Ever had a night out at a nice restaurant or bar and been somewhat shocked by your bill at the end? You’re sure you didn’t order that last round of drinks and if you did, that definitely wasn’t the price advertised at the bar!

Most of us have had this kind of experience and while shocking and unfortunate, there are bigger, badder types of surprise bills out there. Surprise medical bills can leave you much worse off than a miscalculated bar tab. It’s a hot topic among media and legislators, but, what does surprise billing really mean? And how can it impact you? See below for a quick guide to understand surprise billing and learn what steps you can take to fight it if it happens to you or a friend.

What is surprise billing?

Surprise billing occurs when you go to an in-network medical facility like a hospital or emergency room, but you are treated by an out-of-network doctor and you are billed for the services performed by the out-of-network medical professional. In other words, you did your part–you carefully shopped the happy hour special or in this case a hospital that is “in-network” and covered by your insurance. But while there, a doctor not covered by your insurance treated you. Your insurer will pay for all of the “in network” doctors and services but you, the patient, will be billed for the “out of network” doctors that treated you.  Surprise bills occur most often during emergency care or if you are undergoing a treatment or surgery that may require additional physicians like radiologists or anesthesiologists that you do not actively select. In these cases you may not be aware you are receiving services from an out-of-network doctor. Surprise billing can also happen if an in-network doctor unknowingly refers you to a doctor or specialist that is out-of-network.

Check out a few of the gripping patient stories that sparked national attention around surprise billing:

• KHN’s story about a high school teacher who was slammed with a bill twice his annual salary after emergency care for a heart attack
• After the story aired, Washington Post reported that the hospital dramatically lowered his bill
• KHN’s story about Joaquin Lopez, a 37-year-old college professor was hit with a nearly $8,000 bill from the out-of-network hospital — that was after the $11,000 he and his insurer had already paid
• Vox’s coverage of a bike crash that led to a $20,243 bill because a hospital in San Francisco does not take any private insurance

How common is it?

A Health Affairs study found that one in five in-patient Emergency department admissions led to surprise billing. In other words, one in five people who went to the ER and were admitted to the hospital received a surprise bill.  The research institute NORC at the University of Chicago    found that out of 1,000 people surveyed, more than half had received some kind of surprise bill that they thought their insurance would cover. The surprise bills were most often for physician services but other surprise bills covered lab tests, facility fees, imaging, and prescription drugs.

What should you do if you receive a surprise bill?

Don’t pay the bill – If you think you’ve been overcharged or charged for services that should be covered, do not pay the bill immediately. Take the time to look at the bill and compare it to your explanation of benefits (the summary your insurance company should mail you or provide online that is separate from the bill sent by a medical facility). Through your insurance portal, you can see the insurer side of medical claims and look to see how much your insurer paid for a service.

Get an Itemized Bill – If you didn’t receive one already, ask for an itemized bill that breaks down where the costs are coming from. Call your insurance company’s helpline to talk through how the bill compares to what they’ve already paid for.

Cost Compare – You can also get more context on your bill by doing research on the average or typical cost of your medical procedure. Below are some tools you can use to cost compare:

• Guroo.com – A national website you can use to search for the national or state average price of a test, procedure, or office visit. The data is based on aggregated insurance claims.
• Fair Health Consumer – A tool that allows you to see estimates for medical or dental services based on average in-network and out of network costs. It can be a bit more complicated in the search process, asking you to select medical codes, but you should be able to get through it well enough to find a price to compare your bill to.
• California Cost Compare – A California hospital specific website, but you can select a procedure and type in a CA zip code to see the total payments in that area for a procedure

Keep Notes & Self-Advocate – Keep diligent notes of who you talk to at your insurance company and the hospital.  Most of all, be prepared to be aggressive and persistent. Plenty of news stories show that if an insurer or hospital is put under the spotlight they will buckle and lower your bill. While you might not be able to garner national media attention, being your own advocate and pushing back should help you resolve the issue.

Shouldn’t this be illegal?

At this point, you’re probably asking yourself how this type of billing is allowed. How are you as a healthcare consumer supposed to know if someone treating you real time will be covered by your insurance?

Some states have taken steps to protect patients from this kind of outrageous billing. The Commonwealth Fund reports that 15 states offer partial protections from this practice, 6 states have comprehensive protections, and 29 states do not have any laws in place. You can look through Commonwealth’s guide to understand your own state laws. You may be able to use these laws for your benefit to fight a surprise bill.

Federal law is also critically important on this issue. As Health Affairs explains, state laws do not apply to the roughly half of privately-insured Americans that are enrolled in so-called “self-insured” health plans that are common among large employers. “Self-insured” plans are a type of plan when your employer collects premiums and takes on the responsibility of paying your medical claims. However, you may not know you have a “self-insured” or “self-funded” plan because many large employers contract with insurance services making the insurance look and feel like a traditional, fully-insured plan. The good news is that states and the federal government are beginning to turn their attention to this devastating issue.

TLDR:

• Surprise billing can occur when you go to an in-network medical facility like a hospital emergency room, but you are treated by an out-of-network doctor. (typically happens with emergency care or during a procedure that requires additional doctors like a radiologist)
• Your insurance will cover the in network doctors but you will be charged full price for the out of network doctors.
• What should you do if you’ve received a surprise bill?
  • Do not pay it immediately
  • Compare the bill to your explanation of benefits (mailed to you by your insurer or found on your online insurance portal)
  • Ask for an itemized bill from the medical facility
  • Do research to understand what the average cost of the procedure
  • Be prepared to aggressively advocate for yourself with your insurer and the hospital or medical facility that billed you.