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How can I go about paying off large medical expenses?

In last week's post, this blog discussed how residents of the Detroit metro area and other Michiganders can handle medical expenses. The first step, as last week's post mentioned, is for a person to look over the bill and contact the business that sent it. Medical bills are often inaccurate, such as in cases in which the provider didn't bill insurance properly.

However, assuming that the medical bill is correct and that a Michigan resident has taken the time to contact the provider and organize his or her bills promptly, the next step is to navigate the payment process. While doing so may seem simple enough for a routine doctor's visit, not even the most responsible of people can afford to fork over payment in full when the medical care involves a hospital stay or a complicated procedure.

As a word of caution, no one should allow himself or herself to be talked in to paying a big bill via credit card and then paying off the credit card company over time. While medical collectors can be quite insistent, they often do not charge high interest; credit card companies do charge high interest. Moreover, a large credit card bill is more likely to send a red flag to a would-be creditor since it appears that a person has a spending problem, not just that the person got sick or injured and needed medical care.

Instead of paying off medical debt via a credit card, a person should instead pick up the phone and try to work something out directly with the provider. Hospitals and medical professionals often will discount their bills substantially or agree to an interest-free payment plan.

Moreover, although no Michigander likes to think of filing bankruptcy, one of the core purposes of bankruptcy is to help people who have experienced an unanticipated financial setback like a medical emergency. At a minimum, the threat of bankruptcy can encourage a stubborn provider to offer a discount or an acceptable payment plan.

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