TIFU by not appealing a financial assistance rejection

Let me start by saying I know this is 100% my fault. I just need to vent. And my vents go long, so strap in if you're sticking around.

About a year ago, my wife had a mental health crisis (a psychosis) that sent her to the hospital. Much happened, but long story short, the only hospital with a bed open in the mental health center was one that wasn't on our insurance. The State required her to go to a facility, so if she didn't go there, she would have had to go to the State mental health facility, which is really bad news, I've heard way too many horror stories from former patients there. So she stayed there for 45ish days, and a giant bill racked up. Since our insurance didn't cover it, they dropped the bill from $325,000 to $22,000. Yay.

Now, importantly, a few months before this mess, I had been laid off from my job. So by this time, I was reaching the tail end of unemployment insurance and freaking out about money, but there was no way we were having her go to that state facility, and I was also assured that with my current income being what it was, I would definitely qualify for financial assistance.

Fast forward a few months, apparently they've finished whatever billing process and finally sent us the bill. My heart dropped every time I saw the $22,000 line, but I held on to hope that financial assistance would forgive it. I went through the application and was a little concerned because the application asked for last year's tax return. Last year's tax return included the money I made before the layoff, and I was getting paid quite a bit, so that made our income appear much higher than it had actually been for nearly a year at that point. I noted that issue on the application, and included our last 3 months of bank statements to show that there is a major discrepancy between our tax return income and our current income. (This wasn't me going off on my own, that's what it said to do on the application if needed). Sent it off, crossed fingers.

Two months later, we get a letter saying the financial assistance had been denied because our income was higher than the federal poverty level. And thus begins the TIFU. I looked up the federal poverty level guidelines and we were barely making over the guideline. Like we were averaging $1900 per month and the guideline was $1800, something like that. Well, I just took the letter at its word. I was already in a major depression from constant job rejections and several other big problems in my life, and my brain rejected the idea of adding yet another burden of trying to fight this when they'd already said they wouldn't forgive it. The lowest possible payment plan option was $900 monthly, which was completely impossible, so I just...stopped thinking about it. I'm still kicking myself so hard for it, but that's what happened.

A few more months have passed since then, and I'm in a comparably better place, mentally, and I'm trying to get caught up with various things that I let slip through the cracks. So last week, I'm investigating the financial assistance because it seems insane that they expect us to be able to pay $900 per month when we're barely making above poverty level. Well, I found the policy, and it says that if your income is between 0% - 200% of the poverty guideline, your bill can be forgiven, and even if it's between 200% - 400%, you can be given a significant discount. So we definitely shouldn't have been rejected, because we were making maybe 110% of the poverty guideline.

So I gave them a call. Once I gave them the account number, however, they redirected me...to the debt collector company they work with. I was too late, by about a week. It had only just been sent over. I talked with them for a while, and there was only so much they could do since they were a different company, but they did find a note in the bill history: We were apparently denied because we were supposedly making 544% of the poverty guideline! Doing the math, that meant they used the tax return income and ignored the rest of the documentation I sent them, despite me following the protocol for what to do if it doesn't reflect your current income. They said to call the hospital billing and see if I could still appeal, but the best they could offer me is 40% off if I could pay off the whole bill at once. $15,000 that I don't have instead of $22,000 I don't have. Yay again.

So today I called back, and ended up spending about 25 minutes trying to convince the customer service representative to pass me on to someone higher up the chain, since she couldn't access the account anymore. All she would say was that I had to talk to the collections company, no matter how many times I explained that they had said to call back to discuss why the denial occurred. I don't really blame her because I'm sure she's told to take zero actions once she sees that it went to collections, but I'd feel more confident that there is zero information they can give me if it came from a manager or level 2 support or someone like that.

Anyway, that's it, no exciting conclusion, just me having to figure out what to do next.

TL;DR: Got rejected for financial assistance for a $22,000 bill, didn't appeal, and just learned that I probably could have, but now it's in collections so it's too late.