Insured patients can save money by pretending to be uninsured

I’ve mentioned countless times before that paying directly for health care can result in big savings, especially when seeking treatment at providers and facilities that cater to self-pay patients. This applies to people who are uninsured, have high-deductible plans, or who have more comprehensive health insurance plans that don’t cover a particular treatment or provider.

There is one pretty big caveat for the insured, however. Because of the way insurance contracts are typically structured between providers and insurers, the provider is required to charge the full “negotiated” rate they and the insurer have agreed to, even though the patient is paying the entire bill themselves. This creates the odd situation where someone who is uninsured will get a better price than someone with insurance, even if both of them are paying the whole bill themselves. 

I recently stumbled across this post by Dr. Dike Drummond of The Happy MD blog, which explains better than I can why patients with insurance might be better off hiding the fact that they are insured:

Hide your health insurance status and pay cash instead

…We may be seeing a time when the uninsured person writing a check begins to get a much needed break. This new pricing trend is causing some interesting ripples as more and more people become aware of the sometimes dramatically lower prices for cash on the barrel head. 

Here are two examples:

A recent article in the Los Angeles Times reported a CT scan of the abdomen costs about $2,400 for patients insured by Blue Shield of California, while the Los Alamitos (Calif.) Medical Center cash price is only $250. That is a 89% discount by my calculation.

Another local California hospital charges insured patients $415 for blood tests that cost only $95 in cash. This time it’s a mere 77% discount.

Now, there are some interesting rules to the cash discount game.

First, to get the discounted prices, patients would have to withhold insurance information from hospitals. If you tell them you have insurance, they will be bound to charge you the insurance company’s negotiated rate. Those are the up to 89% higher fees documented in the previous paragraph.

However, if you don’t tell them your insurance and pay cash instead, the cash payments don’t apply to your annual out-of-pocket spending limits.

For a 89% discount, I am pretty sure there are times it would be worth it to keep your little secret. If you are healthy and only need an occasional visit to the doctor you now get to make the judgment call on cash discount vs. paying five times as much and applying it to your deductible…

In perhaps the most interesting reaction to cash discounts, a patient who was unaware of the discounted cash pricing last month filed a lawsuit against Blue Shield of California for unfair business practices, breach of good faith and misrepresentation over her medical bills after she was charged $2,336 for a CT scan that would have cost her $1,054 in cash.

Blue Shield said it “cannot promise or represent that there could not be providers who will charge someone less out-of-pocket cost for a service than she would pay if the Blue Shield contract rate applies.”

There are two challenges that patients with high deductibles will have in embracing this strategy. Dr. Drummond mentions the first one, which is that not telling the provider you have insurance means it won’t count towards the deductible. For most people this won’t be a problem because they don’t usually get anywhere near their deductible amount. And paying lower prices as a self-pay patient will make you even less likely to hit your deductible.

But if you know that you’re going to hit your deductible in any given year, perhaps because of a planned procedure, it might be worth it to go ahead and just let them know you have insurance.

The other problem is that it’s possible that the rates for a procedure are less for insured patients than for someone paying cash. Usually this is going to be the case at practices that aren’t cash-friendly to begin with, so be sure to ask right up front if they offer discounts for patients who pay cash. If they’re flummoxed by the question and start explaining that they need to know what insurance you have before they can give you a price, chances are you’re not going to get a discount, and you’re better off either giving them your insurance information or finding another practice.

Assuming they do tell you they give a discount for cash, you’ll want to find out how much it is. That’s not always going to be easy (and don’t try this in the event of a medical emergency), but if you know the treatment you need or type of visit you’re seeking, it shouldn’t be too difficult.

Unless you’re dealing with a cash-only practice or using a service like MediBid, they’ll ask you for your insurance, you don’t have to lie to them and tell them you’re uninsured, just stay vague and say things like “I’ll be paying for this myself” or “my insurance isn’t going to be covering this.” This should cover you in the event you do wind up using your insurance in order to get a better price.

Then you’ll need to find out what your insurer will pay for that treatment, or what the “allowed” charge is. In the past that was nearly impossible to find out, but today some insurers will give this information to the people they insure. You can also use sites like Healthcare Blue Book and Pricing Healthcare to see what insurers are paying, on average, for procedures in your area or even specific facilities.

 If the allowed amount is more than the discount for paying cash, it’s probably worth considering keeping your insurance card in your wallet or purse and. You can still use your health savings account (if you have one, of course) to pay for it, you just won’t be able to apply it to your deductible.

It may seem strange, especially given the widespread assumption that one benefit to having health insurance is that you get ‘discounted’ rates at doctors’ offices and hospitals, that hiding your insurance can get you a better price for your health care. But there are lots of oddities in the world of health care pricing, and knowing this one could save you a lot of money.  

This entry was posted in Cash-Only Doctors, High-deductible health insurance, Negotiating Medical Bills, Price Transparency and tagged , , , . Bookmark the permalink.

171 Responses to Insured patients can save money by pretending to be uninsured

  1. DR. Mike Vasovski says:

    The same “don’t tell them you have insurance” applies to many generic Rx’s that can be filled at big box stores that are offering $3-$4 per month for select meds. Patients frequently comment, “you mean I don’t have to tell them I have insurance?”

    The pharmacy benefits companies are complaining that this interferes with their “quality assurance programs”. More likely it’s interfering with their profit assurance guarantees.

  2. No one ever has to use their insurance. I have heard from many that a drug discount card price was cheaper than their copay. It’s like your auto insurance. You can opt to pay for a covered repair yourself rather than report it to your insurance company.

    • Carol Betz says:

      Your comment says that no one ever has to uae their insurance. Is there a law or anything in writing that shows this?

      • says:

        No, fortunately our legal system isn’t based on the idea that in order for something to be legal, the government must pass a law saying it’s legal. Instead, there would have to be a law that specifically said that it was illegal to not use insurance for medical bills if you had it. No such law exists, so it’s legal.

        • Michelle says:

          What about an insurance contract that holds you responsible for billing any claim from that provider that is contracted. Wouldn’t a contract between the provider and insurance company supercede the ability to “self pay” patients?

          • says:

            An interesting question, I’m not sure but I suppose if an insurance policy requires you to submit all possible claims then yes, that might be the case. I can’t imagine any insurer caring enough about it to enforce something like that though.

      • Cecelia Sheridan says:

        The HITECH Act (HIPAA) expanded a patient’s rights when it comes to whether to use their insurance or not, but the law does state they can opt out of using their insurance if they pay the provider “in full”.
        Individual rights are expanded in important ways. Patients can ask for a copy of their electronic medical record in an electronic form. When individuals pay by cash they can instruct their provider not to share information about their treatment with their health plan.

        • Thad says:

          “When individuals pay by cash they can instruct their provider not to share information about their treatment with their health plan.” That’s a huge right in this era, and one that really empowers self-pay patients (and all interested in medical liberty).

        • J Smith says:

          Could you share the citation for this HIPPAA expansion of patient’s rights? I would love to use this immediately.

        • Tina Stephens says:

          I was wondering if a doctor office can tell you that now your insurance company stopped paying and that you can’t pay out off pocket cash to keep see that doctor

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  4. Eric says:

    I have experienced this myself. I went to an in-network imaging center for a CT-Scan and found that our PPO rate was $2700 which would be paid entirely by me since my remaining deductible was $3,000. Fortunately, the lady at the imaging center quietly told me that if I paid cash and they didn’t report it to the insurance company, they would do it for $400. I just can’t fathom how a stingy insurance company would agree to pay such an inflated rate for this procedure. Isn’t the value of a PPO network the heavy-weight influence they have negotiating great rates for their customers? Obviously not. The silver lining was that this situation was one piece in the puzzle which led our non-profit organization to can our group insurance plan and put everyone in the organization on the Health Co-op plan instead. Our monthly costs are half and we like what we’re getting for it.

    • Tony Simo says:

      This have to be a violation of a law I positive think that the provider split the extra charges with the Insurance company is why they paid such astronomic charges to the provider I my self went to a dentist and got a deep cleaning they charge me $114.00 it took the hygienist about 45 minutes when I got the monthly statement from my insurance co” the provider divide the cleaning in four (4) different session and each session was $341.00 x 4 =$1364.00 that cannot be legal but how can we fight that?. If all of the benefit we suppose to get from the insurance company half probably go back to then and the other half to the provider and we end with almost nothing. This is what is going on with medicare and the state don’t even care or they just don’t want to deal with the problem I appeal to whoever is responsible to correct this problem and do something about the rip off to patient and medicare.

  5. Rick says:

    I just gave up my Medicare Advantage and went with straight Medicare. I learned that Medicare Advantage was more expensive for me in terms of co-pays. I lose my dental and vision. While I haven’t found out if my eye doctor will discount for self-pay, my dentist recently honored what my insurance would pay, which was $100 for exam, cleaning and x-ray. Next exam will cost $82. That is $182 for two visits. The dental plans I found cost $1/day, or $365 for the year. Even when I was working, my company deducted somewhere around $30/month for dental. My dentist doesn’t like me. No cavities, no root canal, etc. He kids me and calls me boring and laments that I am doing nothing to help him put his daughter through college.

