What I Wish Parents Knew About Medical Billing

Written by Brandon Betancourt

One of the things that I do a lot here at our practice is talk to parents about their health insurance coverage. The conversation is usually about why they have a balance on their child’s account.

Health insurance is very complicated. At our practice, we deal with health insurance all the time and even for us, it gets to be very complicated sometimes.

Today, I had a conversation with a patient’s parent regarding medical billing issues. After explaining some in-and-outs about why we do certain things, the parent mentioned she had no idea things were the way they were and now understands why doctors’ offices have to do what they have to do.

She also mentioned that we should do something to spread the word. She said, “I think it is important for other parents to know this. Otherwise, how are things going to get better?”

I thought her idea to spread the word was very good. Therefore, I decided to summarize our conversation in an effort to help other parents understand, at the very least, a portion of medical health insurance.

Coding — a lot of what doctors do

At a restaurant, generally you’ll get an itemized check that shows all the things you’ve ordered. Doctors do the same thing, but they do it in the medical chart.

Virtually every doctor who accepts health insurance uses codes (called CPT codes) that are assigned to every task they and their staff performs. Everything from a simple blood draw, to immunizations, to the ear check, to specimen handling — all these things are “coded” separately.

Why do docs do it this way?

These codes are used by the patient’s health insurance company to determine the payment amount that the doctor will receive for his or her services. In other words, the health insurance company (the one actually paying for the services) wants to see what was done during a patient’s appointment. Hence, everything the doctor and the staff does has a code.

For example, if you are coming in for a child’s well visit, the pediatrician will submit a “claim” to the insurance company using the following codes:

  • Established Well Visit – 99392
  • Developmental Testing – 96110
  • Hemoglobin – 85018
  • Finger/heel/ear stick – 36416
  • Lead Testing -83655
  • Hearing Screen – 92587

If the child gets immunizations, those have codes too.

  • DTAP-IPV – 90696
  • Flu – 90660

Vaccine administration also uses a distinct set of codes. To further complicate things, some vaccines have a single administration code used with them, and others have multiple administration codes for a single vaccine.

  • Admin – 90460
  • Admin – 90461
Oh, by the way…

Let’s say while you are in the examining room, you ask the doctor, “Ya know doc, little Lisa here has been pulling on her ear lately… she may have an ear infection. Can you check that for me really quick?”

This question requires the doc to perform an entirely different assessment than the well visit the child was getting.

The doctor, in order to show the insurance company that she did a completely different assessment, codes the ear pain diagnosis and adds a 99213 – which is an evaluation and management code that documents in the chart and on the claim to the insurance company that the doctor also checked the patient’s ear.

But we feel like we are being squeezed for every penny

Parents often think when they are looking at the bill that the doctor is nickel-and-diming parents, when in reality, it is the insurance company that requires the doc to show their work in this matter.

The health insurance company doesn’t accept the doctor telling them, “I did a well visit — pay me our agreed-upon fee.” They want to know all the things the doctor did during a patient’s visit so they can decide how much they ought to pay the doctor for his/her services.

Since most patients (or in the pediatrician’s case, parents) don’t pay the doctors directly, but rather the health insurance company, they want to know what took place during the visit so they know how much they ought to pay the doctor.

It is the same as going to the restaurant and getting billed for all the side and extra orders. Although the main meal is accompanied by other things, like french fries or a salad, refills, side orders, substitutions and additions to the order are billed as extra.

Health care services are a la carte as well. 

Why then do patients have balances if insurance ought to have paid?

The insurance policy that a patient has chosen may not pay for all the services the doctor performed. So when the doc’s billing staff submits a claim for a visit, the health insurance company often comes back and says, “We are not responsible for these codes/services; these are the member’s responsibility per the member’s health insurance policy. ”

For example, the health insurance company may say, the policy your patient chose pays for a vision screen, but not for a hearing screen. Or they may say, we cover the well visit code, but not the ear ache code at the same time as the wellness visit.

Doctors get stuck with the bill

The doctor, already having performed services, now has to go to the patient and say, “Hey, remember that school physical I performed and you asked me about little Lisa’s earache? Well, your insurance says that the policy you have doesn’t cover the earache part, so I’d like to be paid for the work I perform in assessing your child’s earache.”

Of course, doctors don’t actually say that, but when a parent gets a bill for the earache, that is in essence what the doc is trying to say to the parent. And if one looks carefully at the  explanation of benefits (that document that the insurance company sends after they process a patient’s claim) one will notice they give an explanation as to why they are not going to pay the doctor for the service.

Funny how things work

Here is an interesting, but crazy fact. In many cases, had the doctor deferred the earache question and told the mom to make another appointment to address that issue during another appointment, the health insurance company would have most likely paid for the office visit.

