by Daniel Simmons

Julie Keaveny’s husband died after a freak mountain biking accident while the family was on vacation in Colorado. Nick and Sarah Condon’s three young daughters have an immune-deficiency disease that requires expensive treatments to ward off infections.

They don’t know each other and come from opposite poles of the country — Austin, Texas, for Keaveny, and St. Cloud, Minn., for the Condon family. But all have seen their lives consumed by a dizzying stack of medical bills. Their stories highlight what health-care experts say is a growing problem: medical bills that are often incomprehensible and sometimes inaccurate. About one-third of medical bills contain at least one error, according to the “National Fee Analyzer,” a book published by Ingenix, a medical consulting and publishing company.

Both Tom Keaveny and the Condons had employer-provided insurance they thought covered them adequately. But then the bills came. And the confusion began.

Among Tom’s knee-high stack of bills were out-of-network charges because all of his emergency care, hospital stays and hospice care happened out of state. Before Christmas 2007, a bill arrived for about $100,000.

“That’s a terrible thing to get in the mail,” says Becky Stephenson, a registered nurse who owns VersaClaim Inc., a patient advocate business based in Austin, Texas. Thanks to a recommendation from a friend, Julie hired Stephenson to sort through her bills.

When Stephenson looked at the claim, she noticed a minor coding error that caused Tom’s insurer to reject it. She worked with the billing and insurance companies and got it corrected, she says, but it was just one of many hairy moments in the repayment process.

While Julie turned to a professional to help navigate her bills, the Condons — like most Americans — chose to handle it themselves. “I can’t justify paying someone to do what I can do myself,” Sarah says. “It’s one less person to talk to.”

In July 2007, the Condons filed for Chapter 7 bankruptcy after their debt grew to more than $300,000, Sarah says. At least 80 percent of it was medical expenses. Although their debts were forgiven, the family lost their home and were forced to move to a townhouse, where they’ve lived since last August.

The debt mounted quickly, Sarah says, due to the family’s struggles to pay their $7,500 annual deductible plus charges for out-of-network care providers and the high cost of prescription drugs.

She says at least 70 percent of the medical bills she receives require a follow-up call because of an error or misunderstanding. Most common, she says, are denied insurance claims that should be covered based on their benefits. A variety of reasons — coding errors, typos, poor communication between doctors and insurers — cause the denials.

“It’s not an easy yes or no question for them,” she says.

Although most of the bills eventually get covered adequately, she says, they often float “in mid-insurance-air” for months, leaving the family on edge.

Problems such as the Keavenys’ and Condons’ seem to be getting more common nationwide.

“I’ve seen a huge mushroom of [billing-related problems] in the past decade,” says Nora Johnson, vice president of Virginia-based Medical Billing Associates of America. “People come to us and say, ‘There’s something wrong with this bill.’”

People’s confidence in the health-care system shows a similar trend. The percentage of people rating the American health-care system as poor has more than doubled in the past decade, according to the “2008 Health Confidence Survey,” an annual report by the Employee Benefit Research Institute.

To explain the trend, medical professionals point to an evermore complicated billing structure and a high-deductible insurance model that’s shifted more out-of-pocket costs and responsibility for monitoring bills to patients.

Barbara Bills worked in medical billing for the Indiana University Medical Group for 15 years before moving into her current job as assistant director of development for the group. In that time, she says the bills became considerably more detailed and more difficult to understand for patients and doctors.

“The red tape has gotten a lot more complex,” she says. “There are a lot more hoops to jump through in order to get the bill paid.”

Typically, a series of numbers on the bill tells the story of your visit to the doctor or hospital. What a doctor or care provider does during the visit is reflected in five-digit numbers known as Current Procedural Terminology codes. There are thousands of them, as each represents a narrowly defined medical procedure. There are five different codes just to describe an office visit.

Diagnoses are explained through yet more numbers known as International Classification of Diseases codes. There are thousands.

The codes are updated yearly by the American Medical Association and doctors themselves often struggle to keep up with the changes, says Dr. Bertrand Agus, a rheumatologist in New York. He says he learns through trial and error. “You get rejected for a claim,” he says, “so you call and find out why. It’s usually because now this particular diagnosis requires an extra digit or it needs an extra modifier. Then I know for the next claim.”