    • Lauren says:

      Most optometrists do give a cash discount for a vision exam. If you have a medical issue with your eyes that the optometrist is monitoring, such as cataracts (which most everyone has at 65 even if they are not bothering you yet) then your optometrist may decide that Medicare can be billed for your eye examination, however Medicare will not pay for the refraction (glasses Rx determination part) or glasses. Most optometrists are Medicare providers.

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  8. Jerome Bigge says:

    It should be noted that in France the patient pays the doctor at the time of service and then collects back a percentage of what they paid to the doctor. I see no reason why this sort of insurance wouldn’t work here in the US as well as it does in France. Having the doctor bill your insurance, while convenient for you, adds a fair amount to the cost as the doctor has to have his medical biller bill the insurance company, then wait for payment. Which depending on the insurance company, could be as much as a month or two. If the doctor could get paid right away, no need to hire a medical biller, the doctor no doubt would be willing to discount his usual fee. BTW there are numerous businesses that will give a discount if payment is at the time of service instead of having them bill you.

    • gwoccmed says:

      It used to work that way in the US, only many didn’t pay the doctors kind enough to bill (or alternately family doctors not smart or mean enough to demand payment up front from struggling families). Too many such patients just pocketed what the insurance company paid them forgetting/neglecting to pay the doctor. Hence , the evolution of the current doctor paid directly by insurer relationships (called “assignment of benefits” in the papers you signed at your medical visit). With HSAs making the insurance involvement now a sham for any actual direct to doctor insurance (non)payment [it’s now mostly just a insurer repricing scheme and the patient usually pays] a return to a direct pay time of service system like you mention is a likely next (retro)evolutionary phase.

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  10. There is a certain irony in the fact that hospitals and other medical providers typically charge patients without health insurance as much as three times what they charge Medicare or an insured patient. This situation is getting increased media scrutiny, which is one reason why clinical laboratories and pathology groups may want to review their own policies for charging patients without health insurance. Self-pay patients include the uninsured, under insured, out-of-network patients subject to balance billing, self-insured patients, foreign patients and some others. Even under the Affordable Care Act, there will still be many (an estimated 30 million after 10 years) uninsured Americans.

    • Thad says:

      My experience as a self-pay patient has been exactly the opposite. The cost is far and away cheaper than the insured price.

    • g woodall says:

      Some insurers (and government programs) insist they get the lowest charged rate but also demand significant discounts – then “regular” rates are inflated to allow the discounts – guess who might be paying the “regular” rates . . .

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  12. M Easterbrook says:

    Is “hiding your insurance” actually insurance fraud? If you carry a high-deductible policy, then state that you are “self-pay” is that illegal or fraudulent?

    • says:

      To the best of my knowledge it isn’t – ‘self-pay’ isn’t a legal term, and I commonly use the term ‘self-pay’ to describe people who have high-deductible insurance.

      • Linet says:

        What if your pharmacy already knows that you have insurance? Are they obligated to file a claim with your insurance, or can they just give you the discounted price offered by the manufacturer?

        • says:

          I’m pretty certain you can ask them not to submit it to insurance and that you’d rather pay the cash price.

          • g woodall says:

            Insurance is a contract between you the insurer to indemnify define losses/expenses in exchange for a fee – pharmacies and doctors have you sign assignment of your insurance benefit because patient used to collect the insurance and not pay – now they are in the middle – so long as you pay your bills the middle men “should not” mind and you “should not” be obligated to use your insurance “benefit” (which of course has been bastardized by discounting systems that don’t reflect reality)

    • A.Bundy says:

      on the contrary, having higher rates because you have insurance is fraud, but i think politicians and lobbyists use nicer works to make it sound differently.

  13. g woodall says:

    of course medicaid and medicare may be exceptions due to “participation” rules which prohibit billing outside the program (? includes criminal penalties)

  14. mike says:

    Kroger told me that they “have” to charge everybody the same price for the same drug.

    • says:

      That may be a store policy, but it’s certainly not something they’re required by law to do.

  15. Linet says:

    I showed my coupon to my pharmacy and told them I didn’t want to use my insurance. They honored it. Hopefully they will do the same on the refill.

    • Tetesa says:

      I work in a pharmacy. How it really works is we have a retail price which we give to the insurance company. The insurance company tells how much they pay and then we negotiate until we each get a portion of the pay. However, sometimes insurance pays for all of it. If you don’t want to use insurance it is not against the law. According to hippaa ( a privacy law for pharmacies and other health care facilities) if you don’t want us to use your insurance you do not have to. It is against the law for us to force you to use insurance or notify your insurance company that you got a prescription without using yours.

  16. Diane says:

    Why couldn’t you just file your insurance yourself so it could go towards your deductible???

    • says:

      Quite often, insurers won’t allow anything towards the deductible unless it’s run through their network and repricing schemes. Hopefully this will change, and there may be some exceptions, but usually insurers look at it and rule it an out-of-network expense and therefore not eligible to be considered towards the deductible.

    • EmilyA says:

      Did you read the article, Diane? If you are not going to hit your deductible, applying toward your deductible is wasted money, AND you paid more by going through insurance. Some people (like me) have a deductible of $4500 for each member of the family. My daughter’s hernia surgery will be entirely on my shoulders, and if it’s the only thing she goes in for this year, I’d rather pay $2000 than $3800!

  17. Medicaid self-pay HIPAA policy says:

    According to the Medicaid self-pay HIPAA policy, what are the requirements and process on a Medicaid patient who wants to be considered self-pay or “out of pocket?” How can the patient be assured that their medical records are not reported to Medicaid in the near future if they do not what them to? I understand that all state policies are different, can you provide me with information on how to access this information.

    • says:

      I’m not all that familiar with specific Medicaid requirements, but to the best of my knowledge you’re not required to bill Medicaid for services if the patient requests that you not. I’d imagine a call to individual state Medicaid offices would resolve this.

      • Dawn G says:

        I am a medical biller, and legally we can not charge a Medicaid patient for any service that their plan considers a covered benefit, such as an office visit for a cold. If they came in for an elective procedure (circumcisions are the one we see this happen with the most) then we can charge them as self pay. It is rare that it would benefit a patient on a Medicaid plan to self pay. 95% of the time there is no opt of pocket expense to a Medicaid patient for a covered service. The few times there are is when they have a “transition” plan and they have a copay of $20 – 30. Drs do not make anywhere near what people think they do. Every time we see a patient on Medicaid we are paid between $18 -$38 depending on the age of the patient and complexity of the office visit.

  18. Judy says:

    The doctors I work for would like for me to find documentation to support the fact that a patient can opt out of using their insurance if we know they have it. Are we breaking the contract we have with the insurance company?

    • says:

      You’ll probably need a good contract attorney to review it, but since people frequently lose or switch insurance plans, you’re likely going to be fine if you just take people at their word when they say “I’m paying for this myself” and not run it through insurance.

      • Billy Bombastic says:

        Ah, I think Judy’s question lets on to one of the key problems with health care costs in the country and major reason for the skyrocketing costs NOT involving the insurance companies. What her doctors are really asking is, “If I know I can bill the insurance company for MORE, can’t I do that and to hell with the patient?” In other words, GREED. Apparently the hypocratic oath does not extend to a patient’s financial health.

        This is why a patient needs to be very cagey about revealing they have insurance. Doctors are not going to tell you which route is cheaper. They will almost always err on the side of collecting the most money. After all, they didn’t go to medical school for 8 years to retire poor.

        • Samantha says:

          Billy I think you totally misunderstood what Judy was asking and have already formed an opinion about clinics. I believe she was asking if an insured patient came to her and requested for her to NOT bill her insurance (this is at the patients request), but the clinic has contract with that insurance company, does the clinic have to file the insurance no matter what, even though the patient requested us not to. This has nothing to do with the clinic asking or trying to hide or be greedy. The clinic is only asking this at the patients request and it is probably due to the exact opposite of what you presumed above, is because paying out of her pocket is probably a lot cheaper than her paying her allowed charges to her deductible that was filed to her insurance company.

          • Tom says:

            Yeah, just like when you share information with your doctor, about care you received elsewhere, and he has copies of the information made without asking for your permission. And, then when you ask him to not share that information with your insurance company he says it would be a violation of some law for him to without any information. The doctor will do anything he can to make a buck, including kissing the butt of the insurance company.

    • Anono says:

      45 CFR §164.522
      If you’ve paid in full and asked for the info to not be released, HIPAA protects against the release of that information.

    • Anono says:

      No, because of HIPAA regulation 45 CFR §164.522
      If you’ve paid in full and asked for the info to not be released, HIPAA protects against the release of that information.

  19. Joann says:

    We are a chiropractic facility and truly want to discount for young children. We have been told that we must be in a “discount plan” in order to offer cash discounts. Our question that no one seems to be able to answer is, can we extend this offer to children who are covered under their parent’s insurance plan? We would be processing the children as self-pay patients instead of insured patients, and at a charge that would be much below any coinsurance or copay currently being offered. This is not to circumvent the insurance but to provide affordable care for a clientele that is often overlooked.

