June 13, 2016
Whether you're planning a future procedure or navigating care after a sudden illness or accident, smart consumers have a plan in place to avoid hidden costs and billing errors common to our ever-changing healthcare system. You should too.
The Affordable Care Act (http://www.hhs.gov/healthcare/) (ACA) made it possible for all Americans to get some form of healthcare coverage regardless of their medical history. That's the good news. The bad news is that everyone's personal health circumstances and solutions are different, and we're still far away from the day when the coverage we buy – either individually or through our employers – can prevent us from getting unexpected bills for services and procedures our insurer didn't cover or errors made in the billing process.
It's also important to know that many health insurers are adjusting to the reality of universal coverage by narrowing the assortment of doctors in their networks, leaving more patients at risk of "surprise" (http://kff.org/private-insurance/issue-brief/surprise-medical-bills/) bills if they are treated by practitioners outside their insurer's network.
There are some helpful resources – both public (https://www.medicare.gov/coverage/surgery-estimating-costs.html) and private (https://healthcarebluebook.com/) – which have emerged that price health procedures. Using those resources can help avoid some major out-of-pocket healthcare expenses. It's also essential to determine what practitioners may be in or out of network, particularly if it's an emergency.
So what can you do to prevent these unexpected health costs? If you are not on Medicare, (https://www.medicare.gov/what-medicare-covers/index.html) which tends to have more standardized pricing and coverage, you need to question practitioners (or their billing departments) and price-comparing procedures the way you would any major purchase. Depending on your local medical resources, you may have the option to conduct your research online. Here are some ways to begin.
Know how you're covered for both emergencies and non-emergencies. It's easier to plan for a hip replacement you'll need in six months than for emergency surgery after an accident or sudden illness, but it's important to think through how your coverage works in both situations:
Know your deductible. The latest annual Kaiser Foundation employer health benefits survey (http://kff.org/health-costs/press-release/employer-family-health-premiums-rise-4-percent-to-17545-in-2015-extending-a-decade-long-trend-of-relatively-moderate-increases/) indicated some whopping figures for health care deductibles – the out-of-pocket total you have to pay before the bulk of your health coverage kicks in. For example, if you have a $3,000 deductible that you haven't touched this year, that's the initial out-of-pocket amount you're going to have to pay for any big procedure. Keep that figure in mind as you continue your research on medical options. That's why it's important to keep such amounts in an emergency fund or, if you have the option, set aside in a health savings account (https://www.irs.gov/publications/p969/ar02.html) where you can keep funds not only for the deductible, but for other potential out-of-pocket health costs.
Review bills closely. One recent study (http://abcnews.go.com/GMA/story?id=127077&page=1&version=meter+at+1&module=meter-Links&pgtype=article&contentId=&mediaId=&referrer=&priority=true&action=click&contentCollection=meter-links-click) has reported significant errors in medical bills, particularly for hospital stays. Keep in mind that the price-comparison exercise doesn't stop on the way in to a procedure. You need to keep an eye on pre- and post-procedure bills from practitioners, hospitals and your health insurer for accuracy. If you see an error, contact the appropriate party or parties immediately to correct the problem.
Bottom line: There are very few industries going through as much change as healthcare. Universal coverage is good, but it's important to know exactly what it pays for before you need it. Set aside time to think through your health issues and do your research to help reduce healthcare costs that can impact your overall budget. Learning to save money now can preserve your budget later.
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This article is intended to provide general information and should not be considered health, legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.