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August 6, 2010
Demystifying, and Maybe Decreasing,
the Emergency Room Bill
By LESLEY ALDERMAN
DURING a snowstorm last winter, my 6-year-old son fell and cut his chin not outside on the
ice, but inside on the tile bathroom floor. My husband walked our son, Charlie, through the
knee-high snow to the local emergency room.
Charlies gash was small, less than half an inch long, but deep. The hospital called in a plastic
surgeon, who put 14 tiny stitches into his chin.
Charlie called the incident the worst day of my life mostly because he had to spend hours in
a hospital instead of throwing snowballs. Weeks later, when the bills arrived, we had our own
bad day.
The total charges for his minor spill came to $5,398. The largest single charge was a shocking
$4,950 from the plastic surgeon.
Emergency room bills are notoriously high and perplexing; patients often are left feeling like
captives who have few alternatives. It is impossible to know how much the services will cost
when you walk in the door. The hospital bill, which arrives weeks later, may include seemingly
inflated charges for things like Tylenol or an M.R.I. Doctors who treated you may send their
own separate bills, further complicating the payment process.
The first step toward managing this expense is understanding what goes on in the hospitals
billing department.
NOBODY PAYS RETAIL The majority of hospitals are required by law to treat any person
who walks into an emergency room whether that person has insurance or not. To make up for
those who cannot or will not pay, a hospital sets its so-called gross charges very high.
At the same time, hospitals negotiate contracts with managed care and commercial insurance
carriers that specify prices much lower than the gross charges. Medicare and Medicaid dictate
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8/2/12 Patient Money - Demystifying the Emergency Room Bill - NYTimes.com
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lower rates for medical services to hospitals. In virtually every instance, we get paid a lot less
than we bill, said Michelle Leone, senior vice president for revenue cycle operations at
Continuum Health Partners in New York City.
You may receive a statement that shows your E.R. visit totaled $3,000, for example, but your
insurer may agree to pay just $500, which the hospital will accept. Depending on your plan, you
owe either a portion of that $500 say, 20 percent, after a deductible or a co-payment.
People without insurance end up with bills that are much higher than those for covered
patients, because the uninsured are charged the hospitals gross rates.
People dont realize that the prices on the bill are just a starting point, said Dr. Jesse M. Pines,
an associate professor of emergency medicine and health policy at the Center for Health Care
Quality at George Washington University. Prices listed on the bill often dont represent what
the insurer or the patient will ultimately pay.
The prices ultimately paid to a hospital can vary considerably for treatment of similar medical
problems. Its kind of like the airline industry, Dr. Pines said. Its rare that two people on a
plane will have paid the same amount for their seats.
THE SURPRISES Besides being charged for each service you receive, you will be charged an
emergency room fee corresponding to the complexity of treatment that your injury required.
Normally there are five levels of care Level 1 is for minor problems like an earache. Level 5 is
for more severe problems like a broken bone. (There are higher levels of care reserved for
critically ill patients.) Charlies stitches, for instance, were considered Level 2 care, and the
emergency room fee was $488.
When an outside doctor is called in, you will receive a bill directly from the doctor or from your
insurance company. The fee will be high, but your insurer probably will pay for most of it,
depending on your plan and whether you have met your deductible.
In the end, our final out-of-pocket costs for the entire emergency were less than a third of the
original charges. That sounds good, but the bill was still $1,579.
Some insurance plans require that you get preauthorization before receiving emergency care,
said Gordon Wheeler, associate executive director for public affairs at the American College of
Emergency Physicians.
The new health reform law, though, stipulates that a patient may not be penalized for receiving
out-of-network care in the case of an emergency, and that a patient does not need to seek
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preapproval. The final regulations on this issue are to be released at the end of this month.
Whether you have insurance or not, here are some strategies for avoiding high emergency room
bills and steps to take when the amount you owe seems unreasonably high.
DONT GO THERE If your situation is not dire you twisted your ankle or have a persistent
sore throat, say, or your child receives a small burn call your doctor first and ask for advice.
While this might sound obvious, many people routinely head to the E.R. for nonurgent
problems. The top three reasons for emergency room visits in 2007 were for sprains and
strains, superficial injuries and contusions, and upper respiratory infections, according to Ryan
Mutter, a senior economist at the federal Agency for Healthcare Research and Quality.
Call your insurers nurse triage hot line. A trained nurse can help you determine whether a
swollen ankle is broken and should be immediately X-rayed, for instance, or whether a burn
requires a doctors attention or just judicious at-home treatment.
Another good alternative to the E.R. is an urgent care center. There are now 8,700 of them
across the country. They are typically faster and cheaper than E.R.s. Urgent care centers
specialize in treating mild injuries like sprains, broken toes and fingers and mild cuts. To find a
nearby urgent care center, call your insurer or go to iTriagehealth.com.
SCRUTINIZE THE BILL If a charge looks wrong or the amount seems unreasonably high,
call the hospitals billing department. Hospitals and insurers process thousands of claims a day,
and mistakes do happen. If you received two stitches in your finger, but were billed $700 for
Level 3 care, ask why this is so.
Never be afraid to ask questions about your bill, Ms. Leone said.
MAKE AN OFFER If the final bill is beyond your means, it will pay to bargain particularly if
you do not have insurance.
The majority of hospitals will discount private paying patients bills, Ms. Leone said. Most
hospitals are generous in their discounts.
You can negotiate even when you have insurance. Two years ago Lisa Cullens father, Thomas
Reilly, became very ill and made three trips to the emergency room. Each visit cost about
$15,000. Mr. Reillys insurer contested some of the charges, and the family ultimately was left
owing the hospital $11,000.
The hospital was able to reduce the bill to $5,000. I was surprised to learn hospitals would
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rather receive partial payment than no money at all, Ms. Cullen, a writer in Leonia, N.J., said.
Often you can work out a payment plan with the hospital whereby you pay your bill in
installments rather than all at once.
Negotiate with doctors, too, over their individual bills.
ACT QUICKLY Unpaid hospital bills are usually forwarded to collection agencies that report
uncollectible accounts to credit agencies. When faced with exorbitant bills, dont hesitate to
contact the hospitals billing department and start a dialogue.
By the time your bill lands at the collection agency, your credit score will have taken a serious
hit, Dr. Pines warned, and it might be hard to borrow money in the future. If that happens, a
trip to the emergency room will feel like the beginning, not the end, of your troubles.