One Baby, Postage Due (or: How Your Insurance Company Tries To Gouge and Screw)
Help! Don't send me back!
SFMom is lucky enough to be employed by a company that offers a great health plan (by American standards). Our plan is a PPO, meaning that we can use any health care provider of our choice so long as the provider is “in [our insurer's contracted] network”, which results in 100%† coverage for most services. If we choose to use a provider that is not within our insurer’s network, we get around 80%† coverage.
† Void where prohibited. Your mileage may vary. Batteries not included. Copays, deductibles, coinsurance and many other random gouge-and-screw charges might apply.
In any event, we had planned for B’s birth at an in-network hospital, and since coverage for pregnancy and postpartum care is listed as 100%, this means that we don’t have to pay anything…right?
This time around, the culprit was anesthesia performed by an out-of-network doctor. When we checked into the hospital, we asked the nurses to write in our file that we only wanted the hospital to use in-network doctors and services. (I got this wise tip from someone at our birthing class who apparently had insurance problems in the past.) Anyway, the nurse assured me that the hospital didn’t call out to any other non-network doctors and that we would be fine.
Somewhere in the middle of the 21-hour labor, the anesthesiologist arrived on her magic carpet in order to deliver the long-awaited epidural to the beleaguered SFMom. This was all well and good, but what the hospital didn’t tell us was that the anesthesiologist was out-of-network.
This kicked off a chain reaction of sorts in our insurer’s billing department, and it resulted in a “you owe $550 to the provider” notice being delivered to our doorstep two weeks ago.
Since the anesthesiologist was not in-network, this meant that the insurance company would only cover 80%† of the services rendered.
There were several problems with this from our point of view:
First of all, our health plan documentation said that they would pay 80% of “eligible” charges, but what they tried to stick us with is only paying 80% of “reasonable and customary” (R&C) charges.
For those of you who may not be familiar with medical lingo, a charge that is not “eligible” is something that the insurance company doesn’t think they should pay for at all. For example, this might include the private room that you used for your baby’s delivery (which isn’t covered by our nasty insurance company because private rooms are ineligible, even though no facility in California has a semiprivate delivery room, at least according to our hospital), or it might include the “experimental” procedure that would otherwise save your great grandma’s life if not for your insurance company’s desire to avoid covering it.
If you have an ineligible charge, the insurance company generally will not pay it, period. Note that we eventually got our hospital to write off the above difference between the private and semiprivate room rate that they were trying to bill us for. Thanks a lot, unnamed evil insurance company!
In contrast, the R&C charge is what the insurance company routinely defines as the “standard” payment amount for a particular service, and it describes the maximum amount that they will pay per their other benefit rules. For some odd reason, the R&C charge is almost universally less than what any doctor or facility ever seems to charge. (Of course, I write this from the land of San Francisco where everything is really expensive.) Regardless of the rationale behind it, this means that you’re on the hook for the rest of the bill. The upshot is that the insurer will only pay 80% of part of the bill for out-of-network providers, and you get to pay 100% of the remaining part of the bill that exceeds R&C. Depending on how much the billing exceeds the company’s R&C allowance, this means that your real insurance coverage could be only 50% for the service (or even worse).
In our case, the anesthesia was certainly an “eligible” expense, and their rules didn’t say that they only covered 80% of R&C, so this seemed to be incorrectly applied.
Second, we expected to be getting 100% coverage to begin with, given our request to the hospital about using in-network providers, so the above shouldn’t even matter. Note that the insurance company is run by different people than the hospital, and if the hospital ignores your request to use in-network people, who do you think gets left holding the bag? (Hint: the answer is not “the insurance company” or “the hospital.”)
The upshot is that I wasted the better part of about two-and-a-half of SFBaby’s naptimes talking to people at my unnamed nasty insurer in order to get them to try to fix it. I got conflicting advice from a number of people I spoke to there, including the following (incorrect) opinions:
- the billing was correct in the first place
- if the hospital did not use an in-network provider, we can’t do anything about it and you are responsible for the balance
- we have a policy that says that out-of-network services are covered if they originated from a referral from an in-network provider, but this policy only applies to doctors office visits and not to hospital visits
- the insurance company does not have any anesthesiologists in its network, so all anesthesiology is billed at out-of-network rates (!).
After much time on hold, I finally got connected to someone who found the policy that states that if a a service is initiated from an in-network hospital, but the service is performed by an out-of-network provider, the insurance company will actually cover it at in-network rates. This helpful person agreed to send the claim back to the claims review department to have them look at it.
Two weeks later, lo and behold, they sent us a notice saying that the claim had been reprocessed and that we owed nothing. Hooray for us…but it’s a pity for other people who simply don’t have the time, patience or perseverence to spend hours arguing with the insurance companies to get the benefits that they are paying for and to which they are entitled.
So…is anyone in favor of single-payer healthcare with California SB840 and Health Care for All?
Tags: anesthesia, baby, billing, birth, hospital bills, insurance, ridiculous, stupid insurance companies
Thank you for reminding me of why it’s good to live in Canada!
I heart insurance companies. JK.
name names(!) — let the insurance company be dragged over the proverbial blogosphere coals for their villainous ways.
p.s. will happily harness the power of our costco membership to procure a mass of discount baked goods for a fund raiser
p.s.s. (or is it p.p.s — I always forget)
Handy Tip(tm) — use the same “Return Address” as the “To Address” and the item will get mailed to its proper destination irrespective of applying full postage. Just saying, you’ve got options…
FellStreet,
Do you think the additional postmark would hurt the baby? I mean, one “insufficient postage” stamp is hard enough, but when you go slamming the “return to sender” stamp all over the place…