The practice of surprise medical billing or balance billing has received widespread attention in recent times. The media is full of reports about angry and frustrated patients who receive surprise bills in their mailbox after their treatment, usually emergency medical care and operations. While health insurance eligibility verification before services are provided can address the problem, physicians need to know when they can or cannot balance bill a patient.
When balance billing may be justified:
Balance billing is legal when the health plan does not have a contract with the physician who provides the service. A typical example is the recent case of a Phoenix patient who received a surprise medical bill after her hand surgery. Though she got treatment in an “in-network” hospital, the surgeon who performed the operation belonged to an “out-of-network” surgery center.
Also, when the patient receives services that are not covered by their insurance, the patient may be billed for any charges above the allowable rate in the provider contract. For instance, if the physician’s service costs $100 and the allowed amount for the covered service is $70, the practice could bill the patient for the remaining $30.
When balance billing is prohibited:
It is considered illegal to bill a patient for any charges or the balance of a bill above the allowable rate in the provider contract. When it comes to this type of billing, knowledge of the law and the patient’s insurance coverage is the key to avoiding medical billing errors and legal issues. Providers need to scrutinize plan benefits to understand what they can collect or the patient’s responsibility for their care. An insurance verification specialist can confirm the patient’s coverage before services are provided. This way, the physician’s office can collect any co-pays, co-insurance, deductible or any amount due for services not covered by the patient’s plan at the time of the office visit.
Out-of-network physicians not bound by contractual in-network rate agreements can bill patients for the entire remaining balance. However, they should know that it is unlawful to bill the patient for any charges if the insurance plan or the contract specifies that the patient is not responsible for any deductible, co-pay or co-insurance.
Some states have passed laws to protect consumers against surprise medical bills. The Oklahoma House of Representatives recently proposed a bill that will allow patients to request a different provider who is covered by insurance instead of being subjected to an unexpected medical bill.
Medical offices need to take proactive steps to protect their income while maintaining good relationships with their patients. Opting for the patient eligibility verification services provided by a reliable medical billing company is an important step in this direction. Other strategies to avoid balance billing errors include:
- Inform patients about the impact of an out-of-network status before services are provided.
- Primary care physician who refer patients to a specialist should see that they are sending that patient to an “in network” physician.
- Pay attention to patient complaints and have a process in place to review them and take corrective action.
- Stay updated on the proposed legislation with regard to balance billing, how it may affect your practice, and how you can prepare.
- Understand provider contracts.
Outsourcing medical billing can help you stay compliant with existing laws as well as payer contracts. With experienced teams, the latest technologies, and periodical billing audits, established service providers ensure accuracy in medical billing, and avoid patient ire and legal complications.