A Surprise You will not Like: How Hospitals are Using Insurance Loopholes to Fleece Patients

In the past few years, there have been several changes in the medical industry. One of the most important changes has been the introduction of the rating system for hospitals which have high readmission rates. Insurers like Medicare have cut down on reimbursement amounts that they pay back to the hospitals. The result-hospitals have started to find a way to get around all the cost cutting. And out-of-network services are a poignant and fantastic way to get the patient to pay up and set up an alternate money channel.

How out-of network services raise your bills

Well, it's pretty simple really. You go to the hospital for a surgery or some medical procedure, now, this hospital is covered by your insurance provider so you are not really worried about the money factor here. But no matter what procedure you are in for, a bill for a service provided by an out-of network provider will always need to be paid for in full. These providers can ask for amounts that are around 20-40 times the amount billed by the principal surgeon/doctor.

This can include blood work and other tests done by a pathology group, or even the bill for 'assistant doctors' who help out on major surgeries. Many a times, the patient who is footing the bill is not even aware that a second pair of hands will be needed for his surgery. Many of the situations in which these assistant doctors are called in are not life-threatening at all; raising doubts about the legitimacy of such bills. The hospital almost always has a cut in the fees that the out-of network provider takes, and this is how doctors and healthcare providers across the country are keeping the money flowing in despite the reimbursement restrictions by insurers.

Using the loopholes to their advantage

In the past years, some insurers have made efforts to curb this practice of 'drive by doctoring' and help patients burdened with surprise bills. But since an insurer is never present in the operation room to see whether or not an assistant doctor was required, they typically have a limited ability to fight back.

Also, since hospitals that join a network are not mandated by law to provide only in-network services there is technically no wrongdoing here. This loophole has encouraged many doctors and hospitals to go down this route to extract money from their patients and thereby make up for slashed surgical fees.

In many countries such as Australia, it is seen as the patient's right to be foretold of any out-of-pocket costs. In America, there exists no such law and hospitals often get their way by labeling a situation as 'emergency procedure' to justify calling in outside help. It may not be legally wrong, yet, but it definitely is a moral and ethical outrage. But until the law of the land wakes up and stops this nuisance, there is nothing that patients can do - except pay up and express regret.