Medical bills are an inevitable expense and often times patients are ripped off because of mistakes or errors in the bill itself which they failed to recognize beforehand. It is estimated that more than 80% of medical bills contain errors. Additionally, health insurers routinely deny claims erroneously. This only adds to the confusion when trying to decipher your medical bills, explanation of benefits (EOB's), and how much you should pay your health care provider. However, there are some steps you can take in order to avoid paying a hefty medical bill that you don't fully understand.
- CHECK YOUR INFORMATION
There are many billing errors that occur due to a slight clerical error entered on the claim form submitted to your health insurance company. Even if there is one digit missing from your insurance ID number or your name is misspelled, it can result in your claim being denied- and you being billed prematurely. Many times, claims are submitted to the incorrect insurance carrier. To avoid the hassle, make sure your insurance information on the bill is correct and that the bill has been processed by your insurance company.
- COMPARE THE INVOICE TO YOUR INSURANCE EXPLANATION OF BENEFITS (EOB)
When claims are processed by your health insurance company you should receive a statement called an Explanation of Benefits (EOB). The EOB will provide details on how your claim was processed including any deductible and coinsurance amounts, as well as any services that have been denied. Always compare your medical bill to the EOB to verify that the amount on your invoice reflects the amount your insurance company says you owe.
NOTE – Some providers and billing entities are very aggressive. They will send you a bill requesting payment while your insurance company is still processing your claim. Many people pay these bills without realizing that the amount they owe might be substantially less once processed by their insurance company. Look out for phrases such as"Due Now,""Estimated Amount Due" or"Amount You May Owe." Don't get tricked by this sleazy tactic. Call the provider and ask for an invoice showing the insurance processing information. Verify with your health insurer whether you should pay the bill at that time.
- REQUEST AN ITEMIZED STATEMENT
It is very common for medical bills to only show a grand total of all items and services without providing a detailed breakdown of them. Errors are often made by the hospital or billing entities that can lead to duplicate or inflated charges– such as $20 for a box of tissues or $75 for a warm blanket. Therefore, it is important to ask for an itemized statement of the medical so that you can make sure that you are only paying for the services and items provided to you.
- CHECK THE CODES
There is billing code (HCPS/CPT) for every medical procedure that is performed by the provider, as well as, diagnosis codes (ICD-10) for every medical condition. These codes are used nationwide in order to inform the insurers directly of what was done and how much it cost. They may appear on your invoice or EOB. There are some instances where coverage may be denied based upon the codes submitted. At times, the insurer may deem the procedure unjustified based on the diagnosis code submitted. Other times, the provider may have submitted the wrong code. Sometimes it is a combination of both. In all cases it is important for you to research the code(s) independently. If it is an issue with insurance coverage, you can request a reconsideration or file an appeal. If it is a provider error, contact them immediately and ask that they review, recode, and resubmit the claim to your health insurer.
Reviewing the codes on your medical bills from practitioners, hospitals, testing centers, laboratories, and other providers is a great way to be sure that your insurance company (and you via co-pays, deductibles, and coinsurance) is only paying for services you received. If you receive statements from either your provider or health insurance without the HCPS/CPT codes, contact them and request an itemized statement with codes.
- NEGOTIATE A REDUCTION
Once you have determined that there are no errors in the invoice and that your insurance company has paid its proper share, you might still have a bill that is larger than you can afford to pay at once (and, in many cases, that is just too large PERIOD)! You might try to negotiate a reduction in your medical debt or payment terms that are workable for you. You can find resources on the internet (Health Care Blue Book, State websites, etc.) that will help assign a value to the services provided that is most common—and thus determine if you were overcharged. This information can be a valuable tool when negotiating with medical providers. Make your financial constraints known to them and ask for a discount. (Typically, paying a lump-sum is more likely to result in an adjustment to the bill. Generally, discounts are not given on accounts with a payment plan).
TIP- Many hospitals and some other providers offer a "Prompt Pay Discount," if you pay at the time of discharge from the hospital. They also have financial aid personnel to analyze whether you might be entitled to a discount based upon your income. However, even without a discount, a payment plan can be very helpful— allowing you to spread the payments out over a longer period that is more budget-friendly. If you are negotiating a payment plan remember to ask for zero interest. Also, remember that a medical provider can still report you to any of the three Credit Bureaus (Equifax, Experian, and TransUnion) while you are making payments. This is a detestable practice and should be avoided by having the provider state in writing that it will not report provided you are current in your payments.
- TAKE ACTION QUICKLY
Regardless of the size of the bill, it is very important to take care of it as soon as possible. The longer it remains unpaid, the more likely it is to be sent to a collection agency. New laws require hospitals to wait until six months from the date of service before you can be reported to any Credit Bureau. However, if that does occur, it can remain on your credit report for years- likely increasing your costs of buying a home, car, or increase credit card interest rates (nearly anything on borrowed credit).
TIP- You are entitled to a free credit report from each of the Credit Bureaus each year. We recommend that you obtain a credit report every four months. It should be reviewed for erroneous items or incorrect information. If you notice any errors on your report, you can dispute them with the Credit Bureau to have to removed. Learn more here: https://www.consumer.ftc.gov/articles/0155-free-credit-reports
If you are having difficulty understanding your medical bills and/or health insurance Explanation of Benefits (EOB's), contact one of our Board-Certified Patient Advocates at Human Health Advocates. We review medical bills and health insurance determinations. We negotiate reductions in medical debt from hospitals and other medical providers. We prepare insurance appeals for denied claims. If you have problems with your medical bills or health insurance, get in touch. WE CAN HELP!