The secret to negotiating lower medical bills

Written by: Gabrielle Smith
Published on June 23, 2022.

If you’ve ever been shocked by an expensive medical bill and wondered how you’re going to pay it, you’re not alone. CNBC Make It1 reports that nearly a third of Americans have some kind of medical debt, and more than half of those in debt admitted to defaulting on their bills.

While it may be easy to simply charge the bill to your credit card and hope for the best, there’s a better way to tackle big medical bills. Many Americans don’t realize that there are several handy tips to lower your medical care bills, find financial assistance programs, and even negotiate a more reasonable payment plan with your healthcare provider.

This article will go over seven ways to help you take care of your hospital bills and keep you as far away from medical debt as possible.

Learn how an employer-provided health reimbursement arrangement (HRA) can help you save on medical costs

1. Get started early

The most important thing to keep in mind when negotiating your medical bills is to start the process early. It’s much harder to negotiate your payment terms when it’s close to being due rather than having weeks to work with.

You should be ready to contact your hospital or healthcare provider’s billing agency and your health insurance company, if you have one, as soon as you receive a bill or an explanation of benefits (EOB) that shows what you were charged for the care you received. This usually arrives in the mail or electronically between two and four weeks after your visit.

2. Make sure there aren’t any errors on your medical bill

When looking over your bill, the first thing you’ll want to check for is any errors that might have been made when entering in your cost and services. Errors on medical bills are more common than you’d think.

In fact, some reports2 estimate that as many as 80% of medical bills contain a billing error, and up to 25% of skilled nursing facilities' claims will be overpaid because of errors made on a patient’s medical bill.

Some of the most common medical billing errors include:

  • Duplicate charges
    • This happens when you’re charged twice for the same procedure
  • Incorrect billing
    • This happens when you’re charged for a service you never received
  • Upcoding
    • This happens when your diagnosis is inflated from your actual condition, billing you for a more expensive treatment or procedure than you need
  • Unbundled charges
    • This happens when a group of procedures that occurred together (and should be charged under a single code) get “unbundled” and are listed as separate services, charging you individually for each one
  • Incorrect billing code
    • This occurs when the wrong code is listed on the bill for your procedure

If you didn’t receive one when you were first billed, be sure and ask for an itemized bill from your healthcare provider. An itemized bill gives a more in-depth description of the services you received, including the medical billing codes on your EOB, making it much easier to understand and find any mistakes made.

3. Ask about any financial assistance programs

Once you’ve cleared up any errors on your bill, the next step is to look into any financial assistance programs your healthcare provider or hospital may offer.

Many hospitals are legally required by the federal government and state laws to offer financial assistance to patients who can’t afford their medical bills, so long as the service is “medically necessary.” This includes things like inpatient hospital stays and emergency room visits.

These financial assistance programs are known by many different names, such as Charity Care, Bridge Assistance, or simply Patient Financial Assistance. If you have Medicaid, Medicare, or any other kind of medical insurance, you’ll need to use those benefits first before taking advantage of any financial assistance programs.

It’s important to note that while some hospitals offer these services, they may not make you aware of them unless you ask, so it never hurts to check.

According to Kaiser Health News3, 45% of nonprofit hospital organizations send medical bills to patients who should qualify for charity care. These nonprofit organizations operate more than 1,651 across the country.

Talking with your hospital directly will give you a better idea of what programs are available to you.

4. Research the insured rate for your service

If you don’t qualify for your healthcare provider’s financial assistance programs, or they don’t offer any, you’ll want to start researching the “insured” rate for the services you’ve received.

Sometimes healthcare providers will charge uninsured patients more than their insured patients for the same service. This is usually because insurance companies will negotiate with healthcare providers for lower prices on behalf of the patient. However, insurance companies aren’t the only ones that can do the negotiating—you can, too.

While negotiating without an insurance company is more complex, using well-researched numbers will help when you contact the hospital billing department. You’ll want to look into what price an insurance company could negotiate for the service you received. Contact your healthcare provider’s billing agency and politely ask that they honor that price for you. FAIR Health4 has a quick online tool you can use to estimate the cost of a medical procedure in your area.

5. Request or negotiate your payment plan

If you’re not able to negotiate a lower price with the billing agency—don’t worry! You’re not out of options just yet. While some healthcare providers can’t budge on their price, they may be more flexible on your payment plan.

For example, rather than paying your entire medical bill all at once, you may be able to break it up into several monthly installments, allowing you to pay it off bit by bit over time.

In many cases, hospital and clinic bills are actually interest-free, unlike your monthly credit card bill. So paying off a monthly payment to your hospital will be more affordable in the long run than making monthly payments on your credit card to try and pay off your medical bill.

6. Check to see if the expense is HRA-, HSA-, or FSA-eligible

Once you have a clear idea of what you’re expected to pay—whether it’s all at once or in monthly installments—you’ll want to check and see if the service you received can be paid with any of your health accounts, or better yet, reimbursed by your employer with a health reimbursement arrangement (HRA).

While health accounts like health savings accounts (HSAs) and flexible spending accounts (FSAs) will include some of your own contributions, using your HRA allowance is made entirely of your employer’s contributions. If the medical expense you incur is HRA-eligible and less than your monthly allowance amount, you won’t pay a single cent out of pocket.

7. See if your employer offers a health stipend

Lastly, if your employer doesn’t offer an HRA or your benefits don't cover the total amount owed, check with your employer to see if they can reimburse you for the remainder with a health stipend.

Health stipends are taxable benefits that allow your employer to reimburse you for medical care costs, much like an HRA. Because employee stipends are taxable, there are fewer restrictions on which benefits are eligible for reimbursement and who is eligible for the benefit.

For example, a health stipend doesn’t require you to have health insurance coverage to receive reimbursement. Keep in mind that you’ll be taxed on the reimbursement amount, and it will appear on your W-2 as income.


While getting a steep medical bill may be stressful at first, it’s important to remember that those charges aren’t always set in stone. By following the tips in this article, you’ll be more capable of negotiating a lower medical bill or a unique payment plan that you and your family can afford. Even better, if your employer offers an HRA or health stipend, you have even more ways to pay off your medical bills.

This blog article was originally published on August 25, 2021. It was last updated on June 23, 2022.





Originally published on June 23, 2022. Last updated June 23, 2022.


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