Each year, several million households face severe medical crises such as heart disease, cancer, and AIDS. Medical expenses can devastate a family's finances and lead to a poor credit rating or bankruptcy. Even people with "good insurance" may be responsible for large bills that are difficult to pay. This article describes issues faced by patients and their families, available resources, and tips for coping with the financial after-effects of a medical crisis.
It is important to carefully read your health insurance policy to understand what expenses you are responsible for. Primary costs are costs for actual medical care and include copayments, deductibles, and physician and hospital bills not covered by insurance. Read the "fine print" to understand your coverage limits and the process required to obtain benefits.
Patients and their families can also experience significant secondary costs. These include travel and meal costs for treatment, increased telephone calls, wigs and turbans for hair loss, lost wages for a patient or their spouse, and costs for support or assistance. Some people also overspend in an effort to feel better (a.k.a., "retail therapy").
Fortunately, there are a variety of resources that patients can tap to help cover medical expenses. In addition to health insurance, these resources include Medicare, Medicaid, and New Jersey Family Care, the state program for uninsured adults and children (check the Web site www.njfamilycare.org ). There is also a state program for children with catastrophic medical expenses, veterans' health care benefits, and hospital charity care programs.
It is important to keep good records of all medical expenses. Keep copies of bills from providers, correspondence from your insurance company, records of payment, and copies of referral forms for an HMO. Be sure to keep track of the number of authorized visits and the expiration date to avoid denials of coverage.
In addition, never pay a medical bill without checking it out first. About 90% of hospital bills contain errors, mostly in the hospital's favor. Request an itemized bill that contains a description of services and prices and keep a log of procedures, medicines, and doctor visits. If anything seems questionable, call the provider or your insurance company.
There are also tax considerations for families facing a medical crisis. If income is reduced, you may want to adjust tax withholding to free up extra cash. You may also qualify for a federal tax deduction if unreimbursed medical expenses exceed 7.5% of your adjusted gross income. Keep track of all medical expenses including co-payments, insurance premiums, and transportation expenses.
If an ill family member is unable to work, they or their working spouse may qualify for family and medical leave. This provides up to 12 weeks of unpaid leave over a 12-month period. The leave can be used in small increments such as a week off after each dose of chemotherapy.
There are a number of resources available to patients with information about financial concerns. They include community organizations, such as the American Cancer Society, and helpful Web sites such as www.patientadvocate.org . In summary, keep good records and treat a medical crisis like an important job. Question anything that should be covered but isn't. Get your employer's human resources office to assist if health insurance problems occur. Finally, be sure to budget for ongoing medical expenses such as travel costs, copayments, and prescription drugs.