#CareTalk - Never Pay the First Bill

Hello everybody and welcome to CareTalk. My name is Laura Packard and I am the founder of Healthcare Voices. But I've also been a patient in the American healthcare system because a few years ago I was diagnosed with cancer. So I've gone through insurance denials, unfair medical bills, and the filing an appeal and so much more. And so we are here to answer your healthcare and health insurance questions and help you get the healthcare that you need. So I am delighted to introduce our expert, Diane from Just Care and Social Security Works. And our first question today is from Lorraine, who wants to know how long does it take to get your Social Security disability check? Because right now mine is pending. I really need help. I'm hurting bad.

So Lorraine, that's a really good question and I have a really unfortunate answer, which is that while you might assume that you should get your Social Security check right after you've been determined to be qualified for Social Security disability insurance, the way it works is that you have to wait five months before your first check comes to you. So you get that on the sixth month after your Social Security determination. And what that also means is that if you're waiting for Medicare, you're going to wait for 24 months for your Medicare to kick in, plus another five months. So it's 29 months. For years, advocates have been trying to cut out that five month wait time. It's a way for the government to save money on Social Security disability benefits and on Medicare, but it is not a way to properly compensate people who desperately need support.

Definitely. And so if you don't have insurance right now and you're not eligible for Medicare yet, you can sign up for insurance through the Affordable Care Act. However, open enrollment is over for now. Open enrollment will start back up in November, but some people may still be eligible to sign up for health insurance through through healthcare.gov you can still enroll if you have a if you're eligible for a special enrollment period, which can mean things like you just lost your insurance coverage, you got married or divorced, you had a baby or you moved. Also, some groups are eligible for a special enrollment period year round, like if you're a member of a federally recognized tribe or in most states if your income is projected to be under 150% of the federal poverty level this year, and which is about $20,000 if you're filing solo. And at that level, you are probably eligible for a cheap or even free insurance policy through healthcare.gov so you should definitely go to healthcare.gov regardless, because even if you're not eligible for a special enrollment period. You can apply to Medicaid that way, and depending on your circumstances, you may be eligible for Medicaid. So if you don't have health Insurance, go to healthcare.gov you may not be eligible until November, but do check it out now just to see. And our next question is from John, who asks if you have a Medicare Advantage policy, do the rules in and out network apply to Medicare Part B, or is it separate with the Advantage plan, the primary insurance, and Medicare Part B, the secondary insurance?

DIANE okay, this is a wonderful question because the A, Bs and Cs of Medicare are a big Alphabet soup, and getting clear on the different letters actually can be pretty helpful. So no matter what, if you are covered for inpatient services, that's Medicare Part A, and that includes hospital care and skilled nursing care and rehab care. And if you have coverage for outpatient services under Medicare, that's Medicare Part B, and that includes physician services and durable medical equipment and lab tests and the like. And then if you have Medicare Advantage, you not only have Part A and Part B to cover your inpatient and outpatient services, but you have Part D to cover your prescription drugs. And your Medicare Advantage is called Part C. So Medicare Advantage Part C includes Parts A, B and D. And then if you're in a Medicare Advantage plan, you have to abide by the network requirements of that Medicare Advantage plan in order to be covered for your career. And so that means whether you're getting outpatient services under Medicare Part B or inpatient services under Medicare Part A, you're going to have to see the doctors in the Medicare Advantage plan network in order to be covered for your care. And Medicare Part B is not supplemental coverage. Medicare A is in part supplemental coverage. You actually don't have supplemental coverage when you're in Medicare Advantage. You have Medicare Advantage if you choose to be in traditional Medicare. Just to finalize this Alphabet soup, you would only have Part A and Part B, and that would put you in traditional Medicare. You would not have Part C, which is Medicare Advantage, but you would probably have supplemental insurance to pick up the costs that your traditional Medicare coverage under A and B did not pick up. And there there's a whole other Alphabet soup of supplemental coverage you can choose from. So that's a quick summary of the different letters and how your insurance works either in traditional Medicare or Medicare Advantage.

