Health-Care Savings Series—Day 4: Negotiate your medical bills and check for errors

Oct 9, 2008 11:58 AM

The cost of medical care continues to rise, and the uninsured often have to pay a lot more for the same procedures than those who are covered. Insurance companies can negotiate group rates with hospitals and other health care providers, but when you don't have insurance, or your procedure isn't covered by your plan, there's nobody to negotiate on your behalf. As a result, the bill can be four or five times more than an insurance plan would pay. And even procedures that are covered can cost a lot more than you expect, especially as insurance covers less of rising health care costs. But you can negotiate on your own behalf.

If you have the means to pay, but the amount is too high, you may be able to get your bill reduced by more than fifty percent if you pay it at the time of service. Figure out how much you are willing to pay and ask to speak to the manager of patient accounts. Billing is an expensive and time-consuming process, so the hospital representative has an incentive to reduce the bill in order to get it off the books promptly.

If you can't pay up front, try to negotiate a reasonable payment plan that you can afford. Avoid putting your balance on your credit card, or on any special medical credit cards or loan programs, or you could end up paying high interest rates. See our full report on medical debt for more.

Also make sure you review the bills carefully. Billing errors are common at hospitals and other health care facilities, so ask for an itemized bill and check it for accuracy. If you have insurance, compare the bill to your plan's explanation of benefits or Medicare summary notice. Look for all the common errors, which include:

Incorrect dates of service. Make sure you're not being charged for a room on the day you were discharged from the hospital, which most plans don't allow.
Inflated room charges. Incidentals like sheets and towels should be included in the basic room charge.
Duplicate fees for tests and procedures.
Human errors. One mistaken keystroke could result in the wrong billing code.
Inflated operating room time. Your hospital should have an exact record of when your surgery began and ended.

You may also find that you were charged out-of-network rates when you thought you were in-network. For example, you may have made an appointment with an in-network surgeon, but the anesthesiologist is out-of-network, leaving you with a hefty bill. In that case, ask if they'll accept your plan's in-network rate, or negotiate a lower rate. For more on hospital bills see our full coverage.

—Kevin McCarthy, associate editor

Tomorrow: Use Available Tax Deductions and Credits to Lower Your Health Care Spending