Medical Debt Consolidation: How to Get Help

Medical Debt Consolidation

If medical bills are making you sick, don’t despair. There are cures for America’s medical debt epidemic.And what a plague it is. We spend more than $3.6 trillion a year on medical bills, or about $11,200 per person.

Almost one-third of Americans have unpaid medical bills and 28% of those owe more than $10,000, according to a 2019 survey by Salary Finance. The good news is there are ways to heal your bank account.

But should you consolidate medical debt? Apply for a government relief program? Get a medical debt loan? File bankruptcy?

Merely exploring the options can give you a headache. Just don’t get one if you’re in a hospital, where a single Tylenol capsule can cost you $15.

Here’s a simplified look at how to get medical debt relief.

Unpaid Bills

You are hardly alone if you have unpaid medical bills. They account for more than half of all bills that are turned over to collection agencies by identifiable creditors, according to the Consumer Financial Protection Bureau.

If you don’t pay up, the hospital or healthcare provider will eventually sell your unpaid bills to a debt collection agency. Then the hassling and credit wreckage begins.

Debt collectors can’t threaten you or call you in the middle of the night. They can pester and file lawsuits, so ignoring them is not an option.

A collection agency damages your credit score, which will make it harder and more expensive for you to get a loan in the future. Delinquent medical bills are not given as much weight as other debt, but they can stay on your credit report for seven years if they aren’t paid.

Figure out a way to deal with them before that happens.

Consolidating Medical Bills

If you’ve been hospitalized, you know there’s almost no such thing as a medical “bill.” There are medical “bills” – plural. Keeping track of them can be a hair-pulling experience. Many consumers find it easier to consolidate them and make one monthly payment. Here are your best debt consolidation options.

Debt Management Program

You enroll in a program offered by a nonprofit and credit counselors negotiate with your creditors to reduce the interest payments on your bills.

Be aware that medical bills do not have interest charges. People generally use debt management programs if they paid their medical bills with credit cards or have other bills to consolidate.

Credit Counseling

Those same nonprofit credit counselors comb over your finances during a free credit counseling session and develop a budget and a plan for you to pay off your medical debt in a 3-5 year timespan. Then they’ll negotiate with your healthcare creditor to accept the plan.

Personal Loan

You can refinance existing debt or pay for planned procedures by borrowing money from a bank, credit union or online lending service.Most personal loans are not secured, meaning you don’t have to put up collateral (like your house) to qualify for one. But you may have to if your credit history is poor.

Home Equity Loan

If you have a mortgage, you can take advantage of the home equity you’ve built and borrow against that money. Interest rates are relatively low and usually tax deductible.

The downside is your using a secured asset (your home) to pay off an unsecured debt (your credit card or medical bills). If you fail to pay, you could lose your house.

Medical Debt Consolidation Program Benefits

One monthly debt payment, combining credit card debts with medical debts, will streamline your bill paying process and help you stay organized and save money.

Including medical debt on a debt management program may help you pay it off more consistently and faster than you would on your own.Making consistent, on-time payments, as is required while on a debt management program, can help you improve your credit score.

In fact, if you already are in a DMP, it’s possible you could roll the medical bills into the program. That won’t make much difference in terms of what you owe, but it may be more convenient than writing checks to a variety of doctors and hospitals.

Other Medical Debt Relief Options

Debt consolidation is a popular choice for people looking to reduce medical debt, but it is not the only one. There are other options ranging from simply examining your bill for errors as closely as a pathologist would examine a brain tumor to the nuclear option of bankruptcy.

  • Review Medical Invoices for Accuracy: A 2018 study by Medliminal, a company that works to reduce medical costs, found there were mistakes in 99% of medical bills. Be sure check your invoices for inaccuracies like double-billing, overcharging and other errors. If your bill is large and complicated, it might even pay to hire a medical billing advocate to review your bill.
  • Negotiate your medical debt: Don’t take your bill at face value. You can try to negotiate it down and get on repayment plan, especially if you can show financial hardship.
  • Ask for a Payment Plan: Even if you have insurance, deductibles and other fees can be astronomical enough to prevent you from making one payment. The simplest way around that is to break the bill into equal payments over a period of months.
  • Consider Filing for Bankruptcy: Almost 67% of bankruptcies were tied to medical debt, according to a 2019 study by the American Journal of Medical Health. Because they are unsecured, medical bills are easily wiped out that way. The downside – and it’s a big one – is bankruptcy destroys your credit score and stays on your credit report for 10 years.
  • Seek help from Government Programs: Nonprofit hospitals are required to provide financial assistance to low-income patients, so check to see if you qualify.

Medicare can help pay medical costs if you are over 65. If you are younger than 65, you can qualify for Medicaid, which is the single largest provider of health insurance in the country.

Is Medical Debt Consolidation Right for Me?

That’s the $29,000 question. At least that’s what hip replacement surgery typically costs in the U.S. that’s almost $10,000 more than the next-highest cost country, Australia. It’s about $18,000 more than you’d pay in France, and you might be able to see the Eiffel Tower from your hospital room over there.

If you have about three hours and a pot of hot coffee, we could explain why healthcare costs in America are so ridiculously high, but all you want to know now is whether it makes sense to consolidate the medical bills you have.Maybe.

For a better answer, ask yourself a few questions:

  • Have you taken out a loan and are paying interest on the debt? Or worse, did you put the debt on a credit card?
  • Can you pay your medical debt and still meet your other monthly financial obligations, like rent and grocery bills and car payments?
  • Would consolidating eventually eliminate your debt, or would it make more sense to just file for bankruptcy and start over?

These can be tricky questions. If you need help figuring things out, talk to a professional credit counselor from a nonprofit credit counseling agency. Some good advice could be just what the doctor ordered.


Detweiler, G. (2020, July 10) The truth about medical bills sent to collections. Retrieved from

N.A. (2020, April 20) Why Are Americans Paying More For Healthcare? Retrieved from

Gelman, P. (2018, March 27) 10 Wildly Overinflated Hospital Costs You Didn’t Know About. Retrieved from