Dealing With Medical Debt


Illness and injury can cause stress in our lives. When illness and injury lead to medical bills not covered by health insurance or other assistance, the stress can greatly increase. This stress does not help anyone get better or stay healthy. Medical debt can also destroy financial security and cause other family problems. It is important to plan for medical expenses. Equally important is knowing how to deal with medical bills when you have no money to pay them.

Medical debt is very different from other debt. The choice is whether to protect your very life with health treatment rather than have a new car, new clothes, or a new home. With severe health problems, we often do not have any options other than seeking treatment. Protecting yourself in advance from medical debt should be your first priority.

Avoiding Medical Debt

Of course, taking care of your health should be your first goal. This means working to keep your body healthy. It also means using preventive medicine and getting medical treatment as soon as needed.

Besides taking care of your health, the first defense to medical debt is having medical insurance coverage if at all possible. You should also use all available medical assistance for which you qualify. This means:

  • buying medical insurance;
  • reporting work injuries through Worker Compensation; and
  • participating in Medicare, Medicaid, VA Medical Benefits and other medical assistance programs such as IowaCare, Medically Needy, and Medicare Savings Programs if you are eligible.

When faced with medical bills that you cannot pay, check with your local Department of Health and Human Services office to see if you are eligible for additional medical coverage and assistance.

If you or someone you know is without resources for medical care, you should also know Iowa law requires county hospitals to provide free medical care for people without financial resources or the ability to earn income by labor. You need to have legal residence in the county where the hospital is located. Each county hospital has guidelines to determine who is eligible for free care. For details about your county hospital free care program, check with the hospital's business office.

Dealing With Medical Bills

In many cases people do not have health insurance. If their insurance or assistance does not cover all of their costs, medical bills can quickly deplete savings. Even if you have medical insurance or Medicare, uncovered medical costs can lead to debt. Hospitals and doctors often use collection agencies that aggressively try to collect this debt. The stress of this debt collection can affect your health.

One option is often overlooked when dealing with hospital bills. You can apply for a hospital's financial assistance program. Most if not all Iowa hospitals in Iowa are "not-for-profit" organizations. This means they do not pay federal income taxes and may have a responsibility to provide assistance for people who are unable to pay their hospital bills. If your hospital bills are not being paid by insurance or other assistance, you should ask at the hospital business or billing office to apply for their financial assistance program. The hospital may not tell you about their program unless you ask for help. Different hospitals may give their program different names. They may call it charity care, hardship assistance, or patient payment assistance. To apply for help you will be asked to fill out a financial form to show your income, expenses, and assets. This program can greatly reduce your hospital bills. Doctor bills which are separate from the hospital bills are not covered under this program.

With or without financial assistance, the hospital or doctor's office may help you pay bills by working out a payment plan. Don't forget this possibility.

People often overlook one other option to deal with medical bills. Double check for billing errors in your statement. Make sure you are only being billed for services you received. You should also check to make sure you are not being billed for services that have already been paid OR should have been paid by insurance, Medicare, Medicaid, or some other provider.

Finally, if the injury or illness is due to an accident or another person's negligence, your medical bills may be covered by someone else's insurance. In this case, you should consult with a private attorney for help to deal with these medical bills.

Defending Against Medical Debt

If you have been unable to resolve payment issues with the hospital or doctors, they may start collection efforts against you. In this case, check to see if you have any defenses against the debt. Many issues may be used as a defense against debt collection:

  1. The bill should have been paid by insurance, Medicare, Medicaid, Worker Compensation, or someone other than you.
  2. The bill is wrong.
  3. As a patient at a county hospital, you were eligible for free care.
  4. You were eligible for financial help at a private "not-for-profit" hospital.
  5. Too much time has gone by since you got the medical care (statute of limitations).

Call Iowa Legal Aid to see if you have defenses against medical debt.

Even if the medical debt is correct, you may not be able to pay the debt. In this case, you should know that there are protections from debt collectors against unfair debt collection. There are also protections for your income and property. This includes the option of filing for bankruptcy to get rid of medical debt completely. These are important protections which help people continue to pay their necessary living expenses without harassment by debt collectors. Iowa Legal Aid can advise you about these protections.

Iowa Legal Aid provides help to low-income Iowans. 

To apply for help from Iowa Legal Aid:

  • Call 800-532-1275. 
  • Iowans age 60 and over, call 800-992-8161.
  • Apply online at

If Iowa Legal Aid cannot help, look for an attorney on “Find A Lawyer.”   A private attorney there can talk with you for a fee of $25 for 30 minutes of legal advice.

*As you read this information, remember this article is not a substitute for legal advice.

Last Review and Update: Jan 09, 2023
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