Strategies For Managing A Hefty Insurance Bill

If you've received a huge insurance bill, the first thing to do is to check whether it's a bill or an Explanation of Benefits (EOB). An EOB is a notification from your insurance company that they have received a bill from a healthcare provider and are looking into your benefits and sorting out the payments. If it's an EOB, it will say something like THIS IS NOT A BILL. If you have insurance, any mistakes in the EOB will be fixed. If it's a real bill, you can try to negotiate the amount or get assistance with the payment. You can also ask for an itemized bill to check for any errors, such as charges for services you never received. If your insurer denies coverage of a procedure, find out why and file an appeal.

Understand what a surprise bill is

Surprise medical bills are unexpected bills from an out-of-network provider or facility. They often occur after an accident or sudden illness, and consumers are rarely informed of the costs of medical treatment before emergency treatment. When you get a surprise medical bill, you may not know if you received the billed treatment, if the correct amount was billed, if the amount is covered by insurance, and if the amount was already paid or partially paid.

Surprise medical bills can happen when a patient receives emergency or scheduled clinical care or services from a provider or facility that is considered out of network or non-participating by their insurance plan. This is known as "balance billing" or "out-of-network billing". Balance billing occurs when a provider sends a bill to a patient to cover the difference between what the insurance plan agreed to pay and the full cost of a service.

The No Surprises Act (NSA), which came into effect on January 1, 2022, protects people covered under group and individual health plans from receiving surprise medical bills when they receive most emergency services, non-emergency services from out-of-network providers at in-network facilities, and services from out-of-network air ambulance service providers. The NSA establishes an independent dispute resolution process for payment disputes between plans and providers and provides new dispute resolution opportunities for uninsured and self-pay individuals when they receive a medical bill that is substantially greater than the good faith estimate they get from the provider.

Under the NSA, private health plans are required to cover out-of-network claims and apply in-network cost sharing. The law applies to both job-based and non-group plans, including grandfathered plans. Doctors, hospitals, and other covered providers are prohibited from billing patients more than the in-network cost-sharing amount for surprise medical bills.

The NSA also establishes a process for determining the payment amount for surprise, out-of-network medical bills, starting with negotiations between plans and providers and, if negotiations don’t succeed, an independent dispute resolution (IDR) process. The IDR process is available to settle bills, allowing providers and insurance companies to resolve disputes without involving the patient.

If you receive a surprise bill, you can file an appeal with your insurance company or request an external review of the company's decision. You can also file a complaint with your state department of insurance or the U.S. Department of Health and Human Services (HHS).

Find out why your insurer denied coverage

If your insurer has denied coverage, it's important to understand why. Claims are often denied for simple reasons, such as incorrect information, or a mistake in the paperwork. For example, a patient's middle initial or birth date may be wrong, leading to a denial of coverage. In other cases, an insurance company may not cover the cost of a service that they deem medically unnecessary.

It's worth checking your policy documents to see if the facts fit the reason for the rejection. If you believe the claim was unfairly rejected, it can be challenged. Check that you gave all the correct details initially, and note down any ambiguous or poorly explained wording in your policy. Your insurance company has a duty to give you clear information and a reasonable explanation for refusing to pay your claim.

If the rejection was due to a technicality, such as missing information, you may be able to remedy the issue by correcting the paperwork or providing further proof of losses. If the rejection was due to a lack of coverage, you could consider switching to a different insurance company that offers the coverage you need.

If you believe the rejection was unjustified, you can file an appeal. All insurers have appeals processes in place, so find out what their process is and file an appeal, arguing your case. It can be helpful to have a doctor or medical provider document why the treatment you received was medically necessary.

File an appeal

If you receive a large insurance bill, it is important to first establish whether it is a surprise medical bill or an explanation of benefits (EOB). An EOB is not a bill, but an explanation from your insurance company that they have received a bill from a healthcare provider and are looking into your benefits and sorting out the payments.

