Will I Have to Pay My Deductible Before I Can Get Medical Care?

Over the last few years, it's become more common for hospitals and other medical providers to ask people to pay their deductibles before medical services are provided. According to one recent analysis, at least three-quarters of hospital systems in the U.S. ask patients to prepay some or all of their out-of-pocket costs for certain services, including things like MRIs, CT scans, and even births.

This article will help you understand why this is happening, what rights you have, and how to navigate our current healthcare system.

A stack of 100 dollar bills and a stethoscope
ATU Images / Getty Images 

The Way It Used to Be

In the past, it was generally accepted that patients were expected to pay their copays at the time of service, but charges that counted towards the deductible would be billed after the fact.

So, if your health plan had a $20 copay for an office visit, the doctor's office would collect that when you arrived for the appointment.

However, if your plan had a $2,000 deductible and you were going in for surgery, you'd pay nothing at the time of the surgery but would get a bill from the hospital a few weeks later.

First, they would send the claim to your insurer, where the network negotiated rate would be calculated and amounts over that would be written off. Then the insurer would pay their portion, and notify the hospital about your portion of the bill (you would also receive an explanation of benefits with the same information).

At that point, the hospital and medical providers would send you a bill (or multiple bills, depending on the care that was provided) for your deductible and any applicable coinsurance.

Why They're Billing Upfront

Depending on the service you're receiving and how much it costs relative to your deductible, many medical facilities and professionals still use the traditional method of waiting to send you a bill until after your procedure is complete and your insurance company has processed your bill.

It's becoming increasingly common, though, for medical providers to ask for payment of your deductible—partial or in full—before scheduled medical services are provided. This is due to a variety of factors, including increasing medical costs, as well as rising deductibles and total out-of-pocket costs.

Medical providers don't want to be stuck with unpaid bills, and they know after the procedure is completed, people may not pay what they owe. The medical provider can send them to collections or file a lawsuit against the patient. However, obtaining payment upfront is a more effective method of ensuring that the bill gets paid.

Hospitals are also increasingly running credit checks on patients. They can then use the information to determine which patients will be likely to pay their bills after the procedure is completed and the claim is processed by the patient's health plan. Using this information, hospitals may ask for upfront payment from some patients but not others.

If They Ask for Payment Upfront

Ideally, you should discuss the timing of payment with the medical provider's billing office well in advance of your procedure. Finding out 18 hours before your surgery that the hospital wants you to pay your $4,000 deductible immediately is stressful, to say the least, and often simply not possible. 

If you're scheduling a medical procedure for which your deductible will apply, inquire about the facility's policies right from the start. Talk with your health plan to see if they have any contract negotiations with this medical facility that require the bill to be sent to the insurer before the patient is charged.

If not, the hospital, clinic, or medical provider may very well want you to pay at least a portion of the deductible ahead of time or when you arrive for the medical procedure (here's an example of how this works, from the University of Wisconsin Hospital system).

But in general, network contracts between insurers and medical providers will prohibit the medical providers from requiring payment of deductibles before medical services are provided. They can certainly ask for it, and patients have the option to pay some or all of their deductible upfront. But your health plan likely prohibits in-network medical providers from denying care if you can't or don't want to pay your deductible ahead of time.

If in doubt, it's wise to contact your health plan and your state's insurance department to see if they have any advice about contract rules and state regulations that pertain to medical billing practices (note that state insurance regulations don't apply to self-insured group plans, as those are federally regulated under ERISA). The more you know, the better you'll be able to navigate the system.

How Much Will You Actually Owe?

Ask the hospital to provide you with an estimate of what you'll owe, keeping in mind that negotiated medical costs tend to be far lower than retail costs. And double check their estimate with your health plan, to see if they're roughly the same.

The federal government has rolled out some new pricing transparency rules over the last few years, which make it easier for consumers to have access to health care costs in advance (as opposed to having to wait for the explanation of benefits after the procedure is completed). Hospital price transparency rules took effect in 2021 and health plan price transparency rules were fully in place by the start of 2024.

The medical facility might not know in advance exactly what care they're going to have to provide, since this sometimes depends on what they encounter during the procedure. But for the care they know you'll need, make sure you understand the negotiated rate that your health plan has with this medical provider for that specific service.

