In the Age of Consumerism, you need to exhaust all other payment options before the bill goes out
Many years ago, on a flight home from Washington, D.C., I struck up a conversation with a fellow passenger who was heading home with her young son, a boy filled with joy and energy, who was bouncing around his seat like any other child his age. The difference was that he was blind, though you couldn’t tell how or even if this disability was impacting his life.
Nevertheless, the mother slowly revealed the financial burden that caring for her son demanded. It had made her an advocate; she had been in Washington to seek funding for new services for the blind. One of the most revealing stories she shared was about a medical bill she received for more than $100,000 for her son’s care.
Huge bills like that can be accurate, but I also know that such a large balance often reflects a claim error. Financial assistance was not going to help her enough, and she needed to continue to take her child to the hospital for treatment. She had commercial insurance, but her share of the cost was going to bankrupt her family.
The mother spent hours negotiating with her insurer, speaking with financial counselors and the billing office. I imagined how much energy that probably took and was not surprised that nobody she spoke to would or could help her. Amazingly, one day she happened upon the right person, who routed the claim to someone who examined it and contacted the coding department. As it turned out, the services were wrongly coded, so the insurer denied coverage. Documentation supported the use of alternative codes appropriate for the services, so the provider rebilled the claim and was paid by the insurer.
Not everyone is as lucky as my seatmate. This kind of error and its aftermath – savings wiped out and medical debt mounting – is what we at Salud consciously and diligently strive to avoid when we code, bill, and follow up with insurers and patients. Salud has coined the term “balance integrity” to describe the importance of ensuring that patients are billed accurately, but we take it further: We aim to bill patients accurately only up to their financial means and only after we have exhausted every possibility of an insurer paying for the services.
Consumerism demands these changes. People are seeing the cost of employer-sponsored and individual coverage rise, especially out-of-pocket maximums. A recent Urban Institute analysis of census data says at least 3 million Americans have already lost job-based coverage from the pandemic, and a separate analysis from Avalere Health predicts some 12 million will lose coverage by the end of this year.
As cost pressures rise, consumers are looking more closely at medical bills and wondering why healthcare costs so much. This is why regulatory changes aimed at surprise medical bills and price transparency loom on the near horizon.
Balance integrity requires accurate balances. Our definition of an accurate balance is that it matches the insurance explanation of benefits, and the balance does not include anything caused by a billing error. Providers must ensure that claims have been coded accurately, and that each field on a claim form, including modifiers, has been filled in appropriately.
When a provider makes an error, it can expect insurers to deny a portion or the entire claim with a denial that can be complex and easily shifted to a patient to resolve with their insurance. For a large academic medical center, 25% of our accounts have been denied, many with reasons such as “duplicate,” “non-covered,” “coding (error)” or “not medically necessary.” Providers’ payer follow-up staff need to advocate on behalf of patients and ensure that they solve challenging denials instead of transferring the problem to a patient to solve.
Balance integrity means we evaluate and take into account a patient’s ability to pay. For the indigent or people with deductibles and co-pays beyond their means, providers should try to advocate on behalf of the patient with financial assistance, including charity write-offs, discounts, payment plans and perhaps a zero-interest credit card.
If there isn’t someone else who could be billed for services, balance integrity demands we assist patients with finding alternative insurance coverage, such as Medicaid, COBRA or liability insurance.
Balance integrity results in higher payments because most patients do not pay balances that they cannot afford, and insurers tend to pay more than patients. The industry should embrace price transparency rather than trying to sandbag it. If we truly want to be service-oriented, we need to do what’s right for the patient by ensuring that nobody facing a healthcare crisis should also confront the shock of a huge healthcare bill they should not have to think about, much less try to pay.