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Ways to Save on Medical Bills

The rising costs of healthcare continue to create an enormous financial burden for most Americans. Even with the attempts of the "Affordable" Care Act, the majority of Americans still struggle to cover health related expenses. However, there are some things you can do that may help alleviate the burden.

Medical Service Providers and Costs

Nearly 86% of Americans have health insurance that pays for the majority of their health-related expenses. But even with insurance, there are co-pays, deductibles and other gaps that need to be filled. Do your research to make sure you are getting the most out of your insurance and that you are getting a fair and comparable price on the residual. More specifically:

Use in-network providers

If your health insurance has a PPO (preferred provider option), your insurer will pay for the majority of the cost (after your co-pay) when you use a doctor or hospital that is part of the insurance company's preferred network of providers. If, however, you use a doctor or hospital outside the provider network, you will have to pay a larger portion of the bill. PPOs typically pay only up to 70-80% of expenses incurred outside the network.

Do some research

With a little time and effort, you can find approximate costs for almost any medical procedure. Consumer websites such as HealthGrades.com is a great resource. You'll want to know as much as you can before you proceed, not only for financial reasons, but personal ones as well. Ask the doctor or hospital directly what the procedure/service costs. Ask about options as well. Is there anything in the normal routine that can be skipped? For instance, many women opt not to have an epidural to forgo the separate anesthesiologist charges. Find out what your insurance will cover. It's better to be prepared with the details in the beginning than be shocked with a huge bill after the fact.

Ask for a discount

You may be able to negotiate a lower price, especially if there are other competitors in your area. If you pay in cash, you can probably count on that discount. Even if you pay with a credit card, the discount may apply. In most cases, billing offices that don't have to process insurance claims will pass those savings on to you. It's also considered a reward for paying up front rather than the office taking the risk of having to hunt you down.

Prescription Costs

Request generic prescription drugs

Name-brand prescription drugs and their generic versions have the same active ingredients and produce the exact same result. When a drug first comes on the market, a certain amount of time needs to elapse before a generic version can be made. The only reason you should be taking the name brand version is if no generic is available. Always opt for the generic version when available (most prescribing physicians fill the Rx with the generic anyway); you will save a significant amount on your meds.

Ask about an over-the-counter alternative

You may be able to find an OTC alternative that works just as well as the prescription. Just make sure the OTC version is actually cheaper though.

Order by mail or from big-box retailer

Warehouse club stores like Costco or big-box retailers like Walmart are typically much cheaper than your neighborhood pharmacy. You can also ask your prescribing physician to recommend a mail-order pharmacy where you can purchase in bulk, making it much cheaper.

Billing Errors

Request itemized bills

The explanation of benefits (EOB) statement you get in the mail does not contain a detailed breakdown of all costs charged to you for services and/or inpatient stay. If you want to know exactly what you are being charged for, you need to specifically ask for an itemized bill; which the medical service provider should provide anyway.

Review bills for errors

Always go over your hospital bills! The U.S. Government Accountability Office reports that 9 out of 10 bills have errors. Make sure you actually received all of the services, medications and other items that appear on your bill.

Ask for an audit

You can request the healthcare provider's billing office and your insurance company to audit your medical bills, to make sure everything is accurate.

Talk with the billing office

If you are having difficulty deciphering your bills, schedule an appointment with the medical provider's billing office. They will be able to review your bills, explain your insurance benefits and recommend other resources that will help you.

Paying medical bills

Negotiate a payment plan. Most medical providers offer payment plans, especially for large bills.

Create a health savings account

If you have a high deductible health plan, or no insurance, you should consider opening a health savings account. The money you or your employer contributes to the account is tax deductible, it grows tax free and money you withdraw from the account is tax free, too, as long as it goes toward a qualified medical expense. Some employers also offer cafeteria plans or flexible spending accounts that can help to offset various medical expenses.