How To Dispute And Pay For Large Medical Bills

Personal Finances

If you’re looking at astronomical medical bills, you might think there’s no choice but to pay thousands of dollars for your treatment. But, there is hope.  Here’s some advice on how to bring down the numbers on your medical bills.  Plus, tips on how to cover the remaining costs in six easy steps.

Step 1: Review your bills.

Typically, you’ll receive an Explanation of Benefits (EOB) from your insurance company along with the actual bill. It’s important to hold onto both of these documents and to review them carefully.  These documents tell you how much you’re responsible for paying.

The EOB is a document provided by your insurance company explaining your insurance benefits as it pertains to a bill. It will usually include the following information:

  • Amount Billed By Provider (this refers to the amount the doctor or hospital charged)
  • Plan Discounts (this refers to a discount negotiated by your insurance company)
  • Amount paid by an insurance company
  • The amount you owe the provider

Most explanations of benefits will also include information about your deductible, copay, and coinsurance. If a procedure or treatment is not covered, the EOB should include a short explanation about why. If your statement includes charges for COVID-19 testing or related expenses, like copayments and deductibles, your insurance should be covering the entire amount, as per the Families First Coronavirus Response Act.

Review your bills carefully and make sure the EOB and the medical bill correspond with each other. If there is a discrepancy between the two documents, it may be a billing error.

If you suspect an error, you may want to ask for itemized bills. This will provide you with a detailed breakdown of all costs charged to you for services and/or inpatient stays.

If you’re being billed for a hospital stay, review the charges carefully to be sure you’re not getting billed for a treatment you haven’t actually received. According to a report by the U.S. Government Accountability Office, an overwhelming 9 in 10 hospital bills contain errors.

Step 2: Review your insurance coverage.

It’s a good idea to familiarize yourself with your health insurance policy before disputing any charges. Most health insurance providers will present all members with a detailed manual that outlines exactly which treatments and charges are covered and which are not. Here, you can refer back to the EOB to see if the insurance paid for all procedures it claims to cover.

Step 3: Dispute all errors.

If your insurance billed you incorrectly or did not cover a procedure or treatment that is covered under your plan, call a company representative to ask about the charge. Be sure to have your bill in front of you when you make the call.  Note the time of your call, the contents of the conversation and the name of the representatives you speak to in case you need it for future reference.

If the error is with your doctor’s office, ask to speak to a representative of the billing office and calmly explain your position. Here, too, keep a careful record of the conversation for future reference.

In both cases, be prepared to make multiple phone calls until you reach a party that can actually effect change. It’s also a good idea to follow up with a written request to challenge a charge.

Step 4: Negotiate the remaining bill.

If the bill is unmanageably high after all errors were corrected, you still have options. Consider negotiating with the billing office at your doctor’s practice for a lower price on the treatments and procedures rendered. You may want to do this in person.  Most practices will allow you to schedule an appointment with a representative of the billing office. Bring all your bills and other supportive documents, such as receipts from the pharmacy and information from your insurance provider. If you believe a charge for a procedure has been unreasonably inflated, it’s a good idea to research the going rate of coverage through sites like

At the meeting, explain that you are having difficulty with your bill and that you’re looking for a way to lower the costs. Here are some open-ended questions to guide your negotiations:

  • What discounts do you offer for financial hardship?
  • Which of these fees can be waived?
  • I know many hospitals have charity relief plans for patients having difficulty meeting their payments; what plans do you offer?
  • Can you charge me what Medicare would pay for this service?
  • Can you lower some charges if I pay this off sooner?

With luck, you’ll walk away with a discounted bill.

Step 5: Create a payment plan or seek funding.

Once you have your final bill amount, you’ll need to choose to pay it now or work on creating a payment plan. Spreading a large bill over several months or years will make it manageable.

If you’d rather not have this huge bill hanging over your head for a while, or your doctor’s office insists on immediate payment, consider other options. One way to pay off your bill is by taking out a Directions Credit Union personal loan. This will provide you with the funds you need to pay your bill immediately, with a payback plan offering easy terms and manageable monthly payments. You can also take advantage of low-interest rates and choose to open a HELOC.  HELOCs allow you to tap into your home’s equity and use the cash to pay your bills.

Step 6: Going forward

To avoid an unexpectedly large medical bill in the future, you may want to consider switching your insurance plan to one that provides more robust coverage and less expensive copays and deductibles. Your premiums will likely increase, but the change may be financially worthwhile if you have ongoing medical expenses.

Another long-term option to consider is setting up a Health Savings Account (HSA) at Directions Credit Union. Funds contributed to an HSA are tax-deductible, grow tax-free, and can be withdrawn to cover for qualified medical expenses.