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Dealing With Medical Bills 101

Pregnancy often unleashes an onslaught of medical bills. Families that need to budget for their expenses find themselves frustrated by the lack of certainty in health care billing. It can be impossible to learn how much a procedure is going to cost and confusing when a “routine” lab test comes back with a multi-hundred dollar bill.

Medical bills are uniquely unpredictable because there are no fixed costs in health care and the people providing services often have no idea how those services are paid for. Insurance companies contract with doctors, other providers, and hospitals for rates for each service, meaning that the price depends on which insurance company is paying. Further complicating matters, your bill will depend on how much you have already paid in covered medical expenses (your deductible), whether you pay co-pays or the cost of service before you meet your deductible, who is providing the service (in-network or not) and how the service is billed (what billing codes are used, and if the insurance has the “right” information about your medical needs).

Here is some general advice about what to do when you get one or many bills that you don’t understand.

First, breathe. Unlike your phone, cable or most other bills you get, receiving a medical bill is often the first step in a negotiation. You want to be mindful of what you owe, and don’t want to sit on a bill without communicating with who is billing you, because you risk having the debt sent to collection, but you also do not have to immediately pay the full amount. In fact, it is almost impossible to negotiate after you have paid.

Second, try to understand the document you’re looking at- is it a bill from a doctor or hospital, or an Explanation of Benefits (“EOB”) from your insurance company? EOBs tell you what the insurance company thinks your balance is, but it is not a bill that you pay. If you get an EOB you are confused by, the insurer may be able to shed light on why you are being billed this way, but they are not responsible for getting you to pay those charges, the place that provided the service is where you will receive a bill from.

Third, try to understand whether you are being billed accurately. There are many, many permutations for why a bill you receive may not actually be something you are responsible for. You need to have specific advice based on your denial and the conditions around it.

These are some examples of bills you may receive that you are not actually responsible for or should not pay the full amount:

  • If you get an out-of-network lab bill because your in-network provider sent you to an out-of-network lab without getting your signed consent to pay for out-of-network services. In this case, you can look at the Department of Financial Services website to get more information.

  • If you receive a denial from your insurance company, you want to try and appeal that denial before paying the bill. Winning your appeal means that the insurance company is responsible to pay for the service.

  • If you are responsible to pay for a service, it’s a good idea to first check Fair Health to make sure that what you are being charged is not much above the “usual and customary rate.” This site gives you a sense of how much the procedure you received, as measured by the CPT codes, which are listed on your EOB, costs generally in your zipcode. You can use that number to negotiate.

  • If you receive a major hospital bill, have they provided you with a financial assistance application? If your family income is up to 300% of the Federal Poverty Level ($60,480 for a family of 3 and $72,900 for a family of 4), you are entitled to some form of financial assistance. Remember, if you are a freelancer, this income is after deductions. Apply for financial assistance, as you may be eligible for major discounts.

This post will not answer all of your questions, but hopefully will give you a good place to start when you receive a bill. You can always contact our office for a consultation at (212) 888-2680 or A free resource is the Community Health Advocates helpline, which can be reached at 888-614-5400.