Consumers may feel like their medical bills are unyielding, inflexible and set in stone. But that’s not always true: A new study finds that patients can often gain financial benefits by disputing accusations that appear false or negotiating for financial relief.
Of consumers who don’t reach out to question a medical bill, 86% said it’s because they thought it wouldn’t make a difference – but “the experiences of those who did reach out prove otherwise,” according to a new University of Southern California report study.
About 26% of people who called because they disagreed with or couldn’t pay a charge had their medical bills corrected after the outreach, according to the study published in August. About 15% received a price reduction, 8% received financial assistance and 7% had their accounts canceled immediately.
“Of those who did reach out, most invoked self-defense,” said report co-author Erin Duffy, a research scientist at the USC Schaeffer Center for Health Policy and Economics.
Researchers surveyed 1,135 American adults from August 14 to October 14, 2023.
About 1 in 5 respondents reported receiving a medical bill that they disagreed with or could not pay in the past 12 months. About 62% of them contacted the billing office to address the issue.
More from Personal Finance:
When should you refinance your loan if interest rates drop?
Why working longer is not a good pension scheme
Stocks often fall in September, but many wouldn’t care
‘If you can’t afford something, or [if a bill] doesn’t seem right or doesn’t match what your healthcare experience was, you should call and ask questions about that,” Duffy said.
The savings can amount to hundreds or even thousands of dollars, depending on factors such as a patient’s health insurance and the type of medical visit or procedure, says Carolyn McClanahan, a physician and certified financial planner based in Jacksonville, Florida.
Bills go in all directions
A 2023 Consumer Financial Protection Bureau analysis of medical bills for adults 65 and older found that patients “face a complex billing system with a high potential for errors and inaccurate billing.” Often, inaccurate bills are the result of incorrect insurance claims and are more common among consumers with multiple sources of insurance, the CFPB said.
Common errors included missing or invalid claims data, authorization and pre-certification issues, missing medical documentation, incorrect billing codes and prematurely submitting claims, the report found. Such errors contributed to the “denial of claims that would otherwise be paid,” the report said.
“[Bills] going in all directions,” said McClanahan, the founder of Life Planning Partners and a member of CNBC’s Advisor Council. “And there is no transparency, rhyme or reason as to how [providers] decide to file a fine.”
Doing nothing and avoiding paying medical bills is probably not a good course of action: It could have negative financial consequences, such as late fees and interest, debt collections, lawsuits, repossessions and lower credit scores, according to a separate study. CFPB source.
“If something seems egregious, question it,” McClanahan said.
How to Manage Medical Bills
Consumers should ask in advance what a medical visit or procedure will cost, or inquire what the estimated costs will be, she said.
Sometimes consumers pay “a lot less” if they pay cash instead of through insurance, McClanahan said. However, canceling a check can also have other consequences, such as the amount not counting toward the annual deductible, she added.
If you feel you have paid too much, request an itemized bill from the health care provider or hospital, and look for errors or duplicate charges, according to PatientRightsAdvocate.org. Research the fair market price for a service and use that information to negotiate, the nonprofit said.
If something seems blatant, ask.
Carolyn McClanahan
physician and certified financial planner based in Jacksonville, Florida
The telephone number of your medical provider’s accounting or billing office is listed on your billing statement, the CFPB said.
Here are three other questions to consider about your itemized bill, according to the regulator:
- Do the charges reflect the services you received?
- If you have insurance, do the bills reflect your insurance payment and reflect what the provider said would be covered?
- Does any of the charges indicate that a service was “out of network” when it was not?
If you call a health care provider about a medical bill, keep a diary of the communications, McClanahan said. Write down people’s names and what was discussed, and make sure you know when you’ll hear back.