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Negotiating health care bills a growing trend

Date Published: Jul 06 2010

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6 tips for negotiating your health care bill >>

by Angie Hicks, founder of Angie's List

When you go car shopping, it’s not uncommon to haggle over the price. The same could be said if you’re buying a new appliance, hiring a contractor for a home improvement job, or even shopping at a yard sale. So who’s to say you can’t negotiate the cost of your health care?

Well, in many cases, you can.

It might be one of the best-kept secrets in the health care industry, but there are occasions where consumers can negotiate price and payment with their doctors, dentists and hospitals and possibly save hundreds, even thousands of dollars.

While some medical practices have a set payment and billing schedule, others are prepared to offer discounts and payment plans, and will help patients work through the process.

Because this trend is in the early stages, those options don't get marquee billing. Most of the time, you have to ask your medical provider for savings or payment options, but as consumers become more savvy, medical providers will likely be more willing to negotiate.

So what options are available? For starters, uninsured patients or patients with high deductible plans who pay without using their insurance benefits may save up to 50 percent on procedures by paying their bills in full immediately. Many providers offer discounts, zero percent interest payment plans and senior citizen discounts.

If you're insured and use your benefits to cover your procedure, you can still negotiate costs not fully covered by your insurance provider. You can maximize your savings by paying with cash or by check.

It's important that as health care consumers we also focus on billing accuracy. Some patient advocates estimate that 80 percent of all medical bills contain errors. This isn't a matter of trying to avoid paying a fair price for service. It's making sure you're paying the correct amount and accessing options that are available. Never just pay a bill. Review it first, ask questions if you have them and be persistent.

In a recent nationwide online poll of Angie's List members, we found that 57 percent have never negotiated a medical bill and nearly 25 percent didn't even know they had that option.

Of those who have negotiated, 74 percent who asked for discounts, got them – and some ended up paying less than half of the original charge. More than 40 percent of successful medical bill negotiations were conducted with doctors' offices, 31 percent with hospitals and 18 percent with dentists.

While you should always look at your options, never put too much emphasis on price when it comes to health care. Finding providers who meet your specific needs and have all the necessary licensing and training is priority No. 1.

Remember, like any negotiations, you'll likely be more effective if you're polite and reasonable when asking about the possibilities. The worst that can happen is you learn your provider doesn't offer payment options – yet.

Comments

Submitted by Dan Lehman on Tue, 2012-02-07 14:10
Consider www.medicalcostadvocate.com who apparently make a business of doing healthcare-cost negotiations for clients, taking 35%(?) of the reduction as their compensation. This implies that there must be a fair amount of *overcharging* available. Myself, I recall handling medical bills & insurance for my late father. I was amazed at how different the charge was from the amount that the insurance company paid --the peak reduction was about 70%, with more common reductions around 25-35%, IIRC !! WOW. --dl*

Submitted by Sandy on Tue, 2012-02-07 14:10
would like to know how people have saved money on health care costs

Submitted by Louise Anderson on Tue, 2012-02-07 14:10
I want more info about dental amalgams and who specializes in my area 75225. I subscribe to Angie's list

Submitted by Jim Fitzpatrick on Tue, 2012-02-07 14:10
Good food for thought. The insurance companies always demand a discounted rate, the least we can do is ask, no? Cause a discount to someone like me without insurance is very important

Submitted by Katie Lee on Tue, 2012-02-07 14:10
It is important to note that if your provider is contracted with your insurance plan they are REQUIRED by the contract to collect 100% of the patient's responsible charges. Usually the total charge is discounted to the insurance allowable rate, the insurance pays a % and then the difference is the patient's responsibility. Itis against the law to write off a Medicare patient's deductible and 20% co-insurance and the provider may lose his/her contract with a private insurance company if they do not attempt to collect the patient's balance.

Submitted by Hugh Phillips on Tue, 2012-02-07 14:10
I don't have personal knowledge about this, but I strongly suspect that what Katie said is true. In the case of no insurance coverage, it might be true as we know that medical providers routinely accept discounted payments from insurance companies.

Submitted by Dean Miller on Tue, 2012-02-07 14:10
Blue Cross and other insurance companies, already tell the hospital what they are going to pay them. The dollar amount at the bottom of your Dr. bill is incredibly overinflated, because the hospital already knows that they aren't going to get paid what they are asking for. So, hospital issues this really big bill and they hope to collect at least a certain amount of it....When negotiating with your personal bill, understand that the bill is already in negotiations. It's all based on a house of cards with the roofed raised ever higher by extorters, oops, I mean insurance companies.

