When a claim becomes a medical bill

On Sunday my family celebrated an anniversary that my oldest daughter and son would like to forget.  We were skating on a frozen pond and the kids started a game of hockey.  The kids are not great skaters and they did not have any other equipment other than hockey sticks and a puck. Shortly after the game started my son lifted the puck and hit my oldest daughter right on her helmetless forehead. I fortunately witnessed this accident and immediately went to my daughter’s aid. When I arrived blood was already gushing from her head.  I applied pressured and ice to the wound to stop the bleeding, which slowed but did not stop. We decided we needed to get her to the hospital.

My wife and I drove her to the emergency room where she was seen immediately by a triage nurse.  I was the lucky one left to start the paperwork process. Since I pay for health insurance, I presented my daughter’s health insurance card to the receptionist. My wife and daughter went to another exam room and were met by a doctor. The receptionist finished taking down and copying the insurance company information and showed me to the exam room.

The emergency room doctor’s examination led to a decision to suture the forehead with 4 stitches. The doctor did the stitching, prescribed some pain medication and told us the swelling should go down in a couple of days.  About 3 hours after we arrived at the hospital, we were all back home and my daughter was showing her siblings her wound. Thankfully the swelling did go down and the stitches were removed a few days later.  To this day my daughter has a barely recognizable scar, you would have to know where she got hit to see it.  The doctor and hospital did a wonderful job.  In an ideal world, all are happy and the case is closed.  However, the hospital is a business and needs to be paid for its services, which is why most people purchase health insurance, to offset unexpected medical costs.  Most do not understand the process involved in paying for the services.

Upon being discharged, the hospital sent a claim to my insurance company. About 15 days later, I received a letter from the hospital telling me that this claim had been sent to my insurance company for payment, and that the enclosed “is not a bill”. When my health insurance company receives a claim on behalf of an insured, there are many steps which must take place before payment is released. They must ensure that I or my dependents were covered at the time of the injury/illness, they must determine if there is coverage for my injury/illness under the terms of the policy, they must determine if my claim is from an in network or out of network provider, they must determine if I met my deductible and co-payment amounts. Once all of these steps have been completed, the process of paying the claim begins.

Assuming the deductible and co-payment have been met, the insurance company must pay the full amount. If the provider is in the network, the insurance company pays the claim based on the discounted rate. If the provider is out of network, they pay the amount billed, or attempt to lower the amount via negotiation. If the deductible or co-payment have not been met, the insurance pays only their portion of the claim. Either way, upon processing the claim, an Explanation of Benefits is sent to the insured.

The Explanation of Benefits details how the insurance company determined the amount they paid on the claim. If they did not pay the full amount, the medical provider can and will bill the patient for any patient responsibility (deductible and co-payment not yet met). This is when you get a second letter and billing invoice from the hospital telling you how much you owe. The claim has now become a medical bill.

When you receive this bill, you must compare it to the Explanation of Benefits for accuracy.  Upon receiving the hospital bill most people put the bill with their other bills to be paid, and pay it just like their electricity or cable television bill. These medical bills need to be reviewed closely to make sure there are no errors, and that you were not billed for services not rendered. Today, with deductibles averaging $1,000 and rising healthcare costs, individuals are responsible for paying more for their healthcare than ever before. Professional bill negotiators like INSNET, LLC are available for RISK FREE bill review and negotiation to help lower the amount you pay on medical bills.

What if your dinner check read like a medical bill

I’ve written before about comparing healthcare prices to hotel and automobile prices, imagine this scenario:

You are at a special dinner with your significant other.  The service and meal were terrific and you enjoyed a memorable evening. Once the waiter notices you are done eating, he brings you your check.  What would your reaction be if you read your check and saw this?

Appetizer          $6.00

Salad (2)           $8.00

Entree (2)         $24.00

Wine                 $20.00

Dessert (2)        $10.00

Silverware         $1.00

Busing dishes    $1.00

Total                 $70.00

After you look at the bill, you notice many surprises and errors and call the waiter over for clarification. You inform the waiter that you split one salad, you had a $7.00 glass of wine, you shared a dessert and you have never been charged for silverware or busing services at any other restaurant. You inform the waiter that based on your calculations your bill should be for $46.00, not $70.00.  The waiter excuses himself and goes to talk to the restaurant manager.  After a long, long wait of over 15 minutes the manager comes to your table and makes any of the following statements:

I’ve reviewed your check, it is correct, please pay $70.00 immediately.

