13 Life Hacks to Reduce or Eliminate Medical Debt

Almost every American faces medical debt at some point in their life. So you’re not aloneiStock_000009697836_Large if you’re scared of the prospect of medical debt damaging your personal credit and causing you to go into a financial crisis when you least expect it.

Fear not! There are ways to avoid having your financial dreams derailed by a medical emergency, an unexpected procedure, or unnecessary medical expenses. Here are some life hacks we came up with that can help you reduce or eliminate medical debt:

  1. Stick to Doctors Within Your Network – If your plan requires that you visit doctors within your network, stick to those doctors so you don’t have to pay out-of-network fees.
  2. Pay Your Medical Bills In Full –Chances are you will receive a discount. Many hospitals offer a 10% discount when you agree to pay your bill in full.
  3. Don’t Switch Plans to Visit a Doctor Out-of-Network Once – You can save money if you only have to visit an out-of-network doctor once a year. Changing your plan for the sake of one service can result in higher health insurance plan premiums over the long term.
  4. Opt For “Minimum Essential Coverage” Instead of Expensive Health Insurance Plans – If you’re cash strapped and healthy, a minimum essential coverage may be your best option. These plan usually only cover preventative care and other basic medical services—not hospitalizations and outpatient surgery.
  5. Utilize Charity Care Programs – Your hospital may offer discounted services to low-income people. It’s a little known secret that you can apply for charity care programs that may reduce or eliminate your entire bill if you qualify. To get started, just call the hospital that has billed you and ask them if you can apply for their “charity care program”.
  6. Find Out What’s Covered by Your Health Insurance Provider – Before you schedule a medical procedure, find out what’s covered and at what rate. If you determine the cost will be high, talk to the referring doctor about lower cost alternatives.
  7. Request a Payment Plan – If you owe a medical bill that you are not able to pay in full, you can usually get on a payment plan with lower minimum payments. As long as you continue to pay the bill monthly, the debt should not show up on your credit report. All you have to do is call to make arrangements before the debt becomes delinquent.
  8. Use Urgent Care Centers – Find out if urgent care centers are included in your health insurance plan network. They often charge a flat fee for labs, therefore you won’t have unexpected bills later on. They can also help with a variety of problems that don’t require hospitalization, which will also save you money in the long run.
  9. Ask for Prescription Samples or Coupons – Some prescriptions are free at pharmacies such as Walmart and Meijer. When filling your prescription, ask the pharmacist if any samples or coupons are available.
  10. Combine Doctor Visits to Save Money – When visiting your doctor, make sure they address multiple issues at once so you don’t have to go back for repeat visits.
  11. Get Refills on Prescriptions from a Family Doctor Instead of a Specialist – For example, if you go to a dermatologist to get a prescription for acne, instead of going back to the dermatologist for a refill on the prescription, it may be cheaper to go to your family doctor or a general practitioner to get a refill.
  12. Research the Costs of Certain Procedures/Appointments – Research the costs of procedures and appointments ahead of time so you can choose the lowest cost provider.
  13. Apply for a Grant from the Healthwell Foundation – You can apply to receive financial assistance with covering your medical bills. If approved, they may cover $6,000 per year in medical insurance premiums (for certain diseases). Visit https://www.healthwellfoundation.org/ for more information.

Courtesy of Accel Financial Counseling, Destinations Credit Union‘s financial counseling partner.

How Can I Know If My Too-Good-To-Be-True Deal is Legitimate?

Brought to you by Destinations Credit Union 
 

Q: I was shopping for a new handbag online and noticed a huge difference in prices between retailers. One had a bag for $20, while the other had the same for $200! The first option seems too good to be true. Should I be wary of that amazing deal? 

A: It’s possible, though very unlikely, that someone is selling brand name goods at a fraction of the price. It’s far more likely, though, that the cheaper goods are counterfeit. They’re made to resemble the original, but use low-quality materials and little or no quality control in the manufacturing process.

