Sign Here? Financial Agreements May Leave Doctors in the Driver’s Seat – KFF Health News

Cass Smith-Collins took the leap to have surgery that will match her breasts to her penis.

While living in Las Vegas and then at the age of 50, he finally felt safe enough to come out as a transgender person. He was supported by his wife and a doctor’s letter revealed that he had a long history of gender dysphoria, the psychological distress felt when one’s sex assigned at birth and gender identity do not match.

Although in-network providers were available, Smith-Collins chose Florida-based surgeon Charles Garamon, who promotes himself under the name Early developers of female-to-male top surgery and says that he Does not contract with insurance, Smith-Collins said she was willing to pay more to go out of network.

He said, “I had one chance to have the chest I was supposed to be born with and I wasn’t going to pass that chance away to someone who wasn’t an expert in his craft.”

Smith-Collins arranged to spend a week in Florida and contacted friends there who could help her recover from the outpatient procedure, she said.

According to documents shared by Smith-Collins, Garamon’s practice requires that patients agree to its financial policies. A document states that “full payment” of Garamon’s surgical fees is required four weeks before surgery and that all payments to the practice are “non-refundable.”

Smith-Collins said he and his wife dipped into their retirement savings to cover the roughly $14,000 advance. With prior authorization from her insurer saying the procedure would be “covered,” she thought her insurance network would reimburse her for the amount she paid in excess of the out-of-pocket maximum for care: $6,900.

The day before the surgery, Smith-Collins signed another agreement from the surgeon’s practice detailing how he would file an out-of-network claim with his insurance. It states that any insurance payments will go to the doctor.

The process went well. Smith-Collins went home feeling happy and relieved.

Then the bill came. Or in this case: not reimbursed.

Patient: Cass Smith-Collins, now 52, ​​has employer-based coverage through UnitedHealthcare.

medical services: Double-incision top surgery with nipple grafts, as well as laboratory work.

Service provider: The Aesthetic Plastic Surgery Institute, doing business as The Garamon Center, is owned by Garamon, according to Florida public records.

Total Bill: The surgeon’s practice billed the patient and insurance a total of $120,987 for his work. It charged the patient about $14,000 upfront – which included $300 for lab work and a $1,000 reservation fee – and then billed the patient’s insurer an additional $106,687.

The surgeon later wrote to the patient that the advance fee was for the “cosmetic” portion of the surgery, while the insurance fee was for the “reconstructive” portion. Initially, the insurer paid $2,193.54 for the surgeon’s claim, and the patient received no reimbursement.

After KFF Health News began reporting this story, the insurer reprocessed the surgeon’s claim and increased its payment to the practice to $97,738.46. Smith-Collins subsequently received reimbursement of $7,245 from Garamon.

What gave: Many patients write monthly bills every year With your own complicated billing questions. In many cases – including this one – the short answer is that the patient misunderstood his or her insurance coverage.

Smith-Collins was in a confusing situation. UnitedHealthcare said her out-of-network surgery would be “covered,” then later told Smith-Collins it didn’t give her the reimbursement she expected. Then, after KFF Health News began reporting, they received reimbursement.

The confusion was further compounded by the practice’s financial policies, which set payment deadlines before surgery, gave the doctor control of any insurance payments, and left the patient vulnerable to higher bills (although, fortunately, He did not get any bill).

Agreeing to an out-of-network provider’s own financial policy—which typically protects his or her ability to get paid and can be filled with confusing insurance and legal jargon—can create a binding contract that obligates the patient to pay what is owed. drop offs. In short, it can make money by putting the doctor in the driver’s seat.

The agreement that Smith-Collins signed the day before the surgery states that the patient understands that he or she is receiving out-of-network care and that additional costs for all services provided “by the out-of-network practice” may be responsible for”.

Federal billing protections protect patients from large, out-of-network bills – but not in cases in which the patient knowingly chose out-of-network care. Smith-Collins could have been in trouble because of the difference between the cost of the procedure quoted by her out-of-network doctor and the insurer: about $102,000.

The emails show Smith-Collins had a few weeks to review a version of the practice’s out-of-network agreement before signing it. But he said he probably didn’t read the entire document because he was focused on his surgery and was willing to agree to anything to get it done.

“Surgery is an emotional experience for anyone, and it’s not an ideal time for anyone to sign a complicated legal agreement,” said Marianne Udo-Phillips, a health policy instructor at the University of Michigan School of Public Health.

Udo-Phillips, who reviewed the agreement, said it included complex terms that could confuse consumers.

Another provision in the agreement says that the surgeon’s advance fees “are a separate fee that is not related to the charges charged on your insurance.”

