Before You Accept a Hospital Payment Plan: A Checklist

A hospital payment plan can be a reasonable way to handle a large bill, but free or discounted care may come first. Work through charity care, costs and written terms before you pay.

This guide is general information for borrowers in the U.S., not financial or legal advice. Lending laws differ by state and change over time; check with your state's financial regulator or a nonprofit credit counselor about your situation.

Key points

1. Nonprofit hospitals must have a written Financial Assistance Policy that is provided free on request and explains how to apply for free or discounted care.
2. Ask whether the plan carries interest or fees and compare the full plan total against an itemized bill before making the first payment.
3. Federal rules require nonprofit hospitals to make reasonable efforts to check whether you qualify for assistance before selling your debt or reporting it to credit bureaus.
4. Get every term in writing, including what happens if you miss a payment and whether collections or credit reporting is paused while you pay.
5. You can complain to the CFPB at (855) 411-CFPB (2372) or report a nonprofit hospital to the IRS if it does not follow the rules.

A hospital payment plan can keep a large bill from landing all at once, but it is not always the cheapest option on the table. Nonprofit hospitals are required by federal law to offer free or discounted care to patients who qualify, and some states require more. Work through this checklist before the first payment leaves your account.

Check Financial Assistance Eligibility First

• Ask for the Financial Assistance Policy. Nonprofit hospitals must have a written policy, and by law it must be provided free of charge and explain how to apply. Ask whether it is available in your preferred language.
• Read the eligibility criteria. Federal law does not spell out who qualifies, and state rules vary widely. Ask the hospital what income levels and other criteria apply and how it decides between free and discounted care.
• Gather the documents. Hospitals typically want income information such as last year’s tax forms or a current pay stub, plus expenses including rent or mortgage payments, utilities, credit cards and other debts.
• Ask which providers the policy covers. The policy must list other providers delivering care in the hospital and say which are covered by the policy and which are not. A covered hospital stay can still produce separate bills from physicians or other practitioners.
• Check for state programs. Some states run their own help. New Jersey’s Hospital Care Payment Assistance Program is available at all acute care hospitals in the state for patients who meet income and asset criteria, and Washington expanded its charity care income requirements in 2022, making thousands more residents eligible for free or discounted hospital care.

Helpful step

Charity care is not only for people without insurance. In Washington, it can cover out-of-pocket hospital costs such as deductibles and copays for patients with private insurance, Medicaid or Medicare, based on income alone.

Ask Whether the Plan Charges Interest or Fees

• Ask directly whether the hospital’s own plan is interest-free. Do not assume. Ask whether the plan carries interest, enrollment fees, late fees or any other charges, and what the total cost will be if you pay on schedule.
• Find out exactly what product you are being offered. Some payment offers come from financing products such as medical credit cards or installment loans rather than the hospital itself. The Consumer Financial Protection Bureau has said it plans to publish briefs on the pitfalls of medical credit cards and installment payment products in medical care, and their terms can differ sharply from an arrangement made with the hospital’s billing office.
• Try the hospital’s billing office before borrowing anywhere. A payment arrangement made directly with the hospital is usually worth attempting before taking on debt. Help to Look for Before You Borrow lists assistance programs worth checking first.

Compare the Plan Total to Your Itemized Bill

• Request an itemized bill and read it closely. Make sure the items match the care you actually received. Confirm the bill belongs to you by checking that your name, insurance details and mailing address are all correct. If any charge is unclear, ask the provider to explain it in plain terms.
• Check for out-of-network protections. For care you received starting January 1, 2022, the No Surprises Act limits surprise billing in emergencies, including charges from a provider whose network status only became clear after the bill arrived.
• Use your good faith estimate if you have one. If you are uninsured or paying without using insurance, you are entitled to an estimate before care. When the final bill runs $400 or more past that estimate, you can challenge the difference through a formal dispute process set up for disagreements between patients and providers.
• Add up the full plan total. Multiply the monthly payment by the number of payments and compare it with the itemized bill. The hospital’s policy must state the basis for calculating amounts charged to patients, so ask the billing office to show how they got from the bill to the plan.

Ask What Happens if You Miss a Payment

• Ask what the policy says about nonpayment. A hospital’s financial assistance policy must describe the actions that may be taken if you do not pay. Get the specific answer for your plan: does one missed payment end the discount, end the plan, or start collection?
• Ask whether you can reapply. Eligibility is based on your financial situation, so if your income drops, ask whether a new application can be submitted mid-plan.
• Tell collectors if one is already calling. If the bill is past due, notify any debt collector that you are seeking financial assistance and ask them to pause collections while the application is pending.

Confirm the Bill Won’t Go to Collections or Credit While You Pay

• Know what the law requires first. Federal rules for nonprofit hospitals require reasonable efforts to determine whether you qualify for financial assistance before the hospital takes extraordinary collection actions, which include selling your debt to another party and reporting negative information to consumer credit reporting companies.
• Hold the hospital accountable for its collectors. Hospitals are responsible for the collection actions of the agencies and debt buyers they refer or sell debt to, so a collector’s conduct counts under those rules.
• Ask what gets reported. Ask whether the hospital or any collector reports to credit bureaus while you are on the plan. If a collector has already reported the bill, ask it to show the bill as disputed while your application is pending.
• Know some states go further. Washington hospitals, for example, must inform patients about financial assistance options verbally and in writing and screen patients for eligibility before attempting to collect payment.

Get Every Term in Writing

• The payment amount, due dates and total number of payments, so the schedule cannot change without your knowledge.
• Any interest, fees or penalties, written as actual dollar amounts or rates rather than described verbally.
• Any discount and how it was calculated, tied to the itemized bill so you can verify the math.
• What happens if you miss a payment, including whether the discount survives and whether collections or credit reporting can begin.
• A statement that no collection action or credit reporting will occur while the plan is current. A verbal assurance at the billing desk is hard to prove later.
• The name and contact details of the person who gave you the terms. Keep notes of every call: the date, the name and what was said.

Who to Call if the Terms Change Later

• Start with the hospital’s financial counselor. Ask for the terms in writing again and the reason for any change. If your situation has changed, ask about reapplying for assistance.
• Complain to the CFPB if you hit a wall. You can submit a complaint with the Consumer Financial Protection Bureau online or by calling (855) 411-CFPB (2372).
• Report a nonprofit hospital to the IRS if it does not follow the rules. In exchange for favorable tax treatment, nonprofit hospitals must meet federal requirements for helping people who cannot pay. The IRS website has more information on charity care and accepts reports when those requirements are not met.
• Contact your state attorney general where state law applies. In Washington, the Attorney General takes complaints from patients who believe a hospital is not following the state’s charity care law.

Related guides

• A Timeline for a Hospital Bill You Can’t Pay: what to do, step by step, when the bill arrives before you can pay it.
• Help to Look for Before You Borrow: assistance programs to check before taking on debt for bills, food, rent or medical costs.
• Before You Fall Behind on Utility Bills: A Checklist: the same order-of-operations approach for keeping essential services on.

Common questions