I recently attended a seminar on how to help families suffering from expensive medical crises on a pro bono basis.
This hits particularly close to home as I recently lost a friend to cancer. The number one reason that they're getting referrals for pro bono financial assistance these days is a catastrophic cancer diagnosis.
I was intimidated by the subject because sometimes we can't help when there aren't enough resources.
As it was explained to me, we're not expected to solve all the problems in the world. A lot of it is basic financial planning type things that we're used to, and, then, there's some added in things to think about and consider. There's a lot of help in the community, as well.
I am sharing my notes in case they're helpful. Thanks for taking a look!
Tom
Rough notes:
The majority of pro bono cases that are coming in now are coming from cancer organizations for referrals.
This is not terribly different from regular financial planning. There're just some other items to address. Pro bono is not ongoing work to help it. It's just to triage and refrain the situation and then get them to experts in the community.
It used to be that you could get away with not paying medical bills by just
High deductible healthcare plans are the number one option now, and people are more vulnerable to medical money problems as a result, and they can't afford to fully fund their health savings accounts.
Remember that we are consumers of healthcare, and we need to know that we are usually on the hook for the first $5,000 to $10,000 at least if we have health insurance at all. You get to choose where to go. Sometimes the referrals that are made from the hospital end up being the most expensive option. You don't have to pay the max to get a good MRI. You have choices.
One unique point of advice is to call all creditors and negotiate payments, deferrals, and utilize grace periods. Call them and ask for an open-ended
How to negotiate with creditors is really stuck into two camps:
- Current creditors who want to free up money for medical expenses cut waste out of the budget as much as possible. Contact utility companies and let them know to cut off billing for a while. There are state and Federal programs. Car loans very commonly have a provision where you can skip one or two payments, and they add those at the end, but that can free that month up. Let the representatives know what they have in their power to do for you.
- When the creditors are sending bills and threatening letters, know that they can't garnish wages without a court order. You want to demystify the fact that they can, in fact, negotiate with creditors. Third-party debt collectors need to show to the courts the debt is uncollectible, so if you, for example, say that you can only afford a small payment per month consistently and will spend more money then you can and send it via certified mail with a return receipt requested, you can prove to the court that you are attempting to pay the debt. "Here is how much I can afford to consistently pay over time, and I will send more as I can." Get it in writing, but if they don't respond, continue sending the payments, and keep those received receipts in a file. Remember that you are in charge, not the collector. Turn the power differential around. Help them reclaim their power. Let clients know that this is normal. We can brainstorm together. It isn't about a total end-all solution but can help connect with other resources and triage the situation.
Bankruptcy is usually an option, but what are you going to do after? You can only file bankruptcy every eight years, so timing is important and not a decision to be taken lightly.
Health insurance counseling is available and can be helpful.
United Way's 211 has a lot of information on charities that can help with food, repairs to the house, etc.
A list of resources is available here https://www.fpamn.org/wordpress/wp-content/uploads/Client-Resource-Website-Links.pdf
UPDATE: Some feedback from someone in healthcare management. "The first help for large hospital bills should be the hospital. Almost all hospitals have specialized staff to see if there are programs or insurance that can help pay the bill. Second several years ago the Minnesota Attorney General made hospitals in Minnesota agree not to do ANYTHING to people with incomes under $185,000 who chose not to pay. No credit reporting- nothing. Last year North Memorial Health, the fourth largest health system in Minnesota, wrote off over five million dollars in charity care."
This article represents opinions of the authors and not those of their firm and are subject to change from time to time, and do not constitute a recommendation to purchase and sale any security nor to engage in any particular investment or legal strategy. The information contained here has been obtained from sources believed to be reliable but cannot be guaranteed for accuracy.