Nine Times out of Ten

The Medical Bill Survival Guide : What You Need to Know Before You Pay a Dime
by Pat Palmer, Martha Ellis, Christopher Slone

Why This Book Had to Be Written

More and more people like William Powell are learning that while our health care providers may be treating us well as patients, they're treating us horribly as customers. Reliable studies show that more than nine out of ten medical bills contain errors-bills coming from hospitals, from health maintenance organizations (HMOs), from physical therapists, from laboratories, and from everyday visits to the doctor.

Not surprisingly, the error almost always favors those sending the bill, not the one receiving it.

One study, done by Equifax Services, puts the average dollar amount of error at around $1,300 per patient.

Of course, in times past, the average patient didn't need to concern himself with such misbillings. If an insurance policy said it would cover 80 percent of the total medical costs, it probably did. If and when a health care provider screwed up, the insurance company paid for the mistakes, not the patient. Rarely would an insured patient need to worry about picking up unexpected unpaid tabs.

No longer. With insurance companies and health maintenance organizations privately negotiating fees with hospitals and other medical facilities while at the same time dramatically limiting the amount they will pay for certain procedures, patients are frequently left holding sizable bags themselves.

My Own Experience

My own experience in investigating medical bills over the last fifteen years only reinforces what the studies are now showing. In fact, I've found the percentage of bills with errors to be higher than 90 percent. Our office alone recovers hundreds of thousands of dollars annually in wrongful billings.

For example, one woman you'll meet shortly saw her out-of-pocket hospital expenses reduced from $20,000 to less than $2,000. Another woman saw the $17,000 cost of her twenty-three-hour hospital stay cut in half-within a matter of hours. Other case studies we'll discuss are no less dramatic.

Ghosts in the Machine

Name any other type of business that could survive that sort of gross incompetence in the way it bills its customers. I doubt you can. Business executives outside of health care who tolerate such mismanagement not only risk going under.

They risk going to jail.

When I first began finding errors in people's medical bills, I operated under the naive assumption that everyone-hospital administrators, doctors, and insurance companies alike-would genuinely want these bills to be correct and accurate. Boy, was I wrong. The slipshod manner in which hospitals and other medical facilities currently bill their patients-and in which insurance carriers pay their claims-seems to profit everybody involved.

Everyone, that is, except for the patient.

What I've found through the years is a system so convoluted that it actually discourages accuracy and encourages error. Just what kinds of errors am I talking about? Consider these examples:

• One Virginia hospital billed a couple for the circumcision of their newborn. Not an unreasonable charge, really, except for the fact that the couple had a baby girl.
  
  
• An Illinois hospital billed a man $186,000 for “heart valves.” Two hundred heart valves, that is.
  
  
• Another Virginia hospital billed a patient for the use of its delivery room. Odd, since the man was in the hospital for heart surgery.

What most distresses me about these mistakes is the amount of work it took to uncover them. Had each family involved not rolled up their sleeves and made a concerted effort to investigate their medical bills, they (and probably their insurance carriers too) would have never known what they had paid for!

Many of the problems in health care billing are unintentional, to be sure. Some stem from simple clerical errors keyed in by data-entry workers being paid little more than the minimum wage. Many more problems, however, might rightly be classified as fraud (many already have, as we'll see later).

Whether intentional or not, the problems are endemic. It's the system as a whole that allows and even promotes these errors, and it's the system as a whole that we need to fix if we're ever going to stop the madness you're about to read about.

What to Expect

Many of you reading this aren't all that interested in reforming the system, I know. You just want to find out if your medical bills are wrong, and if you've paid out-or are about to pay out-money you shouldn't have. That's fine. It's for that reason I wrote this book.

In the pages that follow, we'll take a brief look at how we got into the mess we're in, then we'll help you find your way out. You'll be given tools to help you navigate your way through the murky waters of medical overcharges and mischarges and of wrongful treatment by your insurance company or HMO.

People call me a medical sleuth. That may be the case, but I'll be the first to tell you I haven't any medical background whatsoever.

I first started investigating medical bills more than fifteen years ago when I stumbled upon a $400 overcharge in a bill my father received for a routine medical procedure. Most of what I've learned since then I've learned by self-education, by trial and error, by dogged determination, by luck, and sometimes (I'll admit) by accident. Through the years, though, I have been fortunate to have many top health professionals and consumer advocates lend me their expertise and insights.

You can learn from my experiences.

When I first started getting patients' money back from their medical bills, I had no idea that people weren't already doing this sort of thing all over the country. I thought surely others must be seeing these problems and were busy working to fix them. Apparently, I was wrong again.

I'm confident this book can help you recover money that rightfully belongs to you-money currently in the wrongful possession of hospitals, doctors, insurance companies, and HMOs. At the same time, I hope I open everybody's eyes to the other health care crisis in America-the crisis in medical billing. I hope this book forces all Americans to wake up and demand that common sense and courtesy be returned to our health care billing system.

The stakes are tremendously high.

Did you know that we Americans spend more of our gross national product on health care than we do on defense and education combined? In any given year, we receive more medical tests, undergo more operations, and take more drugs than much of the world's population ever receive in their lifetime!

In one sense, we enjoy the best health care in the world. Our health care system is second to none in areas such as medical research, drug development, and technological innovation.

Yet in another sense, few would dispute that our health care system really stinks. Medicare fraud has gotten so bad that ordinary drug dealers are scrambling to get in on the action. The rate of medical inflation runs three times higher than the rate of inflation in general. More than thirty-five million Americans have no health insurance to cover the rising costs.

And at the same time, nine out of ten medical bills are just plain wrong!

The way we're expected to pay for our health care has turned into a comedy of errors. It's time we recognize this disease that's afflicting us and put a stop to the nonsense.

However, I need to forewarn you. Even if you read this book from cover to cover and put all the information I share in it to good use, don't fool yourself into thinking you have all the answers to the problems that might beset you. Like passengers standing on the bow of the ill-fated Titanic, we're only seeing the tip of a disastrous iceberg.

If I've learned anything over the past fifteen years, it's that for every trick we uncover, two more lie in wait.

Copyright © 2000 by Pat Palmer, Martha Ellis and Christopher Slone

About the Author

Pat Palmer is president and founder of Medical Recovery Services which investigates medical billing fraud, and founder of Medical Billing Advocates of America.

Martha Ellis is operations manager for MRS, and specializes in medical and legal research.

Christopher Slone s a former healthcare marketing director, freelance journalist, and columnist.