How to Save Money on Medical Bills

Young male doctor volunteers in free clinic

Medical bills can be a source of severe financial anxiety, especially once they start to pile up. This form of anxiety isn't unique: Nearly 1 in 10 adults in the U.S. carry "significant" medical debt, according to the Kaiser Family Foundation. There are, however, a number of remedies you can employ to prevent or ease the financial pain of medical bills.

Read on to learn how to save money on medical bills, such as negotiating with health care providers, and how medical bills can hurt your credit if they go unpaid.

What to Do About Medical Costs

Immediately paying medical bills that flood your mailbox or inbox can lead to less money for basic necessities like food and housing, which could cause you to delay paying them or prompt you to skip necessary medical care.

Putting off seeing a doctor can exacerbate health issues, and ignoring medical debt can cause long-term financial harm. The Journal of the American Medical Association found an estimated 17.8% of Americans had medical debt in collections as of June 2020—to the tune of $140 billion. And, according to a Kaiser Family Foundation survey released in 2019, 9% of American adults with employer-sponsored health insurance said they had declared personal bankruptcy at some point because they struggled to pay medical bills.

Here are five ways to save money on medical bills.

1. Negotiate With Health Care Providers

If you're burdened by medical bills, reach out to the billing office at each health care provider listed on your bills to see whether they'll agree to reduce the amount you owe. Before you start this process, be sure you've gathered all of your bills, receipts and related documents.

When you're making your case, ask whether the health care provider is willing to waive fees, offer discounts for financial hardship or provide other forms of monetary relief (such as charity care). You also might be able to work out a plan to spread out the charges into manageable monthly payments.

Before you're billed for a medical service, you can inquire whether the provider can give you a discount for paying the entire bill upfront in cash. If you can afford the one-time expense, it could save you big in the long run.

If your medical bills have become unmanageable, consider seeking help from a medical billing advocate. They can help you organize your bills, negotiate payments, come up with a payment plan and look for errors in medical bills. Keep in mind that medical billing advocates charge for their services, although your employer might provide free or discounted advocacy services as a perk. Before enlisting the help of a medical billing advocate, make sure you check out their qualifications.

2. Shop Around for Care

You shop around when you're buying a car, a home or an insurance policy, right? Well, why not do some comparison shopping for health care?

Prices of medical treatments and procedures can vary from one health care provider to another. To cut medical costs, consider calling several providers to check their prices. For instance, if your doctor has ordered an MRI, contact several MRI providers in your area and see where you might be able to get the best deal. If you don't feel comfortable reaching out to a bunch of health care providers, try using an online price comparison tool such as

Of course, you'll want to make your final choice based on factors beyond cost, including the quality of care delivered by a health care provider.

3. Look for Errors in Medical Bills

Believe it or not, medical bills may contain costly errors. To prevent them from chipping away at your budget, review every itemized bill to make sure you weren't charged for a service you didn't receive or overcharged or charged twice for a service you did receive. If you spot a mistake, ask the health care provider to correct it. Any documentation you can provide that contradicts information in the bill could be helpful.

If you have health insurance, you also should hunt for errors in the explanation of benefits you receive from your insurance provider. An insurer should send you a copy of this document after a health care provider submits a claim for services you received. An explanation of benefits is not a bill. Rather, it outlines the cost of the care you received and the amount you owe for out-of-pocket expenses.

4. Stick to In-Network Providers

Most health insurance plans offer access to a network of health care providers, such as doctors' offices and pharmacies. These providers agree to discount their products and services in exchange for being able to join a health insurance network and become what are known as in-network providers.

But if a health care provider is outside your plan's network, they're not bound by any discount arrangements and, therefore, might charge full price. When a provider charges out-of-network prices, your treatment can wind up costing much more than it would if you had used an in-network provider. In fact, you could be left with thousands of dollars in out-of-pocket costs if you go with an out-of-network provider.

Unfortunately, you won't always have the ability to stick with medical care providers that are in your insurer's network, especially if you require emergency medical treatment. But choosing in-network providers whenever possible at every stage of your medical care can prevent you from overpaying.

5. Open a Health Savings Account

A health savings account (HSA) is a type of savings account that lets you put aside money before taxes to cover qualified medical expenses, such as deductibles and copays. You can set up an HSA only if you have what's called a high-deductible health plan. Money set aside in an HSA might enable you to cushion the financial impact of medical bills.

Do Medical Bills Affect Your Credit?

Medical bills can affect your credit if those bills end up in the hands of a debt collector.

A medical bill itself doesn't affect your credit, as long as it's paid on time. It won't show up on your credit report and will not affect your credit score. The same holds true if you pay a medical bill shortly after the due date. But if a health care provider turns your medical bill over to a collection agency, the unpaid debt could eventually show up on your credit report and hurt your credit score.

The three major credit bureaus (Experian, TransUnion and Equifax) have instituted a one-year waiting period before any medical debt reported to collections winds up in your credit history. That means an unpaid medical collection account must be at least 365 days past the first late payment date before it will show up on your report. You can take advantage of this window to handle the debt before it can damage your credit.

In addition, the credit bureaus no longer include medical collection debt under $500 on your credit report. If you owe more than this, however, your score could suffer until you bring your debt below this threshold.

To keep a medical debt from being handed over to a collection agency, you can:

  • Work out a payment plan with the health care provider to whom you owe money. Resist the temptation to ignore your medical debt.
  • Tap your emergency fund.
  • Dip into your HSA or your flexible spending account (FSA) if you have one. Similar to an HSA, an FSA is a pool of money that you can put toward certain out-of-pocket medical expenses.

To better understand your credit situation, you can view your credit report and credit score for free with Experian.