Surprise Medical Bills Continue to Plague Consumers

By Consumers for Quality Care, on May 17, 2018

Surprise Medical Bills Continue to Plague Consumers

Photo by Heidi de Marco/KHN

A Colorado man’s credit score was threatened after he received a surprise medical bill for out-of-network doctors at an in-network hospital.

Jeff Woodard was hospitalized after a horse-riding accident and ran up hundreds of thousands in medical bills, which his insurer covered. But then he was hit with surprise medical bills. According to Kaiser Health News:

In Woodard’s case, his parents had been deliberate in making sure that all the care their son received was within his insurance network. But it turned out that the trauma doctors at the in-network hospital were not. They were employees of Aspen Medical Management, a Colorado Springs, Colo., physician staffing firm that employs physicians and contracts them out to hospitals.

That generated about $3,000 of out-of-network surprise bills, sent directly to Woodard. United Healthcare had paid Aspen the standard rate for in-network care, and Aspen expected Woodard to come up with the rest.

Woodard filed appeals, but he was worried about the impact to his credit.

Stunned, Woodard complained to his insurer and Aspen, and filed paper appeals. His parents hectored Colorado lawmakers and filed complaints with both the hospital and various state agencies. But as notices from Aspen and then collections agencies piled up, with threats to report a delinquent bill to credit bureaus, his worry grew.

Medical debt collection has become a massive industry that affects a vast number of people.

It’s part of a multibillion-dollar industry: In 2016, the most recent year for which there are figures, agencies collected just under 10 percent of the $792 billion consumers owed in overall debt, according to an industry report. … The most recent federal analysis, a 2014 CFPB report, found that almost 20 percent of credit reports had at least one medical collection account listed. An average unpaid medical collection is about $580.

Woodard was able to navigate his situation without a negative impact on his credit, but many others are not that lucky.