money rehab? And let's be honest, we all do. So email us your money questions, moneyrehab at moneynewsnetwork.com to potentially have your questions answered on the show or even have a one-on-one intervention with me. And follow us on Instagram at moneynews and TikTok at moneynewsnetwork for exclusive video content. And lastly, thank you. No, seriously, thank you. Thank you

for listening and for investing in yourself, which is the most important investment you can make.