One of the many scary things about being disabled is the crushing debt that can occur and add stress to your life.
Most disabled people end up relatively poor, sometimes below the poverty level, due to the combination of expenses and lack of income.
We often find ourselves struggling to do more with less and to try to make our checks(if we’re lucky enough to have them) stretch enough to cover our necessary expenses.
Why am I talking about this?
Well, bills are a major source of stress, especially if you simply don’t have the funds to manage them.
Our bodies don’t really differentiate between physical and emotional stress, so any stress you can get rid of gives you more time and opportunities to heal or at least leaves you more energy to manage the next crisis.
So, today, I want to talk to you about what I’d think are likely to be the two heaviest financial burdens we may have and ways to manage or reduce the bills.
Medical bills – the price for diagnosis and treatment
I have received my bills for my two emergency room visits earlier this year. On one level, I guess I did pretty well, in that my total bill has ended up being around $350(plus the $50 I paid them at the second visit). However, that’s still a chunk of change that I would rather not lose if I can help it.
While doctor’s bills are often unavoidable, you can minimize future ones by carefully selecting the best insurance provider for you.
Which health insurance provider you use, especially combined with staying in-network and purchasing covered medications can really reduce what you pay for each appointment, test, and treatment.
That said, ideally, you are selecting your coverage based upon the doctors you trust(so they are in-network) and the medications you take(so they are covered well). No matter what insurance you have, do your best to look at your total cost rather than just those premiums.
Charity Care at hospitals
One of the more expensive forms of medical support is hospitalization.
Whether it’s a trip to the emergency room, a multi-day stay, or an out-patient procedure, the expense of going to the hospital tends to be a lot more than individual doctor’s visits or medications.
The good news is that there is some recognition of how expensive hospitals are. Most hospitals have a charity care program for low-income individuals, as mandated by state law(the link is to New Jersey’s program as an example).
Even if you have insurance, you can still apply for charity care for your residual bills. There are some bills you will still have to pay, because the hospital itself doesn’t make the charges.
For example, if you had surgery, your anesthesiologist and surgeon can bill you separately and that’s not covered by charity care. It doesn’t cover test interpretations or any tests they need to outsource.
Charity care applications can be a bit of a pain, but it’s often worth looking into. While most hospitals have it in some form, some hospitals have the process well-managed and share the details regularly, while others are much more quiet about it.
If you have been hospitalized or had an expensive emergency room visit, look over your bill for the payment contact number if the charity care program isn’t mentioned, and ask them about applying for charity care.
Like most government programs they will need a lot of identifying information(like a birth certificate and state-ID), proof of income, insurance information(if you have any), and possibly a few additional requests.
If you are not on Medicaid(which you likely aren’t since they would cover the full costs), they will also check your eligibility and encourage you to apply if you are eligible for it.
Al and I have both been helped by charity care programs. After his hip surgery, we were hit with a hospital bill of around $3000. That was low compared to the full cost of the surgery, but way more than we could afford.
Initially, Al wasn’t eligible for their charity care program because his income the previous 12 months was too high, but he was able to set up a payment plan(another good option to spread out the costs).
About 6 months later, he checked in with them again, and they recalculated his income taking six months of no earned income into account, and he qualified for their program. The amazing thing was that their program was total forgiveness of the debt, and coverage for current and near-future hospital stays.
I’ve used it a few times, though my bills have never been catastrophic.
A few years ago, I had to have a biopsy taken, and because of my Functional Neurological Disorder(FND) symptoms, I needed to do it under sedation.
When all was said and done, I owed about $550, and had almost all of it forgiven by applying for charity care.
I still had to pay the residual on my anesthesiologist(I think that was $30 or so on a separate bill), but the bulk of the debt was forgiven.
I also was able to apply for similar assistance when I went to Louisville for treatment of my FND symptoms(a 6-day hospital stay), and again had most of the bill covered.
Both of us had insurance at the time(I have been on Medicare since 2006, Al was covered by his employer), which in my case covered 80% of the costs. That remaining 20% is what was forgiven, even with my being covered by Medicare.
