NT / Disagreement with hospital

[RitaB]

In June, my daughter suffered a torn ACL (which required reconstructive surgery) during a school basketball camp. The school insurance company instructed me to forward EOB's from my insurance company and they (the school insurance) would in turn issue checks for the patient responsibility amount, payble jointly to myself and the provider. I was to endorse the checks, forward to the providers, who would apply the payment to my daughter's account.

One provider (a hospital), had offered me a prompt pay discount if I would pay what they calculated to be my responsibility before the surgery. I took the offer, wrote them a check, plus an additional credit of $250 for prompt payment was entered.

In September, when this provider received the check from the school insurance (which was made payable to myself and them jointly, I endorsed and forwarded), they entered a negative credit, rescinding the prompt pay discount they had given me in June. They sent me my credit balance, less the prompt pay discount.

When I called to ask about it, one representative was very nice, but could not explain the policy of retracting a credit. She handed me off to her supervisor, who was extremely beligerent, and actually implied that I was trying to commit "insurance fraud." I was almost seeing their point of view about it all until she said those words, then I just had to say thank you and hang up before I completely lost my composure.

I called the school insurance to make sure I had followed the procedure they outlined, and the representative assured me that I had.

My question is: What was the correct thing for the hospital to do?

a) Refund my entire credit balance?

b ) Rescind the prompt pay discount and keep it? (This is what they did.)

c) Rescind the prompt pay discount and give it to the school insurance company?

d) Rescind the prompt pay discount and give it to Barack Obama to spread around? (Just kidding, just kidding, just

kidding.)

I would think if they were concerned with taking the ethical high ground, they would choose a) or c).

[zeke]

I agree that you should be outraged. You fullfilled the terms of the agreement and the hospital unilaterally abrogated same. I suggest that you assume position © which will resolve any question of "insurance fraud". Then request appointment with the supervisor's supervisor.

z

[JohnH]

They should honor their original commitment, but whether they will do so or not is an open question.

Make the appointment with the next person up the chain and see if they can figure out what's right.

You might also mention that Michael Moore may be making another documentary about the health care system and you've contacted him with a request to come along to the appointment with his film crew.

[jainen]

>>seeing their point of view about it all<<

I can think of a few points. The discount is a general response to soaring collection costs. You lost that advantage when you re-engaged the billing office by forwarding that check. You can't expect to keep the early payment discount when you actually paid later.

If there is some financial benefit, who should get it--the patient who had full coverage, the insurance company that collected premiums based on full costs, or the medical provider?

Medical ethics are as complex as any in our society. I am optimistic that the Obama administration will begin to address this kind of issue. Meanwhile, I recommend that you focus on getting excellent treatment for your family and let the accountants do whatever they are going to do anyway. And thank God that you even HAVE insurance, however convoluted the paperwork is.

[joanmcq]

And an injury that between the two, appears to have been covered 100%.

[RitaB]

You can't expect to keep the early payment discount when you actually paid later.

My account was paid in full before I forwarded the school insurance check. I paid what they agreed to accept for my responsibility before the surgery was performed.

"If there is some financial benefit, who should get it--the patient who had full coverage, the insurance company that collected premiums based on full costs, or the medical provider?"

Yes, I think that was my question.

Thank you all for the input, and yes, I am thankful for the treatment my daughter received, the insurance company I hired, and the school's insurance company (that my tax dollars paid). It just really rubbed me wrong to be accused of insurance fraud, when I had followed every direction to the letter. The hospital was paid in full, before the surgery, the amount they decided to accept from me. There was no bargaining on my part.

I am sure the young lady has a difficult job and was just having a bad day.

[zeke]

>>re-engaged the billing office by forwarding that check<< ???

>>You can't expect to keep the early payment discount when you actually paid later.<<

The patient's responsibility was overpaid at this time. That is why he got a refund.

"a prompt pay discount if I would pay what they calculated to be my responsibility before the surgery. I took the offer, wrote them a check,"

Just what part of offer, acceptance and performance is missing here??

z

[RitaB]

And an injury that between the two, appears to have been covered 100%.

Well, that is correct except for the times I have shut down my business, taken my daugher out of school, and driven 200 miles round trip because of this life changing accident that I wish had never happened. I would gladly have given everything I have to have prevented this accident. (Actually, a player "took her out" on purpose, but that's a whole other story.) This same injury ended my own basketball career in college, and I thank God that my daughter appears to be doing much better than I did. Yes, I am thankful for her treatment.

[kcjenkins]

Joan and Jainen are both wrong, this time. Yes, the injury was covered in full, that was never the issue here. The only issue is that RC gave them, in effect ADVANCE PAYMENT, in fair exchange for a DISCOUNT THAT THEY OFFERED HIM. He completed his part of that agreement, and then the Hospital effectively reneged on their half of the deal. RC 'earned' that discount by paying in advance, out of his pocket, and HE is the one entitled to the discount. The hospital lost nothing and they are in the wrong, and I think that if he pushes it, he will get his discount back.

