More than 25 million Americans are stuck with medical debt. If you’re one of them, learning how to write a medical bill negotiation letter may help you to get a better deal.

Hospitals negotiate with insurance companies all the time to lower the bill amount. Why not negotiate with them yourself in much the same way?

In this article, we’ll explore how you can write a medical bill negotiation letter, what should be included, and what your settlement offer should be.

What Is a Medical Bill Negotiation Letter?

The purpose of this letter is to negotiate a lower payment for your medical bills due to financial hardship. This letter is sent either directly to the hospital or their billing company.

⚕️ For Example

If you received medical bills totaling $20,000, you might try to negotiate down to a $5,000 lump sum payment, with the hospital waiving the remaining $15,000 due.

This letter is not intended to contest what you have been charged. There is a separate medical bill dispute letter for that purpose.

Information Needed to Write a Medical Bill Negotiation Letter

Before you start writing your negotiation letter, there are a few steps you need to take.

The first would be exploring your options for paying the debt, such as disputing the amount billed, pleading with your insurance company, or applying for funds from non-profits. Check out our article on how to negotiate a medical bill for more guidance.

Next, you’ll need to gather all the information necessary for the letter. This includes

  • Copies of your medical bills
  • Your billing account number
  • Insurance coverage statements
  • The appropriate address
  • Financial statements (to determine how much you can pay)

It’s important to contact your hospital or their billing company before writing the letter so that you know who to send the letter to and what their requirements for the letter might be.

⚕️ Learn more: If medical bills have been a concern, you might find our article on PayZen’s approach insightful.

Sample Medical Bill Negotiation Letter


To Whom It May Concern,

I’m writing regarding the services I received from [HOSPITAL NAME] on [HOSPITAL BILL DATE]. The amount due for services is [AMOUNT DUE] on the bill [BILL/INVOICE #].

I am writing to negotiate the above medical bills because I am unable to pay the amount requested. This debt has caused me great financial hardship. [EXPLAIN HARDSHIP HERE]

I am grateful for the services I received, but as I cannot pay the full amount due, I hope you will consider my offer of settlement in the amount of [SETTLEMENT OFFER $] to close out this account. To substantiate my claim…[SUPPORT STATEMENT HERE]

Thank you for considering my proposal, and I look forward to hearing from you soon.



⏬ Debt settlement letter template for Microsoft Word
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 Debt settlement letter template in PDF

⚠️ Please Read Before Using This Template!

This template must be customized to fit your circumstances. You will see instructions for the information that you will need to insert. These instructions are indicated by [TEXT IN SQUARE BRACKETS].

Be sure that you fill in all required information and delete the text between [SQUARE BRACKETS] before you send the letter.

Your medical bill negotiation letter will be less effective if our instructions are still visible!

How to Customize the Medical Bill Negotiation Letter

The letter above is just a sample; you should edit it to your individual situation and needs. This letter is meant as guidance on how to craft a custom, genuine-sounding medical bill negotiation letter.

At the very least, the letter must have these three parts: your medical bill account information, the financial hardship statement, and your settlement offer. Be professional and polite when crafting your letter.

⚕️ Learn more: Looking to navigate your bills with ease? Our latest article breaks down the top bill negotiation services.

Account Information

Your letter may include the total you’ve been billed for services, the date(s) you received services, the invoice numbers, and any patient account ID (or other number) that you have been assigned.

Basically, you need to include any information that identifies you as the patient and/or references the bill(s).

This information should appear in an easy-to-reference section at the top of the letter and can be repeated in the introduction.

If you have multiple bills for the same stay, include details on each one, such as the amount due, invoice number, etc.

Financial Hardship Statement

This is a vital part of the letter, and it needs to be genuine. You can’t just say, “I’m sorry, I can’t pay”; you need to give them a reason why.

You don’t have to tell them your whole life story, but you can add as many details as needed to explain your situation.

🚑 For Example

This medical debt resulted from a severe car crash that left me out of work for six months. I have since found a new job, but this situation left me with many debt obligations, and I am unable to pay this bill in full.

🚑 Or, You Can Stick With Numbers

This medical bill is more than 40% of my annual income and is forcing me into financial hardship.

Make sure to include everything in this section that could help your negotiation.

Settlement Offer

A good first offer value would be approximately ¼ to ⅓ of the original bill amount. But you should also take a look at your financials to determine what you can reasonably afford.

Remember, this is a negotiation; you can start with a low offer and raise it. If you can afford $1000, try offering $500. Suppose the hospital settles for $500, great. And if they counter $800, you’re still good.

If you are trying to negotiate a payment plan, include information on how much you can pay every month and for how long.

As a part of your offer, you can offer evidence of your claim, such as values pulled from, proof of your income/finances, or anything else supporting the amount you offered as fair.

Special Requests

You should try speaking with the hospital/billing company before you draft the letter. They may have specific requests for formatting or information required to be in the letter.

Failing to adhere to their guidelines could have your letter rejected without them even considering your offer.

What to Do Once You Have Sent the Letter

Now comes the waiting game; you might get a reply quickly, or you may have to wait a while. Don’t be afraid to contact the hospital and ask them if they received your letter and if they have a reply yet.

Also, consider sending the letter by certified mail so you have a signed date of when they received your letter.

If Your Medical Bill Negotiation Letter Is Rejected

Hopefully, if your letter is rejected, the hospital will send you a counteroffer. If this is the case, remember, since this is a negotiation, you don’t have to accept their counteroffer. You can continue negotiating until you reach a figure you are comfortable with.

If the hospital outright rejects your offer and seems unwilling to negotiate further, you might need to explore other options. They may be open to a low-dollar payment plan. Or you could try looking for non-profit programs to help you pay the medical debt.

Alternatively, you can wait a few months and then try again.

If Your Medical Bill Negotiation Letter Is Accepted

Congrats, you’ve successfully negotiated down your medical debt. Now get that agreement signed and dated. Do this before you pay them a dime.

Usually, the hospital/billing company will have an agreement form prepared for you to sign. If not, you can add a settlement statement and signature line to your negotiation letter and resend it.

Just make sure that any statement you sign says something along the lines of the hospital agreeing to accept your lump sum offer and that they will not pursue you further for the remaining balance.

Never accept a deal without proof of the agreement (i.e., recorded phone call, signed document, dated email, etc.)

A Note on Medical Debt Collections

When negotiating medical debt, there are a few rules to keep in mind on how this debt can affect your credit.

The three most important rules are:

  1. Medical debt has to be outstanding for at least one year before it can be reported to your credit.
  2. Medical debt must exceed $500 in order to be reported on your credit.
  3. If a medical collection appears on your credit, and you later pay it off, it must be removed from your credit reports.

Outstanding medical bills no longer need to crater your credit.

⚕️ Learn more: Ever been blindsided by an unexpected medical bill? Understanding the No Surprises Act might be beneficial.

Since the new laws have been enacted, the average individual with medical collections has seen at least one bill removed from their reports, and credit scores have gone up an average of 25 points once all medical collections are removed.

These law changes give you more time and leverage to successfully negotiate your medical bills.

Remember that if you use a loan or credit card to pay a medical debt, the debt will be considered consumer debt, and you will lose all protections that go with medical debt. This is generally not a good idea.

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