I highly recommend asking about Charity Care whenever you end up visiting a hospital – it doesn’t hurt to ask, and if you are eligible, it can help a lot!
Repayment of student loans
If you already had some college experience and have debts from that, or if you are looking ahead at potential debts, there are some programs that give you temporary relief. There now is also a plan that will completely forgive your student loan if you are ‘disabled enough’.
Once you have your loan and have finished school, you typically get a six-month grace period before your loans are due.
Before the grace period ends, you want to have your paperwork completed and turned in.
Deferments and forbearances can only be used for a certain length of time(I believe about 3 years), so while you can use them, they are only good a few times. You may want to check into IBR plans first as those are always an option.
IBRs and related programs are something you can participate in annually for any length of time. If you spend 25 years in one of these programs, the debt may be forgiven.
I never got very far in paying down my college or graduate school debt.
Some years I have used the forbearance, and most years I have had my IBR calculated. Some years, my IBR has been about $30/month, other years they tell me $0/month.
IBR does not count disability income in its calculations(which is why it’s often been $0 for me).
The focus seems to be on the IRS’s judgment, so if your income isn’t taxable it doesn’t count.
That does mean that if you work while on disability, not only will that income be counted, but a small part of your check may be included in the calculation if any of it becomes taxable.
Disability-based Loan Forgiveness
I learned about the Total and Permanent Disability discharge mid-2018. It allows anybody who is ‘totally and permanently’ disabled(which in this case translates to ‘disabled and not earning our definition of substantial income for at least 8 years’) to have their student loan debt forgiven.
The more precise wording is that you need to have particular VA disability-related paperwork, proof that SSDI checks on you only every 5-7 years, or have paperwork from your doctor explaining your condition and certifying that you have been disabled for at least 60 months(5 years) or cannot be expected to recover significantly for at least that length of time. So basically, there needs to be a consensus that you aren’t getting better any time soon.
Once accepted to the program, there’s a 3-year monitoring period, where if your income(not counting disability payments) goes over their magic number, they consider you ‘not disabled enough’.
The good news on that front is if that happens, your loans just continue, but no interest or other expenses are added in(like there often is if you get a deferment).
If you are determined ‘not disabled enough’, however long the TPD program was in effect was effectively a forbearance. It’s a no harm, no foul type situation.
Be aware that that forgiven debt has historically been viewed by the social security office(and the IRS) as an asset so if you are on SSI or other need-based programs, that year your debt is forgiven may prevent you from getting services for the year.
There was a law change in 2018 that makes a student loan discharge(loan forgiveness) no longer counted as income by the IRS(at least between 2018 and 2025), but it looks like the state response is variable.
Social Security usually bases its decisions on the IRS’s rules, but with SSI being state-influenced, you may want to look into this further before applying for TPD if you are otherwise eligible.
You can get the big-bill monkey off your back!
Use this information to reduce your bills, and your stress!
Going to the hospital is often a stressful experience, and unfortunately, hospital bills are another round of stress when we really don’t need it.
You can reduce your medical stresses by planning ahead and selecting the insurance plan that gives you the lowest overall expenses, by minimizing the number of visits you need to make(finding more helpful doctors and following your treatment plan), and by applying for charity care before or immediately after your hospital visit.
I actually have had charity care people meet with me when I’ve gone into the hospital(I called in advance) and handled my application then and there. That’s a lot less stress than seeing the bill and worrying about how to pay it.
With student loans, most people are under a lot of stress, even those able-bodied and working full time. With the income cuts that often go with becoming disabled, wouldn’t it be nice to just not need to worry about that student loan debt?
Immediately after income loss(or as soon as you are up for it), you can apply for a forbearance or an income-based repayment plan, which will dramatically reduce(or completely cut out) your monthly payments for your student loans.
If you do turn out to be long-term disabled with minimal or no employment, you may eventually be able to get your student loans completely forgiven.
These bills are big stressors and its often hard to step back and find a way to make them more manageable. I hope this post helps you reduce your bills and your stress, so that you can focus on your healing process!