Don't Miss Out on This Powerful Way to Cut Your Health Care Costs
Health care is a $2.8 trillion industry in the U.S., and the billing system is filled with errors. How many? While it’s impossible to know for sure, there are some fairly good indicators.
Medicare overpayments in 2013 totaled $36 billion, according to the Department of Health and Human Services. A report by the Office of the Inspector General found that 42% of evaluation and management bills sent to Medicare in 2010 contained errors, costing taxpayers $6.7 billion. Those services don’t even include emergencies and hospital surgeries and inpatient stays, where there's a lot more room for error.
Mistakes on hospital bills are widespread, says Pat Palmer, founder of Medical Recovery Services, a Salem, Va. organization that helps patients check and negotiate medical charges. “It’s astounding that eight out of ten hospital bills we receive contain numerous over-charges,” Palmer says.
Scrutinizing a medical bill may seem daunting, but with a few pro techniques on your side, you can catch some of the most common mistakes.
Don't be too quick to pay
Many hospitals and clinics send statements with only one final amount, so start by requesting an itemized bill.
“My most critical advice to consumers is to never pay a hospital bill before receiving and reviewing a detailed, itemized medical bill,” Palmer says. “Otherwise, you are paying money to these facilities blindly.”
You should also have your health insurance explanation of benefits nearby before checking over the charges, since billing errors can result in coverage denials.
Learn to spot common errors
Once you have your itemized bill and EOB side by side, check to see that identifying information like your name, address, and Social Security number is correct on each statement. Misidentification is a common error, and if either your insurance company or the hospital has the wrong information, your entire claim can be rejected.
Next, make sure all medications listed on the hospital bill are correct and that you actually took them. During a hospital stay medications that have been prescribed are often discontinued or cancelled, yet they still appear on your bill. Similarly, if you know you did not receive a service such as an x-ray or blood test but see it on your bill, you’ve been overcharged, says Palmer.
After you've had surgery, look at the charges for the operating room, which are generally by the minute. If you know how long your surgery took, see if the time matches up. If not, check the minutes in the operating room against anesthesia start and end times—they should be similar.
Mistaken room charges also crop up frequently for overnight stays. If you were in a room with more than one bed, double check that you weren’t billed for a private room. This should be listed in the service charge, and will probably be one of the largest items on the bill, especially if you stayed multiple nights.
Finally, see if any item appears more than once, since duplicate billing is also common. These mistakes are the simplest to catch. Because of the fee-for-service coding system is complicated, others may be more difficult to spot.
How to fix what's wrong
If you’ve found only one or two errors, you may be able to resolve them by simply reporting the mistakes to your hospital and health insurance provider. If mistakes are plentiful, set up an appointment to talk with the billing department of the hospital in person after you’ve alerted your insurance company.
If the bill is still higher than you think it should be, you can hire a medical billing advocate to help. Advocates are experts like Palmer who know how to work with hospitals and insurance providers to lower that bill.
Read more from NerdWallet Health, a website that empowers consumers to find high quality, affordable health care, and insurance.
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