Editor’s note: Floridians are paying a lot of money for health insurance, but we’ve been listening to our viewers. Many of you are very unhappy with your coverage. At ABC Action News, we want to take action for you. Has your doctor prescribed treatment that your insurance company denied? We are digging into the problem of outrageous denials. Our special coverage is called “Patient No More!” We are investigating why claims are denied and provide useful information that gives you the best chance of getting your medical claim approved.
I-Team investigator Adam Walser is hearing from a physician who says a broken system often denies patients the care they need.
That doctor tells Adam some health insurance companies are playing games to avoid paying claims.
“It’s horrible. It's stressful. It's wrong on so many levels,” said Dr. Bill Hennessey, who describes himself as “the insider’s insider.”
He has fought to get insurance companies to pay legitimate claims for decades.
Hennessey opened a medical practice after graduating from medical school.
He then formed a physician billing company.
In recent years, Hennessey co-founded CareGuide Advocates, a company that helps clients negotiate costs and appeal denied claims.
“There are two types of people who have been financially harmed or screwed by the system.... doctors and patients. And I've been both. And I just said we’re not gonna take it anymore,” Hennessey said.
20 percent of claims denied
Hennessey says insurance companies often play games.
Think of a medical claim like a dice game. The outcome is uncertain, and no matter how careful or informed the player is, the result is ultimately left to chance.
The probability of rolling a specific number on a die is one out of six... about 17 percent. Hennessey says you have a higher chance of getting a medical insurance claim denied.
“The national average, as well as my physician billing company average, is 20 percent of claims are denied,” Hennessey said. “It’s based primarily on one thing... price tag. The more expensive the care, the more likely the denial.”
He says if a claim costs the insurance company a lot of money, it will be scrutinized.
“All of the sudden, everything’s being questioned. Of course, when there’s expensive drugs, they’re always questioned,” he said.
The claims process can also be compared to a poker game.
Insurers may bluff when it comes to paying legitimate claims, with ambiguous language or fine print.
This leaves patients unsure of the actual “hand” they’re holding regarding their coverage.
When a claim is denied, many patients will “fold” under pressure and often agree to pay for their treatment out of their own pockets.
“If we’re frustrated and confused, we give up. The goal is to open up our wallets,” Hennessey said. “And we fight that like hell all day every day.”
Hennessey says if insured patients don’t appeal and agree to pay the doctor or hospital directly instead of waiting for their insurance company to pay for their care could be off the hook, even if it was a legitimate claim.
The billing coding game
Hennessey says many things can result in a claim being denied.
“Sometimes it’s a billing, coding game,” Hennessey said.
Diagnostic codes in records show what services patients receive and are used to file insurance claims.
“There used to be 12,000 diagnostic codes 10 years ago and now there are 72,000,” he said.
Hennessey believes the purpose of expanding the number of codes may be, in part, to increase the likelihood of claims being denied.
“More mumbo-jumbo to have more reasons for denials. More statistical mismatches of codes so that things are denied,” he said.
Hennessey says often multiple codes could be applied to the same procedure, but the insurance company will only accept a specific one.
“It's a match game between those two codes to get the yes. So we resubmit and we resubmit until we get the care we need covered,” Hennessey said.
Pre-authorized procedures later denied
Hennessey says other times claims are denied after patients were told they were approved.
“Sometimes it’s a pre-authorization game,” Hennessey said.
He says documenting everything makes it easier for patients to appeal.
“You need to know the first name and last name of who you spoke with at the hospital and who says that it’s a covered procedure. And you guard that piece of information. You get it in writing,” Hennessey said.
Monopoly money
When claims are denied, Hennessey says hospitals start out quoting them the full retail price for procedures called the “Chargemaster” rate.
“They do play a discount game and a chargemaster game. If your claim is denied, they try to make you feel good that they’re giving you a discount off that fake high chargemaster price list,” Hennessey said. “It is Monopoly money.”
Using the Monopoly analogy, think of insurance companies as the “bank” which pay providers for patients’ treatment. But unlike in Monopoly, where each player pays the same price for each property, each insurance company pays a different amount for the same thing.
Under the Affordable Care Act, negotiated rates between hospitals and insurance companies can be found on a hospital's website.
They’re often posted in a machine-language format called JSON, most often used for web development.
Hennessey showed us a list of negotiated rates from a Tampa-area hospital’s website.
That list shows that one insurance company reimbursed the hospital $1,226 for a colonoscopy. Another insurance company pays $3,093 for the same procedure and a third insurance company has a negotiated rate of $14,187.
According to the list, one insurance company pays that hospital $4,100 for cardiac catheterization, while another company pays $24,000 for the same procedure.
The posted pay rate for a brain MRI at that hospital varies from $1,800 to $19,000.
The pay rates for some procedures aren’t even listed at all.
“They're intentionally deep-sixing the expensive care because they don’t want their competitors to see it,” Hennessey said.
Hennessey says whether your insurance pays for the care you need could depend on your insurance company, your hospital and the pay rates they negotiated.
That can be as random as a roll of the dice.
But to Hennessey, there's nothing about the broken healthcare system that’s fun and games.
“It all comes down to profit over patients,” Hennessey said.
Here are some tips from Hennessey about how to appeal a denied claim:
- Have your doctor resubmit a claim with a different diagnosis code. It’s important that the diagnosis code and billing code “match” the insurance company's software.
- Ask your doctor for a peer-to-peer review and ask that they both be physicians of the same specialty. Insurance company doctors are often family physicians and not specialists, so not truly peer-to-peer.
- Call your insurance company and request an appeal. Get your doctor’s office notes documenting the medical necessity of your care
Make certain your insurance explanation of benefits (EOB) explains your denial. Many times, the insurance company does not provide the explanation they are supposed to.
Florida woman faced $373,000 bill after 'approved' treatment to save eyesight
After going through her insurance, she thought she was covered. Her insurance company sent an approval letter and she went ahead with treatment. But months later, she was hit with a bill that could have bankrupted her.Florida woman faced $373,000 bill after 'approved' treatment to save her eyesightSend your story idea and tips to Adam Walser