Preventing Overcharging, Surprise Bills, and Medical Debt
Battling Unfair Billing Practices and Overcharging
A hospital bill is often the biggest bill a person will get in her entire life, outside of a mortgage. Medical debt has been a factor in more than half of bankruptcies--for the uninsured and even among many insured who found out-of-pocket costs too overwhelming. While the Affordable Care Act extends coverage and puts limits on out-of-pocket costs, there is more to do to prevent unfair billing practices, from overcharging to aggressive collections practices.
Health Access supports efforts to strengthen consumer protections in the insurance market to prevent underinsurance and medical debt, going above and beyond the ACA as needed. For example, Health Access led efforts to pass California’s first-in-the-nation Hospital Fair Pricing Act, a 2006 law (authored by Assemblywoman Wilma Chan), which limits the common practice of charging uninsured and underinsured patients more for care than everybody else pays.
Typically, hospitals and doctors overcharge self-pay patients 3-4 times what insurers and government programs pay for exactly the same procedures. The Hospital Fair Pricing Act, effective since January 2007, limits the amount that most uninsured and underinsured patients have to pay to the amount that a public insurer would pay for the same care. In most cases, this will be the Medicare price, which is 65-85% less than the inflated price. The Hospital Fair Pricing Act also requires hospitals to adequately inform patients about their charity care and discount policies and provides a moratorium before bills can be sent to collections.
Uninsured and under-insured California residents can learn about their rights and tools for minimizing their own medical debt on the HospitalBillHelp website hosted by Health Access in partnership with our partners in the advocacy community.
Related issues include:
- ‘Surprise’ Billing: Patients who have health coverage are often wrongfully billed by physicians when the patient's health plan refuses to pay. Also known as "balance billing," this practice places the consumer in the middle of a billing dispute between the health plan and the physician. Patients who do not pay these bills are often aggressively pursued or sent to collections. In October 2008 the Department of Managed Health Care, made effective new regulations on balance billing that would take the first step toward protecting consumers against billing disputes between providers and insurers.
Health Access Analysis
- AB533 Surprise Bills (January 2016). A Health Access fact sheet.
- Uninsured in the Emergency Room: New Patient Protections in Place; More To Do (April 2011)
- AB 1503 (Lieu): The Unnsured Pay More Than What's Fair in the E.R. (August 2010)
- FACT SHEET: Protecting Consumers From Medical Debt (August 2009)
- Give Us a Sign: Hospital Overcharging Report (September 2004)
Resources for Advocates and Consumers
- hospitalbillhelp.org (website co-hosted by Health Access and Coalition Partners)
- Sample Hospital Bill Letter