What to do in the event of a claim

If you received a large medical bill, below are steps you can take to make sure the bill does not include the following COMMON errors:

• Charges for services you didn’t receive

• Overcharge for services you did receive (through inflated pricing OR ‘up-coding’)

• Double billing for the same service
• Insurance may not have applied your benefits correctly
• Hospital may not have properly entered in your information
• Someone could have entered the wrong diagnosis and procedure codes or member information into your records.

Step 1: Obtain itemized bill

Most common medical bills only provide a total sum that the member is expected to pay, without providing in detail the individual charges that make up the total.  This is equivalent to a grocery store receipt only showing the total sum due, instead of showing how much was paid on bread, eggs, butter, etc.  Members have a right to a detailed breakdown that includes the explanation of each service rendered and the proper billing code used for each charge.  This is crucial to make sure the each charge accurately reflects what happened.

• On the itemized bill, the specific codes that lay out the charges for services are very important.  Physicians and other medical providers typically use current procedural terminology, or CPT codes. CPT codes will be five numbers all in a row, like 12345, sometimes followed by a hyphen and two more modifier numbers, like 12345-95.

• Hospitals use international classification of diseases, or ICD-10-PCS codes for the procedures they bill.

The definition and description of each code can be found online.  The itemized invoice shows charges for each billing code, but these are more like manufacturer’s suggested retail price (MSRP), and no one is expected to pay these high sticker prices.  Insurance companies negotiate discounts off the list prices.  Uninsured individuals might be told to pay them, but they should negotiate for a better deal.

To understand the codes, just Google the code number with the term “medical billing code” and read the description provided.  It may take a minute to understand them, but it’s far from rocket surgery.  For terminology that is unfamiliar, try looking up the terms online – here are two helpful resource.
1.  www.medlineplus.gov, which is published by the U.S. National Library of medicine and is written in layman terms.
2. Turquoise Health MS-DRG v38 (FY 2021) Definitions Manual

Step 2: If you are insured, examine the insurance company’s explanation of Benefits (EOB)

Insurance carriers are required to provide EOBs for all medical claims – showing the breakdown of charges, how the plan paid for the care received, and how much of the charge(s) are being passed on to the Member. Click here for more details on how to read an EOB.
Yes, EOBs can be a bit confusing, but it cannot be stressed enough how important it is to be able to read them.  Members should only pay their medical bills based on the EOB.  Check to make sure the provider charges are accurate and that they were accurately run through the insurance plan.  Then pay only “Your Share”.  EOBs can vary in layout from one carrier to another, but the terms are standard.  For specific questions about a charge or denial, reach out to your insurance company.  The Customer Service/Member Services number should be on the back of your insurance card.

Step 3: If necessary, obtain the relevant medical records

Members have a legal right to obtain their medical records, which are required to document every test or treatment the member receives.  These can be obtained by calling the hospital/doctor and asking for whomever handles medical records.  They should be able to send you electronic copies, and while some states allow them to charge, always ask that they waive the charges.  And remember, they do not need to know that you want the records to challenge the bill, as it’s a good idea to keep the records regardless, in case they are needed to show a future doctor the type of care provided.
There’s a saying about medical records: “If it’s not documented, it didn’t happen”.  The billing codes should come from the interpretation of the medical records, so examine the records to see if they document every charge that is on your itemized bill.  Any charge that is not documented in the medical record should be contested.  Refuse to pay anything that is not documented in the records – because if it is not documented they should not be billing for it in the first place.  And be especially on the lookout for ‘upcoding’ – the practice of exaggerating the complexity of a case/service rendered in order to increase the payment for those services.

Step 4: Examine the itemized bills and medical records to see if both reflect the care the member actually received.

Step 5: Make sure your insurance plan properly paid the bill

Insurance carriers often autopay almost all of the bills that come in from doctors and hospitals.  There is typically a lack of due diligence to see if the care was appropriate – they merely check to see if the medical biller completed the claims form accurately, by including the member’s information and diagnosis procedure codes and other details to explain what happened.  This lack of scrutiny allows billing errors and fraud to run rampart.

The lax claims processing by carriers can lead to other costly mistakes.  For example, under the ACA all insurance plans must cover certain preventive services for adults – like vaccines, breast cancer screening every year or two for women over forty, and colorectal cancer screenings for members ages fifty to seventy-five – at no cost to the members.  However, the services must be coded as preventive.  If coded as diagnostic (which is the code reserved if cancer is found), the member will have to pay their share.  Oftentimes, these preventive services are coded incorrectly, leaving the members having to pay a portion of these services.  This is an easy one for members to catch, but is an example of why it’s important to stay vigilant to see how things got coded and paid, or not paid, by the insurance carrier.

Step 6: Make sure the bill is priced fairly

Members – or their loved ones – agree to pay for the care that’s provided.  But that does not mean medical providers can charge them exorbitant rates.  Using free price transparency sites such as these two below to see if the price is fair:

• www.FairHealthConsumer.com - this site gathers payment information from insurers/carriers and publishes what it calls its fair price for services or procedures

• www.Turquoise.health – pulls most of their data from the machine readable file disclosure required by the government’s Hospital Price Transparency Rule.  While this engine is still in Beta, you can find at least the Medicare and cash price for procedures from most hospitals.

By using the billing code (CPT or ICD-10) from the itemized bill, you can easily plug those into either website to get a fair comparison.
If dealing with a hospital, check its website and the sites of other nearby hospitals for their prices.  For instructions on how to do this, check our Hospital Cost Estimator page.

Step 7: Negotiate.  See if there’s a financial assistance policy.

Step 8: NUCLEAR OPTION:
After steps 1-7 have been exhausted, more extreme measures are available.  Please submit inquiry on "Contact Us" page referencing Employee Benefits requesting more information...

Back to Member Resources