If you have received a surprise medical bill, you can dispute it. A surprise medical bill is an unexpected bill from an out-of-network provider or facility. If you have insurance, your first step is to find out why your insurer doesn't want to pay for the treatment. It could be a simple administrative error, such as a wrong middle initial or birth date. It could also be that the insurance company does not deem the treatment medically necessary. All insurers have appeals processes in place, so you can file an appeal arguing your case. It is helpful to have a doctor or medical provider document why the treatment was medically necessary. Very often, you can appeal and get things covered, but it is not always successful.

If you are uninsured, you can still dispute the charge. If you received a good faith estimate of the expected charges from your provider and are billed for an amount that is at least $400 more than the estimate, you may dispute the charges in the Federal patient-provider dispute resolution process.

Negotiate the bill amount

If you have a huge insurance bill, you can try to negotiate the amount you have to pay. Here are some steps you can take:

• Check the bill for errors: Medical bills have their own coding system, but you can search online to understand the codes and check if you are being billed for the correct treatments. Common errors include mismatched codes, upcoding, duplicate billing, and unbundling. If you find any discrepancies, contact your doctor, hospital, or insurance provider to question the charges and request a new, accurate bill.
• Negotiate for insurance rates: If you are uninsured, you may be charged a higher rate. Look up the fair market price for the care you received, which is the amount providers usually accept from insurance companies as full payment. Contact the billing department and politely negotiate a lower payment. If your initial request is denied, ask to speak to a supervisor and keep going up the organizational chart until you reach someone willing to help. You can also ask for a cash payment discount, as this saves the office credit card fees and staff time for processing paperwork.
• Negotiate payment terms: If the provider is not willing to budge on the price, work out a payment plan that meets your needs. Be clear about how much you can pay and when. The provider will likely accept a smaller payment rather than risk not getting paid at all.
• Act in advance: If possible, ask for a discount before the procedure, especially if you are uninsured or your insurance does not cover the procedure. Be transparent about your financial situation and income, as many hospitals have programs to help those who are financially strapped.
• Get it in writing: If you successfully negotiate a discount, make sure to get it in writing. It may be helpful to make your pitch in writing as well, so you have a record of your request.
• Understand what's included: Ensure you know what is included in the quoted price. For example, check if anesthesia is covered or if it will cost extra.
• Be polite and persistent: Remember that insurance companies regularly negotiate with healthcare providers, so don't be afraid to ask. Stay polite and maintain your composure during negotiations.
• Reach out for help: If needed, consider hiring a professional, such as a medical billing advocate or an attorney specializing in medical billing disputes. You can also seek help from non-profit organizations like the Patient Advocate Foundation.

Understand Explanation of Benefits (EOB)

An Explanation of Benefits (EOB) is a statement from your health insurance provider that outlines the costs of the medical care or products you have received. It is not a bill, but rather an explanation of how your insurance has processed the claim for the services you received. It is a useful tool to ensure you are receiving the full benefit or discount that you are entitled to under your insurance plan.

An EOB is generated when your healthcare provider submits a claim for the services you received. The insurance company will then send you an EOB, which will include:

• A summary of your account information, including your name, the date(s) of service, and the claim number.
• A list of the dates and descriptions of the services provided, along with the associated charges.
• The amount your insurance has agreed to pay per their contract with the provider/facility, and any discounts applied.
• The amount not covered by your insurance plan.
• The amount you are responsible for paying, which may include a deductible, copay, or coinsurance.
• Any additional information, such as a glossary of terms, instructions for appealing a claim, and details on filing an appeal in your state of residence.

It is important to understand that the EOB is not a bill, and you will receive a separate bill from your healthcare provider if you owe any money. However, you should save your EOB and have it available when discussing your bill with your insurance provider, as it helps to ensure you are being charged correctly.

If you have questions about your EOB or believe there may be errors, you can contact your insurance company's customer support for assistance. They will be happy to walk you through your EOB and help you understand your coverage and responsibilities.

Frequently asked questions