Joshua Bates knew something was seriously wrong. He had a high
fever, could barely move and felt a sharp pain in his stomach every time he
coughed.
The 28-year-old called his roommate, who rushed home that day in
July 2018. The pair drove to the nearest emergency room, the Carolinas Medical
Center in Charlotte, N.C.
After several tests, including a CT scan of his abdomen, the
emergency team determined that Bates had acute appendicitis.
"They said my appendix was minutes away from
rupturing," Bates said.
Not mentioned, he said, was that the hospital was out of network
with the insurance plan provided through his job. Even so, he couldn't have
jumped up and gone elsewhere. His appendix was about to burst.
He had surgery that night, which went smoothly, and went home
the next day.
"Everything seemed according to plan," said Bates.
Then the bill came.
Patient: Joshua Bates, a technical recruiter for a staffing firm,
who lives in Charlotte, N.C. The Continental Benefits insurance plan comes with
a deductible of $2,000 and an annual out-of-pocket maximum of $6,350.
Total bill: $41,212 covering the
surgery, one night at the hospital and the emergency room charges. After
payments by both Bates and his insurer, the hospital sent Bates a bill for the balance, just over $28,000.
Service provider: Carolinas Medical Center,
owned by Atrium Health, a nonprofit health system based in Charlotte.
What gives: Bates was "balance
billed" because he went to an out-of-network hospital — and even though it
was an emergency, he fell through the limited protections in existing law.
"Terrifying," is how Bates describes the feeling he
had when he first saw the bill for $28,000. Don't worry, his insurer told him —
it would negotiate with the hospital.
"If you pay your complete deductible, this will all go
away," Bates recalled the insurer saying. "I pay. It doesn't get
resolved."
More than a year later, negotiations between the hospital and
his insurer were at a standstill. With his credit score falling because the
$28,000 debt had gone to collections, a frustrated Bates contacted the Bill of
the Month team.
"From what my insurance is telling me, the hospital is just
nonresponsive to them trying to negotiate this price," he said.
His situation is not unusual. A recent study found that
about 18% of emergency room visits have at least one such charge for
out-of-network care.
A balance bill is the difference between what insurers pay
toward a bill and a provider's "list charges," which facilities set
themselves and which often bear little or no relationship to actual costs.
In Bates' case, the insurer paid $8,944 toward the $41,212 in
charges, according to his explanation of benefits from his insurer. On top of
that, Bates paid the hospital about $4,000, a combination of his annual
deductible and his coinsurance for emergency care. That left $28,295 of the
hospital's charges unpaid.
The online site Healthcare Bluebook, which
calculates costs based on health insurers' claims data, estimates that a
laparoscopic appendectomy (the type that Bates had) ranges from $9,678 to more
than $30,000 in Bates' ZIP code. The "fair price" it
suggests for the surgery is a little over $12,000 — completely
in the ballpark of the $12,944 that Bates and his insurer already paid the
hospital. Fair Health, another site that collects claims
data, estimates total costs for
an out-of-network appendectomy at $19,292 — about $11,000 less than the
hospital says Bates still owes.
"It's ridiculous. He's a young kid who goes to the
emergency room and he has insurance," said Duane Sunby, the insurance
broker for Bates' employer.
Sunby added that Continental's payment to the hospital was
nearly 2 1/2 times more than Medicare would have paid for similar services, but
the facility is going after Bates for more than seven times what the federal
government would pay. A growing outcry about such balance bills has attracted
attention from statehouses and Congress, but current protections for patients
often fall short.
Congress last year debated several bills that would have
provided federal protection nationwide, especially for emergency room patients.
But bipartisan efforts stalled late in the year following intense lobbying by
providers, including private equity-backed
physician groups, over how to calculate what insurers should pay providers.
Bates is the kind of person who would be helped by a federal
law, because his employer "self-funds" his insurance plan — all such
plans are regulated by the federal
government.
In the absence of federal rules, about 21 states have
taken action, although a study from policy experts at Georgetown
University's Health Policy Institute cites only nine as having comprehensive
protections.
North Carolina, where Bates lives, has partial protections for
people in state-regulated plans, according to the study. It limits, for
example, the amount patients owe in out-of-network emergency cases. But the
state law doesn't cover Bates' type of job-based insurance.
"We really need a federal solution," said Maanasa
Kona, an assistant research professor at the Center on Health Insurance Reforms
at Georgetown.
Bates' insurer brought in a third-party firm called Advanced
Medical Pricing Solutions, which examined his bill and called the $28,000
"excessive charges." The company sought in September an adjustment or
an explanation of the charges.
That move came not long after Bates received a "final"
payment notice from a collections group connected with the hospital. A credit
reporting agency "told me it would continue to impact my credit
score," said Bates. He said that his score had dropped almost 200 points
and that this change meant he'd had to put his plans to buy a house on hold.
Resolution: After Kaiser Health News inquired about
his bill with the hospital, the insurer and Advanced Medical Pricing Solutions,
Bates received a call from a top executive at the Carolinas Medical Center.
"He seemed really eager to help me out," said Bates,
"which is crazy after two years of reaching out and trying to communicate
with them. They call shortly after they catch wind of the story."
However, in an email to KHN, a spokesperson for Atrium Health,
the hospital's parent company, essentially pointed to the insurer for a
solution.
"We believe it is imperative that insurance companies cover
the costs for patients who are unable to choose where they are treated due to a
medical emergency," wrote Dan Fogleman. "We continue to be willing to
work with this patient to pursue any additional payments that may be due to
them from the insurer."
Continental Benefits CEO Betsy Knorr declined to comment:
"It is a legal issue at this point, and we do not want to prejudice the
process."
Bates is deflated.
"The hospital is trying to put all the burden on the
insurance, and the insurance is trying to put the burden on them. I'm back to
square one, essentially," he said.
The takeaway:
Insurance plans' yearly out-of-pocket maximums apply only if you
stay in network.
So, if possible, check ahead of time to see if your hospital is
in your plan's network — and the network status of anyone who might be involved
with your care.
Sometimes that isn't possible, as in Bates' case. What then?
If you get a balance bill after your insurer has paid the
provider, check state laws and check with your state's insurance regulators to
see what protections you may have, said Kona, particularly if your bill
resulted from an emergency room visit.
Ask your insurer or employer to pay the bill or to negotiate a
discount with the provider, said Mark Hall, a law professor at Wake Forest
University who studies contract law and medical billing issues.
Check online claims-data websites, such as Healthcare Bluebook
and Fair Health, to research what insurers pay for similar care in your area.
Use that price range in negotiations about what you may owe.
Even if your employer plan is exempt from state laws limiting
patient responsibility for out-of-network emergency care, ask the provider to
honor that benefit. They don't have to agree, but it can be worth a shot.
Hall also said patients may be able to hire a lawyer and go to court challenging whether
the amount being charged is reasonable, although that could be costly and
success is not guaranteed.
NPR produced and edited the audio report by NPR's Selena
Simmons-Duffin.
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