How to Deal With Medical Debt

Just as the pandemic novel coronavirus is making thousands of Wisconsin residents sick, a new guide on how to deal with medical debt has been published online.

Fighting Forward: Challenging Medical Debt was unveiled Tuesday by HealthWatch Wisconsin, part of ABC for Health, based in Madison. ABC for Health is a nonprofit public interest law firm focusing on health care access for children and families, and HealthWatch Wisconsin is its policy-tracking subsidiary.

The project grew out of the work ABC for Health has done with people who have been burdened by medical debt and swamped by the complexity of the health insurance and healthcare systems. Conceived before the first COVID-19 cases were reported in the U.S., it took on new urgency as signs of the pandemic’s growth in Wisconsin and across the country were just beginning to surface, says Bobby Peterson, executive director at ABC for Health.

The guide has five short chapters on preventing medical debt; consumer protections and rules; managing existing medical debt; myths about medical debt; and resources. An appendix includes sample letters that consumers can use to write to insurers, credit bureaus, bill collectors and health care providers, among others.

Challenging debt and prevention are among the key points in the guide, Peterson says. One point of emphasis is on correcting credit scores. “We call that the electronic debtors prison,” he says. Credit scores can be weighed down by medical debt, and even then might be inaccurate.

More providers are temporarily ending debt-collection efforts, Peterson says. “I think they all should right now.”

While medical debt can be overwhelming, there are ways to combat it. For example, the guide has information on how to appeal insurance denials. It also encourages readers to look at their options for health insurance, including Medicaid (BadgerCare) and the Affordable Care Act.

It also emphasizes ways to avoid medical debt before it happens. “There’s a lot of this stuff that can be prevented with good, up-front assistance and education,” Peterson says. “Too many people wait until the back end. When it’s in the hands of collection agencies and collection attorneys, it’s much more difficult to try to unwind it versus preventing it from the start.”

For people with insurance, it’s important to understand the details of what is and is not covered, including hidden traps, such as a hospital that is in network but with an emergency room staffed by personnel from an outside contractor that is not in network, he says.

“One of the things that we’re concerned about related to the current pandemic is that there are many opportunities for people to go to the wrong providers,” Peterson says. The guide addresses those and other causes of “surprise” medical bills that patients incur when they think they’re covered.

Solutions for medical debt aren’t one size fits all, however. “It’s different for every person you talk to, depending on their job and depending on their medical condition.”

But it’s important for people confronted with medical costs they can’t afford to deal with them as quickly as possible.

“There’s a tendency to put it to the side. I totally understand that,” Peterson says. “it would be great if it was super simple. Unfortunately, nothing in health care is simple.”

Reprinted with permission of Wisconsin Examiner.