Submitted by Roberta Quintero on Tue, 2012-02-07 14:10
Glad to see this subject being addressed. Let's make sure of our facts. If a provider negotiates an amount for the patient's "Responsible" amount it is not against any law of which I am aware. It is, most probably, in violation of one of several contracts between payors (insurance) and providers. That is a breach of contract civil problem. Physicians can and will negotiate. What is the alternative? Same logic applies to any debt. If the person cannot pay, they cannot pay. Medical bills are the number one cause of bankruptcy in the U.S. Here is something to look out for: You will receive a bill from a provider, perhaps a lab or an ambulance company. The bill will state that you owe a certain amount. Please, please look at your bill closely. Some of these invoices are designed to confuse the recipient. We are used to receiving a bill and paying what it says we owe. Some billing companies count on our desire to be responsible. In fact, you may not owe anything. Frequently, providers do not submit their bills to the insurance company on a timely basis. Commonly, that bill is rejected for being untimely. The provider will then look to you to pay the total amount.The bill will simply say "DENIED".In this situation you are not responsible for that providers mistake. You may owe something, but most certainly not the entire bill. As despicable as these practices sound, they are unfortunately common. Thanks Angie for the opportunity to share common experience, particularly when it comes to our healthcare.

Submitted by Marsha on Tue, 2012-02-07 14:10
how exactly does one ask for a discount?

Submitted by Karen on Tue, 2012-02-07 14:10
Marsha asked, "How exactly does one ask for a discount?" There are several ways to do this. Sometimes it's not so much a matter of asking for a discount outright, but just asking if the provider has a cash price, since the price they quote you is usually the price they bill insurance companies, and as others have said, what the provider actually gets paid by the insurance company is FAR less than they billed, so they are often willing to give cash patients a break, too. This is probably the best and easiest way to start. If you have insurance, as my family does, that has a very high deductible (ours is $10,000 per year, as we are self-employed and the cost would be outrageous with a lower deductible), you can ask what your insurance company allows for that visit, procedure, lab test, etc. and compare that to the provider's cash price. Sometimes it's higher and sometimes it's lower, so always ask. Always compare facilities, if you can. I've done this with lab tests, MRIs, etc. and sometimes it will make a big difference. Sometimes you can't do this, if you want to see a specific MD, for example, but for an x-ray, MRI, lab test, etc. it probably doesn't make that much difference in terms of quality, and the prices they charge can really vary. Finally, if the doctor, etc. has no lower cash price and you don't have insurance, just talk to him or her privately and explain your situation -- that you would really like to use his/her services, but that the cost is beyond your ability to pay. The main thing to keep in mind is that it is perfectly OK for you to ask -- just be polite and honest, and don't be afraid to ask. Good luck!

Submitted by Diana on Tue, 2012-02-07 14:10
I am disabled and live on a very limited amount of money. One of my doctors can't accept my insurance but he is the best. I wrote to him and explained I could not afford him every month. He offered to see me every other month and give me enough medication for that amount of time. God bless him. Otherwise, I hate to think where I'd be. It's always worth a try to ask . The worst that can happen is the provider won't agree.

Submitted by Kirk on Tue, 2012-02-07 14:10
I am not sure about medical, but for dental there are some cautions to be aware of. Legally, you cannot bill insurance patients one amount and cash patients another amount. Where the confusion comes is when "cash discounts" or insurance write-offs occur. With the "cash discount," this technically has to be offered to everyone, including the insurance company. The reality is that the insurance company will not pay cash that day, so they are not "eligible" for the savings that a pay in full cash patient can achieve. What cannot be done is a discount on the patients remaining, after insurance balance, WITHOUT INFORMING THE INSURANCE COMPANY. This would constitute fraud and is a crime. If the insurance company is informed, then they have the choice of adjusting payments, etc...which then opens up a can of worms for the patient and doctor. Co-pay "forgiveness" or discounting is illegal. For the insurance write-off issue, this is as a result of a contract between the dentist and the insurance company. The insurance companies label it as a "marketing expense" for the dentist since the dentist has easier access to the patients under their plan. The dentist cannot charge cash patients different standard rates for a given "procedure code," other than as stated above (which really is a gray area and in debate). If a patient receives a lessor rate than the insurance company then any insurance company can come back and say you charged this fee here, so really, your fee for that procedure is LESS than what you submitted to us under that code...overbilling FRAUD. Most dentists are not willing to risk their license or their practice or jail for insurance fraud, which is being investigated more and more. There are some dentists out there that do these things, either intentionally, or simply by not understanding the true ramifications. By the way, in some cases, the patient can be charged with insurance fraud as well, keep that in mind. Laws may vary by state, so check with your state insurance commissioner.