However, had the doctor done that, the patient would have most likely gotten upset at the doctor.

By treating the earache question during the wellness visit, the doctor runs the risk of not being paid despite doing the work. On the other hand, not addressing the ear ache, the doc runs the risk of upsetting the parent, who will probably think the doc is trying to squeeze another $30 copayment, which is clearly not the case.

Cutting cost — not always a good idea

One of the major problems with this is that patients don’t understand what they are financially responsible for. Or, it’s often the case where patients don’t understand what type of health insurance they’ve purchased.

Just like with anything else, you get what you pay for. But patients overlook this issue when purchasing health insurance. They usually look at the monthly premiums and choose the lowest one. But by doing that, they are often reducing the amount of coverage, which means patients will get stuck with larger portions of their medical bills.

Growing trend to save cost

The health insurance company, in an effort to keep their premiums low, have shifted the cost to customers and their doctors. While in the past health insurance companies may have covered 100%, now they are reducing the monthly premiums but only covering 70% of one’s medical expense. Hence allthe high deductible plans out there.

Why wasn’t I told they insurance doesn’t cover?

In our practice – which is a small three-provider practice – we see on average 60 to 75 patients daily.

Add to that there are virtually thousands and thousands of different health plans. In fact, we have patients whose parents work for the same company, but because they are at different pay grades, have different insurance plans.

The answer is, we don’t have enough manpower or time to sit on the phone verifying every single patient’s healthcare coverage. I know of practices that do, and God bless them. But as a practice we believe it is the patient’s responsibility to find out what is covered and what is not covered. The more time we spend on the phone with a patient’s insurance company, the less time we are able to spend providing health care for our patients.

Moreover…

As a practice, we consider that treating patients based on what the insurance covers and what it doesn’t, instead of treating by what the patient actually needs, is an unethical way to practice medicine.

Although most doctors that I know will take into consideration health insurance stipulations, they will not compromise a child’s health as a result of health insurance restriction and cheap health insurance coverage plans.

I hope this post will give all that read it some insight and perspective on medical billing. If you have a question, or don’t understand why doctors’ office do medical billing, feel free to leave a comment and we will try to address it.

Oh, and thanks for reading…

Brandon Betancourt is a practice administrator for Salud Pediatrics. You can follow him on Twitter  @pediatricinc

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29 thoughts on “What I Wish Parents Knew About Medical Billing

  1. Brandon,

    Excellent article. What do you do, billing-wise, when you diagnose and treat an ear infection at a well visit for which the parent did not raise any concern? Or any abnormal finding for that matter? I always find that to be a gray area, especially when it has financial implications.

    • We add a modifier 25 to the visit. If there is an issue with the parent later, I explain how the billing works and why there is an extra charge. I also mentioned that they are saving time by having the doc do both in a single visit. If it were up to the insurance company, they would have had the patient come back the next day.

      Thank you for the nice remarks.

      Brandon

  2. Such a great post. It’s high time patients know what goes on “behind the curtain”. The fact that they are not privy to this type of information, I believe, is a major contributor to the general sense of animosity and distrust towards physicians that is common today. This kind of transparency clarifies the many misconceptions circulating out there and would easily show patients that we’re all on the same side. Thank you for starting the conversation and for finally letting patients in.

    • That is what I wanted to do. Give parents a glimpse of how things really are. I hope many patients read it. Thanks for the positive comments.

  3. “As a practice, we consider that treating patients based on what the insurance covers and what it doesn’t, instead of treating by what the patient actually needs, is an unethical way to practice medicine.”

    Excellent article, Brandon! I especially like the statement above and wholeheartedly agree! Bravo!

  4. Excellent post Brandon, very comprehensive, although long, but i really liked it. This is an important part of medical billing specialists job to be able to communicate this information to patients/families and i think this post could really help others who are learning medical billing should know about it. Hope you don’t mind, I plan on discussing your post here on my own blog?

    • Thank you for the comment.

      I know, the post is long. Normally I wouldn’t post something this long. But I felt I needed to give the entire picture and the whole story. Feel free to discuss my post or use it on your blog.

      Brandon

  5. What a great article. As a billing supervisor/commercial medical biller, I wish I could make every patient read this upon checking in. The hours of time our department spends explaining different scenarios each and every month to patients when bills are mailed is tremendous to say the least.
    At the same time, it is a bit ironic that I have the same conversations with my husband when he receives the EOB’s from your office (our pediatrician) and questions it.
    Thank you for explaining our job!

    • Feel free to print it up and give it to people to read while they are in the waiting room. Although the post is a bit long, I do believe it needed to be in order to give a better picture of the situation. Just make sure to credit the work.