Thank you, Diane. And next we're going to talk more about this in future shows. But you may have heard something about the public health emergency and how it's ending soon. One of the effects of this government declaration, which ends May 11, is that people on Medicaid in the past couple years have been able to stay on Medicaid even if their income changed. But because the public health emergency is ending shortly, states are going to need to redetermine who is eligible for Medicaid. So that means if you are on Medicaid now, keep an eye out for letters, phone calls, emails from your state office that may be asking you things like how much income did you make make this month? Are you still eligible for Medicaid? And unfortunately, there's all kinds of spam things out there too. So if you have any questions about whether a letter or an email or phone call you got is legitimate, you should contact your state department before divulging any personal information. But if you do get one of these, don't just discard it because if you want to keep your Medicaid, you will need to respond. But depending on which state you're in, the way in which they reach out to you may be different. Different and when they reach out to you may be different, but they may be starting to reach out on Medicaid at the beginning of April.

So our next question is from Eileen, who has a Medicare Advantage plan through Humana. Eileen was in a car accident and still suffers for some of the pain from the accident because Eileen doesn't have enough money to continue to pay for physical therapy because it's $20 every time you go. So how does Medicare Advantage help you if you have to pay out of pocket Every single Eileen chose this plan not knowing she was going to have a car accident. But now Eileen is stuck because of not being able to afford the physical therapy care. So what, if anything, can Eileen do?

Diane.

Really good question. I'm so sorry Eileen about your situation. It really is a crime that you have to pay the $20 coinsurance to get your physical therapy when you have Medicare coverage through Humana. With all of Medicare, in fact, there's cost sharing which can be formidable when you get sick. But in Medicare Advantage, the cost sharing is often a huge barrier to care when you need it because out of pocket costs can go as high as $8,300 in 2023. Typically out of pocket costs are around $5,000 before you don't have to pay anything out of pocket. $5,000 is a crazy amount of money to expect anybody to have in their pocket to pay in order to get the care they need. So what should you do? You should check with your state Medicaid office to see whether perhaps you are eligible for Medicaid, which would pick up that copay cost for physical therapy. And even if your income is above the Medicaid eligibility limit, in many states you can spend down to Medicaid mean that if you're putting a lot of money out for health care, that will be counted towards your Medicaid eligibility and you might qualify. So contact your Medicaid office. And even if you're not eligible for Medicaid, you could qualify for what's called a Medicare savings program. And those programs are not as comprehensive as Medicaid, but they do pick up some of your Medicare costs, making them a lot more affordable. You can again call your Medicaid office or you can call your state health insurance assistance program. Each state has one for free. Help navigating because it can get overwhelming unfortunately, just to apply for these programs. Some say that only about half of people who are eligible are actually enrolled because the application process can be so formidable and people aren't aware of these programs. But these programs can help a lot. And I'll just end by saying that a lot of people don't choose traditional Medicare because the upfront costs of supplemental coverage can be very high, you know, easily 2000, $2500. But when you have that supplemental coverage, basically then you get your physical therapy without having to pay another dol, you get your doctor services without having to pay another dollar. You have the ability to sort of breathe freely about your health care. You can always go, you can sleep at night knowing you can get your health care without having to pay anything. And in Medicare Advantage, unfortunately it doesn't have any upfront costs. But every time you need care, you have to figure out whether you can actually afford to get it and whether you'll be covered for. Whether you'll be able to actually access care is always an open question. And as far I know, there's no data telling us how many people are skipping care in Medicare Advantage. No good data, but it seems like a lot of people end up skipping care because the out of pocket costs can be so high.

Thanks. And our next question came in via text. Why do we have to pay premiums to so many different places for healthcare coverage, Medicare supplemental, not covered items, dentist and more. The total costs are outrageous. Even so much is not covered and you don't know how much you're going to need to pay. Why not single payer? Because everyone knows that's better for all the millions of Americans except for owners of for profit health related companies. So this is a much larger issue. But to give a quick answer, Diane, I'll try here.

So Eileen, I could not agree with you more. We're fighting hard for single payer. We call it Medicare for all and not Medicare Advantage for all, but government administered health care which would allow eliminate by some accounts hundreds of billions of dollars a year in administrative costs alone and free up a lot of money so that people could have a comprehensive Medicare benefit that did cover dental, hearing and vision and that didn't have out of pocket costs associated with them. So I would urge you to speak with your representatives in Congress about this. They should know how you feel and they should support.

Much better coverage for people with Medicare. As you might know.

