Reduce Your Out-of-Network Hospital Bill

Health
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By Martine G. Brousse

Learn more about Martine on NerdWallet’s Ask an Advisor

Scenario: You recently had surgery or ended up in the ER. One or more physicians evaluated you. Not all of them were part of your insurance network, and you are now receiving outrageous bills. You did not choose them or directly request their services. How can you get out of paying these fees?

This is routinely happening in this time of restricted insurance coverage, smaller networks, reduced choice of in-network providers and a growing trend among physicians of opting out of all contracts.

Appeals made by patients are often rejected. Reasons range from “it is the patient’s responsibility to use in-network providers” to “the policy has a strict exclusion for all out-of-network services.”

Understand that you may have to pay something for the services rendered to you. But before taking out your credit card, know that you do have options and rights.

1. Get the insurance company to pay

If the hospital is “in network,” but the insurance company paid a provider at the out-of-network rate, file an appeal and demand they pay the higher contracted rate based on the preferred contracted status of the facility. Other arguments to include: You had no choice in the matter; you went to the correct facility; services were medically necessary; this was the only specialist available; or none of the specialists on call were in-network providers (often the case with anesthesiologists).

Ask that the insurance company attempt to sign a one-time agreement with the physician. Inform the office that such deals are routinely (and gratefully) accepted.

2. Invoke your rights

Your patient’s rights include the rights to receive timely, appropriate, adequate, qualified care. If the in-network or preferred provider could not render the service soon enough; lacked the necessary qualifications, expertise or training; was too far away from your location; or if you could not trust him for specific reasons, your insurer must cover the out-of-network cost of the provider you chose.

If a service was rendered under emergency conditions, specific policy guidelines and regulations kick in. Public Health Service Act (PHS Act) section 2719A and the Affordable Care Act (“Obamacare”) require health insurance companies to fully cover emergency services in a hospital emergency department, whether or not the provider is in network, and require insurers to apply the same financial liability to the patient as if the care were in network.

3. Call your state’s insurance commissioner

If your appeal is still denied despite these arguments, consult your state insurance commissioner’s website for information on how to submit a grievance against the health plan. Include a copy of all relevant documents when filing. Some states offer free phone consultations to determine whether you have a case.

4. Deal with the provider directly

A provider may refuse an insurance agreement or to write off your balance after an “in network” payment. Request to meet the office manager to negotiate. Meanwhile, send small monthly payments to avoid going into collection.

Your insurance representative may be able to help you determine an acceptable settlement, as would a billing advocate. Remember that a one-time “paid in full” remittance is more attractive than monthly payments.

5. Ask the referring physician

If all fails, contact your surgeon, explain the situation and ask for assistance. A noncontracted provider, counting on more referrals and work from his colleagues, may have to learn to be more flexible. Another physician is best placed to explain this delicate situation;  the referring physician, or his office manager, may be able to use their contacts with the facility’s officers to get a bill reduced or an application for financial assistance pushed through.

If the provider belongs to a medical group, as anesthesiologists and ER physicians often do, file a request for a review of your case and ask for a fee reduction directly with the managing director. They often are more sensitive to negative comments and potential backlash, especially if you indicate a copy is being forwarded to the referring physician and to the administrator of the facility.

In conclusion

A negative response to an insurance appeal or the initial refusal of a reduced fee should not deter patients from trying other tactics. Patient satisfaction and the threat of public exposure can encourage medical providers to “play nice.” Knowing your rights and demanding they are respected can make a difference, as can hiring a billing advocate or going up the corporate ladder.