In today’s economy, most people are very concerned that they not be reported to the credit bureau. With layoffs abounding and prices on the rise, the last thing you need is a bad credit score that will put your interest rates through the roof. You want to make sure you pay all your bills on time and keep your nose clean to ward off further financial woes. However, this responsible mentality may cause you to pay money you do not actually owe, especially if you did not expect the charges. After an accident, most people, especially the injured, face a lot of unexpected bills from doctors, mechanics, towing companies, and the like. If injured, you may feel pressured to simply pay these bills so that you do not rack up standing debts. However before writing a check, you should be conscious of what you are paying to whom, because you might not be obliged to settle every bill you receive if you are insured.
Take for example hospital bills. When health care is provided by a participating provider (a doctor or hospital who has an arrangement with your insurance company), they are prohibited from the practice of balance billing. A balance bill is exactly what it sounds like; if your insurance does not pay all your medical fees, then the physician will often send a patient the bill for the remaining balance. If you receive a balance bill, there is something you should know: you do not necessarily have to pay. In many cases, patients pay the bill since they do not know what else to do In a simple world, you get an invoice for money you owe, and you make the payment. However, when third parties, like your insurer, are added to the mix, things are more complicated legally. You should call your insurance company if you have a question about a balance bill, because most of the time, you are being billed for money you do not owe. It may actually be a violation of your contract with the insurance company for you to pay the bill.
You may wonder how this comes about. It boils down to your insurer and the doctor disagreeing over the cost of your treatment. If you are treated by a doctor who does not have a contract with your insurer, then the insurer is only obligated to pay the standard cost of your treatment, which is set by the industry and not necessarily equal to what the doctor charges. The doctor just wants to be reimbursed for his regular fee, the insurer does not want to pay an inflated rate, and neither will compromise. Your insurance company and health care provider clash, and you’re caught in the middle of it. Oftentimes you get stuck with what is known as a “balance bill”, which your insurer will not cover.
You should also be aware that some people are not allowed to send you a balance bill. For example, if you are treated by an “in network provider”, meaning a doctor or hospital that has agreed to give health care at a discounted fee, they must accept the rate offered by your insurance company. They cannot bill you. You do not have to pay anything. The logic behind this is that in an emergency situation, you do not have a choice when it comes to which doctor treats you. You have no opportunity to “shop around” and compare their fees, you don’t know whether they will work with your insurance company, etc. If you are already insured, you cannot be held accountable for the fact that your treating physician happens to charge a higher rate. Many insurance contracts also include the clause that the patient is not allowed to make private payments the insurer has already refused to make. This not only protects the insurer, but also you.
After an injury or hospital stay, contact your insurance provider about any bills you receive. Don’t let your good intentions of settling debts cost you. Be careful not to pay what you do not owe.