I learned that it is common practice for insurance companys to
negotiate huge doctor and hospitol bills down to a fraction of the
amount. My family is with out medical insurance and receiveing some
big bills. In order to reach a settelment myself I need to know the
folowing.
 
What is the protocall for negotiateing a settlement. How and when do
you begin negoitation  who is authorized to negotiate and what are
some guidelines?

You are correct that insurers typically negotiate substantial
discounts for medical services, typically between one half and two
thirds of the amount billed, although sometimes the discounts may even
be more substantial.

Nothing extraordinary is required for you to address your medical
bills situation.  Especially if you are having trouble paying your
bills, you are advised to contact the creditor (the hospital or
physician) immediately to discuss your financial circumstances.  Bad
publicity about aggressive collections practices has encouraged
hospitals to improve their interactions with uninsured patients in
financial distress.

The hospital should have a representative available to counsel you
about your hospital bills and offer you information about financial
assistance programs.  You should certainly have reviewed an itemized
statement of charges and insured that they match the services you
received.  You can then approach the hospital regarding charitable or
financial assistance programs, along with fee reductions comparable to
those received by those with private insurance.

At the very least, you should be able to work out a payment plan with
the hospital that you can afford.  Collections are very expensive, so
creditors would rather work with you to receive at least a portion of
what they are owed instead of attempting to extract it from you
through lawsuits and hiring a collections agency.

Ignoring your bills is not the solution.  While an extreme approach,
hospitals can even have you arrested for nonpayment of bills, although
this is rarely used.  However, damage to your credit rating and other
adverse financial consequences can occur.

I have included links to multiple resources related to this subject
that I encourage you to read for additional information.

Sincerely,

Wonko

"Surviving and Controlling Debt: Know What You Want" Consumer @ction
(1993) http://www.consumer-action.org/English/library/money_mgt/1993_SurvivingDebt/index.php

"Haggle with your doctor, cut your bill" by insure.com
http://moneycentral.msn.com/content/Insurance/Insureyourhealth/P35612.asp

"Hospital Debt: Do NOT Ignore It" Health Assistance Partnership
http://www.healthassistancepartnership.org/site/DocServer?docID=3041

"Aggressive Collections" HealthLeaders (July 2004)
http://www.healthleaders.com/magazine/2004/jul/cover.php?month=jul&year=2004