    • says:

      There’s no requirement in law that says you have to be in a ‘discount plan’ to offer cash discounts, perhaps in some insurer agreements however. I think if the children are covered under the same policy AND YOU KNOW they are covered then you may be required under your contract to charge them the negotiated rate, but that’s probably something you’ll need to look at your insurer contracts to determine. The trick is to just not find out whether the kids are on the same policy…

  20. Gloria says:

    Question, our physician is not contracted with patient insurance. Patient would like to pay cash. What if he ends up having surgery and patient wants to bill his insurance? IS this legal?

    • says:

      Just to be clear, the same doctor would be the one performing the surgery?

      First, it’s definitely legal, unless Medicare is involved. Since the doctor is ‘out of network’ it shouldn’t be any problem either, to the best of my knowledge none of the insurers require patients or out-of-network doctors to submit all bills (or any bills, for that matter). Probably the easiest thing to do (check with the insurer first, though) would be to have the doctor hand the patient all bills, and the patient can pay in cash those they want to and submit for reimbursement to the insurer for what they want them to cover. That way the doctor never has to deal with the insurer, and the patient is just submitting those bills for reimbursement they want to.

      • Gloria says:

        Yes, it would be the same physician. What if its a Medicare product?

        Thank you.

        • says:

          If it’s a Medicare situation, I’m pretty sure it’s illegal. Dumb, I know, but they get real upset when anyone with a Medicare card tries to pay cash for anything.

  21. Gloria says:


    A patient has BCBS AZ and a Medicaid plan as a secondary, we are not contracted with any AZ Medicaid plan but we are contracted with patient’s primary. Can the physician deny services since the physician isn’t contracted with patient’s secondary? I believe have to see patient since we are contracted with BCBS AZ and summit an authorization for patient’s secondary. Either get a denial or approval from the secondary. Now, if the secondary denies is patient responsible for any ded/coinsur/oop from their primary insurance?

    • says:

      Sorry, not much I can offer on this, probably need to consult an attorney familiar with provider contracts in Arizona. I’ll just say it’s messes like this that hopefully will make more doctors realize just going cash-only is the best option!

      • Tom says:

        And, then when the patient has enough money to pay for health insurance, but not enough money to pay up-front for something that costs far more than the monthly health insurance payment, that patient won’t be taken care of by the doctor. I’ve already experienced this at the hands of the University of Kentucky.

  22. Marcia says:

    I was told I was covered for preventative care (pap and mammo) by my insurance carrier. Then after the visits I found out I wasn’t because my plan was grandfathered. I was amazed that the office visit for the pap alone was $391. My insurance applied the whole amount to deductible. No contracted amount even though the doctor was in network. I called the doctor’s office, and was told had I said I was self pay, there would have been a 40% discount. The office says they can’t do anything now to rebill it as self pay. Is there any one that I can contact in regards to this? Isn’t this illegal to have two different charges?

    • says:

      This is pretty common, and legal. Once you tell your doctor you’re covered by a certain insurer, they’re obligated to charge you that price even if it would be cheaper to pay self-pay rates. It’s part of their agreement with the insurer.

      • D Moll says:

        Is that allowed by insurance contracts to charge self-pay LESS than what the insurance would be charge, and then with high deductibles, STILL pay higher than self-pay (usual and customary?)?

        • says:

          Yes, it’s all a matter of the specific language of the contract, but I’m not aware of anything contractually (and certainly not legally) that requires cash patients to pay more than insured patients.

    • Taylor Adams says:

      Depending on your insurance company, the provider may be able to submit a provider inquiry or file an appeal and ask that the claim be backed out. (I work for a mental health clinic and occasionally somebody is billed for an appointment they actually did not show up for. In this case, I submit a provider inquiry and let the insurance company know the claim was billed in error). This would result in that $391.00 deductible balance being adjusted and taken back (meaning you would still owe that much towards your deductible) but then you could pay the self pay rate with your provider. It’s worth a call to the provider’s office to see if they can do it at least.

    • Natalie says:

      I had this same problem, but was told over the phone, that i couldnt even make an appointment without giving them my insurance info. I told them i had a large dedutible and would be paying myself.I was told there would be no charge for my annual as it was part of wellness. Well, i got a bill for almost $300. I ,also, was told there was nothing that could be done. Now today, i was told it was fraud for me to self pay while I have insurance. Very frustrating!

  23. C.J. says:

    Now, however, enters electronic medical record, which shares across the board your personal information. I see that causing issues for people who would rather self-pay and another tricky way around people who claim to be, no?

    • says:

      Potentially, but I don’t think electronic medical records currently have insurance information, but it’s not really an area I’m that familiar with.

      • Derek says:

        I work for an EHR company. Just because the records can be shared with everyone, does not mean they actually are. If your doctor sends a prescription to CVS, many times they still have to collect all the insurance information from you. Either because the doctor did not send it, or they want to double check.

  24. J.M says:

    I stumbled across this forum because after a recent experience, I went searching for answers. I went in for a CT and they knew I had insurance. However, the very nice lady at the imaging place presented me with a “self-pay” option. Pay me $413.00 cash today, or I can bill your insurance for you and it will apply to your deductible. I just sat there like an idiot looking at her for a minute. Being blessed with excellent health for the past 55 years, this was something brand new and honestly shocking to me. I said, much would you bill my insurance? She tells me $4,651.00!!! Of which I would end up owing $3,000.00 after deductibles and all. HUH?
    Of course I handed her a credit card and steamed about it all weekend!! How can that be legal? Seriously? If they can still make money with a $400 CT, WHY would they bill the insurance $4,000?? I still can’t believe it. Hence all the exclamation points. This is just not right – scummy!!! The price should be the price, period!! No wonder our insurance rates are so high. Isn’t there anything we can do about this? If we get a movement going, sign me up!!

    • LanceCucumber says:

      Your insurance most likely would not pay them the difference, and you would most likely not be charged more than the self pay amount.

      They may charge 4651.00, but they charge every insurance that amount. When the contracted rates kick in, they are probably looking at $200-$500 depending on what scan type for a CT.

      Your insurance may be able to give you a quote in advance if they offer a pricing tool, but next time just call the billing department, and ask them for the “contracted rate” if they are saying they have no way of telling you that, they are flat out lying. I manage a MRI center, and we make it a point to be upfront with our patients before they come in.

      • HeatherH says:

        I disagree with LanceCucumber in saying that the patient would probably looking at $200-$500 and that she would most likely not be charged more than the self pay amount. The patient stated that she would have to pay approximately $3,000 after her deductible and all (co-insurance or co-pays).

        I really do appreciate any office who is upfront with patients about their charges before a patient comes in, but it’s only helpful if you are presenting correct information. a person who has managed several medical offices over 22 years. I am also a person who has an annual $6,000 deductible and am VERY aware that I will be responsible for all of my (negotiated) charges until my deductible is met.

    • Arnold says:

      The way this works is there is a “maximum billable” amount which is the price a facility or physician charges for a service and the actual reimbursement or “negotiated contract” reimbursement the provider actually gets regardless of how much was billed and there is a cap on this as well therefore creating the incentive for the provider to charge the max billable in order to receive the highest negotiated reimbursement for the service.The difference in these figures can be quite large but generally speaking for out patient services reimbursement is somewhere around 30% of the billed allowable, that percentage can drop significantly in some cases for procedures and imaging though. Also, for reimbursement prices for services and is typically set by Medicare as when they a drop reimbursement for a particular service, the insurance companies will tend to follow suit. It really is a racket and they make sure the average citizen WILL NEVER be able to understand their game! It truly is a ripoff to the healthy patient without a doubt but sadly many never question it.

  25. Brenda says:

    How can it possibly be legal to have a law (ACA) that now requires all Americans to carry health insurance when we can get lower prices by not using it? I’ve experienced similar situations to those in the other comments and wondered “Why do I pay for expensive insurance when it would be cheaper to pay out of pocket?” Because we are REQUIRED TO PAY FOR IT. Some might say – Go to a high deductible plan. We have and it is only about $100/month less than the other plan so we aren’t saving that much money on it. We can’t go to a catastrophic only plan because Obamacare no longer allows that for anyone over 30. Seriously – how is it legal to force me to buy a product that makes all of my out of pocket costs go up?

    • says:

      That’s a good question!


    • LanceCucumber says:

      Because its a scam! Point blank period!

      The ACA gutted plans, raised rates, and shifted responsibility to the patients. Seriously I have seen 5-10k deductible plans w 50% coverage after deductible met. I mean WTF?

      Don’t have insurance ask them for the Medicare rates. Seriously gashed providers again with a 21% cut in reimbursement for the 2nd year in a row. MRI in 2007 was around 500 in Florida w Medicare, now about $225.

      • Somnonaut says:

        OMG people, you are staring at the answer. SINGLE PAYER. DO NOT blame ACA. It only got knee-capped by the Republicans to NOT cut the insurers out of the picture. They are the parasites in the scenario. They make money while doing NOTHING. Put the patient in touch with the physician with a set of prices and be done with it. SINGLE PAYER like Medicare/Medicaid which is all being touted here.
        Wake up.

