Overbilling in the healthcare industry continues to increase dramatically across the United States, to the tune of billions of dollars annually. The existing system has caused skyrocketing annual premium renewals for employers and sharply climbing out-of-pocket costs for plan members. These high costs have led to frustration, dissatisfaction, and the first reported ERISA breach of fiduciary duty litigation over alleged mismanagement of health plan funds.
Adding to already egregious billing practices is the now routine practice of hospitals adding "facility fees" for patients receiving routine care in their own outpatient centers. Practices such as these directly undermine the goal of providing affordable and accessible health care for consumers. They also contradict the federal government's increasing focus on strengthening plans' fiduciary standards, while making it more difficult for plan sponsors to fulfill their duties under ERISA through no fault of their own.
Furthermore, these practices adversely affect the level of service that honest health insurance brokers, third-party administrators, and other vendor partners can provide. Medical overbilling, when combined with fraud and abuse, also contributes to billions of dollars in unpaid medical bills, the leading cause of personal bankruptcy for consumers.
A system for transforming healthcare pricing and creating transparency is critical to overcoming the overbilling issue and the problems that it creates. Finding a benefits all parties involved, from healthcare providers to payors to patients. Expert medical and legal review of billing systems and practices can lead to true payment integrity and fairness, shield clients from predatory billing, and protect plan sponsors from costly litigation.
The Benefits of Eliminating Medical Overbilling
Clients will see significant savings when healthcare providers no longer charge ten to 100 times what a medical service legitimately costs. Businesses can use these cost savings to contribute to benefits coverage, decrease or eliminate out-of-pocket costs, or reinvest into their businesses in other ways.
The Consolidated Appropriations Act (CAA) strikes at the heart of medical overbilling, focusing on price transparency and stewardship of health and welfare benefits. Plan sponsors should see the CAA as a reminder of their clear duty to act in the best interests of plan participants and their beneficiaries. Fair pricing for medical services helps achieve the goals of the CAA.
Navigating the maze of paperwork required to receive medical care and insurance coverage can be daunting. Pre-authorizations, in- and out-of-network provider restrictions, co-pays, and deductibles are difficult to understand and follow for both consumers and healthcare professionals. Unreasonable and inflated billing practices make the situation even more confusing for plan members. Identifying and eliminating unfair billing practices will immediately help simplify matters for plan members who need relief.
Lastly, brokers and other third-party vendors typically maintain better relationships with their clients when billing and claims processing goes more smoothly. Client dissatisfaction at renewal time should decrease, and doors should open for brokers to develop a competitive edge and new revenue streams in an environment free from medical overbilling.
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