Have you ever been to the emergency room at a hospital, thought you were covered by your insurance and ended up with a bill that didn’t seem quite right? There’s a pretty good chance that you have. According to one study, 1 out of 5 trips to the ER includes a treatment by an out-of-network doctor, and that’s what leads to surprise bills.
Why do surprise bills happen?
Here’s how it works: a patient has an emergency situation and heads to their local hospital. At the hospital, they’re handed a stack of paperwork to sign authorizing treatment. Naturally, they sign this because, you know, it’s an emergency.
That’s when things can go off the rails. Even if the hospital is in your insurer’s network, it is possible that individual doctors are out-of-network. This is a big difference. And that paperwork said the patient accepts care from anyone in-network or out.
You see, one of the benefits of having insurance, is that the insurer negotiates with the providers so you don‘t have to. This is a very good thing. Can you imagine negotiating costs while your kid needs emergency care?
Providers who have negotiated rates with your insurer are “in-network.” Everyone else is out-of-network (OON), and is not beholden to any set price.
If you’ve been to the hospital for any reason, the last thing on your mind is asking every single doctor who comes by to check on you or your loved one if they are in network.
If one of those doctors turns out to be OON, the patient is going to receive a surprise bill.
How bad is it?
When you don’t have a negotiated rate through your insurer, the hospital can charge pretty much anything. One study found that this was typically “2.5 times what most health insurers pay and more than 3 times hospitals’ actual costs.” Ouch.
In parts of North Carolina, this happens in 40%-50% of all trips to the ER.
When do I see this “surprise bill?”
After the hospital visit, the hospital sends the insurer the bill. The insurer will look at the bill and pay the negotiated rate with all in-network providers they are responsible for.
In North Carolina, for the out-of-network providers, insurers will typically look at the charge, figure out what they think it should be (usually what the negotiated rate would have been for that hospital) and send a check for that amount to the patient.
The patient needs this cash because they are about to receive that “surprise” or “balance bill” in the mail.
I get why it’s a surprise, but why is it called a “balance bill?”
Hospitals will refer to these bills as “balance bills” because they are attempting to collect the balance left between what they billed and what the insurer paid.
They calculate this amount and send a bill for the remaining balance to the patient.
What can I do?
North Carolinians are lucky because the insurer sends the check directly to them rather than to the hospital. Some states allow hospitals to force patients to assign their benefits over to them (Assignment of Benefits). In those cases, the hospital gets all the money the insurer is willing to pay and then still can send a surprise bill to the patient.
In North Carolina, the patient will usually have the check from the insurer, which means they can negotiate with the hospital.
Here’s what you do if you find yourself with a surprise bill:
- Call the billing department of the hospital.
- Tell them that the charge is too high for you to pay.
- Tell them that your insurer sent you a check for an amount that looks reasonable.
- Say that you would be happy to pay that amount to settle the charge.
Sometimes this will work perfectly, and the hospital will accept the amount of the check. Sometimes you will agree to a lower price than what they initially charged, but is more than what your insurer paid.
And yeah, sometimes it might not work at all. But it’s still worth a try.
The important thing is to not be afraid to negotiate. Consider that surprise bill nothing more than the hospital’s opening bid. Remember: they have no money from you yet, and they’d rather have something than nothing.
Anything else I can do?
YES! Three things:
If you’ve ever gotten a surprise bill, let us know! Your story could help others.
Educate yourself. Hospitals want to impose Assignment of Benefits on North Carolinians. Make sure your representatives know that this is a bad thing.
Join the North Carolina Coalition for Fiscal Health to stay up to date on what you can do to fight Assignment of Benefits, outrageous surprise bills and more threats to your wallet from rising health care costs.