    • Derek says:

      It’s because no one advocates for the patients. Health insurance companies, and even providers all have people lobbying and negotiating for them. Patients have no one on their side. Unfortunately, the Affordable Care Act is just fluff. It does not really help anyone. Everyone now has very high deductible plans, but no one can afford the deductibles. How does a catastrophic plan help an impoverished person when they have to pay 100% of a $12,500 deductible before it covers anything. Sure they only pay $100/month for that plan, but that’s $100 they could use elsewhere, when paying the deductible would only sink them financially.

    • Mike Samberg says:

      Well Congress writes the “laws” so they are all legal as long as they don’t conflict with the Constitution.

      Most people cannot afford massive medical bills, so if they don’t carry coverage who do you suppose pays for the bills? Either the provider/hospital eats the cost (charity care) which is passed on to other patients as added costs or the government pays part of the costs. So when you go without insurance and “pay-as-you-go” the honorable thing to do would be to sign a do-not-resuscitate and no-emergency-care waiver (if you are unable to pay). That way you don’t risk leeching off the system.

      Otherwise the smart thing to do is sign up for healthcare and quit complaining about a healthcare law (ACA) which is helping millions of people get affordable healthcare.

      • says:

        Mr. Samberg, I’d suggest you check out this site and others and you’ll learn why your comments simply aren’t grounded in reality. As I and countless others can attest, there are viable alternatives to the dominant third party payer system.

      • Tom says:

        Mike Samberg, I pray that you are not part of the upper class economic system, because should you ever drop below that, you’re going to have an extremely difficult time going by your comments. Did you tell your loved ones to sign their names on non-resuscitation and no-emergency-care waivers?

  26. ron says:

    it’s cheaper cash because insurance never pay doctors the full amount, which is why doctors have to overcharge the insurance. insurance may reimburse the doctor 75% of what they ask for, but this rate totally depends on the insurance, which often makes this a gamble for doctors. and I am not even talking about waiting for months until the payment arrives. no wonder that many doctors charge less if they can get it cash and don’t have to deal with that insurance crap.
    With hospitals it’s even worse: insurance may only pay the hospital 10% or less of what they ask for, which is why a procedure that costs 300$ cash may very well have an insurance price of 3000%. It’s the ridiculous insurance system, not the doctors trying to cheat patients.

  27. Ann Day Wills says:

    I have been asking for the cash price for a few years and paying it rather than using my insurance. It is always less expense. Recently, I was denied the ability to pay the lower quoted cash price and was told I had to use my insurance. I have contacted the CA Medical Board and the California Department of Insurance. No one can help me. I understand that I must legally have insurance, but as a consumer I absolutely should have the right to chose to use my insurance or not or how to pay for a goods or service, especially if there is a lower cost option. I don’t understand how legally anyone can be prevented from paying a lower cash price and be forced to pay more for the same procedure. If you go to a mental health care provider, they make sure you have the choice to pay cash and not use insurance in order to prevent certain diagnoses from entering your permanent record. How can if be different for those providers? Can you point me in the right direction? I’m not sure how to challenge this and would like to pursue it. Thank you for your time.

    • says:

      I would guess your doctor has a contract that requires them to charge the ‘negotiated’ rate if they know you’re insured, does your doctor (or really, the billing person) know you’re insured?

      • Ann Day-Wills says:

        Yes, they know my insurance plan. I didn’t realize having insurance forces you to use it. Again, mental health providers ensure you understand the implications of using your insurance rather than paying cash. It seems that these contracts should be illegal.

      • Somnonaut says:

        Forcing one to use their insurance sounds like racketeering. Can’t RICO be used against the insurers?

  28. t says:

    As so many policies are being sold with ‘narrow networks’ it is easy to say you believe you are not covered. I think patients have to get wise to the greedy doctor scams…I had a recent situation where I saw a specialist for 10 minutes. Scam 1- ask what medical facilities the Dr actually has there, I quickly learned this was just a room and the actual procedure I need can’t be performed there. Scam 2- yes we take your insurance…how much if you don’t $100…then I get a bill for the amount the Dr wanted to bill insurance $320…
    I checked again and office is in-network so not sure why they didn’t bill insurance but I can only assume the insurance company would negotiate down the claim ( $2000/ hour? Hardly surprising) so this is a sneaky attempt to maximise profit.
    I plan to call the Dr office and negotiate the bill down to the original $100 at most, or report the whole situation to my state insurance commission ( on every statement)
    I presume all these corrupt tactics are well known, but if the agencies start getting written complaints en masses they can hardly ignore it!
    As an aside the actual doctor seemed so caring and normal…beware charming people I find so often. My grumpy GP has never once tried to exploit me!

  29. t says:

    As for the suggestion about just don’t pay- a company once sent me a bill I questioned: I simply didn’t owe them the money. A spurious less than $200 ( No explanation) was passed on to a collections agency. I tried to resolve it via the credit reporting agencies ( hint- another scam industry) Wasted a bit of money- got nowhere. But I felt strongly I should not pay a bill I don’t owe.
    The ‘debt’ gets sold on to weirder ‘busineses’ posing as salespeople, id theft, one call w as purely menacing…finally a call from a man who said how do I propose to pay my debts…I told him I don’t have any unpaid debts…then calls start again ‘you have won a prize’…but guess what- give your credit card number to win. Unbelievable that these are legal business practices, but they are apparently. Or no one can do anything about them.

    Sorry-junk follows as editor didn’t work.
    menacing…then finally after several years of periodic harrassment an actual call from someone who asked me how I proposed to settle this ‘debt’. I said I

  30. Tammie says:

    Can you pay as an uninsured and bill your insurance company on your own?

    • says:

      If the provider is out-of-network, yes. If you’re insured though and the provider is part of the network, the insurance company is likely to throw a fit and require you to pay the negotiated rate, even if it’s higher. Makes no sense to me, but that’s the way they operate.

  31. withheld says:

    Actually, the practice you are describing is known as “balance billing” and it is illegal in all 50 states, I hate to tell you under the ACA. That’s the point of insurance. So if you are covered by the federal supplement, you shouldn’t have a copay, and you are not a cash patient, you are covered by the governement’s insurance. But if you’re not eligible for that care, then you are covered by your employer, or you have to provide your own care, and then you should be able to make the copayments, since I’m single and wouldn’t have to pay for myself unless I earned more than $63,000 per year. Doubt I’ll be paying for my health care any time soon in this lifetime, only problem is that the state of California wants to come after me for all the bills they’ve paid on my behalf and take it all back if I’m fortunate enough to live past my 55th birthday~~enough to make me want to commit suicide, but hey…..

  32. Trevor says:

    Today I discussed having my tonsils and adenoids removed at my Ear, Nose and Throat specialists office. Although they could not give me an exact number, they told me to expect the total bill to my insurance company to be in the $12000-14000 range. Even if I had reached my deductible for a calendar year, that leaves me with 20% responsibility: $2400-2800.

    Moot point though, as I no longer work for my old employers and I have no insurance. I was feeling pretty despondent until the lady in the office told me that if I can pay cash before the procedure, they can do a discounted rate of $2250. Thats not my portion, thats the total cost.

    So under my previous insurance I was paying $590/month for the right to be grossly overcharged. Never did I reach an out-of-pocket maximum. By my math over 36 years insured I paid about $165,000 in premiums which in turn paid about $6000 in medical bills for me. And that’s at the higher insured rates.

    It’s all a scam……..just like car insurance. Paid my premium to Nationwide every month since 16. Minimum $150k in premiums paid over 40 years. Had my first claim 2 years ago. Damaged a trailer I backed into, to the tune of $1500 paid by my insurance company. Which raised my rate by $950/year. So even though my premiums already paid for ther claim 100 times, I have to pay them for the accident and then some over the 3 years my rate hike is active for.

    The world would be much better without insurance and credit. Both are systems to suck the money out of the people who don’t have much and blow it into the coffers of the wealthy Barons of Industry.

  33. Joel says:

    I have been billing Insurance Companies for over 30 years. The self pay rates are always up to 3 times or more what the Insurance Company pays. Even if you can negotiate a discount it will not equal what the Insurance will pay.

    For Example Lab Test Self Pay Insurance
    Hemoglobin 70.00 11.00
    CBC 40.00 11.00
    TSH 125.00 24.00
    CMP 62.00 15.00
    Thyroxine 44.00 10.00
    T-3 Free 220.00 25.00
    Total 561.00 98.00
    Even if you have not met your deductable you can only be charged the insured amount unless it is considered Non-Covered.

    If people could pay what the Insurance Companies Pay we would not have a Health Care Crisis.

    • says:

      It really depends on whether you are going to a medical provider that caters to self-pay patients. If you aren’t then yes, you can easily pay three times more than what the insurance companies do. If, on the other hand, you go to a cash-only or at least cash-friendly provider, then chances are pretty good that you’ll get at least as good a price as the insurance companies, or at least close to it.

    • Bella says:

      That is if the doctor’s office sends your labs to an in-network facility. Otherwise you will be stuck with a $3,000 bill. Big lesson learned. Another big lesson I learned was just because you went to an in-network facility, all of the doctors that treated you may not be in-network. Now I’m stuck with some major bills for going to the emergency room for the first time in my life. What really chaps my hide is that I pay about $900/month for my group insurance premiums for my family. I will definitely need to research more about the benefits of self pay.