[Mel in Hawaii]

I say push it up the ladder. Ask to speak the supervisor, remind them that they OFFERED you the discount based on your prompt payment that YOU did do. They had the use of YOUR money during this time period and never once was having to 'collect' on the payment as you are just forwarding them a check and asking for the excess balance to be reimbursed. I am sure there is a consumer advocacy group that works with your local paper/tv station, mention that you will be getting them involved. It's your money, push it as far as it needs to go.

[RitaB]

let the accountants do whatever they are going to do anyway

Really? I think one of the reasons we have problems with the whole health care business is because more geeky "basketball moms" like me don't look at the bills and ask the provider to explain things. Here's an example:

Me: Hey, why did you charge my insurance company $50 for this tylenol that CVS sells for $1?

Hospital accountant: Don't worry about it, Mom. They paid us $10, and we wrote the rest off.

Am I supposed to be glad about that? Well, I am paying premiums based on these things. (And, yes, I know everybody has to make a living.)

My point is, I don't want to trust those type issues to either presidential candidate or some mouthy accounts receivable clerk. In some things we need to be our own advocate.

Sorry, I have really been insulted by this hospital representative, and I don't mean to take it out on you, jainen.

[jainen]

>>The hospital lost nothing<<

The hospital agreed to accept certain payment for medical services. There was nothing obscure about the discount--it was for avoiding additional, non-medical administrative costs in billing and collection. But that's not how it went down. The patient's family later asked that the early payment be rescinded and replaced with something more complicated. How do you conclude that the hospital reneged on its offer?

The hospital returned what the family paid. It did not return the $250 credit that they did not pay. If you think the hospital should give them a cash refund based on what the family made the insurance cover, that does indeed look like fraud.

[zeke]

Jainen can handle it. I think he just got caught with one of his "everybody is talking - who is listening?" answers!!!

z

[kcjenkins]

The hospital offered the discount in exchange for early payment of the bill. They GOT early payment of the bill. Later, when the check came in, all that was required was that the check be deposited, then the overpayment that created be refunded. There was nothing in that transaction that 'canceled' out their benefit that they got by getting paid early. So there is no legal justification for them to rescind the Discount, which was the family's benefit from the early payment.

[RitaB]

The hospital offered the discount in exchange for early payment of the bill. They GOT early payment of the bill. Later, when the check came in, all that was required was that the check be deposited, then the overpayment that created be refunded. There was nothing in that transaction that 'canceled' out their benefit that they got by getting paid early. So there is no legal justification for them to rescind the Discount, which was the family's benefit from the early payment.

Yeah, what she said.

Plus, I would like to emphasize that the school insurance made it quite clear that I was to forward EOB's and NOT statements from providers. And, like I said, I called the school insurance after the tongue lashing, and was reassured that I had indeed followed their directions. The school insurance rep that has handled the whole deal even expressed the opinion that I should contact another supervisor at the hospital.

Regardless of who should get the $250, it seems to me that changing my already paid in full bill was not right.

[jainen]

>>changing my already paid in full bill was not right<<

I have no opinion on whether it was right, but YOU were the one that changed those terms of payment. Take it as an insult if you must, but you never gave anyone that $250 so it never existed to be refunded. Instead, YOU used the EOB (which you knew was inaccurate as to your damages) to tell your other insurance company to include it in their payment, and even willingly forwarded such payment yourself.

You can check this out very simply by giving your state insurance commissioner a call. People do get prosecuted for arranging extra insurance payments while pocketing the difference. I'm not saying you intended a fraud, but the result of your claim would be exactly the same. And however sensitive you were to the use of that term, I assure you the hospital is a thousand times more sensitive to it.

You refer to lost earnings and mileage as a response to joan's observation that the injury was 100% covered, but those have nothing to do with either the hospital or the two companies. Maybe you have a case against the other player, the coach, the team, the school, and/or the league. Unfortunately, in our overly-technical legal system that's a completely different matter.

[RitaB]

People do get prosecuted for arranging extra insurance payments while pocketing the difference. I'm not saying you intended a fraud, but the result of your claim would be exactly the same.

So what would you call the result of the hospital effectively entering a new charge (by taking away the credit) in order to keep the $250? The result of that seems to be pocketing money they were not owed.

It also seems to me that the second insurance company knows that providers exchange discounts for early payments, and that was not a concern or they would have required provider statements instead of EOB's.

The early use of my money had value. The hospital decided it was worth $250. They got the early payment, then increased my bill to keep another payment. I lost the use of my money, which the hospital valued at $250.

