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Balance billing of medical bills

An article from one of the leading healthcare websites discusses the problem of balance billing by hospitals. https://khn.org/news/taking-surprise-medical-bills-to-court/ A balance bill is the amount from the hospital that you are expected to pay out of your pocket after the insurance company has made their payment. This usually only arises when there has been a bill that is not covered, within the policy deductible, co-insurance or out-of-network. Coverage under a policy that is in-network is usually required to be accepted as payment in full by the hospital. The problem is that for these balance bills the hospital uses their list price which is much higher than the contract or allowable price agreed to for in-network providers. The in-network provider must accept this amount.

Under the law of contracts, two parties must reach an agreement or mutual assent on the terms of the contract. For example, you go to get a haircut and the prices are shown or at least told to you prior to your haircut. You don’t just sit down and then they tell you the charge after you are done. Hospital bills should be no different. If there is no prior disclosure or agreement to the charges (e.g., in an emergency), then there is no binding contract or liability to pay an unknown amount. If medical services were provided, there is liability to pay a reasonable amount under the theory of quantum meruit. How do you determine what is a reasonable amount? This issue has been presented in court and at least two courts have ordered hospitals to accept the lower in-network price.

The Kaiser article recommends that if you have this problem you should attempt to negotiate a reduced amount. There are websites that have information on average costs for various medical procedures were you can find proof of a reasonable charge. https://www.healthcarebluebook.com/ui/consumerfront and https://www.fairhealthconsumer.org/

I also recommend that you refer to the Kaiser health site for any information on healthcare or medical insurance. This website is a great resource with lots of information.