Medical billing has gotten so complicated that more than 250 people can have a hand in creating a bill for a hospital stay, according to the Plain Dealer. No wonder then, that nearly half of Americans say that they’ve received an incorrect bill following medical treatment.
In the past, insurance providers might have absorbed such errors, and consumers who had relatively low copayments and little incentive to scrutinize every bill would have missed them. That has changed in recent years with the rise of the high-deductible health plan, which means that patient out-of-pocket costs are much higher, said Rebecca Palm, co-founder and chief strategy officer of CoPatient.com, a consumer website that helps people navigate health insurance issues.
That means an incorrect charge for a $250 office visit or a $2,000 colonoscopy is becoming more likely to be your responsibility than your insurer’s. “There is real money at stake with these errors,” said Palm. “For many people, it’s thousands and thousands of dollars.”
Such mistakes can have financial consequences beyond the bills themselves. An estimated 7 million Americans say that they’ve heard from debt collectors due to medical billing mistakes, according to the National Consumer Law Center. Furthermore, medical debt makes up more than half of all overdue debt on credit reports, according to the Consumer Financial Protection Bureau.
Having overdue debt on your credit reports can drag down your credit score, making it harder for you to get a loan. Follow these steps to spot errors and correct them as quickly as possible.
1. Look for Obvious Mistakes
Scan your bill quickly when it comes in to make sure that all your contact information is correct, and that they’ve typed in the correct insurance number. Your claim could be rejected simply because either your insurer or medical provider has misspelled your name, or has the wrong birthday listed, said Christie Hudson, a vice president at Medical Billing Advocates of America.
Then go through the bill for noticeable mistakes, like duplicate items, billing for a test that was cancelled or a charge for a copayment that you already paid. “Make sure you’re not being charged for seeing the same doctor twice in one day, or for seeing a doctor that you know you didn’t see,” said Hudson.
Another common error is for providers to charge you individually for services that you’ve also paid for in a bundle. Dates of treatment are important, especially around the beginning and end of the year, when your payment might go toward the wrong year’s deductible, said health care consultant Michelle Katz, author of “Healthcare for Less.”
2. Compare All Documents
Ask your medical provider for your medical records and an itemized bill, which will break down every individual charge. Medical providers must send an itemized bill when asked for one, but they’ll generally first send a summary bill, which won’t provide the details necessary to spot errors, said Palm. Make sure that the itemized bill matches the services you received, according to your medical records and your actual experience.
Compare that bill to the explanation of benefits you receive from your insurer. Carefully go through both statements to see if the individual charges jibe with the total that you owe.
3. Check the Billing Codes
Medical billing uses numerical IDs, known as CPT codes, to classify every service or treatment that you receive. If the price for a specific procedure looks wildly off, enter the CPT code on HealthcareBluebook.com to see if something as simple as an errant keystroke has resulted in an incorrect charge, said Hudson.
“The doctors and insurers usually don’t have an intent to steal from the consumers, but they’re dealing with a lot of complicated stuff,” said financial scam expert Steve Weisman. “The codes get changed and adapted, and there’s plenty of room for simple error. A small mistake can really balloon into something very expensive.”
4. Know Your Coverage
Sometimes the billing error is on the insurer’s side rather than the doctor’s, such as when the insurer denies coverage that you’re entitled to or charges you an out-of-network rate for an in-network doctor. Carefully read through your plan materials to make sure that you’re getting the appropriate coverage. By law, all insurers must fully cover preventive health services, such as blood pressure and cholesterol screening for adults, and vaccines and vision tests for children.
For scheduled procedures, talk to your insurer ahead of time about what should be covered and whether you need preapproval. “Ask the insurer what is covered, and how the deductibles and coinsurance are applied, so you understand the process,” said Katz. If a bill comes with a total that’s out of line with what you were expecting after that conversation, it likely contains a mistake.
5. Get on the Phone
Make calls to your doctor’s office (or other provider, such as a hospital, lab or ambulance company) and your insurer as soon as you spot a mistake, so that the bill isn’t prematurely sent to a collections agency, where it could damage your credit score. Even if you resolve an error that’s not your fault, once the bill goes to collections, it can be difficult to clear your credit history. A doctor’s office usually won’t send a bill to collections when it’s in dispute, said Weisman.
If it’s a doctor’s mistake, call your medical provider’s billing department to explain any errors that you’ve found. They’ll typically correct obvious mistakes, like an incorrect name or duplicate charge, right away, but they might have a more formal dispute process for more complicated issues. If your insurer will be on the hook for part of the bill, they might assist you with the dispute, although they might be hesitant to get into a dispute over how a claim was coded, said Palm.
If the mistake is on the insurance side, you might need to go through the provider’s appeals process to get the mistake corrected, said Hudson.
6. Document Everything
Given the intricacies of medical billing, most errors can take time and multiple phone calls to clear up, said Weisman. Every time you speak with someone, make a note of their name, the context of your discussion and the next steps. Be ready to call back and reference that information if you don’t get a response in a timely fashion, or if you need to appeal the decision. If you don’t get the response you’re looking for, you can take the complaint to your state’s insurance ombudsman.
7. Consider Hiring a Billing Advocate
If you don’t have the time or temperament to deal with this issue, it could make sense to bring in a professional medical billing advocate, whose job it is to negotiate claims and clear up issues on your behalf. “An advocate may have a better relationship with the hospital than you do and a better understanding of the system,” said Katz.
Such advocates can charge up to $250 per hour, or on contingency for a flat percentage of the amount saved, which can be worth it if you’re disputing a claim worth several thousand dollars, said Katz. Your insurer might provide access to an advocate as part of your benefits package, or you can find one via the Alliance of Claims Assistance Professionals or the Medical Billing Advocates of America. If your bill was correct, but you can’t afford to pay it, a medical billing advocate might be able to help you negotiate the cost and set up an affordable payment plan, said Katz.
8. Update Your Credit Reports
Once you’ve straightened out any mistakes, you’ll want to send documentation of the resolution to all the credit bureaus. That way, the mistake won’t continue to haunt you down the road, when you’re trying to open a credit card or get a mortgage.