Keep Health Care Out-of-Pocket Costs in Check

We asked patient advocates who focus on helping consumers with their medical bills to share some secrets.

(Image credit: knape)

Even if you have good insurance from your employer, you probably shoulder a large share of your medical costs, from monthly premiums to deductibles and co-payments. And patients make simple mistakes all the time that cost them even more.

What can you do before a doctor's visit or after the bill arrives to keep your health care costs in check? We asked patient advocates who focus on helping consumers with problematic medical bills to share some secrets.

Ask the right question. You probably know to ask whether a medical practice or hospital is in-network (meaning that it has negotiated rates with your insurer). But apparently, "Do you take my insurance?" is the wrong query to put to your health care provider. The correct one is "Do you have negotiated or contracted rates with [the name of your insurance plan]?" says Martine G. Brousse, a California-based patient advocate who worked for 20 years as a billing manager in a doctor's office. Be sure to state the plan's full name; "UnitedHealthcare" isn't precise enough. Most large insurers offer various tiers of coverage, each with its own network of providers. UnitedHealthcare plans, for instance, include Choice Plus, Core and Options PPO. Remember to make sure the lab your doctor uses for blood work is in-network, as well as any diagnostic facilities, urgent care clinics and hospitals you may visit.

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Get an estimate in writing. Ask your provider or insurer how much the tests or procedures will cost ahead of time, even if your doctor is in-network, says Brousse. The best question: "What will I pay out-of-pocket after insurance adjustments?" Get the estimate in writing from your doctor or insurer; if you can't, "write down the person's name, the details of what they told you and the date," says Brousse. The info may help later if you have to dispute the bill.

Negotiate. In-network doctors may not budge on their fees, but out-of-network providers may give a little. (And, of course, get any negotiated rates in writing.) Ask about getting a discount by paying cash instead of using your insurance. Kenneth Klein, of Human Health Advocates in Boca Raton, Fla., calls this the "self-pay" rate. This strategy works best if you're getting treatment that's not covered by insurance (cosmetic surgery, say) or you have a high deductible you haven't met yet.

Investigate. When a doctor's bill or insurance statement (the explanation of benefits, or EOB) arrives in the mail, read it carefully. About 50% of all bills have errors, such as the wrong codes or incorrect charges, says the Patient Advocate Foundation's Caitlin Donovan. Verify that the charges on your bill match the payment you owe according to your EOB. "Make sure the medical codes are the same, the dates are the same and the billed amount is the same as what the insurance company has processed," says Klein. You may have to ask your provider for a detailed bill that includes diagnostic and procedure codes.

Act fast. As soon as you receive a bill or an EOB, the countdown begins on the time left to appeal the claim, correct the bill or negotiate a payment plan. Check with your insurer about the time limit to file an appeal, and call your provider to find out when a bill will be sent to collections. If you haven't paid your provider by that time, the bill will likely be sent to a collection agency. You can head off the march to collections by asking your provider's billing office for a billing-cycle suspension while you appeal your claim. It can take months to get medical records or sort out a bill. Record the names of everyone you speak with, as well as the dates and times and the extension period you receive.

Nellie S. Huang
Senior Associate Editor, Kiplinger's Personal Finance

Nellie joined Kiplinger in August 2011 after a seven-year stint in Hong Kong. There, she worked for the Wall Street Journal Asia, where as lifestyle editor, she launched and edited Scene Asia, an online guide to food, wine, entertainment and the arts in Asia. Prior to that, she was an editor at Weekend Journal, the Friday lifestyle section of the Wall Street Journal Asia. Kiplinger isn't Nellie's first foray into personal finance: She has also worked at SmartMoney (rising from fact-checker to senior writer), and she was a senior editor at Money.