Getting Results: How One Woman’s Health Insurance Runaround was Foiled!

Pay This AmountMost of us have come up against unfair medical bills at one time or another. Trying to straighten out the charges can be a hassle of epic proportions, as the system always seems to be stacked against us. Often, we’re compelled to just surrender and pay the unjustified balance. But today’s guest blogger and WAC advocate Pamela Johnson would advise you not to give up. She has demonstrated how to “fight back” by exerting reasonable effort and gathering the right people into your corner. Her article is a must-read for everyone. Cheers! -Deborah

They say that you can’t fight City Hall. I would add insurance companies to that saying. But in fact, you can fight them…to a point.

If there is a more opaque industry, other than maybe espionage, I don’t know of it. There are fights we can’t yet win because the real numbers behind “reasonable and customary” are a mystery. And I believe that insurance companies and hospitals have little incentive to change that.

Still, after a recent surgery, I appealed a decision by my insurance company and won! The insurance company told my surgeon’s office in a pre-surgery call that they would cover 70% of the surgeon’s fee and I would be responsible for 30%. In fact, they paid 140% of Medicare rates. On appeal, my surgeon’s office begged them to listen to the original phone conversation. They denied the appeal. So, I appealed on my own.

The following is a shortened version of the letter that I sent to the insurance company’s “Provider Resolution Team” with a copy to the Chairman and CEO of the firm. I also copied Eric T. Schneiderman, our NYS Attorney General and the NYS Division of Consumer Protection. The result was that the insurance company did what it would not do after an appeal from my surgeon’s office….they went back to listen to the original phone conversation. I refer to my insurance company as X Co and have removed people’s names:

Many years of experience have taught me that policy and procedure are the keys to insurance filings/claims. Long ago I learned to follow both.

To that point: On March 25th of this year, I had a surgical biopsy at Lenox Hill Hospital. My surgeon’s office manager called X Co. on March 19, 2014 and spoke to (name) before the surgery to confirm that the out-of-network payment would be 70% from X Co. and 30% paid by me. This was confirmed by (name) during their conversation.

After the surgery, my surgeon filed for payment and was then told that the payment would be 140% of Medicare, or $745.64. In other words, after a pre-check and confirmation, X Co. decided that $3,500.00 was not a reasonable and customary rate for a Manhattan, Upper East Side surgeon with decades of experience performing a two hour surgery. If my math is correct, they are saying that around $532.50 is reasonable according to Medicare, as 140% of $532.50 is $745.50.

Please see attached appeal from the office of Dr. (Exhibit A) and the response from X Co. (Exhibit B).

There is, of course, no way for me to know where X Co. gets this number. The concept of “reasonable and customary” is very important to all your customers, and especially for those of us living in New York City, as is the concept of 140% of Medicare. There is a reason that doctors are dropping Medicare patients in large numbers. It’s a joke, but is no laughing matter.

My husband is retired and while I am still employed I am not a hedge fund manager. My policy was sold by X Co. as 30% copay out-of-network, with a 140% of Medicare caveat. It is unfair and I feel unethical for X Co., after the act of pre-check and confirmation, to decide that a fee is unreasonable and use the Medicare rate. We get very little if any information to help us figure out how X Co. makes these decisions. This incident looks suspiciously like a bait and switch gambit.

My request: Please review this charge and honor what my surgeon’s office was told. Tell me how X Co. could confirm something to a doctor’s professional assistant; then issue payment reflecting something radically different. Tell me how we are supposed to understand what information X Co. uses to determine a 70%/30% payment scheme or 140% of Medicare payment for out-of-network care. Please, no comparisons with hospitals in the suburbs somewhere in upstate New York. I want the figures from where I live: NYU, Columbia Presbyterian, Lenox Hill, etc.

The moral of this story: Keep good records. Have your doctor’s office do the first round of appeals. Most importantly, get someone powerful on your side. We have a history of activist state attorneys general in New York. Use them.

I’ll probably never know how these decisions are made; the request for information on determining payment was ignored. But I got a refund and that made me feel like David tweaking Goliath. It’s a real good feeling.

Pamela Johnson is currently in charge of Operations and Client Services for New York Private Finance, a boutique advisory and lending firm. She has an MBA in Finance and Marketing from Fordham University. Pamela lives in NYC with her husband, PJ, a corporate communications and marketing consultant. They hike and cook, and she plays a mean game of badminton.

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