Understanding the basics of health insurance costs

This week I want to educate you on understanding the basics of health insurance costs and how to use it properly.

Most people think that once they have gotten their insurance card, it’s like magic – that they can just go to the doctor or go to the hospital and hand them their card. And then they’re shocked when they get a big bill. Well, that’s another subject we’re going to talk about in a moment, but the first part is to understand, who’s in-network with your insurance. Do they have out-of-network benefits and where exactly can you go to get your treatment?

Another important point to consider would be if there are places that charge more than others. It may be shocking to realize, but yes, it’s true. You could check with three different hospitals and they’re all going to charge different prices for the same exact procedure or surgery or test. Why is that? This is because we do not have transparency in our healthcare system (something that gets me on my soapbox).

The way I explain it to everyone is an analogy of being in the market to buy a big-screen TV. Do you walk into Best Buy and hand them your credit card, saying ‘Just put it on my card’. No, nobody does that. So what would you do? You’d look at the prices on everything in Best Buy. You may even go to Costco, Walmart, or Target, and you’re going to look to find the best price because it’s your money. Well, this is true for healthcare too. It is your money that you’re spending, especially if you’re sending a ton of money on your premium. It’s important to shop around and be sure to get a policy that is going to pay for something when you need it to.

Have you noticed the lack of transparency with healthcare prices? Wouldn’t it be great if hospitals and medical facilities would post their pricing online? Think about how, if healthcare was more consumer-driven, it would change how the entire healthcare system works.

Here is an example from a client of mine who recently had a knee replacement is well known, a private hospital in Dallas. The hospital had my client pay $3,000 upfront to cover their deductible. The insurance then paid the claim, paying several thousand dollars. However, after this, my client received a bill for $174,000 for the knee replacement. This is more than three times the average cost for a knee replacement. As you can imagine, my client was very upset because they were sent this large bill.

I was able to review their insurance information and I saw that the provider my client used was not in-network. My conversation with the client went something like this: “Did you call me before you had this surgery?” “No.” “Did you ask the hospital if they were in-network when you went?” “No, I just handed them my card.”

So what did I have this client do? I had them call the hospital and make it clear to them that they never told her she was out of network. And that they would need to reprice her bill for a cash patient. The hospital, of course, did not want to do that. They made many excuses but my client called every day. About two weeks later she received an adjusted bill for $1500. Remember, she had paid $3000 upfront for the deductible and the $174000 was after the insurance had paid the hospital too.

I am passionate about helping my clients and ensuring that they find the best possible plan for their needs, for the best possible price, and that they are educated to handle the big and incorrect bills that may come their way.

Please check out my website for more information on understanding health insurance  https://jkappconsulting.com/

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