You go in for a routine surgery or the ER for a minor emergency. You’re not too worried because you have insurance. Maybe you’re one of the lucky few and have really good insurance. You know the hospital is an in-network provider, so you think you’re covered. You pay your copay, the doctor's fees and your out-of-pocket prescription costs and think that’s it. Weeks or months later you get thousands in bills from a doctor or medical provider you’ve never heard of before.
While the problem is particularly acute in emergency room visits, the drive to keep the number of employees at a minimum is pushing hospitals to take on more outsource services within their own walls. To make a profit, those outsource providers have to pad billing wherever they can. The billing insanity is reaching obscene extremes. Some states have stepped in with laws to prevent the practice, but all the legislation in the world won’t change the clear incentives for hospital systems to pad their billing.
Out of Network
Even if the hospital is an in-network provider, sometimes the ER can be run by a different company that's not in your network. Even if both the hospital and ER are in-network providers, doctors are often contract employees and they may not be network providers. Just getting to the hospital might involve an ambulance ride with a company that may, or may not, be a preferred provider. The whole medical bills merry-go-round has become a way for hospitals to avoid hiring people directly, but it’s turned into a billing nightmare for consumers.
Here in an unnamed southeast state one of our local hospitals is trying calculated incompetence as a way to pad billing. Weeks after a routine medical procedure my wife got a $1,400.00 bill with no explanation. Since she requested a quote up front, she called and tried to inquire about the charge. The only people who answered the phone said she had to "contact Billing," a department that apparently never answers messages. Throughout the dispute process the hospital is still sending warnings threatening to send her collections. But when there's no mechanism to dispute charges outside collections, the hospital has a fixed system working for them.
How to Protect Yourself
Protecting yourself from hospital billing follies is becoming increasingly difficult because so many services within hospitals are being provided by outsourced companies. The x-ray and diagnostic imaging center, the lab—even something as simple as the person wheeling you up to your room may all be services provided by out-of-network providers. One solution that might help when it comes to disputing charges is attaching an addendum to your admitting papers that says services from out-of-network providers are authorized only up to the amount your insurance company agrees to pay. The only other thing you can do to prevent crazy medical bills is to stay armed with a list of preferred providers in your area and check every hospital service against that list. Hard to do if you're sick, injured or unconscious, but perhaps they already know that.
There are states, on both sides of the political spectrum, that have started trying address this problem, but there are no easy solutions. It also doesn’t fix the problem of hospital systems that deliberately continue to try and find new ways to game any new laws. In the meantime all you can do is research your local preferred providers and protect yourself the best you can.