The billing process is highly automated — “computers talking to computers,” Stephenson says — and a wrong digit in the coding can result in an inaccurate and often expensive bill going to the patient.

In the past, patients may not have noticed the inflated bills, says Jane Cooper, chief executive of Patient Care, a Milwaukee company that contracts with corporate employers including Coors, Harley-Davidson and Briggs & Stratton, to help their employees navigate medical insurance and bills.

About 158 million American adults with health insurance get coverage through their employer, making it by far the leading source, according to a recent Kaiser Family Foundation study. Cooper says that over the past five or so years, employee health plans generally have shifted to much higher deductibles, creating more out-of-pocket costs.

Since 2004, employers have been offering health savings accounts, which allow employees to pay for health-care bills with pre-tax earnings set aside in bank accounts.

About 6.1 million Americans were covered under the plans in 2008, a 35 percent jump over the prior year, according to America’s Health Insurance Plans, a trade association that represents insurers. Despite the tax benefits, the plans still put more of the financial burden on patients.

In 2008, 18 percent of people with employee-provided health plans nationally had deductibles of $1,000 or more, according to the Kaiser study. That’s up from 10 percent in 2006. Among small-business employees, 35 percent were enrolled in the higher-deductible plans, up from just 16 percent in 2006.

Because patients are paying more of the bills, they’re also paying more attention: “If I’m buying a car and somebody else is paying, I’ll buy a Jaguar,” Cooper says. “But if I’m paying, I’ll settle for a Chevy.”

The search for affordable care and frustration with billing problems have driven more people to get help, as shown by a growing number of complaints filed with state attorneys general and a recent boom in business for patient advocates.

Johnson says her company had a network of 15 advocates nationally in 2001. Now there are 60. Cooper’s company contracts with 200 companies nationally — double what it did in 2005.

“So many people would tell me, ‘Oh my gosh, I don’t understand this bill,’” says Marilyn Welling, who started a patient advocate business last September in rural Gibsonburg, Ohio. “I saw a need.”

Advocates typically charge $35 to $125 an hour, although some charge based on savings gained. They justify their cost by pointing out they offer an individual approach to each patient and have a specialized knowledge of the health-care system that, in many cases, dramatically cuts health-care costs for patients.

Julie says she’s glad she found Stephenson, who billed her for a few hours each month and charged about $1,600 over the course of a year. “Becky was just a godsend,” she says.

Julie stayed with her husband in Colorado during the three months of care he received in hospitals, clinics and a hospice facility before he passed away Nov. 6, 2007. The couple’s three sons stayed at the family’s home in Texas, and her oldest child, Brian, gathered all the bills as they came. “There was a lot of detail involved,” Julie says. “Each place had its own group of doctors, lab work and other procedures.”

And the cost for three months of out-of-network care was substantial. Bills started coming in from trauma doctors, surgeons and emergency care providers saying they weren’t in network — and charging her more than $25,000 out of pocket, according to Stephenson.

The family bought a document scanner and, with it, scanned each new bill that came in and e-mailed it to Stephenson. She kept a spreadsheet of all their bills and notified Julie when and where she needed to mail a check. Beyond the organizational tasks, Stephenson also appealed for lower, in-network rates with doctors and the insurance company, explaining that Tom had no control over where his care would take place.

Stephenson was still wrapping up Julie’s billing issues in late 2008 and expects the total tab to exceed $550,000. Julie ended up being responsible only for an estimated $15,000 — nearly half of what was originally billed to her.

Meanwhile, the Condons’ struggles continue. Daughters Kianna, 4, and Annabelle, 3, have to get an infusion at least every three weeks. The infusions deliver donated human blood plasma, which provides them the antibodies they need to ward off infection. Kaylee, who’s Annabelle’s twin, takes a daily antibiotic, also to ward off infection. Each infusion costs from $5,000 to $7,500. They’ll need the infusions for the rest of their lives, and the price increases the more they weigh. If they develop an infection, they have to be put on antibiotics immediately.

While the family continues to rely on Nick’s insurance, they now get financial help from a state government program.

Sarah, 23, was herself diagnosed in 2008 with a chronic condition affecting her autonomic nervous system. The infliction often leaves her in intense pain. She tries not to feel sorry for herself, she says, and lobbies politicians every election cycle to reform the American health-care system. “I keep my dream of someday it being easier,” she says.