Outrageous Bills – Bad Insurance?

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By Consumers Union on Wednesday, June 18th, 2014

When June’s son dislocated his shoulder while playing basketball at school, it was an easy decision to take him to the hospital, because the Florida family thought that they had a good health insurance plan.  At the hospital, doctors took an X-ray, gave her son morphine for the pain, and manually put his shoulder back into place.  All in all, it took about two hours.

The bill: 11,000 dollars.

At first, the insurance company refused to pay anything towards the bill.  Instead, they wanted to charge the hospital fees to whoever had shoved June’s son in the basketball game.  “We had no idea who did it, and they didn’t do it on purpose,” said June, who had started getting the bills in the mail while her insurance company dragged its feet.  She received a bill from the hospital for about $7000 and one from the doctors for $3500, “which shocked me, because I thought at the hospital the doctors work for the hospital, and that’s not true anymore.”

After June filled out a pile of paperwork, the insurance company contributed a total of about $1400, and the hospital made some deductions, leaving her with $3500 left to pay.  She is still not sure what her share of the provider bill will be.  The simple procedure became a major financial issue, with her husband forced to leave his retirement to help make the payments.  Saying that her 16-year-old son is the priority, June is going to cancel her own insurance to pay off the hospital.

June thinks the real issue is how much the brief medical procedure cost in the first place, with a single X-ray costing $1500 and a small dose of morphine costing $300. “That is where the problem lies. The hospital charged outrageous fees for what they did. I can’t imagine if he’d had to have surgery or something.”

However, the high amounts charged by the hospital aren’t the only reason the family was stuck paying so much.  June’s private insurance, which she found online, turned out to have a lot in common with many “junk insurance plans,” which were common before the Affordable Care Act.  These plans, which take people in with promises of affordability and fast-talking telemarketers, are so stingy they’re almost worse than having no insurance at all.  Junk insurance plans are less common now, after the ACA, but do still exist.  For June’s insurance, her monthly premium was $100, but the company barely covered any of the medical fees.

June’s son is currently on CHIP (Children’s Health Insurance Program), which offers comprehensive coverage.  If he had been on CHIP at the time of the accident, she would not owe anywhere near this amount in bills.  They are currently paying $130 a month to the hospital.  “Especially in the state of Florida, we fall through the cracks here,” she says, adding, “I don’t know what people do […] it hurt, and it’s still hurting bad.”

Do you have a story about outrageous medical costs?  We’d like to hear from you.

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