High Medical Bill Even With Insurance
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Q&A: My Hospital Bill is Too High Even With Health Insurance

Robyn's Question: I took my son to the ER after he lost consciousness. They ran a bunch of tests, but came up with nothing and sent us home. Even though my husband and I pay a lot for our health insurance,  we still ended up with a $3500 bill from the hospital just for four basic tests. It doesn’t even include the doctor’s bill. As I’m looking through the medical bill the tests seem extremely expensive. The $3500 is our health insurance deductible so I know our health insurance won’t pay any more. Why is my hospital bill so high and is there anything I can do to reduce it?

Answer: Yes, you have options. It may not be easy; and yet it may be worth your time, depending on the amount of the bill and what you can afford.

First, know that any work in the emergency room can be as high as ten times more expensive than testing done at your doctor’s office or a lab. Part of the extra charge covers how fast lab results come back in a hospital. In a non-emergency situation, it may take 2-10 business days to get lab results back. In a hospital, you’ll get lab results back within a few hours. But even though emergency room prices are always the most expensive in the medical field, they can be so expensive that they no longer make sense. If it’s worth it to you to put the time into finding out how much you have been overcharged then read through the following steps.

The Legal Contract Between Health Insurance and Hospitals that Patients Must Pay Their Share

There’s a good reason why it’s more difficult to negotiate a hospital bill after your health insurance has already paid. It’s because the hospital has a contract with the health insurance company that requires you to pay your share of the bill (e.g., a co-pay, deductible or co-insurance). That’s a legal contract. If a hospital overcharged a patient so that their health insurance covered the actual cost of medical services without the patient needing to pay anything, then health insurance deductibles would become meaningless. It’s a legal way for health insurance companies to enforce their deductible limits. If it’s proven that a hospital is intentionally allowing patients with health insurance to not pay their medical bills, they could be in breach of their contract and in violation of the law.

Your Health Insurance Negotiates Hospital Bills On Their Own Behalf

The perk of having health insurance is that your health insurance company already negotiates your medical bills for you. Sort of. Your health insurance is interested in lowering your medical bill if it means they don’t have to pay as much, or anything, for that matter.

An Example Explanation (EOB) of What Your Health Insurance Covered:

The Original Price Tag on Your Medical Bill Something Called an "Insurance Discount" Your Insurance Deductible That You Pay What Your Health Insurance Ends Up Paying
$16,000 $11,400 $3500 $1100

“Insurance Discount” is the amount of your medical bill that nobody pays. Health insurance companies will tell you that they receive this as a special discount for all of the patients they bring to hospitals. Medical bill negotiators will tell you this is the amount that you were overcharged and health insurance is unwilling to pay. Either way, it’s a price negotiation between your health insurance and the hospital, plain and simple.

But there’s no incentive for your health insurance company to negotiate a hospital bill just so that you pay less. For example, if your hospital bill was originally for $16,000 and your deductible is $3500, your health insurance company may only negotiate as low as it can to $3500, but not much beyond that. There are a lot of variables depending on the type of health insurance plan you have, but keep a close eye on how much your health insurance actually pays versus how much they get discounted for.

How to Negotiate Hospital Bills With Insurance

Step 1: Figure Out the Fair Price of Your Hospital Bill

  • 1a: Find The 5-Digit Code of Every Single Medical Service

Your medical bill must include a unique five-digit code for every medical service you were provided. This is called the “CPT Code.” If your medical bill does not include a CPT code like in the example given below, you need to call the customer service phone line provided on your medical bill and ask specifically for an “itemized bill that includes the CPT codes.” The hospital must mail you this detailed medical bill, because it is your right as a consumer to know what you are being charged for.

An Example of a Detailed Hospital Bill:

CPT Code Medical Service Hospital Price
70450 Brain CT (without contrast) $9000

  • 1b: Use Consumer Websites That Have Prices for Medical Services Nationwide

It’s no secret that prices vary dramatically for the same hospital procedure even within the same city. It’s also no secret that price extremes at hospitals can be so high there is no logical reason for them. Remember the $150,000 price tag to treat a poisonous snake bite that patients can get for a few hundred dollars in Mexico? “Fair price” is a term used to describe a reasonable price for a medical service given where you live and what other healthcare companies are charging.

