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If you have medical insurance, you should receive an Explanation of Benefits from your insurance company every time you visit a doctor. Have you ever looked at one? It’s amazing. You’ll see the how much the doctor billed you, how much the insurance company negotiated as an allowable rate, and the difference can be staggering. The catch-22 in all this is that if you don’t have insurance, you’d have to pay the standard rate unless you negotiated with the doctor… and negotiating with the white coat can be hard. Fortunately, it’s not as uncommon as you think, according to a New York Times article, and here are a few tips I’ve researched from the interwebs.

Here are a few things you need to keep in mind as you approach this:

• It never hurts to ask. I never thought to do this because I was always covered by health insurance, but millions of people aren’t or are covered by minimal benefits and they negotiate all the time. Hospitals are more like street bazaars than retail stores.
• Medicine is business. It may feel personal to you, since it deals with your body, but it’s still a business. A doctor is like any other freelance profession, they need business and they are willing to work with you to get your business.
• Relationships matter. Doctors don’t do it just for the money, otherwise they’d be lawyers (just kidding!). They need to earn money to pay for insurance and to maintain their practice but they aren’t about to turn someone away because they’re financially strapped.
• They are people too. If you’re experience financial hardship, because you lost a job or lost your medical insurance, explain that to the doctor or hospital. They are likely to give you a break on their standard rates because they’ve already given discounts to faceless insurance companies, it’s not a huge leap to offer it to an individual.
• Insurance is a pain. It’s generally accepted that insurance companies hate to pay out claims, the same goes for benefits. Their systems are usually esoteric, control codes are cryptic, and hospitals spend millions a year submitting claims and maintaining the computer systems to support that process. If they can go outside the system, preferably with cash, then they are willing to help you out.

Here are some ideas on how to negotiate:

• Use Medicare as a starting point. Research how much the procedure would cost to a Medicare patient using the HHS.gov’s Hospital Compare tool ^[3] and negotiate from there. You know they are willing to perform the procedure at those rates so it’s not an unreasonable starting point.
• Explain your financial situation. If you can’t afford the procedure, tell them. It’s better to swallow your pride and get a procedure your body needs, plus it’s nothing new to the doctors, especially in these economic times.
• Pay cash. As I mentioned before, dealing with insurance is a pain for doctors and hospital administrators too. If you can pay cash, it can cut down on that expense and they won’t have to worry about collecting on the backend.
• Consider a payment plan. If you can’t pay the entire fee at once, consider a payment plan to spread the cost over several months.
• Make sure the procedure or test is necessary. A lot of doctors recommend diagnostic tests or certain treatments without them being absolutely necessary (potentially for insurance and CYA reasons), be sure to confirm how important the test is.
• Going during the slow season (if you can). If it’s a procedure that you can put off, try negotiating an off-peak rate as you would a vacation. There are slow seasons in any business and you can take advantage of it by getting your procedure done then for a discount. Also, if your schedule allows, offer to fill in last minute cancellations.

Finally, where you go for treatment can have a significant impact on your costs. Most people intuitively know that you don’t go to the emergency room if you have pinkeye, but a doctor’s visit may be overkill too. If you have a common ailment, consider going to a clinic rather than a doctor to reduce your costs.

Bargaining Down the Medical Bills ^[4] [ New York Times]
5 Ways to Lower Your Medical Bills ^[5] [ US News & World Report ]

(Photo: brykmantra ^[6])