Negotiate Your Way to Lower Medical Costs

December 27th, 2009 Posted in General Insurance Tips

Yes, you really can negotiate the cost of medical care

Although many people are not aware of it, the medical industry is one of the few American industries where negotiating the price is not only acceptable, but common.

The reason many uninsured or under insured people are quoted higher prices than insured individuals is because the price for many services has already been negotiated down by the insurance companies and HMOs.

However, this practice is not limited to major institutions. Individuals can — and do — negotiate the price for particular services on a regular basis and this can result in significant savings.

Negotiating can save you up to 60 percent

According to Consumer Reports, only about thirty percent of Americans even try to negotiate with medical care providers; however, of those who try, 93 percent are successful at least once.

Savings average between thirty and sixty percent of the original principle, though people saving as much as ninety percent have been reported.

Like anything in life there are no guarantees but you can’t go wrong with trying to negotiate lower costs.

Step One: Negotiate in advance

The first step to negotiating medical expenses is to negotiate terms in advance for planned medical visits and examinations.

Prompt payment, especially in large sums, can get you a discount for health providers that don’t want to wait for their money. These discounts are usually reserved for those who are able to pay for planned medical services at the time of the visit.

Many health providers also offer a payment discount for those who are able to make large partial payments.

Step Two: Talk to the CFO

The next step is to speak with the provider’s Chief Financial Officer (CFO) after you have received your bills. More often than not, just asking the CFO for a discount will get results.

From the health provider’s angle, your request will have to seem reasonable to be effective. For these reasons you would be wise to research the average price in your area for the services and ask for a price reduction if the prices are above the average.

Making sure you know the normal price for a medical procedure can be helpful and you can double check that on Healthcarebluebook.com and a large amount of insurance websites.

Step Three: Discuss payment options with the billing department

If you get a discount from the provider’s CFO, you probably will not be able to negotiate further discounts from the billing department.

In some cases it may be possible to get zero interest on your payment plan. The amount of accruing interest on medical expenses can be very high.

If you can negotiate for lower interest on your health care bills, you can greatly reduce the overall amount you pay during the course of your payment plan.

You have nothing to lose and much to gain

Contrary to the impressions of many people, most medical service providers are willing to negotiate and rarely expect everyone to pay every cent originally charged.

You may like to know that repayment levels that are lower than initial prices may already be budgeted in by many health care providers. For those who pay their own medical bills there is nothing to lose by attempting to negotiate lower medical costs and repayment terms.

The worst case scenario is that the provider will refuse to grant a discount. Although, negotiating lower costs is going to pay off in the end. As Consumer Reports has proven, 93% of individuals who ask for a discount actually do get a discount.