For example, let's say your deductible is $5,000, you've paid nothing toward it this year, and you're scheduling an MRI.

The average cost of an MRI in the U.S. is about $1,325, although it varies considerably from one facility to another. It's also important to note that what the facility charges is likely to be quite a bit higher than the rate your insurer has negotiated with that facility.

The facility might bill $2,000, but the insurer's negotiated rate might be $1,050. In that case, the amount you would have to pay towards your deductible would be $1,050, not $2,000

This isn't an issue if you're having a procedure that's many times more costly than your deductible. If you're about to have a knee replacement, which averages about $34,000, and your deductible is $5,000, you will have to pay the full deductible.

The hospital might ask you to pay all or part of it upfront, or they might bill you after they submit the claim to your insurer, but there's no getting around the fact that you're going to have to pay the full $5,000, and you won't save any money by waiting to pay your bill until after the claim is processed.

Note that coinsurance is different since it's a percentage of the total amount that the health plan has negotiated with the medical provider. Since coinsurance isn't a flat amount, it's particularly important to wait to pay coinsurance charges until the claim has been processed. The exception would be a situation in which you know that you'll meet your health plan's total out-of-pocket limit. In that case, even if you pay it all upfront, it won't be any more expensive than it would have been if you had waited for the claim to be processed.

In the previous example about the MRI, however, the actual amount you'll have to pay isn't certain until your insurer has processed the claim. But again, the health plan price transparency rules ensure that you can find out, in advance, how much your health plan's negotiated rate is for an MRI at the facility you're using.

If the medical provider is asking you to pay a portion of your deductible in advance, and it's unclear how much you'll actually owe, discuss the situation with your insurer before giving any money to the hospital. Make sure that the amount the hospital is asking you to prepay is the rate that your insurer has negotiated with them, as opposed to their retail rate.

Check with your insurer to make sure that their contract allows you to reject the medical provider's prepayment request. You should be able to wait until the claim is sent to your insurance plan and the price adjusted in line with the network contract. At that point, you'll receive an accurate bill from the hospital, which you should pay as soon as possible.

One way or another, you'll want to make sure that you're only paying the amount that your insurer's explanation of benefits will ultimately say that you owe, rather than the amount that the medical provider charges. 

Denying Care Based on Ability to Pay

There's sometimes a misconception about hospitals' obligations to provide care regardless of a patient's ability to pay.

Since 1986, the Emergency Medical Treatment and Labor Act (EMTALA) has required all Medicare-accepting hospitals (virtually all U.S. hospitals) to provide screening and stabilization services to anyone who arrives in the emergency room—including pregnant people in active labor—regardless of their insurance status or ability to pay for care.

The emergency room is required to:

  • Screen you to determine the problem
  • Provide stabilization services (e.g., They can't let you bleed to death due to lack of funds.)

They don't have to provide anything beyond that if they're not certain you can pay for it, and EMTALA doesn't extend to any care beyond emergency services.

So a pre-scheduled medical procedure won't be subject to any rules that require hospitals to provide care regardless of the patient's ability to pay. 

But if you're covered under Medicare, federal rules do ensure that you can't be denied care due to a failure to prepay your anticipated out-of-pocket costs. The Centers for Medicare and Medicaid Services clarify that: "Except in rare cases where prepayment may be required, any request for payment must be made as a request and without undue pressure. The beneficiary (and the beneficiary’s family) must not be given cause to fear that admission or treatment will be denied for failure to make the advance payment."

And if you have private coverage, your health plan's contract with the medical provider may prohibit them from requiring that you pay your deductible ahead of time. However, if you haven't paid previous medical bills and still owe money to the facility, they may refuse to continue to treat you.

Increasing Deductibles

The ACA limits how high in-network out-of-pocket costs can be, but the limit itself is fairly high. In 2024, health plans can have out-of-pocket costs as high as $9,450 for an individual and $18,900 for a family.

Many health plans have out-of-pocket limits well below those amounts, but deductibles on individual market plans are often multiple thousands of dollars (cost-sharing reductions lower these deductibles for eligible people, as long as they select a silver plan in the exchange).

Employer-sponsored plans have to abide by the ACA's cap on out-of-pocket costs too, but they tend to have deductibles and out-of-pocket costs that are lower than those in the individual market. In 2023, the average deductible for people with employer-sponsored health insurance was $1,735 for a single person.

