The Consumer Financial Protection Bureau has issued a report that indicates that at least 43 million people in the US have unpaid medical bills. That has consequences since unpaid medical bills hurt credit scores, often substantially. Tellingly, many of these ‘debtors’ don’t have issues with any other creditor.
The report concludes that many non-payers simply don’t understand their medical bills.
I have a confession to make: Even though I’ve been working as a healthcare business consultant for more than 20 years, I don’t understand my bills either. Here are a few of the problems I face –and I know I’m not unique:
- Providers send bills while insurance claims are still pending, so I don’t understand whether I’m being asked to pay the right amounts
- Explanations of benefits from my health plan aren’t timely and aren’t informative. The services described sound completely generic and are hard to trace back to the provider bill
- We now have a high-deductible plan and are being asked to pay more by our providers, but I’m not confident that providers are correctly taking into account our out-of-pocket maximums on an individual and family basis
- Providers aren’t coding claims in line with the Affordable Care Act or insurance company rules, resulting in incorrect out-of-pocket amounts. (See my recent piece on the on again, off again co-pay for a routine physical)
- Few providers (at least around here) allow online payments. I have to either call the office during work hours or mail in a check –both a hassle
I’ve said before that unpaid medical bills shouldn’t be counted for credit scoring purposes. And it appears that FICO has also come around to that way of thinking. Still the big problem is that the whole payment system is way too complex, expensive and confusing.
I understand that providers need to get paid, and increasingly that means collecting from patients. There are companies out there, like PatientPay and Simplee, that try to make this process easier. But we’ve got a long way to go.