There was a time not that long ago that a patient might never see a medical bill, much less have to read it. But few of us can afford to be blissfully ignorant anymore, as rising costs force insurers and employers to push higher deductibles and co-pays onto consumers.
What’s worse, once you get your bill, you may well decide it’s written in a language you don’t understand. Bills are chockablock full of complex coding and shorthand that insiders hope you never really understand. That strategy is working so far. Fully 77 percent of Americans say they don’t understand either the medical bills they receive or their health insurance. But it pays to be persistent. According to Medical Billing Advocates of America, 80 percent of medical bills contain some error. And, the most common ones are duplicate billing, typos in which the wrong coding or price is entered, charges for work that was cancelled and inflated operating room fees.
Of course, these errors could be in your favor or against you, but either way, you’ll want to know if your bill is simply wrong. Here’s how to read and understand your medical bill:
- First off, understand that your charges can come from a variety of different sources, such as your doctor for the exam, the lab for testing and say, maybe radiology for services. The list can go on and on. Different sources means the possibilities for mistakes and errors escalates.
- The second thing you’ll notice on an itemized bill from your doctor or hospital are five-figure codes. These are called CPT codes (for Current Procedural Terminology). These codes are assigned to each and every service a primary care physician, specialist or technician provides a patient, including medical, surgical and diagnostic services. You can understand what these codes mean by going to the American Medical Association’s CodeManager on their website here (https://ocm.ama-assn.org/OCM/CPTRelativeValueSearch.do . You’ll have to fill out some details about yourself and promise not to use the information for anything but your personal information. But going to this extra trouble will allow you to see precisely what you are being billed for. Remember that some health care workers spend their entire careers mastering the CPT codes. So if you’re having trouble understanding them, ask your doctor’s office for details.
- Suffice it to say that the story of what you pay doesn’t end with the doctor’s bill. You’ll also receive an EOB or Explanation of Benefits, from your insurer or Medicare. It will show how much of each service was paid for on your behalf. Like the doctor's bill, each service coded. You’ll want to verify that the CPT codes on your doctor’s statement match the codes on the insurer’s statement to be sure that you’re being charged for the services you are receiving. If they don’t match, contact your doctor and the insurance company.
- Let’s talk about the bottom line. So, at the bottom of your final bill, you’ll see a line item called the “charge.” Consider this the sticker price and not the final price. The discounted price or “adjustment” will follow, which will factor in anything you’ve already paid from your co-pay to deductible or insurance. The “balance” (sometimes called the Patient Responsibility”) is your final bill with whatever late fees or credits may have been paid.