Health insurance is supposed to be an investment that protects you from financial ruin in the event of a medical emergency. However, for millions of Americans, this definitely isn’t the case. In fact, according to a 2016 Kaiser Family Foundation and The New York Times survey, more than one in four Americans had trouble paying a recent medical bill. In December 2014, more than half of Americans with medical debt had no other debts listed on their credit reports, according to the Consumer Financial Protection Bureau (CFPB).
Those who have been fortunate enough to escape the wrath of collections may nonetheless find themselves battling with a series of other financial issues because of excessive medical bills. Why are these consumers, who did their part by securing coverage, still forced to cope with costly bills for medical care? There are several reasons, but at the forefront of the list are excluded services, out-of-network providers, and excessive copays.
- Health insurance is intended to be an investment that protects you from financial ruin in the event of a medical emergency but this isn't the case for many Americans.
- Many Americans struggle to pay their medical bills or have medical debt listed on their credit reports with no other types of debt.
- There are several things that you can do to proactively help prevent the risk of incurring high medical bills, including screening potential providers, confirming the accuracy of your insurance information, and requesting itemized bills.
- Should you face an exorbitant medical bill, you might consider making payment arrangements with your provider, inquiring about financial assistance programs, or negotiating the final balance.
A national poll by National Public Radio, the Robert Wood Johnson Foundation, and the Harvard T.H. Chan School of Public Health sought to reveal patients' perspectives on healthcare in the United States.
According to this study, 42% of the respondents believe that healthcare costs are a serious problem and spend all or most of their savings on large medical bills. In addition, 20% do not believe they get good value for their healthcare; the same percentage say that paying for prescription drugs is a struggle.
How to Curb Costly Medical Expenses
Here are some tips for how to reduce any potential costly medical bills.
Screen Potential Providers
Prior to signing on the dotted line to receive services, confirm with the providers that they are in your network. For more advanced services, such as surgery, you should also speak with the head practitioner to confirm that all the providers rendering services also take your insurance.
Otherwise, you could incur hefty fees because out-of-network providers (for example, the anesthesiologist doing your operation) don’t have to abide by the negotiated rates set forth by your insurance company.
Confirm the Accuracy of Insurance Information
Each time your health insurance changes, you need to pass on the updated information to your provider so that your claims are not processed using the old policy still on file. If you don’t, your claim will be rejected, and you may have to cover the cost of treatment.
While it’s fairly simple for the billing staff to resubmit the claim to your new insurance company, you could end up in the hot seat with the collections department if you don’t get everything straightened out upfront. Even worse, you might end up remitting payment for services that should have been covered under your current policy. For this reason, it's vital to know your rights when it comes to debt collection.
Request Itemized Bills
Medical billing specialists process thousands of claims, so mistakes are bound to happen. Various groups have provided estimates about the extent of this problem, ranging from 7.1% of paid claims containing an error, according to the American Medical Association, to reports of 75% or 80% from billing review groups, according to a CNBC report. For this reason, you should always request itemized bills and carefully review each line for duplications, services you didn’t receive, price discrepancies, and any other issues. If you spot inaccuracies, immediately reach out to your provider’s billing department to resolve any issues.
Compare Quotes for Services
Who says you can’t shop around for medical providers? Some services come at a substantially higher price tag than others, so explore your options if there is more than one available. Also, compare the out-of-pocket costs among providers. Surgical procedures performed at hospitals and treatment received in the emergency room have a reputation for being more costly than medical services rendered at outpatient centers and walk-in clinics.
What to Do If You're Buried in Medical Debt
If you're struggling to stay afloat in a sea of medical debt, here are a few suggestions:
Make Payment Arrangements
Payment plans are always a viable option to consider if your medical bills are too costly to handle in a single transaction. However, it’s important to make timely payments and contact the medical provider immediately if your financial situation changes.
Inquire About Financial Assistance Programs
Some hospitals and medical providers have in-house programs or are connected with organizations that provide assistance to patients who are in dire financial straits and struggling to cover their medical expenses. Speak with the billing department to learn more.
Negotiate the Final Balance
As a last resort, you can meet with the billing administrator and plead your case in an attempt to negotiate the final balance.
The Bottom Line
Carrying adequate health insurance coverage isn’t always enough to keep the rising costs of medical care under control. Fortunately, being proactive can help consumers curb costs, secure financial assistance, and ultimately decrease the impact on their wallets.