The truth about paying your medical bills (and any other unsecured bills) – Medical Bill Survival Guide
The Medical Bill Survival Guide complete book
Available Now: Medical Bill Survival Guide by Nicholas Newsad in print and e-book format at

Second place in the Reader Views Literary Awards, "Health" and "How To" categories

It does not matter how bad your financial situation seems to be, The Medical Bill Survival Guide will provide you with the knowledge to help yourself or your loved one. Medical bill anxiety is caused by miscommunications and misunderstandings. This book teaches easy, effective strategies for working with insurance companies, hospitals, doctors, and other healthcare providers.

Readers will learn and discover:
  • How process problems cause insurance claims to be rejected and denied
  • How to access public insurance programs for the uninsured and unemployed
  • How to access provider-based financial assistance and charity care
  • How to demonstrate financial hardship and
  • How to talk productively to billers and collectors.
The information in this book will benefit:
  • Insured patients who are experiencing difficulty paying the deductibles, co-pays, and coinsurance.
  • Uninsured patients who are unemployed or cannot afford health insurance.
  • Patients and the families of patients who have survived a catastrophic medical episode like cancer, heart attack, or major surgery.
  • Patients with chronic diseases requiring continuous, costly medical care like heart disease, COPD, or diabetes.
Nicholas Newsad, MHSA is a senior analyst at a national healthcare management company. He holds a master's degree in hospital and health service administration from Xavier University. He lives in Westminster, Colorado.He has served as a senior healthcare analyst for six years and has also served as an interim surgery center administrator. He has been quoted and interviewed in the L.A. Times, NY Daily News, MSN Money, and Smart Money, as well as numerous other magazines, newspapers, and radio shows.

Do you have a horror story about your medical bills? Insurance company? Or medical provider? We want to hear about it. at

The truth about paying your medical bills (and any other unsecured bills)

0 Comments - Posted by Bill Cole on September 30, 2012 at 8:19 pm

First off, if you are loosing sleep over high medical bills, stop. It doesn’t matter, go back to sleep. Why ? Because there’s not a lot that a creditor is actually going to do to force you to pay your bill, other then suing you. In order for them to sue you, it is going to cost THEM money for a lawyer, which is not cheap.

Here’s how it works


– You are late paying a bill, so then it goes to some collections company.
– The collections company actually buys the debt for pennies on the dollar, so if you pay your bill, the collections company keeps most of the money, while the actual doctor, or lab, or whoever the creditor is gets a small piece. What does this tell us ?


That the original people that you owe money to, are already willing to take a fraction (1/2 or less) of your bill, just so they get ‘something’. So why can’t you do the same thing ? You can ! This is called debt settlement and you can do it completely on your own. There’s nothing stopping you from calling up the folks you owe money to, let’s say $5000 and offering $2500 or even $1000. The issue is, that you will need to have this much cash available for a lump sum settlement. If you don’t then this isn’t the option for you.


If a collector has your account, they pay for the ability to put things on your credit report. Aside from suing you, this is all the leverage they really have. All this does, is make your credit score lower and put marks on your credit report. What most people don’t know is how easy it is to remove these items from your report. When you do so, these bill collectors loose all their leverage. They are all betting on the fact that you don’t understand this, and ultimately ‘feel’ like some inevitable doom will come to you if you do not pay your bill to them, when the truth is… nothing will happen, aside from annoying phone calls, which I will tell you how to stop as well.


So now you may be wondering (why don’t I just run up debts and not pay my bills at all ?). If you know the rules of the game, you can… if you REALLY want to do that, but I would highly advise against that, because doing things to others that we ourselves would hate being done to us, creates a higher level of undesired consequences that go beyond any money issues here.


