I am not in the health insurance business, and have nothing to do with health care except that I use it. I spend a lot of time at doctors' offices these days, and as a result I spend a lot of time looking at my EOBs (Explanation of Benefits) from the insurance company.
What I'd like to know is why we're not all yelling "fraud" from the billings between healthcare providers and the insurance company. And before anyone yells "Obamacare," I know for a fact this has been going on long before that went into place.
Here is an example of my complaint: my orthopedic doctor gave me a brace for my ankle. The company that makes the brace charged my insurance company $92.19 for it. The insurance company "allowed" a charge of $54.69 and paid $43.75 of that, leaving me with a 20% copay of $10.94.
The company sells the exact same brace online for $33.94. If they'd charged the insurance company that amount, my copay would have been $6.79.
Why isn't this fraud? If the company can sell the thing online for $33, why is it okay for them to charge $92, and accept $54?
Here is another example: one of my doctors charged the insurance company $117.00. The insurance company "allowed" only $80.57. I had a copay of $20 so the insurance company paid them $60.57.
So can someone out there explain this to me? I don't understand why this isn't fraudulent. To me it is. If you can sell an ankle brace for $33 and still make a profit, then why are you charging the insurance company $92 only to agree to accept $54? If you will see a patient for $80, why isn't that the charge?
What the heck is all of this "allowable" charges BS? And I bet that it differs from plan to plan. I bet your plan might get charged $192 for the same ankle brace, or maybe it would be charged $72. I guarantee that nothing is same across the board.
This is what is wrong with our healthcare, and it wasn't addressed in the Affordable Care Act, apparently, since companies are still doing these kinds of billings.
Can I be the only person out there who thinks this is wrong?
I remember a very long time ago, if a merchant advertised something at a certain price, that was the price they had to sell it at. If there was a misprint, they ate it. I don't know when that changed, but at some point it did, and it became acceptable for companies to backtrack, change prices, and do all sorts of price-fixing that I long thought was illegal. I suspect the rules changed under Reagan and his deregulation movements, but I can't be sure of that. I'm not a business major, either.
Health care needs a lot of reform. How it will actually happen is anybody's guess these days.....
ReplyDeleteI used to kinda sorta understand this stuff when I worked for doctors. It's creative financing to be sure. We have Kaiser so don't have those issues so I never pay attention.
DeleteBecause they have clauses in the policy structure that allows them to supply Medicare, for instance, instead of just writing a prescription for the item to the patient.
ReplyDeleteI worked for 6 years as a medical claims examiner in the 80's. "Allowable Charges" used to be called "Reasonable and Customary" charges. Using the provider's zip code, the insurance company would take the average of what a particular service (let's say a brace) should cost for that particular area of the country. It was a safeguard against providers who over (or under) charged. It also allowed for the fact that costs vary depending on where someone lives. So if one provider charged $90 for that brace and another charged $75, and yet another charged $110 in that geographic area, the insurance would "allow" the average of $91. From that charge they pay whatever the individual policy allows- whether 80%, etc. As consumers, we can shop around for medical procedures and supplies and purchase from whomever we want, however the system is not consumer friendly at all. I tried calling around once for a price on an ultrasound. No one would give me a quote, stating they needed more information of which only a doctor could supply. Had you chosen to purchase the cheaper priced brace from a different provider on your own, you might have had a hard time getting your ins. company for it. That supplier might not have been on their "Accepted Provider" list. The system is so broken it gives me a headache.
ReplyDeleteSounds like fraud to me. We need to crack down on the drug and insurance companies both.
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