Yet the Federal Reserve reported in 2023 that about 37% of U.S. adults would not be able to come up with $400 to cover an unexpected bill, or would have to sell something to cover the cost.

That presents a conundrum when people have an unexpected but necessary medical procedure and a fairly high deductible. It also presents a conundrum for hospitals and medical professionals—tasked on one hand with providing health care to residents, but also needing to generate enough revenue to stay financially viable.

Requiring upfront payment of at least part of the deductible is one way for hospitals to avoid situations in which patients end up unable to pay their bills.

Consider an HSA

If your employer offers an HSA-qualified high deductible health plan (HDHP), or if you're purchasing your own health insurance in the individual market, consider enrolling in an HDHP. They aren't the right fit for everyone, but if you're covered by an HDHP, you can contribute pre-tax money to an HSA, and it will be there if and when you need it. 

In 2024, you can contribute up to $8,300 to an HSA if you have family coverage under an HDHP, and up to $4,150 if you have self-only coverage under an HDHP.

Even if you can only contribute a small amount each month, it will add up over time, and there's no "use it or lose it" provision—the money remains in your account until you need to withdraw it.

You can build up a cushion in an HSA while you have coverage under an HDHP, and withdraw it later to cover future medical expenses, even if you no longer have HDHP coverage at that point.

The takeaway is this: If you have access to an HSA-qualified plan, enrolling and making contributions will make it easier to deal with a potential future situation in which a hospital suddenly asks you to pay a significant chunk of money upfront before you can get medical care. And you'll be able to pay the bill with pre-tax money, which could result in significant savings, depending on how much you owe.

Summary

Depending on a patient's health plan, credit history, medical needs, and choice of hospital, the patient may be asked to pay some or all of their deductible upfront, before receiving medical care. Hospitals cannot do this in situations that are covered by EMTALA, but that law only requires an emergency department to assess and stabilize the patient. In other situations, including a pre-scheduled surgery, the hospital or other providers can ask for at least some payment upfront.

But in most cases, a health plan's network contract with the hospital or other medical provider will allow them to request upfront payment of deductibles, but not to require it. So patients need to understand their rights. And if they do prepay deductible and/or coinsurance charges, it's important to ensure that they won't pay more than the network negotiated price for the service they'll receive.

A Word From Verywell

If you're scheduling a medical procedure and are concerned about the cost, the best course of action is to speak up, sooner rather than later. If you think you might have trouble coming up with the amount of your deductible, you may be able to work out a payment plan in advance. If you're asked for an upfront payment and you don't feel comfortable with this, check with your health plan to see if their contract with the hospital prohibits the requirement that deductibles be paid ahead of time.

12 Sources
Verywell Health uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Wahlberg, David. Wisconsin State Journal. Bill Comes Before Baby, As Hospitals Seek Advance Payments From Patients.

  2. Buck, Isaac D. Hastings Law Journal. Volume 73, Issue 2, Article 2. When Hospitals Sue Patients. February 2022.

  3. Centers for Medicare & Medicaid Services. Hospital Price Transparency. Accessed February 17, 2024.

  4. Centers for Medicare & Medicaid Services. Transparency in Coverage. Accessed February 17, 2024.

  5. Vanvuren, Christina. New Choice Health. What can affect the cost of an MRI?

  6. Claxton, Gary; Rae, Matthew; Levitt, Larry; Cox, Cynthia. Kaiser Family Foundation. Peterson-Kaiser Health System Tracker. How have healthcare prices grown in the U.S. over time?

  7. Centers for Medicare and Medicaid Services. Emergency Medical Treatment & Labor Act (EMTALA).

  8. Centers for Medicare and Medicaid Services. Medicare Claims Processing Manual Chapter 2 - Admission and Registration Requirements.

  9. HealthCare.gov Glossary. Out-of-Pocket Maximum/Limit.

  10. Kaiser Family Foundation. 2023 Employer Health Benefits Survey.

  11. Board of Governors of the Federal Reserve System. Report on the Economic Well-Being of U.S. Households in 2022 - May 2023.

  12. Internal Revenue Service. Revenue Procedure 2023-23.

By Louise Norris
Louise Norris has been a licensed health insurance agent since 2003 after graduating magna cum laude from Colorado State with a BS in psychology.