If you were involved in a car accident in Mississippi, you know just how financially devastating a car accident can be. To recover from the hospital bills, lost wages and other damages, you may file a personal injury claim. Though, if successful, you stand to recover a fair amount from the claim or lawsuit, know that your health care provider may try to lay claim to all or part of your settlement through a process called “balance billing.” FindLaw details this strategy in depth.
Unfortunately, when it comes to pricing, hospitals are at the whim of health insurance providers. HMOs often offer steep discounts and, on top of that, make it difficult for health care providers to collect what patients owe them. For this reason, medical care providers scrape for every penny. One way in which many do this is by laying claim to patients’ personal injury settlements through a practice called “balance billing.”
To understand balance billing, you must first understand the medical insurance billing process. The way in which medical billing works is actually quite simple. The health insurance company contracts with a hospital to pay either a fixed amount or a certain percentage of a service’s cost. The insurance company may negotiate for a reduced rate of any given charge. So, say for instance the hospital charges $150 for chest x-rays. The insurance company may negotiate the rate down to $100. In turn, the same insurance company contracts with the consumer to pay 70% of the total cost of a procedure. In the case of the x-ray, the insurer would pay $70 (or 70%) and the customer would pay the remaining $30. This leaves the hospital out $50, $50 for which no one in liable.
After a car accident, a patient’s medical expenses may be extensive. Many times, the hospital loses much more than $50; rather, the loss is often in the tens-of-thousands-of-dollars range. The patient legitimately owes the outstanding balance, and the hospital has every legal right to collect it from the proceeds of a personal injury settlement. However, hospitals do not have the right to double bill, which many often do.
Many hospitals charge patients not only for the portion he or she owes after insurance but also, for the difference between the hospital’s standard rate and the rate set by the insurer. After a car accident, the outstanding amount owed can quickly add up. This tactic is illegal in many states, yet hospitals continue to do it. Even in states that do not expressly prohibit balance billing, hospitals who essentially double bill may find themselves on the losing end of a civil lawsuit.
This article should not be used as legal advice. The content is for informative purposes only.