Submitted by Lee on Tue, 2012-02-07 14:10
As an RN Appeal auditor with 18+ yrs health ins experience there are several things to keep in mind that others have already stated. Where the cost savings can come into play is with a patient's share of cost or residual balance owed to a health care provider. Hospitals in particular are notorious for billing errors. Hospitals are incentivized to get SOME $$. Use the right approach in asking to have a bill audited which is typically done via the facility's Finance Dept. Ask if the hospital has a Bill Auditor to do this for you, a freebie at no cost to you the patient. If you can't pay what is owed, try calmly negotiating a payment plan and ask to be given any sort of Cash Discount the facility can provide. While its true hospitals can't do this with insurers because of their respective contracts with each other, don't ever forget you the patient are the ultimate payer of whatever balance your insurer doesn't pay. Also, don't be stupid and allow yourself be taken to Collections for an unpaid balance. It is always better to address directly with the service provider. Once a Bill Collector/Collection agency becomes involved you will be pursued to the ends of the earth and/or have your credit report zinged to reflect you welched on payment. Keep that in mind. Also, it can't hurt to appeal any bills your receive directly from a service provider to your Insurer. As an informed consumer, you are expected to know what is covered, what isn't and any share of cost you may incur for whatever the service actually is- inpatient, outpatient, DME, Home Health, Psych and Chem dependency if you have that type of coverage, coverage for any supplemental benefits etc. The only entities that really can't address this very timely is Medicare and Medi-Cal aka Medicaid.

Submitted by Cindy on Tue, 2012-02-07 14:10
The following is an edited version of Angie's List conversations with Cindy from Washington, who suggested Angie should conduct more research into medical pricing and negotiation. It is edited with her permission. …Angie’s column isn’t clear as to how much the doctors or dentists discount out their fee due to insurance. Most health care provider are contracted with many of the insurance plans that are PPO providers. When you are a PPO provider the doctor will discount his or her fee from 30% up to 50% of the total amount. If your research was complete you may have mentioned this in the article as well. I'm not in dispute that a patient has every right to shop around or ask for a discount if they do not have insurance. I also think you have to take in consideration what the cost is to run a health care practice from Washington to Atlanta, of course the fee would be different. If the grocery store has different fees in each city I wonder what they would say if you ask for a discount. I would also like to mention when we process an insurance claim for a patient the insurance carrier will take up to 6 weeks or longer. This is very hard for a practice to stay open and operate under OSHA laws when it takes weeks to get reimbursements from the insurance carrier. I do think the consumer should shop around, however I also think Angie's List could look into how a practice runs and the cost it takes before they write an article about discounts. If we start to give all of our patient's a discount we would not have enough income left in our budget for marketing with a health magazine. I have been in the industry for over 25 years and I think it is about time the consumer as well as Angie's List understand the entire process before asking for a discount. … car shopping is a lot different than health care. I don't ever remember a salesman or a contractor going to school for eight years or more. I also don't think I will ever go have a tooth extracted from that car salesman. I would never try to negotiate a fee for someone I want an expert's opinion on regarding my health. Maybe you should call the insurance companies and talk with the clerk – maybe she can offer a negotiated fee from the insurance company. The doctor's fees are the same if you have insurance or you don’t. If we change the fee for the patient this would be the fee we would bill the insurance carrier, which we already have negotiated fees with. The doctor has already written off thousands of dollars so the patient has less out of pocket expense. I don't believe you made this very clear to the public in your article. …I would have thought in your health care article you could have told a story about all the doctors and their staff who put in countless hours for the well being of their patients. In many cases never getting paid for this service that you would like to discount!

Submitted by Marla on Tue, 2012-02-07 14:10
What if the surgeon that is doing your procedure and is himself in network, doesn't tell you that he will be using other doctors and practitioners that are not in network. This happened to me, I made sure that I asked before the procedure. I was told by his assistant not to worry, they are all in network and everthing is taken care of. I found out too late that they didn't tell me the truth.

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