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How to Handle an Out-of-Network Medical Bill

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By Kristine Crane

As if the human price of illness wasn’t enough, a seemingly unwarranted medical bill that follows may truly feel like rubbing salt in the wound. And yet, it happens – all the time, to the best of us.

“I think a lot of people are going to be struggling with these issues,” says Chuck Bell, programs director at Consumers Union in New York. Bell helped get a consumer protections bill passed in New York last March, which has certain protections for patients against out-of-network billing. “People are busy. They don’t have a lot of time to sort through bureaucracy. I have lawyers come to me and say, ‘If I can’t figure this out, how can someone else?’”  

The bill, which goes into effect April 1 of next year, grew out of a case study that was inspired by a New York Department of Financial Services report, which stated that out-of-network bills are the department’s top health insurance-related complaint.

Emergency situations comprise some of the financial burden. “In an ER situation, you are in no position to shop around or drive across town to find a provider,” Bell says. The report highlights one example of a patient with a severed finger who received a bill from a nonparticipating plastic surgeon, who reattached the patient’s finger for $83,000. The patient’s insurer noted that other area physicians charged $21,000 for the same procedure – so the patient was expected to cough up the remaining $62,000. 

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Beware the Out-of-Network Anesthesiologist

Another frequent consumer complaint is out-of-network anesthesiologists. “A lot of providers don’t tell you when they are going to bring an out-of-network anesthesiologist into your care,” Bell says, adding that by the time you realize that’s what you’re dealing with, it’s too late.

Under the new legislation, he continues, the provider is supposed to give you significant warning about who your anesthesiologist will be so you can plan ahead. The new legislation also makes it mandatory to keep provider directories up to date since providers may roll in and out of networks within just 15 or 30 days, Bell adds.

But it’s ultimately patients’ responsibility to check whether a provider is covered before they actually go to the doctor, says patient advocate Trisha Torrey, who herself once got stuck with an out-of-network bill for a dermatologist to whom she had been referred by her own doctor.

“Just because a doctor recommended a specialist doesn’t mean that insurance will cover it. Too many patients rely on the word of the doctor to think that something will be paid for,” Torrey says. “It’s up to you to verify that specialist is covered.”

And if the specialist is not covered, Torrey continues, “That’s the time to go back to the original doctor,” Torrey adds. “In this day and age, no patient should accept a referral unless they verify that the referred doctor is in the insurance plan.”

The Affordable Care Act may complicate matters slightly, she adds, since it potentially “tightens the number of doctors you can see. And the less you pay for premiums, the less likely you are to be able to pick carte blanche a doctor,” she says, adding that Medicaid and Medicare patients especially might have a hard time finding a doctor.

Bell adds that he hopes providers are in sync with the ACA’s open enrollment schedule, so that patients don’t run into surprise bills. “Your ability to transfer into the middle of a health plan in the middle of the year is not great,” Bells says. “So a provider should agree to stay within a calendar year.”

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When It’s Too Late

But let’s say you’ve already been to the specialist, or had surgery with an anesthesiologist who was not covered, or had some unfortunate visit to the ER – and you’re stuck with a huge bill.

“Don’t suffer in silence. Complain,” Bell says. “We encourage people to contact their state’s department of insurance or their state attorney general.” Bell adds that each state’s network adequacy standards differ. For example, if you live in a small town and do have to see an out-of-network provider because no one else is available for miles, some states will charge you an in-network fee.

“If the health plan doesn’t have an adequate number of physicians, you would be able to see an out-of-network physician at an in-network rate,” Bell continues.

The new New York legislation also creates a system of mandatory arbitration so that when disputes do occur – and you were charged $80,000 for a procedure for which your insurance company will only cover half – you have someplace to dispute the claim, Bell says, adding that he hopes the bill will be a model for the country.

Another resource patients can access is FAIR Health, where they can find out what they should have been charged for procedures – since lack of disclosure about what patients might get reimbursed for when dealing with out-of-network providers has been another recurrent problem.

On this website, you can look up a procedure benchmark for reimbursement based on your ZIP code. 

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