Counterfeit goods used to be confined to small luxury items sold by street vendors. Sunglasses and watches were the easiest to vend to tourists and others who were prepared to deal in cash yet unprepared to carefully scrutinize the goods. The rise of the Internet as an international marketplace has resulted in the proliferation of the “fakes” industry. A recent report by the Organization for Economic Cooperation and Development (OECD) shows that around 2.5% of all global trade is in the form of counterfeit goods.
While the most common targets are luxury goods, modern counterfeit manufacturers have moved on to products where the deception is even more difficult for lay people to detect. Car parts, computers, and pharmaceuticals are among the growing pool of off-brand goods that are being marketed at name-brand prices.
It’s not just the fashion-conscious who should be concerned. These products aren’t held to any production standards. There’s no telling what could be in a counterfeit drug, or whether a counterfeit car part will even work. These products take advantage of the trust consumers put in established brands and could result in serious injury or death.
Even if you’re buying shoes (one of the most commonly counterfeited products, according to the OECD), it may not be harmless fun. Because the manufacturers operate outside the law, they frequently circumvent all labor safety standards. The counterfeit goods may be manufactured by children, or in conditions that fail to meet even the most basic safety standards. The chemicals used to treat vinyl or leather in counterfeit manufacturing facilities are also exceedingly hazardous, and may contain toxic levels of lead even after arrival.
The profits from the counterfeiting industry may support a wide range of dangerous elements. Organized crime groups, drug cartels and terrorist organizations are among those that use counterfeit goods to finance some of their operations. Because of all these scenarios, supporting the fakes industry is not a decision to be made lightly.
Counterfeit goods are like any other online scam. You need to take steps to protect yourself against being shortchanged. If you’re worried about buying counterfeit goods online, take these steps.
1.) Watch the price 
It’s possible that a vendor is selling goods at an impossibly good deal. If you’re buying from last year’s stock of brand name goods, or if the goods are returned or were previously opened, you might get 40% off the retail price. If you’re seeing a brand name good for 10% or less of its retail price, it’s got to be too good to be true. 
2.) Check the label! 
Most counterfeit goods are made to pass an initial visual screening. Manufacturers will put as much effort as possible into making the knock-off item shiny, with the logo being highly visible. They hope to distract consumers from exercising more careful scrutiny.
One of the most common errors in counterfeit goods manufacturing is the manufacturer’s address. Counterfeiters will use the corporate headquarters address, while manufacturers will list the location the goods themselves are manufactured. Minor errors in spelling or formatting of care instructions can also serve as red flags for counterfeit goods. 
3.) Evaluate your source 
Reputable vendors want nothing to do with counterfeit goods. The brand has value to the retailer as well. If asked, vendors should be able to clarify their supply chain. They should take steps to ensure their goods are legitimate.
If you’re buying something pre-owned, it can be difficult to keep the same level of scrutiny up. Check labels and serial numbers as carefully as possible. If an item has survived one owner, odds are good it’s not counterfeit.
When shopping online, stay away from auction sites like eBay, which are rife with counterfeit goods. Look for authorized retailers or online versions of brick-and-mortar stores. These retailers are more likely to have those supply chain controls in place.
Many cities also have places that are infamous for selling counterfeit goods. Trust your instincts if you’re on vacation. If an area is surrounded by street vendors selling normally expensive branded merchandise, find another place to shop. 
4.) Pay your taxes 
One of the most common ways criminals get caught is through the IRS. If you’re concerned with the authenticity of a retailer, ask for a receipt. If you don’t get one, that’s a huge red flag. If you do, look for sales tax. Because counterfeiters are already breaking the law, they don’t bother to report their sales or pay sales tax. This exclusion also reflects part of the “incredible deal” they are able to offer on brand name goods. If a store is paying sales tax, odds are good they’re on the level. 
Okay, now it’s your turn to share: What do you do to check the quality of the goods you purchase? Are there brands you always trust, or retailers you recommend? Ever have an experience you’ve regretted but learned some tips that might be beneficial to others? We’d love to know!

How Everyone Else Spends Their Money


One of the most difficult obstacles in setting a budget is understanding how much is needed for each category. Is $500 enough for groceries or should it be $1,000? How do I know if I’m being extravagant when it comes to entertainment? Am I saving enough?

