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Four mistakes that can lead to large medical bills and how to avoid them
Large medical bills can have a significant impact on your financial wellbeing. Approximately one-third of Americans have some type of medical debt and 28% of those with medical debt owe $10,000 or more according to one survey. The issue doesn’t just affect people who do not have health insurance. With high deductible plans and increasing costs for care, anyone can be confronted with large medical bills that strain their finances.
To help lower the likelihood that you’ll end up owing your doctor, hospital, or other healthcare provider more than you expected, follow these tips to avoid the four most common mistakes that can lead to large medical bills.
- Not fully understanding what your health plan does and does not cover. The Affordable Care Act requires health plans to cover a range of preventive care services at no cost to the patient. The mistake that some people make is assuming that all preventive care is covered at no cost. In fact, the care must be delivered by a healthcare provider in your plan’s network. Another situation that can lead to bigger bills is the use of newer technology for covered preventive and screening services, such as 3-D mammography. In addition to carefully reviewing what your health plan covers and what types of care require a copay or that you meet your deductible before the plan pays for care, ask your healthcare provider for the billing code for the care you need and check with your insurer to find out if the specific services are covered and what you may owe out of pocket.
- Going out of network without knowing it. Even when you check to make sure the primary care physician or specialist you see is part of your health plan’s network, there are still situations where part of your care can be out-of-network, leaving you with unexpected bills. If your doctor orders blood or imaging tests, check to make sure the lab or facility is part of your insurance network before undergoing any testing. If your doctor refers you to a specialist, don’t assume that because the referring doctor is in your network that the specialist is as well, even if their offices are in the same healthcare facility.
- Not comparing costs. There is no set fee schedule for medical care in the U.S. Hip replacement surgery at one hospital performed by one surgeon could vary considerably in cost with the same service performed by a different surgeon or at a different hospital. In fact, one study found that an uncomplicated appendectomy performed at one hospital in California cost $1,529 while the same surgery cost $182,955 at another hospital. And simply because care costs more, it’s not necessarily better quality care. Before receiving care, research what different providers in your area charge for the service using a price comparison tool like FAIR Health or Healthcare Bluebook. Of course, price isn’t the only consideration when choosing where to receive care. A health advisor can help you vet the quality of care provided.
- Not checking the accuracy of your bills. According to some experts, about 80% of medical bills contain errors that increase the amount you’re charged. Common errors include upcoding (using the billing code for a more expensive service), charges for care that was cancelled or refused, duplicate charges, and incorrect balance billing for covered, in-network care. It’s important to review every bill you receive and, if you find an error, work with the provider to get it corrected. Another option, which can be especially helpful for complicated or large bills, is to work with a medical billing advocate. An advocate can check your bills for errors, work to get them corrected, help set up a payment plan, and even negotiate a lower balance due.