The three major credit bureaus—Equifax, Experian, and TransUnion—have a significant impact on the financial well-being of millions of Americans.For many in our country with medical debt, bureaus plan Eliminate nearly 70% of debt From consumer credit reports. To further illustrate how dire the situation is, The White House recently announced The same goes for the Medical Debt Initiative.
Medical debts under $500 will no longer be included, and patients will have 12 months to clear their outstanding balances before their credit reports are deleted. The credit bureau will also remove paid medical debt from the credit report entirely, rather than simply marking it as “paid.”
These are useful accommodations for one-third of Americans with medical debt. But first, affordability is the real challenge. Even people with insurance can get billed over $2,000 for just one day in the hospital. Many of them qualify for financial aid, but they don’t even know it.
Financial aid programs are like preventive care
Hospitals have access to tools that specifically address patient affordability. Hospitals across the country have established financial assistance programs—nonprofit hospitals must have them and already offer them—that prevent many patients from sending their accounts to collections in the first place.
Hospitals also benefit from connecting patients eligible for financial assistance to their programs. Patients need to know that their hospital has financial assistance programs and that these programs must be easily accessible and easy for patients to navigate.
The White House is stepping in
The White House recently announced new actions to reduce the burden of medical debt, saying providers “should make it easier for eligible patients to access the financial assistance to which they are entitled.” Many times, financial aid programs are hard to find or have a complicated application process .
The White House’s plan involves reforms on four fronts: Hold health care providers and debt collectors accountable for harmful behavior; Reduce the role of medical debt in determining Americans’ access to credit; Help more than 500,000 low-income U.S. veterans forgive medical debt ; and inform consumers of their rights.
Who is eligible for financial aid?
There is a common misconception that terms like “financial aid” apply only to the poor and destitute. But the eligibility threshold is higher than most people think.
These programs typically extend to individuals whose household income is several times the federal poverty level. In other words, many working and fixed-income households tend to qualify.
not too complicated
People who are admitted to the hospital, whether for a planned surgery or in an emergency, are well prepared. Filling out pages of forms and questionnaires, requesting and printing copies of sensitive financial information is no fun, no matter where you are. In the hospital, it’s even less so.
Hospitals need to process these forms like everything is on a need-to-know basis. If the answer to a question doesn’t matter to the patient’s eligibility for financial assistance programs, don’t ask it. If it affects eligibility and helps hospitals get reimbursed, go for it.
win-win
Low-income families struggle to save for a house or car, and even more difficult to pay for open-heart surgery or the removal of a child’s appendix. It’s not about providing care for free; it’s about helping patients who can’t pay their hospital bills.
Most patients who are able to pay, pay, and expect them to do so are perfectly reasonable. But many patients who qualify for financial assistance under hospital policy need help from the hospital. Whether it’s partially discounted or completely free care, hospitals should make it as easy as possible for those who truly qualify for the program to get the support they need.
While it may seem counterintuitive for hospitals to offer discounts unsolicited, when managed properly, discounted care is much better than sending bills that patients can’t afford to send to collections, where collections are minimal.
People want health, not debt—hospitals want to treat patients, not pursue their overdue bills. People should not delay or forgo the care they need because they don’t think they can afford it. Necessary care should not lead to bankruptcy.
Credit bureau cancellation of medical debt and White House support for the cause is a win for patients. But hospitals have an opportunity to take a financially-friendly, patient-friendly approach and maintain the positive momentum. Fortunately, financial assistance programs are ready and available to hospital leaders looking to make this happen.
Photo: freedigitalphotos user Naypong
