NEW YORK — Unexpected High medical bills are common in the United StatesBut there are ways to get relief. According to the Consumer Financial Protection Bureau, one in five Americans is burdened with outstanding medical debt, costing them $88 billion.
In a 2022 study, the bureau found that about 20% of U.S. households report having medical debt, with collections showing up on 43 million credit reports. As of the second quarter of 2021, 58% of all accounts in collections on credit reports were medical bills.
Households also suffer unequally from medical debt, the agency said. Delinquency rates are higher among Black and Hispanic people than among white and Asian people, and medical debt is more prevalent in the U.S. South, in part because states in that region have not expanded Medicaid coverage.
While the process of fighting high medical bills can be time-consuming and frustrating, advocates stress that patients shouldn’t feel intimidated by the system. If you’ve received an unexpected medical bill, here’s what you need to know:
When Luisa, 33, received a medical bill of more than $1,000 after an emergency hospitalization for a viral infection, she was able to get the full amount reimbursed by the hospital after claiming on their financial assistance insurance.
“I thought it was just a cold at first, but it turned out to be something that I needed specific medication for,” said Luisa, who asked to be identified only by her first name for privacy reasons. “It was really bad when I went to the ER.”
Luisa had heard about the patient advocacy group Dollar For from a viral video and filled out the nonprofit’s online form after receiving her surprise bill. The organization contacted the hospital, which was located in central Florida. Ultimately, the hospital contacted Luisa directly to let her know that she did qualify for financial assistance. Although she had already paid for part of the bill with a credit card, Dollar For was able to recover those payments.
Laws governing charity care in hospitals require nonprofit hospitals to reduce or write off bills for individuals based on family income. To determine if you qualify, simply Google the hospital using the term “charity care” or “financial assistance policy.” Dollar For also offers a simplified online tool so that patients can see if they qualify.
“Federal law requires hospitals to have these programs in order to maintain their tax-exempt status,” said Jared Walker, CEO of Dollar For. “If you fall within their income range, they will write off, waive, forgive or reduce your bills.”
Even if you have already paid off your medical debts, the hospital must reimburse you for the payments you made, he said.
“It was the first time I’d ever experienced anything like that,” Luisa said. “I tried to be an informed consumer and ask questions when I was in the hospital about the cost, but of course it’s hard when you’re sick in the emergency room.”
While people with Medicare, Medicaid and Tricare have long been protected from surprise bills, the laws now apply to people with private or market-based insurance as well.
The federal No Surprises Act applies to people who are insured through their employers, the marketplace, or individual plans. It requires insurance companies to reasonably cover all out-of-network services related to emergency and non-emergency medical care. That means if you’re charged more than you’re used to or expected when you receive in-network services, that bill could be illegal.
To challenge a bill that falls under this Act, you can use the toll-free helpdesk and hotline of the Centers for Medicare and Medicaid ServicesMany states also have free consumer assistance programs to assist with disputes and insurance questions. You can always write to a hospital’s medical billing department to say that you believe a bill violates the No Surprises Act and ask the hospital to negotiate directly with your insurance company.
“The complexity of the system itself is just as much of a problem as affordability,” said Kaye Pastaina, who directs patient protection research for KFF, a nonprofit health policy organization. “A lot of it comes from the fragmented system and the complex rules, but also from the lack of awareness about existing protections that are part of federal law that could help.”
Even if you don’t qualify for charity care or you’re not sure whether your bills fall under the No Surprises Act, you may be able to reduce your costs.
Medical billing is notoriously cumbersome and error-ridden. When you receive a bill, ask the hospital or provider for an itemized invoice with the billing codes for all care you received. The Health Insurance Portability and Accountability Act (HIPAA) requires providers to share this information.
Next, check to see if the billing codes are correct. Again, just googling codes with the phrase “medical billing code” can help. If something is wrong, disputing your bill with your medical provider or doctor’s office can lead to changes.
Another approach: Compare the bill to insurance companies’ estimates of fair costs for services. If the price you’re charged is higher than average, you can have your costs reduced. You can even take the provider to court over the discrepancy (or let them know you have a case).
Finally, compare your insurance company’s “explanation of benefits” with the bill. This explanation of covered and uncovered charges should match the hospital bill. If it doesn’t, you have another reason not to pay and can ask the provider to work with your insurance company first.
Despite the hassle, these steps can save you significant amounts of money. Even after taking these steps, you can always appeal health claims to your insurance company if you believe there is a reason the bills should be covered in full or more than the company originally decided. You can also contact your state insurance commissioner for assistance.
“What we’ve seen in our research and the data is that the people who appeal — and there are very few of them — but among those who do appeal, there is a high level of reversals,” Pastaina said.
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