Hospital collections

[BittyGeorgia]

What is the name of your state? Washington.
Our insurance company has denied payment on my husband's two surgeries, totalling $70,000. I am appealing their denial, but I'm not sure what to do with the hospital bills in the meantime. They are wanting me to start paying and provide them with my financial information. Our annual income is $13,000 and we don't have the means to pay a bill like this. IF the insurance company won't pay this, we would like to negotiate with the hospital to reduce the amount. We have been told that even tho our income is low, our assets will preclude us from getting a reduction in the bill. Our assets aren't that much: $40,000 in IRA and 401K, $15,000 in 2 cars, and a travel trailer worth about $8000 which we live in full time. We don't own a house or real estate. The 40,000 we have is all we have as far as savings for the rest of our lives, and I hope that is at least another 30 years, so I'm not too anxious to use it all up now.
Is there a way I should negotiate with the hospital? Do I have to disclose my assets to them now? They want me to start paying before the appeal process is completed, and I don't really have those resources. Would they be satisfied with $50 or $100/mo on a $70,000 debt?

[Ladynred]

It is VERY unlikely that they'll take $50-100 on a 70K debt, it would take you forever to pay it off and they won't wait that long. They will sue you first and then you'll have a judgment. Surely they have more than one low-income solution, have you even asked them ??

Why has the insurance company denied the claims ??

[BittyGeorgia]

The claim was denied by the insurance company as a pre-existing condition. This was due to a note written in my husband's chart by a nurse who misunderstood when he said he began having leg pains. The doctor has since clarified this, but the appeal process will take at least one month for each step (there are 3 levels of appeal).
I asked the hospital early on about the low income reductions and was told that having a retirement account would preclude us from being eligible for any reductions, until we have used all of that retirement money up. I am trying to reduce the amount of retirement money in the 401K and IRA now, but can't take any more out until next year, for tax purposes. I don't like the idea of diverting it, but I also don't like losing all of our savings and having nothing to fall back on for the rest of our lives.
I am hoping that the hospital will accept the $50 month just until the appeals have been exhausted. I know that if we lose all of the appeals I will then have to really look at how we are going to pay them off.
Thank you for the response.

[Ladynred]

The bad thing about taking out your IRA and 401K is the tax hit you're going to take for early withdrawl.

Good luck with the appeal, at least the Dr. has clarified on your side.

[lady alone]

You should make sure you DISPUTEdenial of the claim and follow all plan rules on disputing denied claims. Very often, there are two or more different addresses and if you send your dispute to the wrong place, it doesn't count, the ins co won't forward and no action will be taken. READ your "EXPLANATION OF BENEFITS" carefully and any or all plan adminsitrative materials.

Hospitals are no different than any other merchant when it comes to disputed claims. They can take no action until you have exhausted your immediate remedies.

If you can determine what your deductibles might have been, had the surgeries been covered, you can send that amount to the hospital with a copy of your dispute letter to the insurance. Indicate that you are proceeding as if the claim were going to be paid and sending the deductibles or co-insurance amounts until you hear back on the status of your dispute. And don't forget, there are first level appeals, second level appeals and even hearings in front of an Adminsitrative Law Judge, depending on the statutes in your own home state. So be sure you read them.

At this point, do not under any circumstances negotiate for a lower bill, since you may find that your bill will actually increase, since insurance co's get the benefit of UCR ( usual customary and reasonable) fees, based on medicare/medicaid reimbursements-- the Industry Gold Standard, as it were. Uninsured or cash patients pay the highest amount for services.....so don't talk cash payment-- yet-- until you make sure the invoice is completely settled and there are NO mysterious additional charges ( a favorite of hospital systems) because the original invoice was prepared with the watchful of the Big Brother Insurance Co in mind. And if Big Brother is out of the picture, you may find all kinds of charges that before weren't mentioned**************...

[BittyGeorgia]

Thank you for all the replies.
On pulling money out of IRAs: we can take out about $15,000 a year without increasing our taxes because of our low income. And, if it will save me from paying it to the hospital, I'd rather have 90% of my money than none!

The amount that the insurance company would pay on this $70,000 hospital bill is about $22,000. If I lose the appeals, I would try offering them that amount. If the insurance company does pay, we would be responsible for about $1200, since we have an out-of-pocket cap of $1500. Would it help if I offered them that amount?
Unfortunately, I guess my goal is to try to preserve our retirement funds just in case we lose the appeals. I don't like doing that, but I do have to take care of my family.

The appeal process for this insurance company is the first two appeals are "in house". The third is done by doctors and other professionals (not quite sure what kind) that have had nothing to do with the first two appeals. The people doing the last appeal have nothing to do with the insurance company of the first two appeals.

My first appeal is in the form of a letter, 3 pages, no attachments, because I know they will get copies of everything anyway. The second will be more in the style of a brief with exhibits. The third will probably be pretty much the same as the second; maybe some caselaw if I can find any, or "expert" opnions. Hope I dont' have to go that far.

Thanks again for the support. This has been a very frustrating, devastating experience. I don't know if I said it before, but we got the denial letter for these surgeries the day AFTER myhusband got home from the second surgery. Additionally, it all would have been covered, regardless of pre-existing condition if we had put it off for a month. Since it was an elective surgery, that would hav been very easy to do.

[stevek3]

Originally Posted by BittyGeorgia

What is the name of your state? Washington.
Our insurance company has denied payment on my husband's two surgeries, totalling $70,000. I am appealing their denial, but I'm not sure what to do with the hospital bills in the meantime. They are wanting me to start paying and provide them with my financial information. Our annual income is $13,000 and we don't have the means to pay a bill like this. IF the insurance company won't pay this, we would like to negotiate with the hospital to reduce the amount. We have been told that even tho our income is low, our assets will preclude us from getting a reduction in the bill. Our assets aren't that much: $40,000 in IRA and 401K, $15,000 in 2 cars, and a travel trailer worth about $8000 which we live in full time. We don't own a house or real estate. The 40,000 we have is all we have as far as savings for the rest of our lives, and I hope that is at least another 30 years, so I'm not too anxious to use it all up now.
Is there a way I should negotiate with the hospital? Do I have to disclose my assets to them now? They want me to start paying before the appeal process is completed, and I don't really have those resources. Would they be satisfied with $50 or $100/mo on a $70,000 debt?

Try to buy yourself some time. Last week the U.S. Supreme Court heard arguments in a case as to whether or not IRA accounts can be shielded as an exemption, either partially or in full, in bankruptcy cases. Similar exemptions typically extend to civil judgments. A ruling is expected sometime next summer.