03 May 2013

Five Things We Should Be Able To Expect In Medical Billing

There are certain aspects of medical billing in the United States that are absurdly out of step with reasonable expectations in a modern marketplace.  Here are a few things we should be able to expect:

1.  The real price of services should be disclosed before they are rendered in non-emergency situations, and should appear on the bill.  It should also disclose how much of the bill the patient will owe under the health insurance provided by the patient. 

Providers who fail to do so should be limited to a bottom tier Medicaid scale payment only, rather than having the freedom to set their own rates or having an entitlement to a "customary rate."  If you want more, you should have to bargain for more.

Patients who can find providers who charge less than the health insurance allowed amount should receive some or all of the benefit from doing so in their financial responsibilities under the health insurance contract (e.g. a waiver or reduction in co-pays).  The notion that the person who chooses the provider has zero incentive to price should and zero ability to price shop is a critical reason that health care providers are currently overpaid in the United States.  This is a critical market failure whose creeping impact of medical provider pricing now costs Americans hundreds of billions of dollars a year.

2. Bills should accurately reflect health insurance contracts and not claim a right to claim something different than what a contract with a health insurance company allows.  Doing otherwise amounts to an anticipatory breach of the contract that the provider has with the health insurance provider from which the provider intends to benefit.

3. The provider should know what patients are charged for the provider's services and the services of others that the provider orders.  Providing medical services without any awareness of what they cost somebody is irresponsible and verges on unethical.

4.  A single hospital stay or doctor's visit should produce a single bill, not multiple bills from everyone involved in the process (many of whom have never even identified themselves to the patient by name).  How can patients trust a group of professionals who can't cooperate enough to produce a single consolidated bill to a patient to provide sufficiently coordinated medical services?

5.  A provider who sends a bill should do so in the same name that the provider does business under, and provide contact information for someone with the authority to resolve disputes regarding a bill.  Providers should not bill patients in the name of some anonymous affiliated administrative unit or collections service without authority to resolve disputes.  A responsible business person should be afraid to bill in their own name.

None of these expectations say anything about how much should be charged that doesn't apply under the current regime.  It simply involves the manner in which bills are presented and handled.  Each of these steps would be a fairly radical change from how business is done today, but it is not too much to ask.

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