Short of clearly negative terms such as homelessness and domestic violence, I can't think of a more depressing topic than healthcare. The topic is so immense that I'm not even going to attempt to cover it in any kind of detail. I'm only going to address healthcare billing.
You'd think billing for something would be easy. We've been billing for things for hundreds of years without issue. It can't be difficult, right?
Let me tell you how I spent Tuesday morning this week.
In March, the wife and I went on a vacation in Silicon Valley to visit with some old friends. As luck would have it, I got pink eye. I'm going to blame the Extended Stay America in San Mateo, which was one of the worst motels/hotels I've ever been at... and I like Motel 6.
What idiot gets pink eye when they are away from their kids for a few days? This idiot, I guess.
My wife, being a pharmacist, knew that we just needed a cheap, generic antibiotic. However, to get that antibiotic, you need prescription. That's when everything went to hell in a hand basket.
My understanding is that some 99.9999% of the insured US population can go to some kind of non-urgent clinic for something simple like this and have it covered. I even hear that it is relatively quick. Our military insurance is great, but the compromise is that you have to go through emergency rooms for something that should be quick. It means that I often wait six hours for a visit that can be as quick as 5 minutes. (I think emergency room triages could learn from grocery store check-out lines of 12 items or less. Oops, broke my promise to stick to billing.)
In any case, such visits are always covered 100% from by my understanding. This is the way the health care plan wants it to work.
Since we lived in the area for years, we knew just the hospital to go to. It was the one my first son was born at a few years back. As far as vacation illnesses go, this is going to be easy, right?
The visit itself was uneventful. I didn't even have to wait the usual 6 hours. In fact, I was almost unhappy to have to leave the waiting room that had a new episode of Undateable on.
A couple of months later, the bill came in the mail. We owed $400. Hmm, that doesn't seem right. I gave them my insurance card. Turns out they ignored what I gave them and used what they had in their computer system. That was no longer an active insurance due to our move. So it churned out a bill of $400 to be sent to my house.
Fortunately my wife works in this area every day and as the sponsor of the plan called up to fix things. I'm never sure who you are supposed to call in this scenario, the hospital or your insurance. In any case, she got the problem solved...
... until Monday when I get a new bill from the hospital for $330, the balance of the portion that my insurance didn't cover.
This is called "balance billing" and in some states and for some forms of health insurance (such as Medicare) it is illegal.
I had never heard of balance billing before. In my quick research it seems very controversial. For example, I think my bill would have been a lot cheaper if I hadn't gone to the emergency room. It can't be $400 for 5 minutes of someone to look at my eye and tell me what I already know, right? However, my insurance requires that I go to the emergency room. On the other hand, is it fair to the emergency room to take only $60 for what they deem is a $400 service? In this case, I think $12 a minute is still very good money, but I bet there are other cases where the insurance doesn't cover the hospital's expenses well.
If you really want to have your mind blown, you should read this Forbes article on balance billing. The patient planned a $2000 procedure with an out of network provider which is listed as being covered 50% by her insurance. She saved up $1000 for the procedure. However, she got a bill for $1600.
The insurance decided that the procedure should only cost $800 (their negotiated in-network rate) and decided to reimburse her 50% of that (or $400). That left a balance of more than $1600. It's a double whammy as she was penalized with a higher rate for going out of network and also only reimbursed 50%.
The Forbes article cites research that says only 16% of people were able to accurately estimate their bill in one study.
I can't imagine that anywhere else in life. The closest I can think of is my mechanic, but even then I get a fairly estimate before work is done. I can understand not having billing details when you are bleeding from multiple knife wounds (or some other urgent situation). However, that wasn't my case with pink eye and certainly not the case with the person in the Forbes article that saved up for her procedure.
Getting back to my case... I was in California and the Forbes article specifically points out that emergency rooms there can't balance bill. So I'm not sure how their computers even allows for the scenario. As an extra layer or protection, my insurance seems to say that I can't be balance billed. So it seems that the hospital is break the state laws and their agreement to take my insurance.
How can we fix this
From a technology standpoint, it should have taken all of 15 seconds for me to swipe my insurance card and have their computers tell me what it is going to cost for a pink eye emergency room visit. Maybe it's 30 seconds. I'm even happy to run it myself during the hours that I'm usually waiting in the emergency room. The could even take this to the next level and make a mobile application where it saves my insurance in the app. Then I'd only need to enter my condition and GPS could tell me nearest providers and final costs (with my insurance) in the area.
This technology is thousands of times easier than programming to Siri to understand what I'm saying and respond relevantly back to it.
Is this anything new?
Not for me. Twice before, I've gotten in conversations that went back-and-forth between the two a few dozen times over a span of several months.
One was for an ambulance ride when I almost died choking on pizza crust. The ambulance company couldn't figure out how to take my insurance. They couldn't work it out with my insurance company who had conversations with them. While they went back and forth to resolve the technical issue, my bill went into collections where it started to damage my credit. I was financially held hostage by two organizations who weren't even disagreeing with each other.
Another time, there was a disagreement between the hospital and the insurance for how the procedure should be coded. Under one coding it would be covered. Under another one it would not be. It was another case where it wasn't an urgent condition... yet they couldn't have told me beforehand whether my insurance would cover it.
So now, whenever I have something come up, it's a game of medical bill roulette. I've been fortunate enough to win the disagreements, but I think the process to resolve the financial aspect is far worse than the medical condition itself.
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