There are two main websites that help consumers find fair medical pricing for their city or town: Fair Health (FH) Consumer and Healthcare Blue Book. If all hospitals are overcharging for a pretty routine medical service (like having your cholesterol checked in a blood test), then Medicare is always a good third resource to see how much the government is paying for a medical service. Critics do say that Medicare doesn’t usually pay enough for medical services, but it helps to see what government healthcare experts think is a fair price if your medical bill is extraordinary.

Get out your pen and paper, or an Excel spreadsheet, and start recording. You are going to look up the price of every CPT code from your medical bill on all three sites. It can be hard to find the Medicare price sheet for lab tests on their website, so we linked it here. You will need Microsoft Excel to download and open it.

  • 1c: Do the Math To Make a Fair Price Hospital Bill

An Example Fair Price Spreadsheet:

CPT Code Your Hospital Charged FH Website Healthcare Blue Book Website Medicare Price Sheet
70450 $9000 $251 $309 $123.67
80048 $2000 $48 Not Found $11.60
85025 $3000 $61 $21 $10.66
80051 $2000 $35 Not Found $9.62


Total Price $16000 $395 $413 $155.55
Multiply by 3 For Emergency Room Setting - x3 x3 x3
Final Fair Price   $1185 $1239 $466.65

  • 1d: Decide on the Final Fair Price for Your Hospital Bill

Well, there’s a reason it’s called the “art of negotiation.” How much has your health insurance already paid to cover the fair price? What final price makes the most sense for you to pay? Is your price reasonable for an emergency room setting? Write that final price down and circle it.

Step Two: Negotiate Your Hospital Bill

The reality is that hospitals lose billions of dollars each year because lots of patients, both uninsured and insured, simply don’t pay their hospital bills. Legal contract or not, health insurance companies can’t force their customers to pay their hospital bills. The fact that you want to pay enough to cover the medical services you got, means the hospital keeps one less medical bill being sent to a bill collector’s office. And it’s never your responsibility to make up for other patients’ medical care at a hospital.

  • 2a: Negotiate Medical Bills Over the Phone?

Some hospitals are easier to work with than others. A hospital that is interested in helping you afford your medical bill may be willing to accept a discounted amount if you pay in full. You might have a wonderful experience working with them.

However, the hospital has to train it's staff to negotiate with you by phone. If the hospital doesn't provide this training, you won't get very far by phone. The hospital may also be legally bound by their contract with your health insurance company. You may hear by phone that they cannot negotiate medical bills with you when you have health insurance. Even if you hear this, it may actually still be possible to negotiate your medical bill. Don't give up yet.

  • 2b: Negotiate Medical Bills Letter

Write a thoughtful letter about why you are paying this new price and include the full payment for it. Include any of the research you did. Make sure you are very clear about your intentions and that this payment is your final payment if they accept it. This does not grant you any legal rights, it just makes your intention clear.

If you can’t cover the full payment, you lose some bargaining power. The hospital may ask you to make monthly payments instead if they don’t know for sure how much you will end up paying.

  • 2c: Companies that Negotiate Medical Bills for You

If reading about this process is giving you a headache, there are professionals you can hire to do it for you. You just have to see how much they charge versus how much you will save to see if it's worth it.

  • Attorneys who negotiate medical bill disputes
  • Patient advocates who specialize in medical bill disputes
  • Medical bill negotiators

You can find these professionals listed in OUR DIRECTORY. If you cannot find someone in your local area, do a simple google search or you can also check out the directory for the Alliance of Professional Health Advocates.

This is Not a Guarantee That You Can Negotiate Your Hospital Bill

Whether or not the hospital ultimately accepts your fair price is up to the hospital. It’s also up to you as a consumer whether or not you pay. Negotiating hospital bills can work out well for both sides.

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