Hire Help to Handle Hefty Medical Bills

(Image credit: Steve Debenport)

When you or a family member experience a medical crisis, it can be hard enough to focus on getting the best care. The last thing you want to deal with is an overwhelming pile of medical bills.

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Health insurance claims specialists can help. They serve as experts, advocates and detectives—knowing how to deal with the mysterious and complex insurance system, translate the jargon and codes, understand when you need to pay a bill and when to wait, and how to fix errors and build a case for an appeal.

“It’s not a process you get good at because hopefully you don’t go through it very much,” says Kathleen Hogue, president of Mediform Inc., in Twinsburg, Ohio, who has been a medical claims specialist for 37 years. Her job has changed a lot during that time, especially now that more people have high-deductible health insurance policies, complex out-of-pocket cost rules and narrow provider networks.

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Claims specialists tend to charge $75 to $95 per hour, and they’ll generally give you a free consultation with a cost estimate and some basic advice. You can find claims specialists through the Alliance of Claims Assistance Professionals. Some prefer to work locally; others have clients throughout the U.S.

If you suspect there is an error in a medical bill, it helps to contact a claims specialist before making arrangements to pay. “You don’t want to negotiate 50% off something you didn’t owe to start with,” says Pat Palmer, a medical claims specialist in Roanoke, Va. “You want to contact someone with experience to do a thorough investigation into those charges.”

Contacting a claims specialist soon after discovering a problem can help avoid hours of frustration and missed deadlines (specifics vary by plan, but you generally have 180 days to file an appeal). “Many times people try to resolve it on their own, and they make a million phone calls and fight with the insurance company,” says Denise Sikora, president of DL Health Claim Solutions, which has offices in Monroe Township, N.J., and The Villages, Fla. “By the time they get to me, these claims are often more than a year old, and sometimes two and three years old,” says Sikora.

The claims specialist may be able to spot an error to get a claim paid quickly without filing an appeal. Pat Shea, a specialist in Green Bay, Wis., says about 80% of the denials he deals with are reversed once he resubmits the claim with extra information or coding mistakes fixed. Only about 20% go to a formal appeal.

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Shea first studies the denial letter. “You look at the reason for the denial, and that’s what gives you the way forward,” he says. If payment was denied because the procedure was cosmetic, such as removal of a skin lesion, he asks the doctor to provide evidence that the procedure was medically necessary, for example. If the diagnosis or treatment was miscoded, Shea fixes it and resubmits the claim. He tries to deal with insurers through e-mail, so he has a paper trail. (His website at www.medicalclaimshelp.org offers more strategies.)

Shea can also help people avoid claims trouble ahead of time. Anne Richardson of Alexandria, Va., contacted Shea when she was helping her adult daughter get coverage for cochlear implant surgery. Her daughter works in Atlanta, but the surgeons recommended for her complex case were in Chicago. Before scheduling surgery, Richardson contacted Shea to find out if there was anything he could do to get coverage at the distant hospital. Shea found that her daughter’s plan has a reciprocal arrangement with certain out-of-state hospitals in the Midwest. He made sure that her surgeons, radiologists, anesthesiologists and followup therapy providers would all bill at in-network rates.

Richardson says the full price for the surgery and therapy would have been about $90,000, but with in-network coverage they paid just $6,000 (plus $225 for Shea’s help). “If you are facing a complicated surgery, get someone to check on the coverage ahead of time,” says Richardson.

As the "Ask Kim" columnist for Kiplinger's Personal Finance, Lankford receives hundreds of personal finance questions from readers every month. She is the author of Rescue Your Financial Life (McGraw-Hill, 2003), The Insurance Maze: How You Can Save Money on Insurance -- and Still Get the Coverage You Need (Kaplan, 2006), Kiplinger's Ask Kim for Money Smart Solutions (Kaplan, 2007) and The Kiplinger/BBB Personal Finance Guide for Military Families. She is frequently featured as a financial expert on television and radio, including NBC's Today Show, CNN, CNBC and National Public Radio.