  34. Denny says:

    I use Costco in Oregon and for one of my prescriptions my insurance will only cover 9 pills a month. I need 30 pills a month/one a day/per doctor’s instruction.
    Don’t ask me why insurance gets to set up how much I take. I asked Costco to never use insurance for that prescription, which they do at my request. It’s actually cheaper now than my co-pay. Got to love insurance companies, they at
    are now deciding what kind of drugs I take and how many.

  35. Dr. Herrin says:

    Here is something most are missing. The office that provides a cash discounted price for NOT BILLING INSURANCE actually makes more profit when they collect the lower fee, than when they bill the insurance and collect the higher fee. In 2003 Medicare agreed that it is cheaper for a doctor to see a cash patient than an insurance patient, hence the “cash discount” became acceptable at that time. A doctor’s office spends an incredible amount of money on staff, computers, and software just so they can bill YOUR insurance, whether you have met your deductible or not. The work was already done. Want to revolutionize healthcare, make it illegal for a doctor to bill your insurance. Pay cash and put the burden of insurance reimbursement back on the consumer of the healthcare. If you spend hours filling out paperwork, wait two months to get reimbursed 50% of your charges at the doctor, two things would happen. People would quit paying premiums for terrible insurance, and the cost of healthcare would drop since doctors would not be burdened with billing and collection expenses.

  36. Ed says:

    I have heard of hospitals advertising on the radio up to 50 % discounts on high deductible plans purchased on the ACA health market exchanges. Received brochure in mail today stating what I heard on radio. It’s called the Positive Bill Program according to the brochure. Quoting the brochure, “individuals who are signed up with one of the new Exchanges, yet have a high deductible, will receive a 50 percent discount on services and the full fee will be applied to help meet the deductible.” Nice thing to know if you have a bronze plan with a $5,500 individual/$11,000 family deductible. Do some home work now and know what hospitals offer this in case you need to use them in future.

    • says:

      This is interesting, though I’m not sure about the legality of this. I don’t believe a provider can essentially “credit” to an insurance company deductible bills that they don’t intend to collect.

  37. Tommi says:

    So my question is that if it is ideal to be a “cash only” patient in lieu of incurring an increase in patient responsibility, then why are the “uninsured” not taking advantage of this “huge” discount that is readily available? Why do they choose to use urgent care and emergency departments as a primary care ifthis wonderful commodity is readily available? It seems to me that there should be more attention brought to paying your way and therefore you can qualify for discounts, as opposed to only bringing awareness to the fact that the insured are being over charged and encouraging them to not use insurance. There is a reason the ACA was put into place it was to encourage those who do not pay for health service at all because of their “unisured” status to finally be accountable and quit placing a burden on the rest of consumers who comply.

    Why is there so much written off along with non-collected funds because a person goes in for medical care and then never pays their bill? Statistics show that in 2013 hospitals collected: 15.3 percent. (Source: ACA International’s Top Collection Markets Survey*, Jan. 1 – Dec. 31, 2013.) U.S. hospitals provided $45.9 billion in uncompensated care in 2012, representing 6.1 percent of annual hospital expenses.(Source: American Hospital Association, “Uncompensated Hospital Care Cost Fact Sheet,” January 2014.)
    U.S. hospitals reported that 5.93 percent of their total second quarter 2014 gross revenue was written off as charity care or bad debt, compared to 5.09 percent in the first quarter of 2014. Of the 5.93 percent written off as uncollectible, 3.03 percent was for bad debt and 2.90 percent was for charity care expenses. Uncollectible write-offs among Southeast, Southwest, and Midwest hospitals swelled past the benchmark in second quarter 2014, and significantly so for Midwest and Southeast hospitals. Midwest hospitals reported the highest level of uncollectible write-offs by region, at 11.40 percent of total gross revenue, or more than double the 4.73 percent of total gross revenue written off as uncollectible in the first quarter. (Source: The Hospital Accounts Report Analysis on Second Quarter 2014.)

    It seems to me that everyone loses. Especially, because people who do not comprehend that a physician and/or facility is rarely reimbursed their actual charges, rather only a portion of that and they often times write off the difference. Not to mention in the event the facility does not get the charges in within a certain time period they are subject to a timely filing penalty which means they cannot file to a insurance company and therefore write off or eat the cost, and this by law cannot be billed to the patient’s responsibility.

    • says:

      Well, there are different reasons people are uninsured. Some are extremely low-income. Some could afford to buy insurance but just don’t see sufficient value in what’s available at the given prices. And some, myself included, just don’t want to be part of the third-party payer system where each and every encounter with a medical professional also involves some unknown number of insurance company bureaucrats, and pay far more than we need to for that privilege. Being “self pay” doesn’t mean skipping out on the bill, it means just what it sounds like – we pay for our health care. I would also suggest that if hospitals charged the uninsured real prices for their care and not wildly inflated “chargemaster” rates then some portion of that debt that is written off or considered uncompensated care would in fact be paid – a lot of people might look at a $6,000 bill for a busted arm and say “I can pay that over time” instead of looking at a $25,000 bill and saying “no, I can’t ever pay that.”

    • Arnold says:

      While these figures above seem astounding, you also have to account for the difference between what the provider bills and what is actually received by the insurance company and considered “paid in full” by both the provider and insurance company. The patient is not held responsible for this amount. For example if a provider bills the max allowed billable amount of $800 for an echocardiogram and assume the patient has satisfied their copays, etc and the amount reimbursed by insurance is around $200 for the service. The $600 difference is not passed on to the patient because the contracted amount reimbursed for the service of $200 is understood by both the insurance company and the provider therefore that $600 is a “write off.” So these large figures they publish also contain these differences for the insured patients who have indeed met their financial obligations to the hospital and the hospital has acknowledged such as well. It’s an extremely beneficial system for the provider to be able to write these differences off although they aren’t related to any realized cost of the service but rather an exorbitantly inflated price that has little to nothing to do with the cost of providing the service with the certain knowledge they will only receive a certain amount from the insurance company and the difference is written off. It’s a rather symbiotic relationship between the two entities;)

      • AZ Marcia says:

        As a practicing health insurance agent (for almost 40 years) a practicing certified medical biller and coder (for almost 8 years) and retired medical practice manager (I know really weird combination of skills but it works for me), I read Arnold’s comment several times and I now feel compelled to share a few tidbits related to medical insurance coverage, submitting a claim to an insurance company and the “write-off”.
        A. The amount billed to an insurance company (and insurance company), that extremely outrageously high bill, is called a “Charge-Master”, Provider Fee Schedule, or my favorite a Master Fee Schedule, among other things and the doctor or medical office or hospital can only have 1 (one). That Master Fee Schedule must be used to bill for services to ALL the insurance companies the provider is contracted with. The “negotiated” reimbursement rate is the amount the doctor or medical practice or hospital has agreed to accept as payment for the services provided. The negotiated fee has nothing to do with the Master Fee Schedule. Why only one Master Fee Schedule you might ask? And why is it 2 or 3 or 4 or 10 times higher than what the insurance company might actually pay? Because the Master Fee Schedule needs to be high enough to cover every insurance contract the doctor has agreed to and not be less than what the negotiated fee is for each one of them.
        Here’s why: If a doctor bills the insurance company $250 for a service and the insurance company’s negotiated fee is $275 how much do you think the insurance company is going to send the doctor? If you guessed $250 you’d be correct. An insurance company will never send a doctor more than what they ask for. Would you pay $30,000 for a car with a sticker price of $20,000? It’s the same idea. And every insurance company pays a different negotiated fee for the same service. For example, insurance companies #1 pays $259 for new patient visit, limited complexity and insurance company #2 will pay $367 for the exact same claim. The doctor does not know how much more insurance company #2 pays compared to insurance company #1. So the Master Fee Schedule has to be high enough to cover both negotiated fee schedules form #1 and #2. The insurance company is not going to pay a doctor more than what they ask for.
        B. The negotiated fee determines the entire amount allowed for the service provided. The negotiated fee also includes the co-pay, deductible and co-insurance. These are subtracted, with a note on the EOB (explanation of benefits) that these are the patient’s responsibility to pay. Then the “net” amount of the negotiated fee is paid by the insurance company to the doctor, medical practice, hospital, etc.. Contractually, the negotiated fee is the total amount that can legally be collected from all parties (patient and insurance company).
        C. The “write-off” – the difference between what the Master Fee Schedule says and what the Negotiated fee is, is not a tax deductible expense. It has absolutely no value as far as the business is concerned. It is not a bad debt, it is not a deduction, it does not affect the bottom line of the doctor in any way. It has no value. It is a line item that is reviewed by providers, clinics, hospitals to determine if their Master Fee Schedule too high or too low. The only deductions a medical office has are (basically) the same as most other businesses. If the medical office gave a patient a “discount” of some kind against the negotiated fee (which would be a red flag to someone like me and an entirely different comment…) then the “discount would be something to consider as a business deduction. But not the difference between the Master Fee Schedule and the negotiated fee.
        I hope this helps.

  38. Maria says:

    If a medical claim has been already submitted to my insurance do i have a right to take it off my deductible and pay myself using discounted rate?