About half the Medicare population has annual incomes under $30,000. People are hard pressed to afford the out of pocket costs in Medicare and Medicare needs to be much more robust. And in addition, we need to be negotiating drug prices so that drugs are affordable in this country.

Unfortunately, so long as we go without government guaranteed comprehensive coverage for everyone and corporate insurers are in the mix, we can expect out of pocket health care costs to just continue to rise into health care and for health care to become just increasingly unaffordable for everyone.

Thanks, Diane. And in past episodes we've had guests talk about how health care is run in other countries and the many parts of our system that are broken. Guests like Wendell Potter. And so you can go back and watch previous episodes to learn more about the very extensive problems with the American health care system. And speaking of our broken health care system, I am delighted to introduce our special guest for today, Marshall Allen, the reporter and author of Never Pay the First Bill and Other Ways to Fight the Healthcare System and Win to talk about how you can fight healthcare overcharging and outrageous medical bills in America. Welcome Marshall.

Thank you. Thank you for having me here. I've really enjoyed listening to your conversation, but it just highlights how non patient centered our healthcare system really is. It's really unfortunate.

So let's start with what are some tips in your excellent book for people that are going to get care or have already had care, how can they fight these medical bills?

Well, I think one of the book is filled with principles that people need to follow and learn and also specific tactics that they need to deploy. And one of the principles that you need to put into place is that the clinical side of healthcare genuinely I think they're trying to heal us, they're trying to help us and they are doing that in many cases. But the Business side of the healthcare industry has unfortunately taken the work of the clinicians and they're turning it into, they're exploiting that work actually for profit. They're finding ways to profiteer from the work that's being done by the clinicians instead of just making an honest profit. And so when you know that as a patient going into these healthcare interactions, you have to understand how some of these incentives work and how you need to be skeptical about some of the things that you see. So let's just talk about getting a medical bill. Okay, so we've all gotten medical bills. The first thing you need to do when you get an item, I get a medical bill, is get an itemized medical bill. And especially you want to make sure that itemized bill has billing codes. And these are the codes. It's usually a five digit code that's used to send to your insurance company to process that payment. And it's your right as a patient to have that itemized bill. And it should lay it out just like a receipt you'd get at a grocery store. It should lay out the description and the billing code for each service that you or the patient received. And then that allows you to check and make sure that you actually are being charged only for things that happened. And believe it or not, our healthcare system is so backwards in the way it processes these claims that often people get charged for things that didn't even happen. Or another common thing that happens is that you'll get sent a bill and that bill hasn't even been sent to your insurance company or whoever it is that's covering providing your healthcare coverage. So you want to make sure that bill is accurate, and then you want to make sure it's priced fairly. And so I show in my book and in my health literacy videos how people can price those things out themselves. And there's a website now, now my book is more geared toward working Americans, so. So people who are not covered by Medicare or Medicaid. And so my book will point people to a website like healthcarebluebook.com or another one called fairhealthconsumer.org and those websites actually show you, you can put in the description of the service you received and the billing code or one or the other, and it'll tell you what other insurance plans are paying in your community for those services. And that allows you to kind of do a little fact check just to see am I being overcharged for these services or not? And once you can tell whether you're being overcharged, then you can know whether or not you need to contest that bill. And I do encourage people, always ask for a discount. Always. 100% of the time, ask for a discount. Because outside of the Medicare or Medicaid space, these prices are just made up. They're made up and then they're discounted by insurance companies. But you should always be asking for discounts and often you'll receive them.

Them.

And we had a question come in via text a couple hours ago. This person says, I've waited too long on some medical bills and so now they've already gone to collections. What's. What's the best way to deal with that? What's the best way to deal with a bill that's in collections?

