Medical Bill Basics

Written by eHealth Navigator

Whether you have insurance through Medicare, or through your job, or you purchased it on your own, you could receive unexpected medical bills – bill you thought were covered.  Experts point to the way insurers price products, organize provider networks and interact with non-contracted physicians as the culprit. Here are some things you need to know to avoid surprise bills.

Understand the terms of the policy.  Know the basic terms of your policy in order to understand what you may owe and why.  Terms include:

In-network provider:  A doctor, hospital or healthcare facility that has an agreement or contract with your insurance company and provides services to plan members for negotiate rates.

Out-of-network providers:  A provider who is not affiliated with your insurance company.  In many cases, an insurance company will pay less or not pay anything for services received from out-of-network provider.

Deductible: The amount of money you have to pay out of pocket each calendar year before your insurance will start paying.

Co-pay or co-payment:  A flat fee you pay to a health-service provider.

Co-insurance:  The percentage of charges you pay to the medical provider after your deductible has been met and your insurance has started paying claims.

Before you have a procedure.  Ask your surgeon for a complete list of doctors and facilities that will be used.  Call your insurance company to discuss your plan and determine if those doctors and facilities are in-network.  If it is not possible to do your procedure completely in-network, contact the out-of-network providers and clarify the balance you will be responsible for so you can eliminate the surprise of a post-op bill.

If you get an unexpected bill, talk to your insurance company and the provider.  Some providers may accept the insurance payment as payment in full, or the insurer and the out-of-network provider may negotiate a fee and decrease the balance you owe.

If you have a plan that you bought through a state or federal marketplace, contact your state health insurance department.  Some states have rules limiting how much you have to pay for out-of-network care.

Prescription sticker shock.  Anytime a doctor writes you a prescription, find out how much the medication costs, whether it is covered by your insurance plan and if there is a low-cost generic alternative.

Most private insurance companies can adjust the list of medications they cover at any time.  Medicare can do that only during the open enrollment period. 

If you find out the medication you take is no longer covered, ask your doctor if you can take a generic or a similar drug covered by your insurer.  You may also shop around for the best pharmacy price or get a coupon from the medicine’s manufacturer typically promoted on the drug’s consumer website.

If you have a chronic condition that requires medication, before you commit to an insurance plan check if any of the drugs you take are covered.  You will get the lowest out-of-pocket costs when you buy the coverage plans’ “preferred” generic or “Tier 1” drugs.  A drug that isn’t listed will often have the highest out-of-pocket cost and may not be covered by your insurance.

Emergency treatment.  Your emergency room treatment may not be treated as in-network, even if the ER is at an in-network hospital.  So it’s important to have an emergency care plan in place well before you need it.  Call your insurer to discuss your plan and find out which in-network hospitals in your area employ in-network emergency room providers.  If you get a surprise bill from an emergency room visit, contact your insurer and the provider and explain that since it was an emergency you did not have a choice of providers.  The provider may accept the insurance payment or negotiate a reasonable fee with your insurance company.

For non-life threating situations, going to a urgent care may be an option.  Ask your insurance provider for information about co-pays and potential out-of-pocket costs at a clinic before you visit.

Appeals:  If your health insurance refuses to pay a claim, you can appeal the decision.  Medical billing advocates may be able to help you navigate a difficult billing situation.  You may find the right advocate for you through organizations like the National Association of Healthcare Advocacy Consultants ( or Alliance of Claims Assistance Professionals (  Fees for medical billing advocates vary.

Last Updated on Wednesday, 6 July 2016 2:54PM