Baffled consumers seek help with rising medical bills
by Jane Lerner
A new industry helps people decipher and challenge medical bills they don't understand.
The cost of health care nationwide is rising at breakneck speed while people are being asked to pay higher premiums and co-insurance. That leaves patients puzzled by incomprehensible medical bills, and others unable to pay unexpectedly high costs.
Ellen Buczkowski has experienced the unexpectedly high costs. Over the last eight years, she has received an infusion of medication that she needed since her spleen was damaged by illness.
Until recently, her doctor charged about $500 for a treatment, with Medicare paying $216.82. Her share, once she met a small annual deductible, was $50.70 for the treatment plus $60 for her 40 mg dose of gamma globulin.
In January, she went to the same doctor in the same office for the same treatment. This time the bill was a whopping $19,235.07. Medicare paid $2,623.16. Her share: $655.80.
Buczkowski's doctor sold his practice to a hospital, so her treatment was billed by the hospital, not the physician.
A thriving new industry helps people decipher and then challenge medical bills they don't understand or are convinced are too high.
"The easy thing to do is open the checkbook and pay the bill," said Gary Dieckman of Pleasantville, N.Y., who was baffled by bills for physical therapy and other expenses his 86-year-old mother received after fracturing her arm. "But that is exactly what they want you to do. Why should I pay a bill that I don't have to?"
He turned to a medical billing advocate to lead him through the process and figure out what his mother owed and what she didn't.
As part of health-care reform and a movement toward greater consumer responsibility and cost transparency, the federal government is making public more information about hospital prices. People are being urged to shop around for the most cost-effective care.
But much of the available information leads to more questions about the rationale behind some charges.
The Centers for Medicare and Medicaid Services recently released information about hospital costs nationwide for the 100 most common reasons people are hospitalized, including chest pain, pneumonia and lower-joint-replacement surgery.
Medical bills of all kinds are challenging people's ability to pay.
Hospital bills are typically the largest of all medical expenses, so they tend to get the most attention. But experts say lab bills, outpatient facility bills and charges for services such as physical therapy are rising in both their size and their complexity.
Julie Roussell has been trying to figure out the bills sent to a friend. Roussell, who handles her friend's finances, was having a hard enough time understanding the nearly $25,000 in expenses.
Then the nursing home sent a letter to Susan Hassert's bank, stating she had died nearly nine months earlier.
"Dead?" Roussell said. "She's not dead. What are they talking about?"
Nursing home administrator Joseph Zimiles said the letter was an unfortunate mistake made as a result of "human error," and the facility has apologized to the family.
Hospitals contend the amounts they are paid for services are generally set by either government programs such as Medicare and Medicaid or negotiated by private insurers. Nyack Hospital, for example, noted in a statement that "co-pays and deductibles for patients with Medicare are also determined by (Centers for Medicare and Medicaid Services) and are not related to hospital charges."
When Buczkowski contacted Nyack Hospital to protest her bill, she said her concerns — outrage, really — were brushed off. She was told no one expected her or anyone else to pay the full amount. Other hospitals make the same argument.
So why bill such high amounts?
"It's a game," said Marc Chapman, who runs Hospital Bill Review, a Texas consulting firm that specializes in challenging hospital and other medical bills.
Chapman, a former hospital reimbursement director who also worked in the insurance industry, said most — but not all — charges are paid at a fixed rate by government and private insurers.
"Medicare won't pay any more, Medicaid won't pay any more, and private companies won't pay any more than what their contract calls for," he said.
"But there are payers that will have to pay that dollar amount or a larger portion of that dollar amount."
Need an expert
Medical bills have become so confusing that an increasing number of people are doing what Dieckman did when he was trying to decipher his mother's health-care expenses: hire an expert.
"Figuring out your medical bills has become as complicated as doing your taxes," he said. "You need an expert."
He turned to Adria Gross, founder of MedWise Insurance Advocacy, a Monroe, N.Y., company that helps people and businesses navigate and challenge bills.
"People don't realize that they can fight back," she said.
Gross estimates she finds mistakes or overcharges in 80% of the medical bills she analyzes. For Dieckman, that meant several hundred dollars in savings.
In the 15 years since Pat Palmer founded Medical Billing Advocates of America, she said, she has seen every conceivable charge, overcharge and made-up charge.
A common ploy involves charging multiple times for the same item or service, she said. Others include concealing low-cost items behind high-tech names.
One of her favorites includes $12 for a "mucous-recovery system" — also known as a tissue.
"These crazy charges have brought us to the crisis we are at now," Palmer said. "Request a detailed statement. Tell the hospital, 'I am not paying you any money until you tell me what I am paying for.' "
There are signs that more people are fighting unreasonable charges.
Palmer trains medical advocates, and she has seen the number of people entering the field rise from 40 people a year a decade ago to 200 to 300 annually now.
Most advocates charge either an hourly fee or a percentage of any money saved. Nonprofit organizations offer similar services free.
Most people don't seem to know they can fight medical bills despite a proliferation of for-profit and not-for-profit advocates, experts said.
Consumers really do not have the power to reform the market, said Derek Fitteron, founder and chief executive officer of Medical Cost Advocate in Wyckoff, N.J.
"Health care is a very interesting market. It is very fragmented on one side — lots of consumers and hospitals and doctors," he said. "And very consolidated on the other side — several large insurers pay most of the bills."
That imbalance often leaves consumers at the mercy of hospitals and other medical providers, experts said.
"We have the best care in the world, but we pay a lot," Fitteron said. "We overpay for it. Our costs are not just higher than any other country; they are two times or three times higher than any other country."
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