    • says:

      Probably not – once a claim is submitted by the provider, you’re pretty much stuck with that price regardless.

  39. Laurie says:

    I have a question regarding self pay. I have been insured with the same insurance company for many years. The specialist I need to see is listed as a participating provider according to my insurance company. Each doctor must be approved, not the group they are with but each doctor personally must be listed as a provider. That being said, I made an appointment with this doctor. When I was seen for my visit, he told me he was re-applying to be a provider in his own practice. He left the group he was with. But according to my insurance company, if he still has the same address, which he does, then he is still a participating doctor. This doctor made me pay for the initial consult in the amount of $200, rather than a $20 co-pay. Then he said once he was accepted by my insurance company, he would submit my claims after that and charge me accordingly ($20 copay).

    On my second appointment he charged me $100 for the visit. I told him that I contacted the insurance company and they said he was a participating provider. He ran out of the room to make a phone call. He came back and said he was not, but he is!!! I’m real confused, because he is a participating doctor. First he tells me he had an application pending with my insurance to be a participating provider under his new practice, and now he tells me no no I’m not going to accept your insurance and I don’t have an application in. All he wanted to talk about was the money, and how he charged less than what medicare pays. I don’t know anything about that. I’ve never went to a non-participating provider before. When I made my first appointment, I was told he was and made sure he was participating with my insurance company. Now it’s a whole other story. So after much back and forth, he says you can go somewhere else, you don’t have to see me. The problem is that he is a pain management doctor, and now I have no choice. My doctor that I had for years has decided to close he pain management practice and just practice as an anesthesiologist.
    In the pain management world, you must pick a doctor and stick with them. There are not many to choose from on my list of participating providers. They are either not taking new patients or do not care for my illness.
    My new “self pay” doctor I guess feels sorry for me because he lied to get me there, told me he accepted my insurance and has me in a pickle. I had to pay $200, then $100 and he said next time he’ll charge me $89. I can’t help but think somethings wrong with this picture.
    He said don’t worry, you’ll reach your deductible soon. Which is not the case. My deductible is $1,000, I will never reach my deductible. I also asked him if he was reporting my visits to my insurance company, so that it does go to my deductible. He said of coarse! I don’t think he is, because he is listed as a participating provider, and the insurance company would find that odd.
    So my question is: Just because this doctor is no longer with the group he was with, does that mean he is no longer a participating provider? I mean I called my insurance company, and they said that doctors must apply individually to be participating. So as an individual, he is participating. He kept telling me that he was applying for a new tax ID number, what does that mean? He is clearly covered under my insurance. Yes he is making more from me than what the insurance would pay him. And he gets paid right away, in cash. He said the insurance companies take tooooo long to pay.
    Is this legal? This guy has me at his mercy, because of what is going on in the pain management world. I guess I should just keep my mouth shut. I have real good insurance and never had to “self pay”, its not advantages for me. One appointment is costing me what five appointments would cost if he would just put it through the insurance.

    • says:

      I don’t know the particulars of this doctor’s practice, but it’s not unusual for there to be lots of confusion over whether or not they are in a particular network – sometimes they are in the network for some plans offered by an insurer while they are out-of-network for other plans from the same insurer. I assume you have medical bills from him, you might want to try submitting them for reimbursement from the insurer. That ought to prompt one of two responses – the insurance company will say he’s in-network, refund you the payments in excess of your co-pay, and go to him for the difference and possibly violating his contract with you. Or, they’ll realize he really isn’t in-network after all, in which case you have your answer. But the bottom line is, if you feel like this doctor isn’t on the level with you, it’s probably time to seek another provider.

  40. Sean says:

    I am trying to get on PreP (a preventative HIV medication) which would cost $1500 per month – after the insurance discount. Obviously, no one can afford that. However, there are plenty of programs available for people without insurance. Many of my friends are on it and don’t pay a dime. But the BCBS Bronze plan that I have won’t help much with costs before I reach the $6K deductible, and I just don’t have that kind of cash. The health center I go to already knows I have insurance though – it’s all on file. I was in today for an appointment, and asked about PreP again. Even the nurse told me that I should have lied and said I didn’t have insurance! So I guess my question is, if I wait a month or so and go back in, can I tell them that I have since cancelled my insurance in order to qualify for the medication? Or will they do some background research to check whether or not I still have it?

    • says:

      I’m not sure what your best option here is, it’s one thing to simply omit the fact that you’re insured, another to lie, particularly if this health center is funded with public dollars. I’m generally the last guy to tell people to buy the “Cadillac” health insurance plan, but in your particular case it might be worth getting a “platinum” plan – generally speaking for people with chronic conditions that’s the best financial option.

  41. Juan says:

    I have a high deductible plan, my doctor is openly telling me that if I use the insurance I end up paying 500 USD for the visit but if I self-pay I would only have to pay 80 USD.
    The problem are then the lab tests, those are sent to a third party. I am wondering if I can say I don’t have an insurance and once I have the bill call BCBS and tell them that I am insured for the lab work, sometimes they pay 50% of the lab. Then what is the doctor going to tell me? That my bill is much higher cause they actually want to charge 20 times more the insurance?

    What is not legal is to charge one price to self-pay and then inflate the bill for the ones who have an insurance, that is just a fraud.

    It is also illegal to routinely excuse patients from copayments and deductibles. (A copayment is a fixed dollar amount paid whenever an insured person receives specified health-care services. A deductible is the amount that must be paid before the insurance company starts paying.) It is legal to waive a fee for people with a genuine financial hardship, but it is not legal to provide completely free care or discounts to all patients or to collect only from those who have insurance.

    Studies have shown that if patients are required to pay for even a small portion of their care they will be better consumers and select items or services because they are medically needed rather than because they are free. Routine waivers thus raise overall health costs. They are considered fraudulent because averaging them with the doctor’s full fees would make the “usual” fees lower than the amounts actually billed for.

    • says:

      I’m not sure everything in this comment is accurate, but it’s an interesting take.

  42. Monika says:

    Question: I’m new to insurance policy, benefits and coverage. Recently I visited a Doctor, she ordered for few lab tests to be performed by a lab company which is not contracted with my insurance company. I was not aware of this until I received a bill from Lab company stating that I’m solely responsible for the payment of bill as they are contacted with insurance company. Basically I donot know I should check about all these prior. Now when I contacted insurance company regarding bill, they asked me to write an appeal. Could anyone please help me to come out of this situation. I would be very thankful to them.

  43. David Loftin says:

    Seems to me that it is the hospitals & doctors that are charging the insurance companies the inflated rates. Why would the insurance companies WANT to pay more? Unless I’m missing something it appears that most people blame the insurance companies when I would think that during negotiating what prices they pay the insurance companies would try to pay as little as possible. I just had surgery and had met my deductible and the insurance company paid almost $40,000. Basically 100% of the bill. I don’t think they would WANT to pay that much. So, looks like to me the insurance companies are getting the screw job and the doctors & hospitals accept a lot less in cash payment because they don’t have to deal with all the insurance paperwork if you pay them up front.

    • Charlene Mercadante says:

      This is all crazy… it’s no wonder cost of buying insurance keeps rising.. the insurance companies pay 3x the amount the cash buyer would be offered. This makes no sense and seems like fraud to me. How can you have one price for the insurance company and a different price for the cash buyer? I’ve run into this with a emergency room hospital bill…. they charged the insurance company over $1000, I’m to pay $807 since I have not hit my deductible yet… the hospital charges $239 to the cash buyer. I’m telling them I will pay them the $239 not the $807 since my insurance company did not pay them a penny and they will not accept it because they ran my insurance. Pretty annoyed right now and tired of the scam that WE all pay for by paying inflated rates to insurance. I don’t get it.

      • Charlene Mercadante says:

        Is there anything I can do about this? do I have any recourse??

        • Katie Owen says:

          Dear Charlene, I am in a similar position as you are! I was wondering if anything worked in this situation because frankly we are getting screwed for having an insurance! We can’t let them win! This scam

          • Thad says:

            When you have insurance, you are the product. The insurance company and the hospital have contracts. Those prices are usually part of the contract. You can’t know the price agreed to in that contract…but you do get to pay the contracted prices. You can find services who will fight the costs for you, but if the charge is legit, you’ll be left with it (if you haven’t met your deductible).

      • says:

        This, unfortunately, is how insurance works. I wish you luck and it’s possible that they’ll agree to the lower cash price, but generally it seems that hospitals and insurers are pretty intense about their negotiated rates and won’t waive them under most circumstances. Crazy indeed!

  44. Peter Canney says:

    Be VERY careful with this. Most insurer/provider contracts stipulate that if a patient has insurance, then the copay MUST be paid, and the visit billed to insurance. (NOTE: in managed care, to “write-off” a co-pay, or to allow a patient to see the doctor without collecting the co-payment, is against federal law). IF the insurer finds out, the physician can be penalized or kicked out of the network. The real reason is not, I think, the money (obviously, the insurer wins there). It is, I think, the patient’s medical data they are after, numerous reasons, including meeting quality mandates, and, if ACA goes down, the possibility of again using pre-existing conditions to deny insurance or raise premiums to assigned risk rates.

