Costly medical billing error

We recently reviewed a large hospital bill for a self funded company. The patient had a brain tumor and the bill was for a surgery to shrink it. The surgery  placed 8 implantable wafers  in the brain. The hospital bill for the implants alone was in excess of $93,000.00. Needless to say, this was a very complex procedure.

The hospital is part of the network the self funded company belongs to and thus the bill was submitted with a ppo contractual adjustment. The bill was submitted to us to determine if after the adjustment, was the hospital billing a fair rate (within Usual and Customary amounts).

Upon our review of this bill, we noticed that the cost for a box of 8 implantable wafers was $45,015.20.   We were able to determine the hospital cost for the box of 8 wafers to be $24,453.The hospital was billing the company over 1.8 times their cost for these wafers.

This bill was several pages long, and we also noticed 8 single line charges each for $6,044.56. Each single line item was for the generic name of the implantable wafer.  Based on the Operative Report and the manufacturer suggestions, 8 wafers were implanted in this surgery. The billing error was that the hospital simply charged for the box, and then mistakenly charged for each individual wafer.

On the implant charges of over $93,000, our client allowed about $37,000. Upon receipt of the check from the company, the hospital contacted the company via telephone and was looking for a fight; accusing our client of all sorts of things.  I can’t say I blame them, if they were expecting $93,000. Our client simply pointed out the double billing error. The hospital rep quickly reviewed the bill and according to our client became very quite and ended the coversation.

Not all billing errors are this large. This really is a simple error, it’s just compounded by the cost of each unit. Studies show that 8 in 10 medical bills contain errors. Our client hired us to help them. INSNET is available to provide risk free medical bill review and negotiation on any medical bill with a patient balance exceeding $200.00. Next time you get a medical bill in the mail, doesn’t it make sense to have it professionally reviewed?

Lessons about healthcare reform from a computer technician

Our family computer was not working properly. I’m the tech guy in our household, so it was my responsibility to fix the problem. Not knowing the answer I Googled the symptoms and got many possible cures. The problem was, I couldn’t run any programs on the machine. It was time to call in the experts.

As you probably guessed, the machine had a virus, and due to the damage caused by the virus and also by the machine having a lot of dust, the best fix was to replace the hard drive. I was a little skeptical about this, the computer is almost 3 years old, and I know these are built to have increasing shorter shelf lives, but I listened to the technicians reason for repairing this machine instead of replacing with a brand new one. I decided to replace the hard drive, which cost me around $150.00. The machine now works great, better than before for sure.

What does this have to do with healthcare reform? Instead of a rash, overhaul of a fix (new computer), I opted for a small, less expensive repair. I would advocate three small repairs to the healthcare system. Less expensive high deductible health plans ,which makes consumers more accountable for the true cost of the healthcare, tort reform which will lower the award in malpractice lawsuits which increase insurance premiums which doctors pass the cost of on to patients, and thirdly, allow insurance companies to sell their products across state lines, the more competition involved, the lower the cost of monthly premiums will be. None of these repairs will increase taxes, and will help lower the cost of healthcare. I don’t think the same can be said for the current health bills.

A 35% discount is good isn’t it?

If you got an email, or saw a coupon advertising a product or service at a 35% discount, you would think the product or service must a good value at the reduced price. However, when dealing with healthcare, numbers can be very deceiving.

Studies show that 90% of all medical claims processed are done so ‘in network’, meaning that the provider of service is in the insured’s network. Going to an ‘in network’ provider is generally thought to be a  great way to save money on out of pocket medical expenses.

An insurance company or third party administrator must process hundreds of medical claims each day. Elaborate computer systems assist these organizations with this task. But in doing so, the human element is taken out of the equation. It is estimated that 95% of medical claims are ‘auto-adjudicated’ meaning a human does not review them. These computer systems have eliminated many mistakes, but when a human does not review bills, overpayments can occur.

For example, we recently reviewed a medical claim for a patient who underwent spinal surgery. This bill was from an insurance company and exceeded $240,000. the hospital was in the insured’s network, and a contractual adjustment of $84,549.33 ( a 35% discount) was in place. It is hard to find anyone who would not think that the $84,000 savings does not represent good value. This bill was not auto-adjudicated due to the dollar amount, and it is a good thing.

Part of the bill, over $159,000 of it, was for spinal implants used in the surgery. The insurance company requested and received invoices from the hospital as to how much they paid for the implants. The invoices totaled over $65,000.  If the claim was auto-adjudicated, the hospital would have received $103,350 (35% discount on the $159,000) for these implants, a mark up of 1.6 times invoice price. Additionally, invoice price, does not represent the actual amount the hospital paid for the implants. If there was a standard 20% discount offered, the hospital is receiving nearly 2 times acquisition cost for the implants, after a 35% discount was applied.