Let’s talk about the credit report, and what it actually means to us. Your credit report will be looked up when you try to apply for credit. Different types of loans have different requirements, lets look at them:


Getting a credit card:


If you do not have a high credit score, you will not be able to get a credit card with a very high credit limit, but you could probably get one with a lower limit. If you credit score is good enough, you will just be seeing credit cards coming to you in the mail, without you even applying for them. As your credit score improves, credit card companies will simply increase your credit limit (without asking). At what point can you not get a credit card ? Probably if your score is below 550. but that is just a guess. The point I am making here is that people can still get credit cards with a lot of damage done to their credit… Unless you’ve filed bankruptcy or had a forclosure withing the past few years, then you enter into a whole new category.


Getting a car loan:


In simple terms, no one is going to give you a loan for a car that you can not afford. However, dealerships are writing loans for customers with terrible credit all the time. Almost anyone can get a car these days, and it doesn’t matter very much what is on your credit report these days. Don’t take my word for it, call a local dealership yourself. The only thing a good credit score will get you at the car dealership is a lower interest rate, but not the ability to get a loan in the first place. You may have to get a cheaper car, but you still will be able to obtain a means to transport yourself in the form of you own car. This may be the case, even if you’ve filed bankruptcy.


Getting a mortgage:


Getting a mortgage is different then the other two. If you have any money you owe other creditors, your loan underwriter may force you to pay them all off first before writing you a repo. Also, in order to get an FHA loan you need to have a credit score of at least 640. If you are applying with your wife, they take the median score from both of you, then use the LOWER one, and that needs to be higher then 640.  This is the case where your credit report and credit score really matter. Unless you’re looking to buy a house, you’re score and marks don’t matter as much. Additionally, these days real-estate has taken such a beating that you can rent properties so cheap anyway so how much does it matter ?


Getting a job:


There are some companies our there, especially a bank or a financial type firm that will pull your credit with your job application. If they see any foreclosures or a bankruptcy on there, you may not get the job simply for that reason, this is rare, but it happens. A bad credit score, due to things like unpaid medical bills, will likely not matter.


 So what does it matter that you owe someone money for medical bills and you can’t pay it ?




So here you are, on this website,with thousands of dollars in medical bills and an income that can’t support the debts. If you want to get to the crux of this issue, it’s that in an uncorrected society, we allow profit from other peoples suffering. Going to the doctor is not a luxury, it’s a necessity. We are all trying to stay alive, as that is the purpose of being alive. We all don’t need to go to the doctor / hospital all of the time, and we as a society should pay into a pool that pays for the ones that need, like insurance, but 1 insurance company that’s non-profit and for the entire country, or even world. This is the correct way, and we have more then enough money for everyone to have what they need. I will get off the idealist train for a moment and back to reality. Since we don’t currently live in such a world, here’s what I’d do for myself and would advise to a friend:


First, ask yourself what do you need good credit for. Are you planning on buying a house or a car, and you need a loan ? If you need to have good credit, then I would advise either hiring a law firm to get all the crap off your report, which will cost about $80 month for 6 months to a year, this is the case because it’s an on-going process. One law firm that I’ve used personally and I can vouch for working is Lexington Law. However, I do not think they will be able to help remove a bankruptcy or forclosure, only things like medical bills and credit cards and such. Also, instead of paying these guys, you can do it all yourself. Doing such a thing yourself is outside the scope of this post, and perhaps I’ll write another making it easy to do it. Lexington Law does offer a website somewhere that explains how to do it yourself as well, I don’t know the URL for it. Basically the idea is that you get a copy of your credit report each month (this cost money) and send letters to the reporting agency and the creditors within a particular format and protocol. By following the correct process, you’ll basically be able to get everything off the report.


Look at how much money you have each month to pay towards these bills, even if it’s $20. Setup a recurring bill pay in your bank to pay these guys “something” each month. By doing this, you are showing that you are making an effort to pay and demonstrating a measure of amicability. The only thing you’re really doing here is making it a little harder for them to sue you (maybe). At the same time, you’re honoring your debt in some way.


Once a creditor is off your report, they basically have no leverage, other then calling you or mailing you stuff, or suing you. And I’ll talk more about the suing later.


So how do I stop all the annoying calls on weekend mornings and nights ?