  45. chris utley says:

    I was involved in an auto accident requiring me to be seen in the ER, they performed a ct scan of my head and one of my neck and diagnosed me having whiplash. I live in a no fault accident state so had to file claim thru my auto insurance. I had 10,000 worth of PIP ( personal injury protection), they billed me 18,340.00 for services, plus the er dr charged me a separate bill of 1,621.00. After my insurance covered the 10,000 it left me owing 8,340 plus the drs bill. 2 months later a friend was in a car accident went to same hospital thru the er, she had no insurance coverage at all. She received 2 ct scans, stitches in her lip, and xrays of her arm and her bill barely reached 8,000. Is there anything I can do to make them re evaluate my charges and hopefully not be left owing the 9,000 and change balance after my insurance payment

    • says:

      Can’t say for sure but I’d think your health insurance (if you have any) would pick up the balance. Failing that, contacting the billing department or bringing in a professional medical bill negotiator may be your best option, but be sure you have full documentation on what the hospital typically accepts from self-pay patients. You’ll need to compare the bills you have, line-item by line-item, with your friend’s bill (assuming she’ll let you) to make sure it really is for the same services – she may have had a different type of CT scan, for example. Hope this helps.

  46. Jeff says:

    I received an invoice from a pathology group for $160, along with a request to provide insurance coverage information if I have it. If I do this, is the group allowed to increase what I owe if the claim comes back with a higher amount? I feel like this is a different case than some of the other ones posted here, since I already have a number from the provider — I’m not asking for the cash price after the fact.

    • says:

      Yes, they can increase the price after the fact if the negotiated rate is higher than what their cash price is. It’s also possible the negotiated rate is lower, you might want to check out Health Care Bluebook to see what insurers typically pay for those codes.

  47. nancy says:

    I have an itemized hospital bill $1887.95 and the hospital is requesting to be paid $3000 because the insurance has an “allowed” amount of $7000 and they paid $4000 and want me to pay the $2000 deductible and $1000 copay. The EOB and hospital bill clearly only show the charge is $1887.95. Both provider and insurance co say they have a contract and the $3000 is what needs to be paid but why would my insurance company pay more than the bill and want me, their customer, to also have to pay more than the bill. I thought the allowed amount is the maximum the insurance will pay per contract or the provider’s charge – the lesser of those. Am I crazy?

    • says:

      No, the “allowed amount” is what the insurer has agreed will be paid between them and the insured (you). Sometimes the list price is less than the “allowed” amount” in which case the “allowed amount” is still what’s owed. Crazy, I know. Most people think having insurance means you get great “negotiated” rates that are lower than what self-pay patients might be billed, and often that is true, but not always. And usually self-pay can negotiate down the fee to something closer to what insurers pay. All part of the bizarre world of third-party payment.

      • nancy says:

        Okay, still upsetting to have insurance and have them negotiate for me to pay more than the actual charges. I have never seen an EOB where the allowed amount is greater than what they charged. I guess they have a flat fee for the procedure (newborn baby). My hospital bill for the delivery was separate. My baby had no issues so the itemized cost was very low – I assume a lot of babies have more procedures done which could end of making the newborn baby bill higher than their allowed amount but it still seems wrong to me that I should have to pay $1100 more than the bill to “compensate” for other newborn babies whose bill is higher than the contracted flat fee between the hospital and the insurance. I had already filed a grievance with the insurance company and am waiting to hear back by Nov 16. I assume now there will be no change from what you say but I think I will ask to “retract” that claim on the baby and then just be liable to the hospital their $1887.95 charge. I have switched insurance companies beginning 11/1 anyway so I am not concerned with having just about met the deductible. The other option is to just let it go and pay the $3000 but just pay it over a year period instead of all at once. Thank you for this forum – I have searched high and low on the internet to try to figure this out.

  48. Marcia says:

    FYI -I asked to retract a claim because the payment was less for uninsured patients but was denied. I would try it as it seems each person has a different answer to the same question. With my claims, they never understood why they still owed me a refund. Since it was around $25, I gave up after 5 phone calls. But it is still annoying to me.

    • nancy says:

      Thanks Marcia. It seems a no-win situation. I will see how the grievance works out and go from there. I tried to call them on another topic the other day and over 1/2 hour period I was put on hold and hung up on 3 times so I gave up. It seems that if they can’t answer your question, they put you on “hold” but you get disconnected. Sad state of affairs.

  49. Janice says:

    If I have a plan with a high deductible, and I have a hospital stay that surpasses that deductible. Do I have to prove I have paid off the previous hospital stay before the insurance will pay the rest?

  50. KLJ says:

    My husband needs a CT scan, but doesn’t want to have it because of the radiation. He would like an MRI instead, but insurance won’t approve the MRI (only the CT). Can he request to pay cash for the MRI (even if this specialty dr knows he is insured)? If not, can he go to his regular doctor for the MRI and request the MRI?

    • says:

      He can certainly request it, I suspect that even though he’s paying cash he’d still be charged the negotiated rate. Probably best off finding a third-party MRI that offers cash prices, and not getting the MRI through the specialist or another doctor that knows he has insurance.

  51. Janell says:

    I just found out that if you claim to not have insurance your bill is cheaper.
    My daughter went to the ER room in November and the total bill was around $2400. We were asked to pay around $860. I filed with our insurance and now our bill is around $1400.
    Can I retract the claim? or fight to pay the $860? Is that successful? or a waste of my time.

    • says:

      Unfortunately, probably a waste of time. Your provider is obligated to charge you the negotiated fee once they find out you are insured.

  52. Emily says:

    The doctor I saw only accepts self-pay and provides paperwork so you can submit the claim directly to your insurance. I paid the $450 up front and I then submitted to insurance, and they only applied $200 of the $450 bill to my deductible. Is this typical?

    • Sean Parnell says:

      Not sure. Sounds like they may have decided to reimburse at an out-of-network rate. Or else the doctor you saw is really, really pricey.

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  55. Angie says:

    Does anyone know if insurance companies are obligated to tell you what your lab costs through a PPO will be before you have the labs? My insurance has refused both times I tried (once Humana and now BCBS). How can you compare self pay rates to your PPO plan rates if your insurer refuses to tell you ahead of time. I don’t understand how they can get away with this. It’s like going to a store to buy something and they won’t tell you the price until you make the purchase! There has to be a way around this, but I have struck out both times trying to find out what my price through insurance will be, both with the lab who can’t tell me and the insurance company who can’t tell me!

  56. Cher says:

    I’m sorry but this is not a reply to last comment but it is a problem that many people may encounter if they go with self pay. I gave my dentist my insurance information and he offered me a discounted price in lieu of billing my insurance. I paid him the agreed amount, and received a receipt listing each procedure. Three weeks later I received a statement of charges submitted to my insurance company and payments paid to my dentist. Listed were the exact items that I already paid for. I believe this is illegal (double billing). I’m still waiting for my permanent crown which I paid for (my insurance pays nothing for a crown, so dentist did not bill insurance for this procedure). I plan to wait until I receive the crown and then ask for reimbursement. What recourse would I have should he refuse?

    • Sean Parnell says:

      Small claims court and complaint filed with the Better Business Bureau, plus contacting your insurance company and the state board of licensing all come immediately to mind. Of course it could have been a clerical error, his billing person may not have known about the arrangement.

  57. Kay says:

    I went to my regular dentist for an eval of a cavity in a molar and an evaluation to extract 4 wisdom teeth (2 are impacted). The dentist billed Aetna (dental provider) then the dentist referred me to a specialist.
    Here is the problem: The specialist submitted a limited eval for the tooth with the cavity to Aetna, then billed UHC (my healthcare provider) for the Exam and Xrays on my wisdom teeth.
    Aetna paid 100% of the limited evaluation on the single tooth. UHC paid $0 toward the Xrays and the exam on the wisdom teeth.
    The specialist handed me a treatment plan totaling $2,504. She said “by law, we had to submit the wisdom teeth to UHC because that is your primary health insurance and Aetna dental is your secondary insurance and the rates you are paying on this treatment plan are the negotiated rates from UHC which are your responsibility”.

    Aetna would have paid 100% of the entire bill and UHC would pay $0. Am I missing something? If Aetna Dental would pay 100%, why “by law” did it go to my health care provider first? In the end, I cancelled that appointment and went to a different Oral Surgeon and my dental insurance paid it all. To have me pay UHC rates seemed like a huge scam to get more money to me.

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  59. Emilee says:

    in a physical therapy clinic can you charge a cash pay price of say $85 for a treatment that you would normally bill to insurance as say $190?

  60. Barbara says:

    Medicare only pays gynecological exam biannually. I did not know this and went for my annual appointment. With Medicare they charged $106.00 and collected less than $40. They are charging me $402.00. Do I have to pay this? Or can I pay the insurance price?
    What is the legality? It sure isn’t fair.

  61. Jen says:

    I have a member who is asking why he can get a prescription with the Good Rx discount card cheaper than his insurance – he is on a high deductible plan and pays full negotiated discount rate until he hits his deductible. If he was on the PPO plan he would pay cheaper than the discount card by far. He thinks his insurance plan should cover the drug for the same price. I have explained discount cards are seperate from insurance and do NOT go towards ded. or OOP and he thinks the company is screwing him over. Any way to eloquently respond more than I have in that he pays full price until his deductible is met (he chose the HSA plan) he can use a discount card and it won’t go towards ded….