      Thanks for reading

      Brandon

  6. Brandon, that write-up really is very good. As an insurance broker who has arranged insurance coverage with those insurance companies, we are often asked for help with claim payments and why the process is so complicated. We do spend a lot of time on the phone with customers and with the insurance companies to advise what is or is not covered. I am frankly at a loss to explain or understand why the insurance companies have complicated the process to the level that exists today.

    • You mention:

      I am frankly at a loss to explain or understand why the insurance companies have complicated the process to the level that exists today.

      Actually, this one seems easy for me. There is only two reasons one would want to create confusion: 1) confusion brings loss of orientation, making things unclear and blurred in an effort to take advantage of people; 2) incompetence.

      I doubt the insurance companies are incompetent.

      Thank you stopping by and leaving a comment, Bill.

      Brandon

  7. Adding fuel to the fire: insurance companies contract with each practice to provide services for those insured for a specific fee, a fee much lower than the “retail” price. Thus those with no insurance who pay the doctor less than the “retail” price might actually be paying more than what the insurance company ultimately reimburses. Smaller practices may have a harder time negotiating fees with insurance companies. They just don’t have bargaining power.

  8. Great article; very comprehensive. I feel like we’re seeing more and more transparency today between patients and HCPs or physicians. Do you think healthcare tech trends (HCIT, mHealth, Social Media, EHRs, etc) are behind this? If not, do you think patients could benefit from mobile apps that inform them on physician practices, health insurance regulations, or drug information? Or is it up to the physician to inform?

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  10. Great article! A basic source of confusion is health insurance is (mostly) not “insurance,” it’s pre-paid health care. My car insurance does not pay for a regular trip to the gas station to fill up or a routine oil change.

    • Actually, I would say it is “partially” paid health care. We get people saying, why didn’t my insurance pay this? The assumption is, I pay my premium, why do I still have to pay for the doctor visit.

      And I have to explain to them, well, you are still responsible for part of the bill; your premium only covers 80% or 90% or 60% (whatever it is) of your medical expenses. That is often hard for people to understand.

      Thank you for the comment Ross.

      Brandon

      • I get “I paid my co-pay every time I came in, why do I have a balance?”. If pressed about their deductible very few people are aware of what their deductible is or how it works. Admittedly, often times when discussing benefits with patients I get confused and desperately look for a way to make sense of it to them, thanks for the terrific analogy!

        Mitzi

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  12. Great article. This doesn’t just apply to parents, I wish all patients knew these things.Years ago, I worked for a doctor who treated the elderly. They found ti very difficult to understand their insurance and why we billed the way we did. Thanks for taking the time to write such an educational article!

  13. Patients I think view their Insurance like a credit card. i thi k the feeling is they spend so much per month on the premium alone that this should cover them completely. They sign their name to the line without even knowing what their insurance covers. Patient’s love to blame the physician. “you billed this wrong” and such. The insurance company are telling patients the physician is “billing wrong” It infuriates me to ne end. I get a dozen calls in a month telling me I coded wrong. Educating the patient is key. I think ultimately that is the solution to all of this. We must educate our patients. Thanks Brandon for the article.

    • I often tell parents, we see over 10,000 visits in a year. Coding is how we get paid. Believe me when I say, we are pretty good at this. So the likelihood we “coded” it wrong is unlikely. In fact, it is in our best interest to code it correctly. Contrary, it is in the health insurance company’s best interest to say, the doctor coded it incorrectly.

      I try to drive it home by saying: Who has both our money right now? We are on the same team. But we are getting the short end of the stick here because the patient got the services, the insurance has the patient’s money and we are still waiting even though we did the work 4-weeks ago.

      I have yet to find a parent that doesn’t empathize with us after I have that conversation.

      Thank you for stopping by and leaving a comment.

  14. I read this post almost 2years after it was written, and shared it at the office. It taught my new office assistant a lot more in a few minutes than anything I’d said all week long! A must read for every one new in a medical office setting and a welcome primer for the seasoned ones.

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  16. I always quote from your article, and never receive positive feedback from parents. Because we are a small practice (1 doctor, 1 nurse practitioner) these problem parents are big issues to our collections. When I give the example of a restaurant bill parents argue that they know ahead of time that it is an extra cost for them to order fries because the prices are on the menu, or the server tells them. Parents expect the same expectations of a doctor to tell them that they are being billed for an extra service at a well exam. If a doctor asks the parent if there is anything else they would like to discuss, and the parent has a laundry list of problems then the parent expects that to be covered. Parents will go as far as saying that if they didn’t know that that was an extra cost to there insurance or to them then the doctor shouldn’t expect them to bill them without there knowledge. That argument is hard for me, and I end up in a 20 minute phone call going no where. Also, hearing exams and vision exams seem to be covered at certain ages with certain insurances. How do we tell parents that it’s there responsibility when parents argue that the insurance company told them that it is ours?

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