Health insurance is expensive. But do you know what’s even more expensive? Losing your policy and having to sign on with a different provider. Trust me, I know what I’m talking about…because a few years ago, I made this boneheaded mistake myself.
When I set out to start my own business, I filed for COBRA, which allowed me to continue the health insurance I had with my last employer as long as I paid the full premium, which was around $600/month. But then—doh!—I made a late payment. I got no mercy, people. The next thing I knew, I was terminated. I had to find another, individual health plan…for $1,100/month, nearly double what I’d been shelling out before. As if the universe hadn’t paid me back enough for losing track of my bill, before my new plan kicked in, I came down with a nasty stomach virus that sent me to the ER. Guess what? Not covered. It was a $2,000 nightmare.
So what did I do? Well, I panicked, naturally. And then I negotiated my butt off.
People think that when they get a bill from a hospital, or any official looking source for that matter, it’s set in stone. It’s not. No bill is. Just remember this every time you open up a bill: it’s your money they’re looking to squeeze. So fight for it!
I’m a BIG advocate of negotiating. All it takes is a little guts. Whether it’s a medical bill, phone/cable/internet plan, or utilities payment, you should always ask for a better rate. You have nothing to lose but a little time. The worst thing they can say is no. And they usually won’t. Here’s how:
Master your medical bills. Even if you have all the money in the world, get an itemized hospital bill so you can see exactly where the charges come from. As it turned out in my above tale, I was on the hook for an $800 X-ray that I never even had. But $1,200 was still way too much, so I kept haggling until the bill came down to about $600. That’s right: I successfully negotiated my medical bill. Here’s the secret: the hospital knows from the outset that there is a small chance they’ll never recover the full (and typically outrageous) amount from you, so with a little pushback (okay, sometimes a lot) they’ll take what they can get. Look around online to find the fair market price for a procedure or treatment before you pay a cent; average costs vary based on region or even city, so you should know what you’re getting into. Then call your healthcare provider and plead your case openly and honestly, offering to work within a payment plan or pay a reduced rate in cash, if possible. If they think they have a better chance collecting 75% of the total cost than 100% of the total cost, they’ll likely work with you to make that reduced rate happen. And this should go without saying, but start negotiating before the bill is due; the provider will be much more accommodating if the bill is still active, not late. After all, siccing the bill collectors on you is not only annoying for you but costly for them, too.
Play your phone/cable/internet provider. The key to handling your standard phone/cable/internet companies is to talk about leaving the provider and going to their competitor. I’ve done this with all of my major bills at some point and have been successful more often than not. Try to haggle with your bill collectors at least twice a year. First, I promise it will become fun and addictive. Second, if you aren’t successful in negotiating, you want to make sure you’re in the right plan for you. Are you still bundling with a landline and not using one? Ditch it. Still have that international phone plan tacked on when you haven’t traveled in months? Whoops. Always good to get on the latest or most correct/appropriate plan for you. You might not get a big W every time you try this, but even a little win every once in awhile is better than nothing.
Bring down your utility bills. As for your utility bills, negotiating them isn’t exactly the same as it is with your phone and cable bills. It’s not like the electric company is going to give you a lower rate. But, like most things in life, it’s not that simple. Some utility companies might offer discounts if you agree to participate in energy conservation programs, such as allowing the company to cycle your air conditioning off for brief periods during high-demand times, or allowing them to install a more efficient thermostat in your home. If you live in a house and pay for heating oil, you might be able to lower, or at least normalize, your monthly bill by asking for even billing. So instead of forking over huge amounts of dough during the winter, and never knowing how much until the oil guy makes a delivery, you can pay a fixed amount every month throughout the year (yes, it sucks to pay for heating oil in July, but it’s a good trade-off for not getting a heart attack–inducing bill in January). You might not be able to shave any money off the bill, but you can always negotiate a better deal for yourself.
Conquer debt collectors. You can and will get out from under their thumb, but first you have to face them. So dry your eyes, and pick up the phone. Approximately 30 million Americans have at least one debt in collection. That means lots of people are getting these calls all the time. And they are dealing with it, and living through it. Is talking to a debt collector uncomfortable? Yes. But should you be filled with fear when the phone rings? No. Be brave and fight for your money! As a consumer (even one with poor credit) you have rights. First, ask for an itemized statement to check for any errors. (These are more common than you would think! 80% of medical bills contain errors.) Then try to haggle the bill down to a smaller amount in exchange for paying in cash, or if you can spread the payment out over several months instead of paying all at once. The main thing is to remain calm, stop hiding under the covers, and—I’m going to say it again—pick up the phone. Debt collectors will be more likely to work with you if you are forthcoming, and reasonable, and less likely to offer you a deal if they need to hunt you down.