July 13, 2020

Negotiation Tools

One often overlooked aspect of health care is medical bill negotiation. Every day thousands struggle to pay their medical bills. While throwing the statements into the trash might yield a bit of self satisfaction, it won't solve the problem. Experts say you need to talk to your insurance company and negotiate if you feel like you didn't receive the proper coverage. The most important thing is to do your homework and be patient -- very patient. Don't expect bargaining to be a breeze. Be proactive. Don't wait for the bills to start coming in. Start medical bill negotiation early by:.

Comparing Costs  It's normal to shop around and compare costs when you're buying a car. When you renovate your kitchen, you get estimates from more than one contractor. Shopping around for the best surgical procedure is essentially the same thing. Being proactive and comparing costs can save you a lot of of cash before you go to the hospital. The best time to negotiate prices is before you get the treatment. Make sure you know the CPT code for the procedure you are seeking. CPT means "current procedural terminology." In simple terms, CPT is the billing code hospitals use for each procedure. Knowing the code will make it easier for you to get quotes from various hospitals and doctors. Your physician can supply you with the codes. Just keep in mind, if you choose a hospital where your preferred physician does not have practicing privileges, he may not be able to perform your procedure.

Making Sure Your Health Plan Pays  We've all been there. The medical bill comes in the mail and we write a check without really studying the statement. Sometimes, though, insurance companies don't pay their fair share. That's why it's important to scrutinize your bill. If you disagree with your insurer's decision, make sure you contest it through the normal appeals process. 

Sometimes insurance companies can be stubborn, so you might have to escalate the matter. If push comes to shove, contact your state representatives who can provide you with information on how to resolve the matter. They may steer you to the state attorney general, the state insurance department or a health care advocate office. Under the new health care reform law, insurance companies are mandated to implement an appeals process if a claim is disputed. If the patient is still not satisfied with the outcome of the internal review, he can ask for an independent review of the coverage. Decisions to rescind coverage are also subject to appeal. 

Negotiating Medicare Rates  Did you know your insurance company generally pays higher fees than Medicare for the exact same procedures? It's true. But you don't have to be a senior citizen to enjoy the lower rates of Medicare, the federally-funded health care plan that pays for about half of all medical costs for those 65 and older. Because Medicare pays doctors, hospitals and other health-care providers the lowest fees, you can use those fees as a starting point to negotiate a lower medical bill negotiation. One way to find those fees is to visit the U.S. Department of Health & Human Services website. It's relatively simple. All you have to do is type in your ZIP code and begin comparing hospital rates.

Coming to Terms on a Payment Plan  Keep this in mind when you begin to haggle: Hospitals, doctors, medical labs and other health care providers don't want to turn your bill over to a collection agency, or write it off completely. It costs them time and money. That's why it's in their best interest to agree on a payment plan with you. In negotiating a plan, consider some of these tips that work well, whether you're paying down your deductible or paying your doctor.

  • Decide on a specific time when the bill needs to be paid in full, perhaps in three to six months. It's important the timeframe be comfortable for you.  
  • Make sure you can afford the monthly payment.
  • Don't neglect other bills.
  • You might need help in paying down your medical debt. If you can, go to the bank and apply for a personal loan or a line of credit. The interest rates will be much cheaper than putting the bill on a credit card. 
  • Pay your bill each month in a timely manner and stick to the payment plan.
  • Make sure you get receipts from the billing department.

Scrutinizing Your Bill  Billing errors are very common. A doctor may request a procedure or a medication, than cancel it. Yet, the treatment still shows up on the bill. There might be a misplaced decimal point, or an extra zero, which can add hundreds and even thousands of dollars to your bill. Check the dates, too. You might not have been in the hospital or doctor's office on the day the procedure was allegedly completed. And unfortunately, there are unscrupulous health care providers out to defraud you and the insurance company. The National Health Care Anti-Fraud Association estimates that $68 billion -- or 3 percent of all health-care spending -- is fraudulent.

Exploring Low-cost Treatments  Buying generic drugs instead of brand names can save patients a lot of money. The same can be said of low-cost medical treatments. While 80 percent of doctors will prescribe generic medication to save patients cash, not nearly as many will suggest low-cost treatments. According to the Center for Health System Change and the University of Chicago, only about half -- 51 percent -- of the doctors surveyed told their patients that lower-cost diagnostic testing was available, while just 40 percent recommended outpatient treatment rather than hospitalization. The lesson here is to speak up and ask your doctor if low-cost treatments are available.
Paying Cash Upfront  Whether you're negotiating with a used car dealer, carpenter or a cardiologist, nothing says lower my bill better than "I'd like to pay now with cash." Most doctors pay thousands of dollars each year to strong-arm patients patients who pay by  into paying their bills. In many cases they have to hire attorneys or collections agencies to recoup the unpaid money. Doctors also don't like credit cardbecause their processing fees can be huge. Receiving cash saves the doctor a lot of time and trouble. When someone pays cash up front or within 30 days, chances are they can negotiate a better deal, perhaps up to a 40 percent discount.
Negotiate a Rate  If you want to be proactive, ask the billing department what their hospital or clinic charges for a medical procedure. Be specific. For example, ask what the charge will be for the radiologist or anesthesiologist. Be persistent. Once you find out the cost, ask the billing department or your doctor for a discount. Some people have reduced their payments by as much as 40 percent by negotiating a rate. Many health-care providers will also offer discounts to patients who are facing hefty medical bills. It doesn't hurt to ask. Keep in mind that many hospitals have more than a dozen rates for the same procedure, regardless of whether Medicare, Medicaid or a private insurer is paying.
 Related Resources: 

"How to Negotiate Your Medical Bills" , Lita Epstein (2010).

2. "Avoiding Surprise Bills With Homework and Negotiation", Walecia Konrad, N.Y. Times (2010)

Medical bill negotiation with hospitals: There is some good news for the millions of Americans who find their hospital bills a confusing mess. Wyatt Andrews reports on how you can save money on your bill by doing a little investigating.