The same difficulty comes up when it’s time to negotiate your salary or ask for a raise. If we don’t know how much money everyone else is making, it’s difficult to ask for a fair amount. No one wants to leave money on the table because they asked for less than the boss would have agreed to, but there’s a little voice in the back of our heads that makes us uncomfortable with asking for too much.

That little voice is part of the problem, of course.  It’s what keeps us from asking the neighbors how they managed to save up enough to buy the house. It’s what keeps us from being willing to admit our budget isn’t where we’d like it to be. Our overall discomfort with discussing money, which lies in stark contrast to our willingness to show off our money, can be an incredibly large problem.

In hopes of helping you live within your means, understanding where you’re being frugal and where you’re being extravagant, and figuring out what it will take to save for a house, retirement, or college fund, let’s take a look at how the typical American household makes and spends its money. As a reminder for those who haven’t taken algebra since high school, most of these statistics use the median figure, which is the number at which 50% of Americans would be above the number and 50% would be below. That number is more accurate than the mean or average, simply because the ultra-wealthy distort the mean, in spite of making up a very small proportion of the population. 

Question:  How much do Americans make?

Answer:  The typical household income is just shy of $54,000.  That number comes from the U.S. Census Bureau, which is reliable, but its reliability comes slowly:  it’s a 2014 stat. Still, our income is up one percent from 2013, and another 1 percent would put us at right about $60,000. After a few years of sub-one percent income growth in the middle class, every little bit helps.

Question:  How much money does the typical American have saved? Does age affect our savings?

Answer:  It really does.  Young people have the least saved, with 51% of Americans under 35 keeping less than $1,000 in savings.  Millennials have a negative savings rate of about 10%, meaning that for every $100 young people make, they spend $110 on average.  The savings outlook gets rosier as Americans get older, though, with positive savings rates among every other adult age-related demographic. Americans between the ages of 35 and 44 years old save at nearly a 3% rate, which doubles to nearly 6% for those between the ages of 45 and 54, and doubling again to 13% in the decade before retirement.

As for the total amount saved for a rainy day, the typical American household has around $6,000 in savings, around 12% of median household income.  Unfortunately, roughly one-third of all Americans reported that they had less than 30 days of emergency savings, while 47% said they had less than 90 days.

Financial planners typically recommend households keep at least six months of emergency savings on hand, although some analysts suggest household savings should be equal to a year’s income.  Six months of median income would be $27,000. 

Question:  So, how do we spend our money?

Answer:  The biggest chunk of the typical American budget goes to housing, at roughly $18,000 per year. That’s about one-third of our paychecks, which has a ripple effect throughout the economy.  It makes homeownership crucial, because getting back equity on part of that huge slice is the first step to financial security.  It also causes all sorts of geographic problems:  A family needs an income over $150,000 per year to buy a home in Los Angeles, but only $48,000 to afford a home in Orlando. Since everyone needs a place to live, employers have to pay employees more in expensive cities, driving up the prices of goods and services across the board and raising everyone’s cost of living. Thus, lower-income individuals are pushed farther and farther from city centers, lengthening commutes, increasing transportation costs and generating CO2.

Transportation costs about $10,000 per year, the second most expensive budget category, while food costs of around $7,000 come in third.  Both of these categories will be cheaper in next year’s numbers because fuel prices are so intimately tied into both.  Still, if you’re looking to clean up your budget, the 30% or so that typical families spend on cars, gas, groceries, and eating out is probably the quickest way to trim fat.

Personal insurance and health costs take up another $9,000 per year, so your health care and health insurance might cost more than your food.  Eating healthier may reduce all of these costs for your family, although it’s not clear how much less expensive eating healthy really is. 

The rest of our spending is discretionary spending, split into three roughly equal categories:  entertainment, clothes, and everything else. These numbers vary considerably from family to family and year-to-year.  If you bought a new washer/dryer last year, for example, you’re probably not in the market for a new one right now.

Hopefully, this article was enlightening and it can help you figure out how you’ve been spending your money as well as what adjustments you might make to save a little extra money.  If you’re looking to set up a more aggressive savings plan, let us know. We’ve got great programs and we’re eager to help you out.

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