That is a great question. And I, I have to say I totally understand where this person's coming from. You feel often paralyzed when you get a medical bill. You know you don't want to open it. Maybe you know you don't have the money or you don't feel like you understand it. And that's also why I want to encourage people. I have a video about this and it's in my book too, but I did some videos. If you go to allenhealthacademy.com and if you're on a limited income, I have a scholarship program available there. You can just pay what you can for the videos, but watch those, because the ideal is to not let it go into collections because it becomes more difficult to handle once it goes into collections. But the first thing you want to do if it goes into collections is dispute the debt in writing. And in my book and in my videos, I have a template letter that you can use that you just adopt it for your purposes and dispute the debt. Now, you may believe that you owe the debt, that's not really my point. But you have to dispute it within 30 days so that you have time to actually check that bill and make sure it's accurate and make sure it's fairly priced. Often these debts get bought and sold by these debt collection companies. They might not even have the paperwork to legally pursue you for that debt. So you can make them prove that you owe the debt, make them prove that it's priced fairly, and then that gives you some grounds for real negotiation with that debt collector. So another thing I recommend, so you've disputed it within 30 days in writing using the template that I provide. Or you can do it on your own too. Then you've priced it and checked it to make sure that it's accurate and that it's fair, then another big step is once it's gone into collections in a really kind of dark way, you're negotiating. Leverage has gotten a lot better because it means that they are not really thinking that they're going to get a lot of money from you. So they're expecting that you won't pay that bill. And so then you can negotiate that bill. And I think that you catch more flies with honey. So be friendly. It's counterintuitive, but be friendly to your debt negotiator. It's not going to help you to have an adversarial relationship. So be very friendly with them. Tell them that you're going to need a discount if you're going to pay off this debt. Tell them you're very sorry but you don't have the money. And do not enter into an agreement that you can't afford to keep. Because let's say you enter into a payment plan and then you miss a payment, they're going to say that's a default on the payment and any discount you receive is going to go back to the full amount owed. So when you, and when you think about a discount, I want you to think about a big discount on a medical debt. So if it's been sold to a debt collector, it's probably been sold for about 5 cents on the dollar. So you could probably get a discount as high as 85% and that debt collector will still make money. So your goal is to get a massive, massive reduction on that debt. If it hasn't been sold, that means it's still in the hands of the hospital or the doctor's office or the dentist. In that case, you probably won't get as big of a discount, but you still can. Like I would be thinking in the 50% range. If they, if they say, oh, we'll give you a 10% discount or 20% discount, don't, don't take it. Just keep working that friendship with your debt collector to get that negotiated down as much as you can.

Dan?

Yes. So I'm curious to hear a little bit more on the fair pricing, because my understanding was that in the commercial market for working people, hospitals basically could set their rates as high as they want and so can doctors.

That's correct. There's no regulation of prices in the healthcare system when it comes to the commercial plans or the working Americans who are on private health insurance plans or exchange marketplace plans or maybe they're uninsured paying self pay. In those cases, those prices can be set at whatever they want. And then the idea that they have is that then they would give a discount to your insurance company. You know, an insurance company is supposed to get some kind of discount. But what we're finding now that there's more price transparency. For example, hospitals are now required to post their prices on their websites. So we're seeing a lot more insight into hospital pricing now and all healthcare pricing. And there is no rhyme or reason to these prices. You could go to a hospital that pays Medicare, say $1,000 for a colonoscopy, and if you're on Aetna, you might pay 2,000. If you're on UnitedHealthcare, you might pay 4,000. I've seen colonoscopies for as much as $10,000. That makes no sense at all. And it's not fair. And I look at this, this is legal. It's not that they're doing something illegal, but in my view, this is not moral and it's not ethical behavior. To charge one patient multiples more than another patient just because of the type of insurance plan they have is not ethical business. It's not something we accept in any other industry. And so we need especially. They don't give you those prices up front. Right. If they told you up front, hey, we're going to charge you $5,000, but if you were Medicare, we charge you a thousand at least, then you would know it going in. Right. But you don't get that bill till after the fact. And so in my bill I show you how to successfully, or in my book and videos, I show how to successfully contest these kinds of bills.

So I have quick follow up here because I think you've given a really great nugget of a tip to folks. You said that a collection agency.

Is sold the right to collect at like 80, 90 cents on the dollar. Yes, the hospital has given up 90 cents on the dollar. So if I hear you correctly, if you get a notice from a collection agency, you can go back to the hospital, say, I want to pay my bill. I know you've sent it to collection, I'll pay you 80 cents on the dollar. And they're going to be better off and you're going to have the collections agency out of the way. Is that.

