Health Care Survival Guide: When Not To Pay Medical Bills.

I wrote this article after a simple thing happened to me; I received a collection notice from a physician. The interesting thing was that, I never received a bill... Protect and educate yourself with these experiences, tips, and definitions.

    By Dr. David Ryan and IFBB Pro Figure Competitor Amber Steinmetz, RN/Insurance Review Nurse

    "Please note that most physicians are genuinely interested in helping you, they are not doing illegal procedures. This is true for most hospitals and insurance companies. Your understanding about what happens in the health care system, will help you to better deal with the protocol and make educated decisions about your health care dollar."

It really is getting crazy out there. People are getting fatter and health care is getting more difficult to understand everyday. The average American will likely use their health insurance plan at least ten times this year.

You will likely visit the doctor at least four times this year and if you have kids, well then you are likely to visit the doctor a whopping twenty times. All this comes with a price.

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In fact, I would bet that you or someone you know has a bad opinion about some particular insurance company. Maybe you don't have insurance. Maybe you gave up trying or just can't afford it anymore. Please still read this short article, for you, your parents or your friends may benefit from the information found here.

I wrote this article after a simple thing happened to me; I received a collection notice from a physician. The interesting thing was that, I never received a bill, I was just sent to collections. I cut my hand, pretty bad, went to the Emergency Department, got some stitches and a week later the staff took them out. Simple right? Not exactly.

-> The Collection Notice:

    I received a letter, like many of you will, from the hospital stating several months later demanding payment. It also said, that I was being sent to collection. It said Consumer Collection Company, right on the top of the page and had an account number and a phone number to call.

-> Insurance Company:

    Obviously dismayed about the letter not wanting my good reputation or my credit to fault I took action. I called my insurance company first, not the number on the letter.

    I took down the name of the person who finally answered the phone after about six prompts. Gave them my information and told them what happened. The customer care rep on the other line was also confused, seemed they had sent out payment per the contracted amount, nearly three months ago.

    I asked and received a valuable number which the insurance company calls your "payment ID number (PID)." The PID number is part of the EOB (Explanation of Benefits: tells what your insurance pays or doesn't pay for a particular medical charge).

-> Hospital Billing Department:

    Now I was ready. I didn't call the number on the Collection letter, instead I called the hospital's billing department. I spoke to a Melody, again noting the date and time and name.

    I asked an open question about why my account was turned over to collection. Melody indicated that they had not received payment from me. Well, with four patients waiting on me, I decided to drop the bomb. First I let her know I was a doctor, then I told her that I know she was paid and gave her the date of payment.

    Melody quickly changed her tune, "You aren't in collections," she said. "Funny," I said, "That letter has a font of 18 telling me that I was." "Oh, we just send that out to people, to get them moving on payment," she replied.

    I asked her if she knew my account was a PPO contracted amount. She indicated that they did. I asked her then if she knew that there was a usual and customary rate (UCR) that was paid by the insurance company, she note they did.

    Giving up on time and knowing the system, I got upset very quickly. "Melody, your hospital is balance billing and you are dual billing and both are illegal." You could have heard a pin drop. "Sir you are not listening to me, we haven't received payment." "Melody, I have the PID and the EOB telling me otherwise," I said. Again you could hear a pin drop. I was immediately prompted to a supervisor.

-> The Supervisor:

    Well the phone rang and rang, no one answered, then finally I got an answering machine.

    I left my name and my number and then again told my story. Funny thing is, they don't expect you to know what is going on, but I have worked in health care for twenty years and nearly seen it all. I have done the administration part and the collections part and the billing part and been a patient too.

    I finally got a call back after my patient load dropped off for the day and was told, they were looking into it. I also informed them that payment was made by me a few days earlier to cover the other $400 bill they sent me on the same procedure. The insurance company had told me that it was only $240 that I owed.

    This idea of "quick billing" is illegal and per the contracts of most insurance companies, the hospital and your doctor or other health care professional must wait for the EOB to come back to the provider (which is the person sending the bill). You are only allowed to receive the co-pay and deductible until that time.

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Lack Of Knowledge From The Medical Community

Truth is most doctors have the same problem that I did, when we went to medical/chiropractic/osteopathic school. They taught us physiology, anatomy, pharmacology, radiology, etc., but no billing. That's right; we don't have classes in INTRODUCTION TO HEALTH CARE BILLING 101.

So the problem is, you have doctors who are likely to not bill an insurance company correctly and when that happens, they get frustrated and bill you. Many attend seminars that tell them to bill you directly and if they get the money twice, just sit on it until you ask for it back.

Most insurance companies will send you an itemized EOB stating what they pay and what you are responsible for. Most people toss it in the trash. Or insurance companies require additional information prior to payment, you forget or lose the letter and no payment or EOB goes out. Then the whole system gets so messed up that everyone sends bills to everyone, almost immediately. What should you do?


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Co-Author, Amber Steinmetz.