Months after her procedure, having received no reimbursement, Smith-Collins contacted her surgeon, she said. Garamone responded to them in an email, explaining that UnitedHealthcare had paid for the “reconstructive aspect of the surgery” – while Smith-Collins had paid thousands of dollars upfront for the “cosmetic portion.”

Filing an insurance claim initially resulted in a payout for Garamon, but no refund for Smith-Collins.

Garamone did not respond to KFF Health News questions or repeated requests for an interview for this article.

Smith-Collins had miscalculated how much her insurance would pay for an out-of-network surgeon.

Documents show that before the procedure Smith-Collins received a receipt from Garamone’s practice marked “Final Payment” with a zero balance, as well as a prior authorization from UnitedHealthcare stating that Garamone Surgeries performed by will be “covered”.

But out-of-network providers don’t have limits on how much they can charge, and insurers have no limits on what minimum they will pay.

The explanation of benefits, or EOB, statement shows Garamon submitted a claim to UnitedHealthcare for more than $106,000. Of that, UnitedHealthcare determined the maximum it would pay — known as the “allowed amount” — was about $4,400. A UnitedHealthcare representative later told Smith-Collins in an email that the total amount was based on what Medicare would have paid for the procedure.

Smith-Collins’s upfront fee of approximately $14,000 was much more than the price the insurer deemed fair, and UnitedHealthcare was not going to pay the difference. According to UnitedHealthcare’s math, Smith-Collins’ share of its allowed amount was about $2,200, which counts toward her out-of-pocket costs. This means, in the insurer’s eyes, Smith-Collins still hasn’t reached her maximum of $6,900 for the year, so no refund.

Neither UnitedHealthcare nor the surgeon provided billing codes to KFF Health News, making it difficult to compare the surgeon’s fee with the cost estimate of the procedure.

Garamon’s website says His fees vary depending on the size and difficulty of the procedure. The site says their prices reflect their experience and say that “cheap” can lead to “very poor results.”

Although she spent more than she expected, Smith-Collins said she will never regret the procedure. He said he had been living with suicidal thoughts since his youth, realizing at an early age that his body did not match his identity and fearing that he would be targeted by others because he was trans.

“It was a life-saving thing,” he said. “Whatever they wanted me to do, I jumped into it so I could get that surgery, so I could finally be who I was.”

Resolution: Smith-Collins submitted two appeals to her insurer, asking UnitedHealthcare to reimburse her for the money she spent over the out-of-pocket maximum. The insurer rejected both appeals, finding that her payments were correct based on the terms of her plan, and saying that her case did not qualify for a third, external review.

But after being contacted by KFF Health News, UnitedHealthcare reprocessed Garamon’s claim of nearly $106,000 and increased its payment to the practice to $97,738.46.

UnitedHealthcare spokeswoman Maria Gordon Shidlow told KFF Health News that the company’s initial determination was correct, but that it had reprocessed the claim so that Smith-Collins was “only” responsible for its patient’s portion: $6,755.

“We are disappointed that this non-contracted provider was chosen to charge members such a high fee,” he said.

After that new payment, Garamone gave Smith-Collins a refund of $7,245 in mid-April.

Takeaway: Udo-Phillips, who worked in health insurance for decades and leads provider services for Blue Cross Blue Shield of Michigan, said she has never seen a provider agreement signed by Smith-Collins.

Patients should consult an attorney before signing any out-of-network agreements, he said, and they should make sure they understand pre-authorization letters from insurers.

The prior authorization Smith-Collins received “doesn’t say whether it’s fully covered, and it doesn’t say at what rate it’s covered,” Udo-Phillips said, later adding, “I’m sure [Smith-Collins] Thought that prior authorization was for the cost of the process.”

Patients may look for in-network care to feel more secure about what insurance will cover and what their doctor may charge.

But for those who have a specific out-of-network doctor in mind, there are ways to avoid sticker shock, said Sabrina Corlett, research professor and co-director of the Center for Health Insurance Reform at Georgetown University:

• Patients should always ask insurers to define what “covered” means, especially whether it means full payment and for what expenses. And before paying upfront, patients should ask their insurer what the total amount they will reimburse.
• Patients may also ask their provider to agree in advance to accept any insurance reimbursement as full payment, although there is no requirement to do so.
• And patients can try to get their insurer to provide an accurate dollar estimate for their out-of-pocket costs and ask if they are eligible for reimbursement if insurance picks up the tab.

Bill of the Month is a crowdsourced investigation kff health news And npr Who analyzes and interprets medical bills. Do you have any interesting medical bills you want to share with us? tell us about it,