Contract Dispute Between Hospital and Insurer Leaves NJ Consumer with $25,000 Medical Bill

By Consumers for Quality Care, on October 2, 2024

A contract dispute between a hospital and an insurance company left a New Jersey consumer with a $25,000 hospital bill, according to NorthJersey.com. 

Ray Dietrich had surgery at Mount Sinai Hospital in New York for torn muscles. The surgery was successful, but weeks later, he received a $25,000 bill from the hospital. Dietrich was confused; he thought that his insurer, UnitedHealthcare, would cover all these costs after he paid his $5,500 co-pay. But Dietrich didn’t know that at the time of his surgery, the hospital and his insurer were in a contract dispute, meaning that his surgery was considered out-of-network. “They did the surgery knowing they don’t take my insurance,” said Dietrich. “I was never notified by the doctor, hospital or my insurance. And then they started hounding me about the bill.” 

Contractual disputes between hospitals and providers are becoming increasingly more common nationwide. During these disputes, insurance companies consider the hospitals involved out-of-network, creating instability for consumers. 

In Dietrich’s case, his surgery was approved by his insurer in November 2022, when Mount Sinai accepted UnitedHealthcare. But Dietrich’s surgery was delayed three months due to scheduling conflicts. By the time the surgery was performed, Mount Sinai and UnitedHealthcare were in the middle of this contract dispute. As his case shows, disputes like these usually hurt the consumer in the end. 

Months of back-and-forth ensued between Dietrich, UnitedHealthcare, and various health care mediators, leading to an eventual resolution where UnitedHealthcare covered his entire medical bill under the newly renegotiated contract with Mount Sinai. 

Consumers should never be caught in the middle of contract negotiations between insurers and hospitals.