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Do Not Pay the Co-payment On the Medicare Bills --They are Illegal
Gary North's Tip of the Week - September 06, 2008 Medical Bills
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If you are ever sent a bill by a hospital for the difference between what your insurance company paid the hospital and what the hospital says you owe, call a lawyer. You may not owe the money.
This practice is called "balance billing," and in some states it is illegal. Yet it is widespread. The hospitals thrive on ignorance of the law. This report appeared in a recent issue of "Business Week."
When doctors or hospitals think an insurer has reimbursed too little, state and federal laws generally bar the medical providers from pressuring patients to pay the difference. Instead, doctors and hospitals should be wrangling directly with insurers. Economists and patient advocates estimate that consumers pay $1 billion or more a year for which they're not responsible.
There have been cases where the hospital has turned the bill over to a collection agency. The phone calls convince the victims to pay.
My view is that a lawyer should be calling the collection agency. Maybe the funds should be flowing in the opposite direction.
National statistics aren't available, but there's little doubt that many consumers unwittingly fall victim to balance billing. The California Association of Health Plans, a trade group in Sacramento, estimates that 1.76 million policyholders in that state received such bills in the past two years, totaling $528 million. The group found that 56% paid the bills.
If you get hit with such a bill, do not pay it before you have been assured by a lawyer that you owe it. Here's why.
California, New Jersey, and 45 other states ban in-network providers from billing insured patients beyond co-payments or co-insurance required by the plan. Similarly, federal law prohibits providers from billing Medicare patients for unpaid balances.