    • Sean Parnell says:

      I’m not sure there is an eloquent way, but it probably wouldn’t hurt to tell him to read my blog or book to understand how the system works (or doesn’t work, as the case may be).

    • Arnold says:

      Perhaps he should weigh the savings to him by using the discount card and not having it go towards his deductible or paying insurance prices and having it go towards the deductible. For my family I have found on multiple occasions the savings from using the discount card far outweighs paying insurance prices and it going towards the deductible especially when going for a refill of a maintenance med and being hit with the “your insurance company won’t cover this unless you get prior authorization from your doctor and proof of step therapy otherwise you’ll need to pay $365 today for the med.” Yes, this happened and was for a 30 day supply of a generic medication that was not new to us and we needed it that day. Of course I was angry at the prospect that the $1100 per month premium for an insurance policy that was seemingly worthless. My first question was what about if I use the discount card which was coincidentally FREE, the response was $41.00 to which I said “I’ll take it!” So, for me it is totally worth not having to jump through hoops or pay their “insurance price” for the meds despite the fact it won’t go towards the deductible.

  62. Beth says:

    If a patient is covered by an ACA plan with a narrow network and no out of network benefits, and he/she wants to continue seeing a doctor who is out of network for said plan, are there any restrictions on the patient paying cash for the visit, since the doctor is out of network? What if the patient has Medicaid and is seeing a non-Medicaid provider? Is it illegal for the provider to accept a cash payment for services rendered? And, though it is rare, what if a doctor is not a Medicare provider? Can a Medicare patient see the doctor and pay out of pocket? Trying to determine if there are any legal guidelines as to whether or not a patient is allowed to pay cash to a non participating provider in any of these three scenerios? Thanks!

    • Sean Parnell says:

      To the best of my understanding, there are no restrictions on paying cash to an out-of-network provider if you are in a narrow-network plan (or any other private plan). I think, but am less certain, that a Medicaid-covered patient can also pay cash. A Medicare patient who sees a doctor that does not accept any Medicare payments can be paid cash as well, but if they accept Medicare it’s illegal if it is for a covered service. Hope this helps!

  63. Rick says:

    Great article and thank you for the information.
    What if you did in fact give your insurance information out of ignorance expecting to pay less than the self pay, but you then receive a bill that was higher than self paid because the insurance was charged more than three times.

    For example, a procedure cost $150 for a self pay with no insurance.
    I provided my card anyway because the rep at the front said maybe it will be cheaper.
    I was told later as i left to not worry about anything that it will be billed later. I assumed it was going to be billed $150. Yet since it was through the insurance they sent them a claim for $550, and I am responsible for $216. Is it too late for me to be able to pay the 150?

    • Sean Parnell says:

      Unfortunately, yes, it probably is too late – once they know you have a particular insurance policy, they’re contractually obligated to charge that rate. They might be willing to negotiate the bill, however.

      • Rick says:

        Thank you for your response. Is it illegal for the office (florida) to charge me less than the amount my insurance has told them to charge?

        • Sean Parnell says:

          “Illegal” is the wrong word, but it probably is a violation of the contract to charge less than the “negotiated” rate.

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  66. shahe kaimatlian says:

    how does this work with multiple doctors involved. for example if i needed surgery for colon cancer and i need to be in a hospital with a surgeon and an anesthesiologist. i assume the 2 doctors both have to be paid, and the hospital has its own charge correct? getting both doctors to agree to work on the same day. time in the same hospital. seems impossible logistically and how much of a discount would be expected if i paid cash? assuming i can get that amount of cash ofcourse. it still seems like inurance is the best option for more complex procedures requiring multiples tests, procedures and specialists.

    • Sean Parnell says:

      You’re right that it can be a bit tricky, UNLESS you go to a hospital that caters to self-pay patients or, even better, is cash only. Surgery Center of Oklahoma and Regency Healthcare in New York come to mind, but there are others as well. But yes, trying to coordinate doctors can be a pain if only one is cash-only.

  67. Jacquelyn Dudek says:

    I am a diabetic and some of my insulin is over $1000.00 per month. I am also on medicare and will reach my deductible quickly. The problem is I can’t afford to pay this amount per month. But just today I found a coupon from tresiba to only pay $15.00 per month for 24 month’s. But in the article it says not to be used with medicare or Medicaid. Can I still get this coupon and self pay as long as I don’t submit it to them and fill out the form with no insurance info?

  68. E.G. says:

    My husband works for an Eye Clinic that give us a free eye exam and glasses/contacts at cost +10%. I recently got a pair of glasses with this discount and paid cash. I then turned around and submitted it to my medical insurance (which has a high deductible) so it would get reimbursed by my HRA (not FSA or HSA). The HRA won’t reimburse me unless i got through my medical insurance. I was waiting for this claim and mentioned it to my husband. He told me that his employer says that these claims should never be submitted to insurance. To be clear i submitted it to insurance through MY employer not through theirs. It is a large clinic in their area so I am sure they have agreements signed. When submitting the manual claim I always indicate that i received an employee spouse discount and I submit the receipt showing how much I actually paid (I also give the breakdown which shows the full costs and the discounts given). Is there any reason the clinic can restrict me from submitting it to my insurance?

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  71. The comments on this article are valuable beyond all I know about third party billing, in the one year I’ve experienced revenue cycle management. Healthcare should be simple, not complicated. Healthcare is a physician caring for a patient. Insurance is an option for people to pay their physician(s), federal entitlement programs (COBRA, Medicare and Medicaid are a different conversation). Third party payer billing guidelines are complex and change constantly, which is why fee-for-service or a cash model is a simple ideal for physician reimbursement. Unfortunately it is because of the ACA that Americans are mandated to have health insurance with the risk of paying IRS fines (whichever is higher: 1) Percentage of income [2.8% household income or year premium for national average price of a Bronze plan sold through Marketplace] or 2) $695/adult, $348/minor or maximum $2085; source accessed 4/25/17). If only patients knew that it is legal, and their right (HITECH Act, 45 CFR §164.522) to choose not to have their provider bill their insurance company. Of course I personally feel that there is a moral obligation to honor any business contract that may be in place between providers and payers, however if a patient advises his/her provider to not bill their insurance, to do so a provider is in direct violation of federally mandated HIPAA legislation, divulging patient information without consent. What are the larger implications of patients choosing to withhold health insurance status from their providers-or requesting their insurance not to be billed? This practice could translate to lower healthcare costs. It’s not insurance fraud to not bill insurance. Especially if it’s in the patients financial interest (cost-effective measure) to pay the providers named “self-pay” rate. Now, this is all fine and good if the provider is non-contracted with commercial payers. If the provider has an agreed upon contract with a reimbursed rate schedule, then practicing good business ethics is paramount-therefore the contracted provider ought to deny services to an insured patient requesting a self-pay rate who has a policy with the provider contracted payer. For a provider to take patients who have policies with the contracted payer, and not bill them (payer), is wrong and unethical (in my opinion). Moral: providers ought to opt out of signing contracts with commercial payers. Healthcare is about the sacred patient-physician relationship and wellness, not profitability. This is a moral and philosophical argument. The Hippocratic Oath exists as a pact, that all physicians profess upon matriculation to first and foremost: “for the benefit of the sick and to remain free from intentional injustice.” I work in healthcare revenue management and am working towards attending medical school in the next year, quoting Paul Farmer, MD “I feel ambivalent about selling services in a world where some can’t buy them.”

  72. Kapil says:

    I faced similar situation yesterday,there was a specialty drug (endometrin) which was prescribed for my wife and insurance required prior auth .The Prior auth was taking time so to begin with we started with cash price ,we purchased 7 days supply for $96 ,
    Later on I realised that prior auth was approved , so requested pharmacy to rerun the claim through insurance and they billed $226 for the same dosage and supply.And that $226 got applied to my deductible ,Now I don’t think I can go back to self pay price.
    why can’t insurance negotiate cheaper rates with them

  73. Darlene says:

    I was seeing a physician that I was well established with. The first year went okay with Obamacare. The second year was a nightmare. I called the doctor’s office and asked what insurance they were going to accept. They said between two different ones. The one I was on at that time was going to be outrageous, so I chose the 2nd one. Well, I seen the doctor in December and had to go back in March of the next year, I had already met my deductible for the entire year. Well, the doctor’s office said they chose not to go with the insurance company they told me they were going with, they wanted me to change in March. I would have to pay extra cost for changing every month plus pay 50% on everything all year. So I told them I would just pay cash to see him. They told me they couldn’t take cash from me because they had to use insurance which they did not take and if I didn’t change insurance, I would have to change doctors because they would be fined if they seen me and if I paid cash. I don’t see why they would be fined and me paying cash. So they refused for me to pay cash. I have not been satisfied since I left that doctor. I don’t know if they told me the truth or if his staff made all this up. But this was not very professional. But once you leave them they will not take you back as a patient. What is my rights since I was done this way?

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