Tuesday, May 24, 2016

How To Reduce Your Hospital Bills

Discount Weekend: Get your kids from the clearance rack and save!

The week that our second son was born was a rather hectic week. We had been planning to have a home birth for our second child but he decided to throw a surprise birthday party for himself a full month early, so we had to deliver at a hospital. Then, a few days later our other son got pneumonia and had to go to the Children's Hospital.

I was terrified of the impending bills that would be coming in from it all. We had our emergency funds in place so that we could cover up to our insurance's out-of-pocket maximum, but I still want excited to have to pay for all of these fiascos. Luckily, just after we had announced that we had gotten pregnant, one of our good friends had mentioned that their hospital had given them financial aid for their second child.

We had never even thought about financial aid options before. Even when our first son was born and we were poor college students living off of one part time income. And this time I had assumed that there would be no way we would qualify since I was working a full time salary job. We don't make a ton, but we do make considerably more than the "poverty line". I had figured that since we don't qualify for WIC we wouldn't qualify for any other types of aid.

We were shocked to find out that you will qualify for financial aid at most hospitals if your income is less than 400% of the national poverty income level. Here is a table of the poverty limits and the 400% cutoff marks.

Persons in Family/Household
Poverty Guideline
400% of Poverty Limit
1
$11,670
$46,680
2
$15,730
$62,920
3
$19,790
$79,160
4
$23,850
$95,400
5
$27,910
$111,640
6
$31,970
$127,880
7
$36,030
$144,120
8
$40,090
$160,360
9
$44,150
$176,600
10
$48,210
$192,840
The Poverty Guideline increases by $4,060 for each additional family member

Since this birth has made us a family of 4 and we make less that $95.4K per year, so we ended up qualifying for at least 58% off of our hospital bills.

We also learned that, apparently, not all hospitals use the same measurements because the delivery hospital cut 58% off of our bills but the Children's Hospital cut off 75% of our bills. It did turn out to be a bit of a hassle to go through the application processes but it literally saved us thousands.

But how do you go about applying for this secret program? Answer: When you get your bill, turn it over. When I had usually gotten the bills in the past I would typically just look at the amount and never realized that they all contain information about applying for financial aid. One of the hospital bills told us to call the financial aid department and they mailed us the applications. But on some of the bills they had the application printed right there on the back. All you have to do is flip it over, fill it out, and send the bill back to them.

Are there any other awesome benefits to the program? Of course! The hospital sends the bill to your insurance, who pays their portion then applies the remaining amount towards your deductible, assuming that is how much you will be paying. After the hospital approves you for financial aid they simply write off that part of your post insurance bill but don't communicate it to your insurance provider. For example, according to our insurance we have almost reached our out-of-pocket maximum but in reality we've only had to pay out about 75% of our deductible. So we get to pick up the benefits of the amount that they write off twice.

Another benefit that we found from the process is that it buys you time if you need it. Because we had an emergency fund in place this actually ended up not mattering to us, BUT if you don't have the money on hand to pay the bill you might as well apply for the aid. Whether you will qualify or not, it will give you time to come up with the money. Once you send in your application they don't hold you responsible to pay the bill until they have reviewed and made a decision about your application.  One of the hospitals told us days they hold the application for 90 days before it is even reviewed by the decision board. So, for instance, our son was almost 4 months old before we were told how much we owed for his birth.

So, moral of the story. Babies do go on sale, and they don't even have to be a scratch and dent model, it's just as cute as ever (just with a smaller price tag tied to the ankle).