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What To Do When You Receive A Surprise Medical Bill

01 Apr

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Are you one of the more than 20% of people who have visited an in-network emergency room only to find yourself surprised by a bill due to an out-of-network doctor or other health care professional that treated you? As someone who made my husband walk home after getting hit by a car on his bike to make sure we were going to an in-network ER, I can relate. It’s safe to say I may go to extremes to make sure that we pay no more than necessary when seeking health care. But consumers are finding that despite their best efforts to stay in-network, they may be unable to avoid being slapped with an out-of-network charge.

I learned this late last year when I had a minor surgical procedure at my in-network doctor for a procedure I knew was covered by insurance, only to find myself with a huge bill from an anesthesiologist that was out of network. When I dug deeper into the issue, I found out that there was basically no way to avoid it. There are no anesthesiologists in-network on my plan and my insurance applied their “allowable” amount to my deductible, but the practice could charge me whatever they wanted and I had to pay it (called “balance billing”). I realized later THAT was the waiver I signed just before going under and probably also why the anesthesiologist was suspiciously nice. I bet she knows that everyone who signs that waiver is in for a surprise medical bill.

A study by the Urban Institute found that almost 24% of non-elderly adults in the U.S. reported past-due medical debt, with percentages higher among millennials and gen Xers. You’d think that since older people tend to have more medical issues that they would be more likely to have unpaid bills, but when you consider the increased complexity and narrowness of certain networks coupled with the huge rise in the popularity of high-deductible health plans, it makes sense. People on Medicare are more likely to expect big medical bills. But when you go through the trouble to research your in-network options only to find out some random person was able to sneak a charge in there anyway, you’re much more likely to set that bill aside until you can do further research into how in the world this happened. That’s definitely what I did.

I recently spoke to Tom Torre, the CEO of medical expense management company Copatient, to see if there was something I was missing. “You are the poster child for everything that’s wrong with our health care system,” he commented when I shared my story. He confirmed what I already suspected: health care providers are always looking for ways to maximize the amount they’re paid and one strategy is simply to be out-of-network as much as possible. “Medical transport [ambulance services] and anesthesiologists are actually notorious for this,” Torre commented. When no relationship is formed between provider and patient, there tends to be little incentive to reduce patient expenses.

In other words, since they can get away with it, they do it. This is a perfect example of the dark side of the U.S. health care system, one that causes an estimated three out of five bankruptcies among consumers. So what can you do if you find yourself the unlucky recipient of a surprise medical bill? Torre recommends the following:

BEFORE YOU GO

Assuming you’re in a non-emergency situation, the short answer is do your homework and make sure you go to an in-network facility in the first place. When I found myself with a 104 degree fever and lower back pain while on vacation in Tucson earlier this year, I used my health insurance app to look up which urgent care facilities were in-network before heading in to be treated for a kidney infection—a move that saved us a couple hundred dollars. If you’re planning ahead for a procedure, ask every provider you encounter if they’re in-network. Don’t assume just because a facility is in-network that the providers will be.

Torre says that the best way to figure out if a provider is in-network is to check against your specific plan. A doctor’s website may say they accept your insurance company, but they may not accept your plan. Make sure you’re logged in to your plan to do your search. Then to be extra cautious, call the provider’s office to confirm.

AFTER YOU GO

If despite all of the above, you’ve been balance-billed by an out-of-network provider, it’s time to begin the journey to try to resolve it. Don’t just assume you’re out of options and have to pay the full amount. Most people’s first call is to their health plan to ask why the bill was for so much. The insurance plan will typically tell you it was out-of-network and there is no resolution.

Your next call should be to the provider to ask why they billed you so much more than your plan’s negotiated rate. You may not get very far with the billing associate who has no authority to do anything, so Torre recommends that you ask to speak to a supervisor or someone in authority. I had several rounds of this where the anesthesiologist was claiming to “dispute” my insurance company’s lack of coverage even though my insurance company had already applied their acceptable amount to my deductible, which is typically what the provider would bill me. Regardless, the anesthesiologist said they were under no obligation to reduce the amount due.

At this point, one option could be to call a billing negotiator like Copatient, who collects the relevant information from you and then looks it over to see if there’s an opportunity to decrease your bill. If they think they can help you, you must give authorization for them to fight on your behalf. These services are typically either offered as an employee benefit through work or they work on a contingency basis in which they collect a percentage of whatever amount they’re able to save you.

In my case, I finally called the billing office of the anesthesiologist and asked if they would be willing to accept the amount my insurance was willing to accept. The billing associate consulted her manager and then offered me a 20% discount. At this point, I was over it, so I accepted, paid the bill and moved on with my life.

Would I have done better by using a service like Copatient? Torre says maybe, but that 20% is a pretty typical amount. Perhaps I have a back-up career as a medical bill negotiator if this financial planning thing doesn’t work out for me.

So could I have done anything differently to avoid this whole maddening debacle in the first place? Other than not having the procedure (which wasn’t an option), everyone I’ve asked has said no. Obviously, the best prevention is to continue to make sure you stay in-network.

But when it’s beyond your control, this is when it’s essential to have an adequately funded emergency fund (or HSA account with your out-of-pocket maximum always in the account), and don’t be afraid to negotiate or call in assistance. “Putting money in an HSA is far and away the best investing decision you can make,” says Torre. I couldn’t agree more.

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