I am authorized to discount your bill 25% and would be happy to accept $52.50, provided you pay and leave immediately

My waiter cannot remember you ordering only one salad and one dessert, so to be fair to you, I’ll’ only charge you for one salad, please pay $66.00 immediately

I see that you had wine with your dinner, my waiter keyed in a full bottle of wine in the computer which generates your check, therefore I must keep the charge for the bottle on your check

It is our policy to charge for the use of silverware and busing of dishes, it is written in fine, fine print at the entrance to the restaurant, you should have seen it when you entered

I am not authorized to reduce your bill at all. We are part of a chain which has all bookeeping done in a central location. If you wish to speak to bookeeping, please contact them tomorrow during regular business hours.  You may discuss a rebate with them, but in the meantime I must ask you to pay the full $70.00

If you’ve ever tried to speak to a hospital regarding a billing error, it is likely you’ve gotten a response similar to what this restaurant manager gave. With the codes used on most medical bills, it is very confusing to understand exactly what you are being charged for. Competition prevents restaurants from charging for items like silverware, glassware and table linens; all of which should be included in a restaurant experience. Many hospitals in fact ‘unbundle’ services which should be included in room and board rates. Trained professionals recognize when unbundling charges and errors occur on a medical bill. Visit www.myinsnet.com if you need a patient advocate to help you save money on your medical bills.

If you have a story about how another industry could bill like this please email me at ddobecki@myinsnet.com

Doctors Opinions of Financial Bailout Package

I came across this list and had to pass it on:

The Allergists voted to scratch it

The Dermatologists advised not to make any rash moves

The Gastroenterologists had sort of a gut feeling about it

But the Neurologists thought the administration had a lot of nerve

The Obstetricians felt they were all laboring under a misconception

The Ophthalmologists considered the idea shortsighted

The Pathologists yelled “Over my dead body”

The Pediatricians said “Oh, grow up”

The Psychiatrists thought the whole idea was madness

The Radiologisits could see right through it

The Surgeons decided to wash their hands of the whole thing

The Internists thought it was a bitter pill to swallow

The Plastic Surgeons said “This puts a whole new face on the matter”

The Podiatrists thought it was a step forward

But the Urologists felt the scheme wouldn’t hold water

The Anesthesiologists though the whole idea was a gas

The Cardiologists didn’t have the heart to say no

In the end, the Proctologists left the decision up to some a_ _ holes in Washington..

I got this as an email and had to share it with all. I hope you enjoy.  Feel free to send me an email at ddobecki@myinsnet.com if you can come up with any more.

Good news, healthcare spending slows; now the not so good news

I’ve seen it reported in many places that in 2007 healthcare spending in the United States slowed. The rate of increase (not overall decrease in spending) was the lowest in nine years.  Most of this was attributed to a slowed increase in spending for prescription drugs, which was the slowest since 1963. This data comes from a report published by Health Affairs.

However, the report mentions that other types of healthcare spending increased at brisk rates. In 2007 $2.2 trillion was spent on healthcare, an average of $7,421 per person.

Spending on prescription drugs rose 4.9% to $227.5 billion compared to 8.6% in 2006. The report was authored by Micah B. Hartman and he gives 3 reasons for the deceleration of drug spending; an increase in the amount of prescriptions being filled with generic drugs, a slowdown in the amount of increase in drug pricing and safety concerns lowering the demand of some drugs. The increase in the amount of prescriptions being filled with generic drugs is promising in that people are starting to control the amount they spend for healthcare.

The report goes on the mention that spending on hospital care rose 7.3% in 2007 compared to 6.9% in 2006.  Spending for doctors services rose 5.9% which is lower than the 6.4% increase in 2006. The report attributes this to a reduction in Medicare payment doctors receive for imaging services.

Out of pocket spending (the amount individuals are responsible for paying before their insurance pays) also increased 5.3% in 2007 to $268.6 billion. In 2006 the increase was 3.3%.

With more Americans insured with higher deductibles and HSA’s we need to make every dollar count. The move by more individuals to generic prescription drugs is a step in the right direction. Other steps to reduce costs are to review all medical bills carefully and make sure there are no errors on your bills. Consulting a professional patient advocate to help negoatiate your medical bills is also an option.