National reports show that 90% of medical bills have errors, according to Sheri Samotin, President of LifeBridge Solutions, a medical advocacy and elder care coaching organization.

Here are some examples of scenarios that happen all-too-often:

Medical Billing Error #1: Providers that are "out-of-network"
Jerry had a brain tumor surgically removed. He has insurance– a PPO plan. As long as Jerry used providers who are "in network," he would only have to pay his $250 deductible, which he had already met for the year. Jerry researched and found a neurosurgeon and hospital that are "in network," and the surgeon's office contacted the insurance company to pre-certify the inpatient admission. Two months after surgery, Jerry began to receive mail from the insurance company, the surgeon's office, the pathologist, the anesthesiologist, and the hospital. The bills stated that Jerry owed over $4,000 to the anesthesiologist because she was "out of network."

Jerry couldn't understand how the hospital, the surgeon, and the pathologist's charges were all processed as "in network" while the anesthesiologist's bill was not. Jerry couldn't imagine how he was supposed to ask as he was being wheeled into the operating room, "By the way, are you in network?" Rather, he assumed that if the doctor and hospital are both in network, and his surgery was pre-approved, then the charge from putting him under would be too. Jerry made several phone calls to the insurance company, and they told him there was nothing they could do because the doctor was not a participating provider. He called the doctor's billing service and they told him that he was responsible for the balance and they were going to send him to collections since his bill was 90 days past due.

Medical Billing Error # 2: Billing for procedures that weren't performed
An elderly man received a bill for his annual physical. The charges included a line for a pap smear, which even most lay people know is a test that is only performed on women. Had he reviewed the bill right there at the check‐out window, that charge would have been removed before the claim was ever sent in to the insurance. Now, he has made numerous calls to his insurance company – to no avail so far.

Medical Billing Error #3: Duplicate charges
Hospital bill that itemized 77 of the same item at $198 each. That's more than $15,000 of charges. This item is something that no one could have done to them 77 times in the space of a three-day hospital admission. Can you guess? We're talking about a urinalysis. Not only was the charge itself very high, but the number of tests just didn't make any sense. If this patient had requested and reviewed the bill, I'm pretty sure she would have picked this up.

How to Find and Avoid Medical Billing Errors

Unfortunately, elders and their families make some common mistakes regarding medical billing…mistakes that can cost them thousands of dollars. Here are the top five mistakes people make when dealing with medical bills.

Mistake #1: Ignoring the mail
Why is it that so many of us receive mail from a medical provider or insurance company and put it in the "I'll get to it later" pile on the kitchen counter, often unopened? The most common reasons are:

  • The paperwork intimidates me
  • I don't understand what I'm looking at
  • I have insurance, so I don't need to review this stuff
  • I can't pay it anyway, so why open it and stress out about it?

The reality is that taking this approach is very likely to come back to haunt you in the form of being sent to collections. If you don't understand the bills or explanations of benefits (EOBs) you receive following a medical service, ask someone to explain them to you. You can call the patient billing specialist at your provider or try the customer service representative for your insurance plan. If necessary, you can enlist a medical billing advocate to help.

Everyone needs to review their medical bills and how the claims were processed, even if you believe that you have "good" insurance or Medicare and a supplement. Billing mistakes can and do happen, and you, the patient, are often responsible for paying for them. While you have the right to appeal, you must do so within the timeframe required by your plan. By ignoring the mail, you risk missing this important appeal deadline. If you're worried that you can't pay what you owe, you're always better off to negotiate a payment plan and possibly a reduced charge than to simply ignore the demands for payment and end up damaging your credit.

Mistake #2: Not asking for (and then reviewing) itemized statements
The best way to avoid medical bill problems is to make sure that the charges are correct in the first place. While no one expects you to be an expert in medical terminology, by requesting and reviewing a detailed itemized statement following every episode of care, you can often avoid some of the obvious problems. Always take the time to ask for and look at an itemized bill. If you see something that doesn't make sense, try to get it resolved immediately. If you feel you are being charged for services you did not receive, ask for a copy of your medical record.

Mistake #3: Not asking for what you need
Many insurance plans limit the amount of services you are eligible for. For example, physical therapy visits are often limited to a certain number within a period of time. While this works out okay in many instances, sometimes a patient just needs more sessions in order to optimize her recovery. When that happens, asking your physical therapist or physician to write a "letter of medical necessity" IN ADVANCE of the provision of services. Don't wait until you've run out of visits before you ask your providers to help advocate for you. It's your responsibility to be aware of the limits on your policy and not to just assume that your providers are on top of it.

In other situations, doctors will prescribe a certain drug, not realizing that a particular patient's plan only covers a less expensive alternative. There is no way that a physician can keep track of the frequently changing approved drug lists for each of her patients, so if you, the patient, go to fill the prescription and found out that the drug your doctor prescribed is not covered, it is perfectly reasonable to let your doctor know and find out whether something that is on the list will be a reasonable alternative. If your doctor feels very strongly that you need the specific drug, don't hesitate to request that the doctor's office make a phone call or prepare a letter of medical necessity. He may not succeed, but if you don't ask, you definitely won't get the intended medication.

Sheri Samotin brings more than 30 years of business and management experience to LifeBridge Solutions. She is a Certified National Guardian, Certified Daily Money Manager & Certified Professional Coach. She is the author of Facing the Finish: A Road Map for Aging Parents and Adult Children.

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