What Should You Do When You Receive A Bill From Your Doctor/Hospital?

1. Do Not Pay It.

    That is right, a doctor is telling you, don't pay that medical bill right away. At least not right away. It takes 60-90 days for most insurance companies to process claims. If your doctor submits their bills on paper, then it takes longer.

    I use electronic submission and it still takes some claims over 120 days to get paid and some are over five years old. That accounts receivable number gets pretty high, that is why they quick bill you.

2. Look At Your EOB.

    If you can't find your EOB, then call your insurance company first. Ask what has been paid and what is being processed. Then pay only the portion that your insurance company has calculated that you owe.

3. Write Everything Down.

    Write down the names/numbers/dates of anyone you talk to from your insurance company. You may have to reference that phone call several times.

4. Call The Provider.

    After you have called your insurance company, call the provider and ask about the bill. If they seem confused, always default to your insurance company. Trust me, I have experience working for both; I work for the insurance companies as a reviewer and I am a provider.

    Again write down the name/number/date and time of who you spoke to. It is better to have that, than to say: I spoke to someone in your office and they told me this...

5. Call Your Insurance Company Again.

    Write down the names again and the date and the number and the time. This gets very important if things start to go bad.

6. Call The State Board.

    If you have a dispute and feel you are being lied to, call the state medical/chiropractic/osteopathic or other appropriate board and the state insurance commissioner's office.

7. Verify The Mail You Send.

    If you receive a letter from your insurance company, open it, fill it out appropriately, copy it and return it to them promptly, then call them in ten days to make sure they got it.


Educate Yourself

Not all doctors are bad and others are just as lost as you when it comes to insurance. Not all insurance companies are perfect either.

Ever see the movie Rainmaker? That will be a good movie for Saturday night. Rent it. There is a book about it too. It is a true story. Trouble is most bad billing doctors give insurance companies a bad name. Most people assume it is the insurance company who is delaying payment, but more times than you would believe it is your health care professional.

Just educate yourself, your family and friends about this article. Get informed and stay on top of the moment and once you have justified the bill, then obviously pay the bill as quickly as possible.


Learn The Terms

-> Balance Billing:

    When a provider will charge you the full amount for their services. This is illegal with a contracted provider. Inform your insurance company's fraud department if you suspect this kind of activity.

    You can also write letters to the medical/chiropractic/osteopathic/physical therapy-occupational therapy boards, and tell them what has occurred. Lastly the Attorney General would also be helpful in such matters of possible fraud. You may think, I am just one letter, but those letters go to a file and they add up.

-> Quick Billing/Dual Fee Billing:

    When a provider will not wait for payment from the insurance company for their services and sends you a bill immediately. Dual fee billing also refers to billing different amounts for the same service to cash patients vs. private insurance patients vs. auto accidents vs. worker's compensation.

-> Capitation:

    When a doctor is paid a set amount to see a particular number of patients and is usually given a bonus if they keep their office doors closed or use low referral patterns and are not using diagnostic protocols, as they normally should. Capitation is also a dollar amount that your employer sets as maximum payment for any particular benefit payment.

    See USA Today MONEY Section B, Friday January 24, 2003: Kaiser to reveal incentives for physicians. It discusses how insurance companies are giving money to physicians as an incentive for them NOT to see patients.

-> Explanation Of Benefits (EOB):

    Tells what your insurance pays or doesn't pay for a particular bill. Keep this and look it over.

-> ICD-9:

    International codes of diagnosis, used to convert common diagnostic terms to numbers.

-> CPT:

    Codes for procedure terminology. This is what doctors charge for.

-> Co-Payment:

    The amount you must pay per visit to a particular providers office. Be aware that this amount may be directly related to the UCR amount. If you have percentage payment, then you have to wait until your UCR amount on your EOB prior to payment. Call your insurance company or human resources department for details.

-> Deductible:

    The amount you must pay prior to obtaining the insurance companies payment. Be aware that this amount is subject to the UCR amounts.


Key To Who Answers To Whom

  • State boards police the activities over the physicians.
  • State hospital board polices the activities of the hospitals.
  • State insurance commission polices the insurance companies.
  • Attorney General polices them all.
  • ALL USUALLY HAVE LINKS.

As a physician, I try and work with insurance companies. Together we make up the health care system that so many people have lost faith in. Learn to use the system more effectively and work towards making it a more useful system that you can put your trust in.


Typical Format Of Payment

  • Doctor Charges for procedure = $200
  • UCR for particular CPT = $ 150
  • Insurance company contracted amount for CPT is 50%.
  • Actual allowed cost for CPT billable is now half the UCR @ $75
  • Minus your twenty dollar co-payment they can pay $55. If you have a percentage co-pay; (example 80/20), the insurance company will pay the 80% and you will pay the 20% or $15 in this case.

Remember that math that you said you will never use. Looks like you should have listened to your teacher.


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Co-Author, Amber Steinmetz.