For business owners, there is no expense that has gone up more in the last decade than employee health insurance. High double digit annual increases are common. Health care insurance is the only business where you can raise your prices 25% a year and offer less service. Many companies have gone to higher deductibles to keep premiums down. The future cost with the new health care legislation is in doubt.
So when the small business owner is finally able to get health insurance at a high cost, we expect the medical bills to be paid. When we submit a claim, we expect to be covered after we have met our individual or family deductible.
Now here is the cruel hoax of how health insurance companies get you to pay high premiums with even higher deductibles.
For example, you have health insurance with a $5,000 family deductible. You go to the doctor and they charge you $150 for the visit. You immediately send this claim into your insurance company. They reply by saying that even though the doctor is “in network”, their customary fee is only to count $100 for this visit toward the deductible. Now, you paid $150 to a medical provider, so why shouldn’t this count toward your out of pocket deductible expense? Because the insurance company says it doesn’t and for the next 4 years, they still make the rules. In many cases, you have prepaid the doctor so you can’t really challenge the bill and get a refund. Effectively, by not covering this extra cost and saying the service is only worth $100 when you paid $150, the deductible goes up. Multiply this annually, and your health care deductible may be twice what you think it is!
Has this happened to you? Are there good strategies to avoid this?
I pay the doctor a co-pay and then they send me a bill after they bill the insurance and the insurance pays what they say the doctor is allowed to bill me and sends the doctor a check and I am responsible for the difference between what is allowed and what the insurance already paid.
This is true before the deductible and between the deductible and the maximum out-of-pocket. I generally hit the deductible in 2-3 visits and it takes a few months to hit the maximum (still $500 away from max this year) but at least that happens with 80% co-insurance kicking in to leave me with only 20% to pay.
My wife has to pay the doctor up front rather than a co-pay because she’s got really, really, REALLY sucky BCBS coverage that doesn’t cover many things, and then THOSE payments we pay don’t go toward the deductible. THAT pissed us off after spending $300 on Rx’s.