What Happens if You Can’t Pay Your Medical Bills?

Nicolas Cesare  | 

Over 40 million Americans are saddled with medical debt. With the cost of healthcare on the rise and insurance coverage on shaky ground for many working class people, it’s becoming harder and harder to pay hospital bills for unexpected emergencies or even routine (but costly) treatments.

So exactly what does happen when you have unpaid medical bills? If you can’t pay your medical bills on time and in full, here’s what you should expect.

Unpaid Medical Bills: What Happens If You Don’t Pay

Late Fees and Interest

When you first receive a medical bill, it should include a issuance date, or the date on which you were charged for the services rendered. If you fail to pay after a certain period of time beyond this date, then you could be subject to late fees and interest payments on your medical bill. However, the good news is that — unlike many other forms of debt — late fees and interest are not a given on your medical bills.

Depending on the laws of your state, medical providers may be banned from tacking on late fees to medical bills or charging interest rates beyond a certain level. If you can be charged for late fees or interest, then it should be stated in the terms of service up front. Make sure to read any paperwork that you’re provided with carefully before agreeing to treatment.

Collections and Your Credit Score

Of course, medical treatment is rarely an option. In the case of an emergency or a medically necessary service, it’s not always an option to refuse services just because payment might be difficult.

Even if medical providers can’t hit you with late fees, that doesn’t mean that you should hold off forever when it comes to paying your medical bills. If you start to carry medical debt and show no signs of paying it off, your provider may send your bill to a debt collections agency.

Debt collectors specialize in being annoying in an effort to get you to repay your medical debt. However, having your medical debt go to a collections agency can have real and lasting consequences — as soon as a medical bill goes to collections, it will show up on your credit report. The bottom line is that your medical bills can tank your credit score if they go unpaid.

Lawsuits, Judgements, and Jail

If the collections agency isn’t able to get anything out of you, then your medical debt problem could move on the final phase, where legal action is taken against you. Your medical provider could sue you for your unpaid medical bills and a court could authorize measures like wage garnishment — where money can be taken straight from your wages to pay your debts — in order to appease them.

Thankfully, you cannot be sent to jail for failing to pay your medical bills. By law, someone cannot be imprisoned for failing to pay any civil debt. However, that same protection doesn’t exist for government-imposed expenses like taxes.

What If You Can’t Pay Your Medical Bills?

Things look dire if you can’t pay your medical bills. At best, you could be saddled with late fees. At worst, your credit could be damaged and your wages garnished. Here are some things to do if you are having trouble paying your medical bills.

  • Negotiate your medical debt. Remember, the bottom line is that your medical provider wants to get paid. They may be willing to accept a small sum if you can guarantee that they’ll get it. When the medical bills start to pile on, speak with your provider about finding an amount that they will accept and that you will be able to meet.
  • Don’t ignore your medical bills. Ignoring this problem will only make it worse. If you ignore your medical debt for too long, it can show up on your credit report and your wages could be garnished to help pay that debt.
  • Don’t stop going getting medical assistance. Forgoing medically necessary treatments can only make your health problems worse, causing you to get an even larger bill later on down the road. You should also remember that many insurance plans are required to cover preventive care at no cost to you. Keeping up on your preventive care visits can help save you money in the long run.
  • Don’t be afraid to ask for help. Medical bills can be huge, but you don’t necessarily have to face them alone. A loan from friends or family could help you get out from under the shadow of your medical debt. There are also charities that help pay medical bills for people in certain circumstances.
  • Double check your bill. Medical providers and insurance companies can make mistakes. Make sure that the services you’re being billed for and the services that your insurance company is or is not covering are services that you actually received. If you notice mistakes, then you can dispute your medical bill to get those charges removed.

Leaving your medical bills unpaid can have a severe impact on your credit score and on your income. Find ways of paying your medical debt, even if it’s just a little at a time, in order to avoid these consequences for your financial health.

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Nick Cesare is a writer from Boise, ID. In his free time he enjoys rock climbing and making avocado toast.