prospective negotiations

A great article from The New York Times Online that talks about the many challenges people face when sick, underinsured or have no insurance. Here is a list of steps and helpful points to better manage the medical bills.

The New York Times

MEDICAL bills have a way of piling up — especially when you’re sick or underinsured. Just ask Kirk Kupka, 48, and his wife, Susie, 53.

Mr. Kupka has multiple sclerosis. The Kupkas, who live in Lindstrom, Minn., have an annual income of $45,000 — a combination of her salary as an office manager and his disability payments.

More than 20 percent of that income goes toward health care. Their annual insurance premiums total $5,400, and then there’s the $4,000 Mr. Kupka spends on drugs, doctor’s visits and lab fees before he fulfills his policy’s deductible.

In the three years since Mr. Kupka’s disability forced him to stop working as a mental health therapist, he has accumulated $12,000 in debt.

“It’s frustrating,” he says. “We earn too much to qualify for state and county assistance, but not enough to stay ahead of the bills. I’ve thought maybe my wife and I should get divorced. But not only is it against our faith, it turns out it wouldn’t help.”

Medical debt can lead to drastic measures, forcing people to raid their 401(k)s, tap into home equity lines and, in some cases, declare bankruptcy. Surveys by the Commonwealth Fund, a nonprofit health care research foundation, found that 41 percent of adults said they were struggling to pay their health care bills in 2007, up from 34 percent in 2005. That percentage is almost surely growing.

And as Mr. Kupka’s situation illustrates, it’s not just uninsured patients who rack up large bills. Nearly two-thirds of those with debt problems, according to Commonwealth, had health insurance.

But insurance covers less and less these days, as employers continue shifting more health care costs to their employees, and as consumers resort to lower-cost plans that come with high deductibles or less generous benefits.

“People who have been faithfully paying insurance premiums for years are coming in with medical bills they can’t pay,” said Gail Cunningham, a spokeswoman for the National Foundation for Credit Counseling, an umbrella group for services that help consumers cope with debt.

But if you’re having trouble paying your medical bills, you’re not helpless, either. There are ways to reduce, or at least more effectively manage, medical debt.

CONFRONT, DON’T IGNORE Procrastinating only leads to trouble. If your bills are turned over to a collection agency, the debt goes on your credit report and will remain there for lenders, and even potential employers, to see. You may have difficulty getting a loan and, if you do get one, you’ll be charged higher rates. So take action — even if that doesn’t mean writing any checks right away.

Proceed to Step 2:

SCRUTINIZE YOUR BILLS Look over your outstanding bills and make sure the listed services actually square with the care you received. Errors are common. If terms or procedures confuse you, call the hospital’s or doctor’s billing department and ask for an explanation.

If your insurer denied one or more of your claims, resubmit the bills, advises Mark Rukavina, executive director of the Access Project (www.accessproject.org), a nonprofit group in Boston that helps consumers cope with medical debt.

“If that doesn’t work, file a formal grievance or appeal with the insurer,” Mr. Rukavina said. “Even it that fails, most states allow insured patients the right to an external review by a certified third party, often a state agency. And patients should exercise this right.”

HIRE AN EXPERT Try first to negotiate with your providers for a discount or an extended payment plan. Explain that you simply can’t pay your bills in full right now, and you need some leeway.

If this tactic doesn’t work, or you don’t have the time or energy to haggle, consider hiring a billing specialist — a professional trained to spot errors who speaks the language that medical providers understand and respond to.

Some billing experts charge only if they save you money. Others may ask for a retainer up front. Make sure you clarify the terms at the outset.

(more…)

Hospitals and other healthcare facilities are beginning to require patients to partially pay up-front for service before receiving treatment. If you are confronted with the requirement to pay upfront we recommend you pay as little as possible. Another option is to prospectively negotiate your full payment for needed services with the asistance of Medical Cost Advocate. To understand more, read the below article and then visit our homepage and click on the Prospective Negotiation tab.

Philadelphia Inquirer

There was a time, say two years ago, when a relatively well-off suburban hospital like Abington Memorial could afford to wait for patients to pay their parts of their bills.

Times have changed.

Like many hospitals around the country, Abington Memorial has started to ask patients for their money up front instead of sending bills later. The effort to reduce billing costs is paying off: Abington collected only 4 percent of co-payments and deductibles from patients while they were at the hospital during the first eight months of fiscal 2008. It got 20 percent during that time period this year. “People are always less likely to pay after the fact,” said Michael Walsh, Abington’s chief financial officer. The new strategy has “had a positive impact on our bottom line.”
Kenneth Braithwaite, who leads the Delaware Valley Healthcare Council, said hospitals worried less about bad debt – uncollectible patient bills – when it accounted for 1.5 to 3 percent of revenue. But some hospitals are telling him now that their bad debt is above 5 percent and even into the low double digits. Braithwaite sees increasing patient debt as an “emerging issue” and recently established a task force to assure that hospitals treat struggling patients with “understanding” and share “best practices” for collections. Employers have been transferring more of the cost of health care to their employees in the form of higher co-pays and deductibles. Layoffs are leaving more people without insurance at all. “As more and more of the burden has fallen to the patients, hospitals have become much more proactive about collecting that [the patient share] up front,” he said. Alan Zuckerman, president of Health Strategies & Solutions in Philadelphia, said hospitals have been increasing up-front collections for the last two or three years, with “more acceleration in the last six months.” Though it is routine to collect co-pays in many physicians’ offices, some hospitals still don’t ask for much cash. “There’s lots of places I go where they don’t collect much of anything,” he said. Abington started its push to increase collections at 2007’s end, said Betsy Seeber, director of patient accounts. It’s a two-pronged effort to make sure patients pay as much of their share as possible before leaving and to confirm that insurance information is up-to-date and accurate. “It takes a heck of a long time to collect from Aetna when really the insurance is Blue Cross,” Seeber said dryly. Even when the company is correct, getting a number wrong on the claims form can really slow down a payment. The hospital has rolled out its program in a wide variety of departments, including outpatient registration, radiology and emergency. No one is forced to pay up front, Seeber said, but even inpatients are asked to pay their parts of the bills before they go home. Walsh said he’s hearing about more “push-back” from patients as their share has risen and fears about the economy have grown more intense. It’s not unusual for patients to have a co-payment of $1,000 to $1,200 after several days in the hospital, he said. “Each year, we’ve seen the level of co-payments increase,” he said. “The economy being in the position it’s in, people are just scared.” Seeber said some staff members were initially uncomfortable asking patients for money. She encourages them to think of it as a chance to explain insurance benefits to patients and help them pay conveniently.
From July through February, Abington collected $2 million from patients up front, a big jump from $303,518 during those months in fiscal 2008.

Enlisting Help for a Lower Bill

No room for patience: Hospitals seeking payments up front