Injured in an Accident? How to Budget for Medical Bills and Other Expenses

Being injured in an accident is stressful enough on its own, but that stress is multiplied when you can’t work and have to deal with lost wages. When your medical bills finally start coming in, it can be a source of anxiety trying to figure out how you’ll pay them.

 

Medical bills can pile up fast after an accident, and it’s important to have a plan to avoid ending up in debt. According to statistics, despite over 90% of the U.S. population having health insurance, medical debt affects more than 40% of adults and accounts for $220 billion in owed balances. These numbers highlight the importance of financial planning after an accident. 

 

If you’ve been hurt in an accident – whether it was a car accident, a dog bite, or a slip and fall – you need a solid plan for handling your bills. 

 

Here are some of your options.

 

  1. File a personal injury lawsuit

 

Don’t settle for being left with a mountain of debt after an accident that wasn’t your fault. The best help you can get is hiring a lawyer and filing a personal injury lawsuit against the negligent party. The vast majority of cases settle out of court and never go to trial. That works in your favor because it means your attorney will fight to get you generous compensation according to what your case is worth.

 

In the meantime, there’s a chance you’ll be contacted by an insurance adjuster offering a lump sum of money for your injury, but don’t accept any offers without consulting a lawyer. Insurance companies are known to make lowball offers in an attempt to prevent people from filing lawsuits. The amount offered is almost never enough. If you accept a settlement offer from an insurance company, there’s a good chance it won’t cover all of your bills, and you’ll lose the right to sue.

 

  1. Visit a hospital with a  financial assistance program

 

Some hospitals offer sliding scale or charity care based on income. Accessibility depends on where you live, what services you need, and your gross income. However, even if you can save a few hundred dollars by getting some tests covered, it’s worth exploring this option.

 

  1. Calculate your immediate medical costs

 

You can’t budget if you don’t know what you’re being asked to pay. Before you start paying anything, track all of your visits to the ER, regular appointments, ambulance rides, and overnight hospital stays. These expenses can reach thousands of dollars. For instance, a CDC study found that the average ER visit to treat an injury costs $5,800, while inpatient care averages $52,250. It’s important to collect itemized statements and final bills so you know what you’re facing.

 

Remember to include physical therapy, medication, and follow-up tests. If you use care outside of your network, pay attention to the balance you’re expected to pay. The difference owed can be shocking.

 

  1. Don’t forget about household bills

 

While you’re busy budgeting for your medical bills, don’t forget to manage your household bills. For example, if you can’t work and your bills are piling up – like rent, internet, and electricity – you’ll need to prioritize what you pay. For instance, it makes sense to pay your rent before you pay your medical bills. If you have a mortgage, call your lender and ask them to pause your payments for a month. Some companies are willing to work with injured people, especially when they know they’ll be getting a lawsuit settlement.

 

  1. Consider bankruptcy as a last resort

 

While some people immediately start planning for bankruptcy after an injury, this should be your last resort. Although medical debt is dischargeable under Chapter 7, it can hurt your credit for many years. There’s nothing wrong with bankruptcy, but make sure to explore other options first. Sometimes it’s avoidable.

 

  1. Fight incorrect charges

 

Look at your itemized bills and verify that all charges are accurate. Never start making payments on a bill that includes inaccurate charges. Contest line items that don’t seem right or that you know are bogus. However, don’t be surprised if some of those items stick. A lot of what seem like fraudulent medical billing practices are technically legal.

 

Don’t leave your finances to chance

 

After an injury, you’re going to have medical bills. But don’t let them pile up while ignoring them. Start planning for how you’ll handle them, whether you pursue a personal injury lawsuit or file for bankruptcy. Take control early because waiting will only increase your stress.