Occam's Razor

Apparently it’s quite legal to get away with robbery in the United States, at least if you are a health care provider.

I imagine the health care providers don’t see it this way when they send you threatening bills saying you owe tens, hundreds or thousands of dollars. Curiously most of us don’t know we are being robbed. That’s because we naively assume that being legitimate businesses they would not rob us. We assume whatever they put in the amount owed we must owe, so we better open up our wallets and pay up. Payment is always due upon receipt.

Not all health care providers try to rob you, but a lot of them do. When you press them on it, like I did today, they will say it’s a small mistake. However, if you pay their amount due which is more than you actually owe, you are unlikely to hear a thing. They consider it a bonus for services rendered. Thanks! I guess it helps pay for those large country club fees.

Just in case it isn’t clear to you, if you are insured you owe a provider exactly what your health insurer says you owe them. This is usually a copay. Particularly at the start of the year there are deductibles that you have to meet. Thus you end up paying for a lot of it out of pocket anyhow. So near the start of the year, you may owe a $30 copay, and $200 because that’s how much the agreement between your health insurance provider and your service provider specifies. So you may be out of pocket $230 and after you hit your deductible, the next visit is just for the $30 for the copay.

What a lot of health care providers do though is they bill you for the list price of the service. So if their rate for an uninsured person is $300, you will get a bill for $270, which is $300 less the $30 copay. Or maybe you hit your deductible and they will bill you for the $70 and see if you pay up.

This has happened regularly in our household but particularly this year as my wife had an expensive operation in March. Upon release she ended up in the emergency room to deal with a postoperative condition. Blizzards of bills soon arrived, and some arrived a month or two later. There is the surgeon. The hospital. The anesthetist. There were bills for Tylenol and replacing bloody gauzes that needless to say far exceeded the price for similar stuff at the local CVS. Payment was due on receipt, as if I had thousands of dollars of spare cash just lying around. Thank goodness I didn’t pay their ransom demands. In the case of one procedure they said we owed $3000 while the insurance company said we owed $0.

What you owe is what your insurance company says you owe, not a penny more or less. That’s why they send you those statement of benefits. Unfortunately, it’s not always easy to play mix-and-match with these dueling statements. Doing it though is critical, unless you are happy to give health care providers gobs of extra money rather than bother to parse through all this stuff.

In our situation with all these disparate bills it was pretty challenging, not to mention frustrating. After a while I moved from frustration to anger. First, how dare they bill us for services beyond what they are legally owed! This should be medical fraud, but I’m betting it’s not simply because I’ve never heard of a case (outside of fraudulent Medicare billings) of providers doing this. It happens all the time! If we are typical, about half of our medical bills make demands for more money than they are entitled to receive.

Second, why don’t they wait until they get a response from the insurance company before sending these bills? Many do of course, but a lot don’t. They just send their ransom demand that they purport to be a set of legitimate charges. What you should do is wait to hear from your insurance company and then send any additional money they say that you owe. It’s not like these providers don’t know we are insured. Every one of them won’t even see you until they get your health insurance information into their system. They even copy my insurance card and license because, you know, I could be a deadbeat.

Third, they bill for all sorts of dubious crap. I went to see a local urologist recently because as a middle aged man I suffer from a temperamental prostate gland. It was a routine visit. I saw the PA (Physician Assistant) instead of the physician. There was no special test this time, no flow test to see how quickly I could urinate. They did test my urine then they did an ultrasound to see how much I retained. They billed not just for the ultrasound but also for “medical supplies”. That was for a dab of that jelly they massage into your skin before the ultrasound. This required me to later write a check for $6 to cover it and also a stamp to mail it. It amazes me that they have the audacity to bill for these minor things and annoys me that my health care provider considers it a valid expense. This is the cost of doing business. Moreover, I was billed as if I saw the physician, not the PA.

Fourth, they don’t like to take no for an answer. A month of so back I got a ransom demand from the physician that saw my wife in the local emergency room. I sent them back a check for what I actually owed, along with a statement from my insurance company saying what I owed. Today they sent me another statement for the difference. It took a call to their billing department (and patiently waiting on hold for a while) before they agreed I didn’t have to pay the amount which I had already documented to them!

I hope you won’t put up with it because all these billing errors/extortions just subtract from your fragile bottom line. It could mean you can’t afford that daily trip to Starbucks or you can’t add that extra principle to your next mortgage payment.

It should go without saying that our current health care system is a really crappy system. It’s great that twenty million people are now insured who weren’t, but doubtless they are going through this crap for the first time too, trying to parse through its pointless complexity. I suspect it costs all but the most vigilant families at least hundreds of dollars a year. Those who need more services are probably paying thousands of dollars unknowingly than they should.

There ought to be a law and maybe there is one. If so, I’d like to see it enforced just once. I can send local investigators plenty of leads.