[jainen]

>>use of my money had value<<

Please don't trivialize this; it is not about investment earnings. The purpose of the discount was as I said to reduce administrative costs. Paying them twice should be better than not paying, but accountants don't necessarily think that way. Usually the price for insured medical care is already discounted for a similar purpose, i.e., administration costs more than the medical care itself.

The hospital did NOT assess "a new charge," as you can see for yourself from the EOB you attached in support of your own insurance claim. If you don't care to call your insurance commissioner, at least tell your insurers. The fine print requires you to identify any suspected overcharges, as well as to turn over any monies you recover from this claim. Do you want to short your daughter's medical provider so the insurance stockholders can get a bonus?

The reason the school's supplemental insurance only wants the EOB instead of an invoice is just that they are covering the whole obligation for you. In that sense, your discounted invoice is irrelevant because you owe nothing at all anyway. If along the way you do lay out some cash you get 100% of it back. You don't, however, make a profit on the deal--only the hospital and the insurance companies do that.

[lbbwest]

All political rhetoric aside, this is typical of today's medical ACCOUNTING issues. It's an industry where the provider charges whatever it wants, and the recipient of the bill pays whatever it wants. E.G. the provider CHARGES differently depending upon self-pay versus third party pay. Blue Cross pays differently than other insurance providers or Medicare, or gosh darn what's that filthy word...oh yeah MEDICAID. There are stringent "rules" about what the co-pay CAN BE charged. So without looking at the various contracts your insurance provider, the school's provider etc. one can not make a professional judgement. An early payment discount that is offered and accepted in June for a final payment received in September, may not have qualified for the "early payment" discount. Were you NOT given all the facts necessary to make the correct assessment YES. Have we NOT been given ALL of the pertinent facts to make the correct assessment YES. As always, the correct answer in accounting and tax is ALWAYS "It depends." lbb

[RitaB]

...the provider CHARGES differently depending upon self-pay versus third party pay.

Yes, you are so right. As I am thinking about it now, I guess that is why the school insurance wanted to work with me and not the providers.

As I re-read all this, if you tend to think that way, it almost sounds like I paid the hospital early to try to make a buck. I assure you all, that is not the case. I was willing to pay early because I wanted to make sure I was on their "good list" for my daughter's sake. I figured the quality of care might be better that way. In fact, I didn't even know how the school insurance company was going to help us (if at all) until the surgery was over. They have never helped us in the past with sprained ankles and such. This was much bigger, as you know.

Anyway, I actually still feel just as strongly that the hospital was wrong, but I probably will not even contact them again, unless it is to express my opinion about the attitude of the young lady that was rude to me. The surgeon was top notch, and you never know, I might have to use that hospital again.

Jainen, I do not feel insulted by you or anyone else on the board. I wanted honest opinions, and I got them. Thanks to all.

[TaxmannEA]

What you are dealing with is a prime example of the level of honesty in most medical finance offices today. The hospital had $250 extra payment in hand and then simply kept it. You protest, and are accused of fraud in an attempt to intimidate you into silence. The fact that they did not honor their own agreement means nothing to them. That , unfortunately, is the way these people seem to operate now. Honoring their word and treating the customer ethically take a back seat to getting more money any way they can.

[jainen]

>>The hospital had $250 extra payment... they did not honor their own agreement<<

Those are not the facts in rcooper's original and subsequent posts. The hospital received only its standard fees (probably set by negotiation with the primary insurance carrier). The primary paid the part it was supposed to and the supplemental paid all the rest. The only thing "extra" was rcooper's advance which she later took back. The hospital never had an agreement to give the supplemental insurance company a discount; in fact, such a discount would probably violate the agreement they DID have with the primary.

Insurance is highly regulated and no hospital will risk their major contracts and Medicare eligibility over a $250 discount. They are always cautious of potential insurance overcharges that pass through a patient's hands. Although there can be innocent explanations, this remains one of the most common fraud patterns.

While it may seem unfair to charge different amounts depending on who is paying, this is standard practice in many industries. It reflects the cost of doing business over and above the cost of specific products and services, a point I have repeatedly tried to make in this thread.

[RoyDaleOne]

Hospital is wrong, end of story.

The insurance payment should not have been paid to the hospital, and the hospital was not entitled to the insurance payment.

It's services were paid in full before the insurance payment, therefore, it had no claim or entitlement to the insurance payment.

[Randall]

Kind of like church, pay and pray.

[michaelmars]

the discount was for the time value of money, the hospital had it early and the patient was out the use of that money prior to actually being obligated to pay it. That is what the discount if for. As for defrauding the ins co, i just don't see it. The Insurance pays based on damages and a contractual payment plan. if the patient didn't get the discount, the ins co would be paying the same amount.

when you have a collison claim, you get a check from the company whether youspend it fixing your car or at Vagas.