Well, so there's two different types. So you have to know who owns the debt. So if you get contacted by a debt collector, you want to check and see, okay, does the hospital or doctor still own the debt and you're just a debt collector working to collect it for them. I see one Scenario, in that case, you're really still negotiating with the hospital or the doctor's office. So your discount isn't going to be quite as dramatic. But I would still expect a big discount like in the 50% range. But if that hospital has sold the debt to a debt buyer, in that case they've sold it for pennies on the dollar, a very, very low amount. And so let's say Your bill was $1,000. They might have sold that bill for as low as $50 to a debt buyer. Then that debt collector is working for the debt buyer. Now you're thinking your discount should be more in the 85% range so that debt buyer can still get make a profit and you can get a massive discount. And again, don't ever enter into one of those agreements with a debt buyer that you can't meet because if you negotiate it down and then default on one of your payments, then they're going to come after you for that full amount. And it becomes very sticky with debt collections, especially if it's gone to a debt buyer. But in a dark way your leverage improves because they think they're not going to get anything from you. So it's a dire situation. But on the other hand, it also creates a little bit of hope because you can get out from under that debt for a much, much lower price.

Thank you.

Thank you. And Jocelyn, our behind the scenes producer has a question for you.

Hi, Jocelyn.

So first of all, huge fan of your book.

Oh, thank you.

You know, I guess I get to be like a guinea pig here for all your wonderful ideas because I read this book, this book right here, love it. Where I had a horrible interaction with a dentist office. Right. So I went in armed with the information about like, okay, you know, make sure like you get everything in writing. Everybody said everybody and everything was in network. And then I was hit with an out of network bill for new grand anyway. And it's like, it's really fascinating. Like they can say they're in network, everybody can agree on that and then everyone can agree, no, no, no, this was out of network. So I know I need to write an appeal. But what, I mean, do you have insight on how to do that? It sounds like, yeah, be charming, be lovely, don't come on too strong.

Yeah. So you start charming and lovely. You start charming and lovely. Right. We always want to.

Really repair these things and, and reconcile them in a way that's fair and appropriate and professional. But that doesn't mean that we play soft. Right. So you try and do it the fair way. So did you, you actually got it in writing that it would be in network and then they hit you out of network?

Yes.

Okay.

On both sides.

Okay. So this is, this is beautiful. So chapter five of my book, and then I also have a video about this, shows how to use small claims court to give them the incentive that they need to treat you fairly. So this dentist has hit you with a $2,000 bill. The person you want to sue is the person sending you the bill. So this is between you and your dentist. The dentist is saying it's out of network, you have to pay more. Well, they make up those networks. That's the thing that they come up with between the two of them. But this is now between you and the dentist. That dentist doesn't have to charge you the out of network rate. They're not obligated to do that. That dentist can give you a discount on it and treat you fairly and give you the in network price. That dentist could come to a cash agreement with you where you decide to waive the insurance. You're not going to use insurance, you'll just pay them cash. They could come up with something that would be fair to you, especially because they misled you to begin with. So small claims limits vary from state to state. It's usually between $5,000 on the low side to up to $25,000 on the high side. So I have in my book a template that's a 30 day warning letter. So let's say you've tried to work through this with them in a nice way and they haven't responded. You're going to send that dentist the 30 day warning letter. In my book, it's a template that you can adapt for your purposes. And that's a warning saying, if you don't resolve this within 30 days, I'm going to sue you in small claims court. Now imagine the hassle that that creates for the dentist. They might have to hire an attorney for hundreds of dollars an hour to go meet you down at small claims court. They're going to be held accountable in front of a judge or a hearing officer for that claim. It just creates the incentive that they need to do the right thing, which they should be doing in the first place. But unfortunately, sometimes we need to apply some pressure and some leverage to get them to comply. So that's what I would recommend in that case. And I would also file complaints. So the attorney General's office in every state is a good place to complain. And I would tell them again that's more playing hardball where if you don't fix this in a fair way, I will file complaints with you. I will, I will write negative reviews about you. I mean, you know, we do have some, some power as consumers and so that's when we start to leverage it.

That's so empowering. Okay, so if you get, if you get a bill like that, that's clearly unfair, that's clearly egregious. And they like really overdid it too. They were like, oh, let me show you all these things that are covered. You will be charged no money. Like, it was, it was a surreal experience.

Wow.

