Pay your Bill
As long as the EOB and medical bill are correct and they follow your insurance plan, you are now required to pay your bill. You want to pay your bill in a timely manner. Thanks to technology you can pay your bill online for most billing offices which have safe ways to pay using a credit card, or debt card. If the doctor’s office only accepts checks as payments, you can use your bill pay feature at your bank and have them send a check. In some cases, some hospitals and doctor’s offices are offering 0% payment plans to make it easier to pay it off and some are offering 6 months or more.
If you don’t pay your bill the changes of it going to collections is high and this can affect your credit score.
In fact, the Consumer Financial Protection Bureau reports that around 31.6% of adults in the United States have collections accounts on their credit reports. That’s almost one in three Americans! Medical bills account for over half of all collections with an identifiable creditor. Chances are good that you too have a medical bill in collections. Credit.com Medical Bill Myths
If you are having financial difficulties, it is always best to be up front and say you are:
“I can’t pay that amount right now, I can only do this amount ____. “
Hospitals and doctor’s offices want to get paid just like all businesses and they don’t have a lot of time and energy to hold onto bills for long periods of time which is why doctor’s bills do go to collections faster than people think. Even if you do arrange a payment plan or adjustment to any bill make sure you get it in writing so you have proof of the changes.
Always monitor your credit reports on a regular basis using the free credit reports you get for free each year, most banks and credit cards are offering free monitoring as well as other free services.
Don’t forget your FSA or HSA
In open enrollment with your company you can sign up for a FSA which is called a Flexible Spending Account or HSA called a Health Savings Account if you have a High Deductible Plan. The FSA is an account where you put in pre-tax money in from your paycheck. This is a great way to save on taxes. Beware! You have to use it or lose it. Thanks to new rules by the federal government some companies will allow you to roll over up to $500 into the next fiscal year. To be on the safe side estimate what you think your bills will be. You can learn about qualified expenses and how to use your FSA by talking to your HR and looking here for more guidance.
Note: The rules have changed this spring 2020 so you can make mid-year changes to your FSA. Here is the article here.
The HSA is called a Health Savings Account connected with a High Deductible Plan. This account is awesome! The reason is it is an account that you can keep forever. You also have the option to keep the money in cash or invest the money in index funds or mutual funds by your HSA investment account company. The best part is the money is taken out of your paycheck pre-tax and will grow tax free and you can take the money out for qualified medical expenses at anytime tax free. You just need to keep those receipts and EOBs mentioned above. More details about an HSA can be found here.
So remember you can use these for any qualifying expense. This is a great way to save as well. Let me know if you have any questions.