If I was paying this claim, I would question whether this is good value or not, how about you?

Searching for the best medical pricing

USA Today ran a story titled In a weak economy, patients search for best medical pricing. The story points out that people today need to make the most of their dollars, and are thus actively looking for the best price for their healthcare. This is a difference to years past, when most of healthcare expenses were paid by insurance companies, and the patient had very little to pay out of pocket. Deductibles are now higher, which means out of pocket expenses are greater.

The story continues to say that many insurance companies are now providing online tools to assist their insureds. However, after reading the comments to the post, and in my own experience, many of these sites are not user friendly, and fail to offer enough information.

Healthcare Blue Book and Out of Pocket.com are two websites which I have come across which provide a wealth of information. But just having information doesn’t always mean you can get the best price. For example, you had a MRI on your knee at a hospital and were billed $1,750. You consult an online resource and see that the recommended price to pay for a MRI of the knee is $850.00. Is this a $900.00 overcharge? There are many factors involved in determining if you are being billed a fair price.

When in doubt, you should consult the services of a patient advocate who is trained in reviewing medical bills and determining a fair price to pay. Visit www.myinsnet.com if you have any questions.

A glimpse into what government run healthcare will look like

The town I live in is running a program offering to vaccinate school aged children for the flu as well as H1N1. I’ve lived in this town over 17 years and am not sure why it is being done this year.

A letter came home from all the schools in September announcing this program, with the shots to be administered by a third party agency in the first week of October. The notice mentioned that this will just be the seasonal flu vaccine, and will not protect against H1N1. Shortly afterwards, we got another notice stating that due to a shortage, the schedule vaccinations will take place November 9 – 14.  Another notice came out stating that there will indeed be a H1N1 vaccine, but the seasonal flu vaccine will not be available. Furthermore, the H1N1 vaccine would not be a shot, but instead a nasal spray (much to the delight of my younger children. Finally, the first day of vaccinations and low and behold, the seasonal flu vaccine is available along with the H1N1, in both shot and nasal spray form.  Not only did they get the wrong information out to the families, but they had 3 chances to it correctly and still didn’t get it right. Do we want all of our healthcare run like this?

Due to the size of our town, the vaccines are to be administered based on your last name (A-F the first day, G-M the second etc.) Sound like rationing to anyone?

Additionally, the vaccines are to be administered between 2:00 and 7:00 at the high school. My daughter who attends the high school went to register for the vaccines immediately after school ended at 1:45. She got in line behind others, who were already in a line extending outside of the school. I know people who waited in excess of 2 hours for their children to be  vaccinated yesterday.

Furthermore, there is no fee to be paid at the time the vaccine is administered. It appears to be a free program, which many will indeed believe does not cost them anything. How much are taxes going to go up to run this program this year and into the future?

Our healthcare system is indeed in need of change, but I believe that the government should stay out of it.

Haggling with your Doctor

Forbes Magazine ran an article recently titled Cut your Doctor Bill. The article explains that with the rising cost of healthcare that people need to find out the costs associated with a medical procedure before they have it done. The problem is actually finding the cost beforehand.

If you are seen at a doctor or hospital and don’t know beforehand what the approximate cost will be, you are in for sticker shock once you receive your bill, especially if the medical provider is not part of your insurance network, or if you don’t have any insurance.

INSNET,LLC President Jack Gillis was interviewed for this story and shares some tips for those who feel confident enough to do their own negotiations. First he says you need to determine if the facility is authorized to give you a discount. If they are, your next question should be, who is authorized to give me a bigger discount? Not all medical providers are willing to reduce their fees, but with unpaid debt at record levels, many any re-thinking those policies.

If you would rather have a professional organization who has been negotiating medical bills with providers for over 20 years review and negotiate your medical bill, INSNET is available at www.myinsnet.com or by calling 877-MYINSNET (877-694-6763)

When not knowing can cost you money

Yesterday Insurance Negotiating Service, which negotiates out of network medical claims for insurance companies and TPA’s got a phone call from a gentleman wondering if we negotiate non healthcare claims. This seems like a strange question since INS has saved insurance companies millions of dollars since opening in 1985.

It turns out this gentleman was calling on behalf of a friend of his who had a fire at their home. The home is a duplex and the friend’s side of the home suffered major damage while the other side just had smoke damage. The gentleman, who found our site on Google, was calling to see if we could assist his friend deal with the insurance company adjuster as they had no idea what  to do.

The call was routed to me as I had experience as a property casualty insurance adjuster. I  informed the gentleman that this is not something that INS could help with, for among many reasons, the fire took place in a state I am not licensed in; but I was able to pass on some information. I informed the gentleman that their are Public Adjusters who do just what his friend needed, they represent the homeowner or insured deal with the insurance company adjuster, to ensure a fair settlement is made. I was able to assist the gentleman find 3 public adjusting companies in his area.

