Medical bills can come as an unpleasant shock. Due to opaque costs and complex health insurance networks, unexpected charges may appear out of the blue.

As it happens, there are a variety of strategies for handling medical expenses more effectively, from understanding coverage to exploring cost-cutting measures. Here are four tips to get you going in this endeavor.

Budgeting

Due to rising healthcare costs and complex insurance plans, many Americans worry about how they’ll pay unexpected medical expenses. With some basic knowledge and organization skills, however, these expenses can be lessened significantly.

One of the greatest healthcare expenses for individuals are deductibles and copayments, so in order to save money on these costs it’s crucial that they compare healthcare providers and services before making their choice. One effective strategy to reduce healthcare expenditure is shopping around for providers and services.

Cost of procedures can differ dramatically between hospitals. Medicare has provided online access to their 2011 chargemaster prices for various inpatient procedures so you can easily compare these with similar offerings from local facilities.

Hospitals reported uncompensated care and bad debt of $20.8 billion in 1999, representing only 6.2% of their total costs (MedPAC, 2001). This estimate does not take into account care provided to uninsured people by clinics and community health providers or charity care given by physicians in private practice or volunteering their services (MedPAC, 2001).

Shopping Around

With prices for procedures often differing widely across cities, consumers could benefit from engaging in price shopping for medical procedures. This is particularly relevant to those with high-deductible health plans requiring them to spend thousands before insurance kicks in.

Consumers can access pricing information for healthcare services at local healthcare facilities online. Insurers often offer cost comparison tools that enable their members to quickly locate providers with fair prices. Third-party “infomediaries,” like Healthcare Bluebook or Amino also have tools that allow consumers to estimate costs associated with certain medical procedures.

An informed consumer can benefit from having access to price information, as it allows them to identify unfair or legitimate charges and better control them. It can also give more spending and saving power directly into their hands which serves all. Putting money in health financing options such as FSAs or HSAs can also be helpful.

Negotiating

No one knows when or the costs associated with medical care will arise, but an Ameriprise financial advisor can offer tailored guidance to manage costs and potentially save money in the long run. They may suggest strategies like negotiating with billing offices and researching financing options to avoid interest charges, or discovering whether you qualify for income-driven hardship plans.

Ask the billing department for an itemized bill and compare it with your explanation of benefits (EOB) from your insurance provider if applicable, to ensure that items and services provided have actually been charged to your account. This will give you peace of mind that those being charged actually provided them.

Secondly, if there’s any discrepancies, inquire about discounts. Hospitals and clinics are used to negotiating, so don’t be shy to negotiate; hospitals might reduce or forgive some of what you owe altogether. Keep your finances in order; never put medical debt on a credit card!

Prioritizing Debts

Health care costs can be an immense financial strain for many families. Even those covered by private health insurance pay out-of-pocket health expenses more frequently than those without health coverage; those uninsured tend to use less health services, yet when they do utilize these services they often incur debt as a result of these costs (Hadley and Holahan 2003a).

Negotiate an interest-free payment plan with hospitals or clinics rather than charging it to a credit card; this will also avoid processing fees that can be costly. Remember to pay other bills such as car and mortgage loans first before paying medical expenses as paying too early can have negative results such as eviction and foreclosure proceedings.

Financial assistance and debt repayment programs could provide hospitals with quick wins, making them a better alternative than debt collections. More research needs to be conducted in order to ascertain whether these programs actually improve health outcomes.