Insurance fraud vs self pay

[KayKat 0]

I went to a well known weight loss place for my LAP-BAND®. The self pay price was @ 15-18,000. My insurance co approved the surgury and I didnt think anything about the cost. To my horror this place has billed my insurance almost $100,000!!! and insurance has paid this!!! This exact thing simultaneously happened to my friend who went to the same place and has a different insuance co. They charged her insurance $138,000. This was outpatient surgury!!

All the ads on here show cheap prices...what happened?! This eats into my lifetime insurance health cap.

The weight loss place said if you prepay/self pay its 18,000 but if they "assume the risk" of going through insurance they charge more. 10 times higher?! Are they loan sharks or doctors?

has anyone run into this?

[BetsyB 9]

Insurance companies are well aware of the customary and reasonable costs of each procedure they cover. If they actually did cover the full amount billed, then someone on the insurance end is involved in the fraud.

I'd report it to my state's department/board of insurance. I'd probably also report the doctor to the state medical board. But first, I would call the clinic and ask for an explanation and request that the very obvious error be amended --- with the understanding being that if it is not, you will report.

It's NOT unusual for out-of-pocket payers to be given a small break, price-wise; they don't have the same administrative costs associated with their care.

But what you've described is ridiculous--and if true, criminal. (Time to find another clinic for follow-up care, I think. If a doctor/group is that unscrupulous, then you don't want them administering your medical care.)

ETA: I'm not sure what "risk" is assumed by going through insurance, since each and every doctor gets pre-approval!

Edited March 16, 2010 by BetsyB

[LapBandBobbi 8]

My daughter was a self-pay ($15K) and my insurance paid for mine. So far, the hospital/doc's have billed the insurance around $25K. I believe the doctors are expected to "write-off" was is beyond customary.

If I were you, I would call your insurance company and ask them to look into it. Sounds like some fraud going on there.

[LeighaMason 19]

I had foot surgery a few years ago, the pre-approval was denied so I agreed to self pay. Insurance cost was $1600 but they would do a "cash price" of $800. I paid, after the surgery I submitted the receipt to insurance and I was reimbursed. Apparently the insurance company also sent a letter to the doctors office about the reimbursement. They called and DEMANDED that I send the money to them, that if insurance paid it was $1600. Fortunately I had a letter stating that the total cost was $800 and after a few threatening phone calls they realized they couldn't bully me and they gave up. :wub:

[JoJo1 0]

I have actually heard of this many times on here and other forums. The highest I had heard until now was 109,000. I know it is amazing what they get away with. I was 7000.00 plus plane fare. I am self pay.

[Jssc73 1]

I would look at the EOB (Explanation of Benefits) from the Insurance. Most likely the cash payment is not the full amount that was paid. Hospital charges are the same whether you are self pay or insurance - just if you are self pay, you never see the high bill because they have agreed on a price with you as self pay. They do not bill you because you pay upfront. The insurance also has a contractual agreement with the hospital and do not pay the full amount of the charges. If you get your EOB, you will see the insurance probably paid (cash outlay) less than the self pay person did. It is part of the hospital world. I know for my procedure, the charges were around $25,000 and the insurance only paid $5,800.

[RavenClaw779 2]

BetsyB is right on the mark. I've got my EOB's coming in now -there's what the provider charged and the "contracted" price - the price the provider agrees to take as an in-network provider for whichever carrier.

It's funny how large the difference between the billed and what they actually get paid - how do they even make a profit?:cursing:

They use the difference as a tax write off. For obvious reasons the self-pay price is often much lower - for example - they know the average person isn't going to be able to shell out $4,000 for just the sleep study.

When you've got insurance, alot of providers treat you like a cash cow. This is why we need health care reform - for real not Obama Care!