The free way:

Use Google Voice.

– Get yourself a free Google Voice number
– Connect your landline and cell phones to it.
– Call ALL your creditors, banks, utilities and change your number with them to your google voice number.
– Moving forward, only give our your Google voice number to anyone, and everyone !

What this buys you is, if you get any calls that you don’t want, you just login to, view your call history, and right-click ban the number. Each time someone annoys you with a call, ban them. The next time they call back, they get a disconnected number message. This is what I’ve done for years and I love it. Also, as people call you, if you provide a name to the number, the call will be announced to you by Google using text to speech. It’s fantastic !

The not-free way:
If you have a land line and you simply wish to keep your current phone number, the only thing you can really do is use a device like the one on it’s about $80 and it actually works pretty well. I know this because a good friend of mine sells them.


Getting sued:

In order for it to be a good decision for someone to sue you, you have to be judgement-able. Meaning, if I sue you and I win, I need a way to collect that money. In many states, as a result of a judgement, you can’t take someone’s house from them if it’s their only one and they are living it in. You can’t force one to liquidate their car if it’s their only one and they are using it for work. Also, in many states you can’t garnish someone’s paycheck as a result of a judgement. For most people not paying their bills, that’s all there really is, therefore, it’s likely the case that most people that are not paying their medical bills are non-judgementable. Surely if you have cash and other assets, they can be liquidated for force a judgement, but generally hospitals and credit card companies in the United States will not go through the trouble or expense of actually suing people for their money. This is a calculated decision for them based on the amount of money you owe them, they assets that you have (which they have no way of knowing), and how confident they feel they will do with a law suite. If you file bankruptcy, they are basically screwed (more or less).


The legal agreement of your medical bills are not legal most of the time:

How many times have you walked into a gas station, purchased a pack of gum, or a soda, or gas ? Many, many times I’m sure. In this case, you know what the price is of your item, you take your item to a cashier you give them money and they give you the merchandise. This basic concept is called “consideration“. In order to have a valid legal agreement to purchase anything, we need to have consideration. In order to have it, I have to tell you how much this costs, and you agree to it by handing me the money in an amount I previously advertised to you. Sounds fun right ? How many times have you gone into a gas station, purchased your item, then got a bill in the mail 2 weeks later for $200 for a handling fee ?.. probably never. And, if you don’t pay it, I’m going to make a mess on your credit report, causing real financial damage for you, and you can’t really sue me over this, because this is how the system works. Pretty fair, eh ? The main reason why this doesn’t happen is because I would have no legal basis for to charge you this money, because there was no consideration in the agreement. You didn’t know how much the handling fee was, and you never agreed to it. So then, how do Dr’s offices, labs, and hospitals get off doing the same thing ? Simple answer: We let them. You could present this argument to your medical account receivable professional and they may say something like: “We have no way of knowing how much your insurance will cover and we don’t know what you’re going to be charged till later, and there’s no way for us to know this“. I’d simply respond with: “Insurance aside, you don’t tell me how much this is going to cost before-hand so I can make an informed decision as a consumer to decide if I want it or not“. If you knew your total costs, as well as the proper procedure codes they are performing, you could simply call your insurance company and ask them, but since you never get this information, and it’s completely not obvious, it doesn’t get done. I’d think there should be a law that anyone performing a medical procedure HAS TO give you this information before-hand to provide pricing transparency and allowing you to choose another provider that offers the same service cheaper. You see, if we’re going to do this the capitalistic way, then let’s follow all the rules of capitalism, shall we ?


The point I am making is that your medical bills are end-to-end bullshit. Pay these ass-monkeys an amount that you can honestly afford, and let a firm like Lexington Law take the garbage off your credit report, and simply move on.



** Disclaimer: Nothing in this post is legal advise, this is the opinion of the writer and should be viewed as “entertainment”. We hold no responsibility for your actions as a result of this advise, take it all as-is. Make up your own mind, do your own research. We simply offer a perspective, as that is what any one really has to offer, is a unique perspective.

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