It was, it was like I came home feeling so adult. Like, wow, I got a lovely. And then a month later, two grand.

That's dirty.

It's gross.

That's dirty. So I would, I would file complaints with the Better Business Bureau, with your Attorney General's office, with Yelp, with Google. I would file complaints, I would file negative reviews with all those groups. Again, you don't want to, you don't want to do this unless you have to, right? You want to let them know, hey, look, you didn't treat me fairly here. This is not right. And I'm going to do something about it. So I'm going to start with the complaints. Then if you don't comply, I'm going to send the 30 day warning letter and then I will file that case in small claims court. Now that doesn't, this case is probably never going to go to trial. So it's not, it's not likely that you're going to end up in front of a judge and you can drop it at any moment. So if you decide to file it and then drop, drop it, you can do that. It doesn't cost that much to file a case. It costs about $30. You have to make sure and follow the, the guidelines in your state. But every, every state has brochures. They make this easy for patients to do or for consumers to do because our judicial system is set up to allow the little guy to stand up to the big guy. And so that's just, it's just a dispute like any other business dispute. It's just people don't really think about using small claims court for health care. And that's what I'm really trying to make a normal part of the process for consumer empowerment.

That's so inspiring. So would I be my own attorney in that?

Yeah, yeah, yeah. So your cost is very low. And again, I can also help you if people want to look me up@marshallallen.com you can send me messages. I love to help people with this stuff. I get a real delight out of helping, you know, the Davids beat the Goliaths. So if you want help, message me. And I can, I can help walk you through it. And then I also have a newsletter. That's it. It's on substack@marshallallen.substack.com and I'll send you a link to a story I wrote about a patient who used small claims court to sue Sutter Health. Sutter Health is a big hospital system in Northern California. They're notorious for price gouging. And this mom up in Northern California got overcharged for some imaging tests. She used the guidelines I laid out in my book. She sued them in small claims court and she won and they refunded her money. So it's, it's actually a pretty, pretty good system. It is, I will say this. It's. It can be stressful.

Yeah.

So, you know, it's a lot. This is not fair. It's not fair that consumers should have to deal with this stuff. It's really, really not right. And so it is a burden that's being placed on the American medical patients because our health care system has been so entitled to taking advantage of us. I mean, $2,000 is a ton of money. Most Americans do not have that in their bank accounts right now. So that is a massive, massive bill you're talking about.

Well, and Marshall, I really, I'm from the bottom of my heart, not to embarrass you. Like, I want to thank you so much for writing this book because had I, I had I not read it, I probably would have been like, well, you know, like, dip into my savings. But for those who haven't had the privilege, it opens with you fighting a 300, I think a 300 bill that was unfairly laid upon your mom and being like, yeah, no, this is stupid. And also, this is activism. It's activism to say like, no, you can't just go around price gouging the working and middle class trusting that our inherent American pro social conformist nonsense will be like, oh, yeah, well, the guy with money told me to, so I should like, no, this is wrong. It's evil.

It is. And I, and I think that's, that's where I think American health care has a moral problem. I mean, it's, this is, this is the root of the moral problem of our healthcare system is that it has become too often about profiteering instead of actually serving the American people. They estimate right now that about a fourth of all the spending on healthcare is completely wasted on things like you had mentioned earlier, the administrative burden just of processing all these claims with all these fragmented insurance companies and insurance plans. Fraud is rampant in health care. The prices are unjustified and unreasonable. Over treatment is very common. It sounds like you might have gotten some of that over treatment at your dental visit. So this is an injustice and it is activism and it's a huge inequity problem because it's taking the money from middle and lower income working Americans, although higher income working Americans are also overpaying. It's just they can afford it, but it's taking money from the working Americans in our country especially. And it's padding the bank accounts of the healthcare executives and wealthy doctors and wealthy individuals running our healthcare system. And the deception is rampant. I mean, this is they don't even give you the prices up front. So, you know, the deception is just the standard practice, unfortunately.

Well, thank you so much for joining us, Marshall. And again, everyone should read this book, Never Pay the First First Bill by Marshall Allen. And please keep calling and texting in your questions. We will answer them in future episodes. And next week. We're featuring Gerry Ashton from RIP Medical Debt to answer more of your medical debt questions. Thank you for listening. This is Care Talk.

Sa.