This got me thinking that if there are people out there who do not know that Public Adjusters can help them with property casualty claims, then there are people who do not know that patient advocates such as INSNET can help individuals save money on their medical bills. Just like the price of a new automobile, a hotel room or an airline ticket; medical bills are negotiable! Professionals like INSNET ensure that individuals pay a fair price on the medical bills.

How do these numbers add up to savings?

I recently came across this story that says that hospitals have agreed to give up $155 billion in future Medicare and Medicaid payments to help defray the costs of President Obamas healthcare plan. This piece of news was seen as the bright spot in the White House effort to reform healthcare. Digging deeper into the story I’m amazed how this can be seen as positive news for people interested in reducing healthcare costs.

About $50 billion of this projected $155 billion “savings” is expected to come from a reduction in payments made to hospitals that provide care to uninsured and low income patients. The effected hospitals say this will put a strain on these local communities. These reductions come from payments currently made by Medicare and Medicaid (Government).

The story goes on to detail that in exchange for giving up $155 billion in future payments, the hospitals have negotiated a deal should the Finance Committees’ (Government) legislation include a public health insurance plan. Under this agreement, the hospitals would receive reimbursement amounts in excess of what Medicare and Medicaid currently pay.

So hospitals have agreed  give up a lesser amount from Medicare and Medicaid (Government) in exchange for higher reimbursements under potential Finance Committee’s legislation(Government). How does this end up saving any money on healthcare expenses. Where does the average citizen realize any savings in this plan?

US Open Golf and medical bills?

The second major tournament in golf in this week, the United States Open. I don’t play as much golf as I used to thanks to the responsiblities of parenthood, but I always look forward to this tournament and its last day which takes place on Father’s Day.

The responsibilities of providing for my children and how I go about it prompted the following comparison between golf and patient advocacy. The object in most weekend players game and the US Open is to break par on the course. Similarly, as a Patient Advocate, I try to help my customers break ‘par’ by reducing the amount they must pay compared to billed charges on their medical bills.

In the game of golf, one of the best ways to succeed is to have the proper tools, whether it be properly fitted clubs or a high distance golf ball. On a professional level, a caddy you can trust and a dedicated swing coach are essential. Patient Advocate’s help individual through the maze of health care statements from medical providers and insurance companies. INSNET has the experience through over 20 years of negotiating medical bills to know a fair price to pay on a medical bill.

The golf courses at most US Open sites have penalizing rough with high grass just outside of the fairways. Have you tried to contact a medical provider and speak to someone about reducing your medical bill?  If so, then you know it is possible to spend the better part of an hour doing so if you do not know the right department to ask for or the correct words to say to speak to the person who actually has authority to reduce your bill. At INSNET our service is not rough at all, as a matter of fact it is easy and painless; if we don’t save you money on your medical bill you pay us nothing!

I hope all father’s have an enjoyable day this Sunday, and reflect on how they provide for their families. I also hope every father gets a chance to step onto a golf course with if not your own father, then your children.

Back in the saddle again

It sure has been a hectic past couple of weeks. Preparing taxes, kids on school vacation and securing additional negotiators has left precious little time for this blog. It then struck me that if I’m struggling with squeezing more items in my day than so must others.

Which got me thinking obviously about our negotiating service. I believe that anyone can negotiate their medical bills, just like anyone can negotiate what they pay for hotel rooms, airfare and new automobiles. The major stumbling block is most individuals do not know what a fair price is to offer their provider or what is fair to accept as a discount.

The founders of INSNET have been negotiating medical bills for over 20 years. We have the experience to not only know what a fair price to pay for services is, but also what dollar amount your provider has accepted from insurance in the past. With this information we base a settlement proposal and ensure you pay a fair price for your medical care.

I was recently reminded of an article our president Jack Gillis wrote for the Self Insurer years ago. The article references a Case Management Nurse who was looking for pricing information for a lymphadema pump. The homecare medical dealer was billing the insurance company $5,200.00. The Case Management Nurse  negotiated the price down to $2,300.00. Now most would say that the savings was fantastic. However, before she contacted the provider we informed her that the manufacturer had a suggested list price (not dealer cost) of $1,600.00 . In this case, the fanatastic negotiated settlement was a least a $700 overpayment. If a medical provider is able to negotiate a deal that great for themselves with a trained medical professional, just what kind of chance does the average citizen have?

How much time do you have to contact your medical provider with questions on your medical bill. The time you spend on hold can be an eternity. In fact I finally used my time well and wrote this post during my 14 minutes and 34 seconds I was on hold with a provider.