Counter Offer

Despite sending a request to the finance lady in hospital two weeks ago, I keep receiving "Balance Due Notice" from hospital. This is really dumb and irritating. It is one of those "F*ck you, we are big, you are small, we will keep sending you mail until you go tired" things, and I would imagine it does wear down a person who is not determined.

And with all of that, real problems were never addressed. I never got an answer, how do they determine the price.

It is pretty clear to me why: while digging up information on the hospital practices, I found a fascinating website by an actual medical doctor David Belk - "The True Cost Of Healthcare". It make a lot of things clear to me, such as: how such ridiculous charges possibly appear on a medical bill. Nobody wants to discuss that subject, this amounts to confessing in being part of a giant fraud scheme.

At any rate, I am about to try another strategy. I will ballpark, how much could the service reasonably cost, and offer that amount.

Here's my letter:


Dear Ms ********:

This is a notice, that I have not received a reply for my communication dated April 17, 2012. In that communication, I asked you to clarify following questions:

1. You wrote "During emergency visits, we are unable to anticipate the cost of providing care in advance". Were you trying to say that the services had to be provided so fast, and the situation was so volatile, that you did not have a chance to communicate the pricing information? Or, are you saying that it is your policy to withhold pricing information from anyone visiting your emergency room? 

2. Yes or no: do you interpret the finance agreement, as an authorization to bill me any amount, without limit, and amount is solely at your discretion?

I wanted to let you know, that despite my efforts to resolve that dispute, I have received a "Balance Due Notice" (attached). This was done despite my written statement, in which I clearly stated, that I am disputing amount owed (attached). I consider this a harassment. The notice does not address the matter of dispute, and only serves the purpose of undue pressure on me.


As a sign of good faith, I am offering to settle a dispute for $700 payable by check immediately on your confirmation. This amount offered is to cover my obligations, retaled to the ER visit on 2/27/2012, in full.

According to my research, a way of settling a dispute, would be to send a check with a "payment in full' note on it, but apparently, this technique may not be valid anymore.

Paper exchange, part 2

Got answer:

Dear Mr. *************

In response to your email date April 7, 2012, please see the attached statement for your review (a hard copy of this letter and statement was mailed to you today). We have previously provided you with the UB04, itemized statement, and Conditions of Admission.

During emergency visits, we are unable to anticipate the cost of providing care in advance. Please contact me at ****  or **************** if you believe that you will need assistance in paying your bill, as we have many ways to our patients through our Payment Assistance Program.

It is our pleasure to assist you and thank you for choosing ********** Medical Center for your healthcare needs. 

As a reminder, I asked her two simple questions:

1) Why didn't they tell me how much procedures cost?
2) Is she considering the "financial agreement" a blank check?

She gave a non-responsive answer on question #1, because "Emergency Visit" is a word game. What it looks like she is saying is: "it was an emergency situation, we had to move so fast, we simply didn't have time to tell you about cost". But she does not say this, because it is plain not true. We sat in different holding areas for hours, there was plenty of time to get me informed. So, what that really means is "we are not going to tell you when you come to ER". There is no excuse for latter, unless you wrap it into right wording.

She also completely skipped question #2, and here's why: if she says that they are only charging reasonable prices for their services, she will have to lower down their demands to a reasonable level. If she says, no, there is no limit, that would be insane, she essentially renders the contract void.

So, all I need at this time is to ask for clarification, and not accept non-responsive answer. Here's my reply:

Dear Ms ***:

This is in response to your electronic letter from 16 Apr 2012.

1. Your reply is not clear to me. You wrote "During emergency visits, we are unable to anticipate the cost of providing care in advance". Were you trying to say that the services had to be provided so fast, and the situation was so volatile, that you did not have a chance to communicate the pricing information? Or, are you saying that it is your policy to withhold pricing information from anyone visiting your emergency room?

2. Please, answer the following question, yes or no: do you interpret the finance agreement, as an authorization to bill me any amount, without limit, and amount is solely at your discretion?

Paper Exchange

I got the letter from hospital in response to a template from hospitalvictims.com, which said:

Here was my reply:

Dear Ms ********: 

This is in response to your letter from March 28, 2012. 

I received a document package based on which you allege that I owe you $1189.40. Please answer the following question for me, so that I better understand your grounds: 

The financial agreement does not have any details on the amount I will be liable for. Have you communicated to me the amount of future liability, I was allegedly accepting, and if yes, in what form? Please, attach the evidence that I was aware of bill amount.

As you see, I am trying to stay away from  any statements here. I am simply asking hospital, if they told me the bill amount before they go on.

Here was a reply:

Dear Mr. *******: 

When your son presented to our Emergency Room a “Conditions of Admission” form was signed by you. Our Conditions of Admission form explains that we will bill the patient's insurance and then bill the patient for co-payments, co-insurance and deductibles designated by your insurance company. Your insurance company should have sent you an Explanation of Benefit (EOB) explaining the amount you owe to the hospital and why. If you did not receive an EOB from your insurance company for your son?s visit to our Emergency Room, please contact your insurance company to obtain a copy.

She obviously never answered why did they not explain me how much their service costs. Instead, she referenced some financial agreement. Now that I'm not under stress of potentially dying child, I could re-read the agreement. Here's the item she references:

I think I might be starting to understand something here. The excuse (because it's clearly not a reason) for being so cryptic about their price structure comes courtesy of insurance paying part of the bill. That certainly could not have prevented them from telling me the amount that procedures cost.

That would have been a valid agreement, should there have been a good faith to disclose me amounts that they charge. "Here is what we will be billing you for. You also will have those external vendors billing you directly approximately for this amount, and here's why". This never happened. The whole "financial agreement" is bogus, because it was never their intention to get me to agree to certain conditions.
There was no meeting of the minds. It was just a way for them to make me sign them a blank check.

Here's what I replied:

Dear Ms ***************: 

This is in response to your electronic letter from 06 Apr 2012. 

1. Your letter does not answer my question: 

The financial agreement does not have any details on the amount I will be liable for. Have you communicated to me the amount of future liability, I was allegedly accepting, and if yes, in what form? Please, attach the evidence that I was aware of bill amount.

Since you considered me a financially responsible person, and if you were acting in a good faith, it would be customary for you to disclose the cost of procedures to me, prior to administering. If disclosure did not happen, what prevented you from giving it to me? 

2. Do you interpret the finance agreement, as an authorization to bill me any amount, without limit, and amount is solely at your discretion? 

3. Your electronic mail says: "this email is both proprietary and confidential, and not intended for transmission to or receipt by any unauthorized persons". For your information, I do not agree to be bound by that condition, moreover it is my intention to publish this case in details.

I has been a week, and I have got no reply. I would assume the letter got lost in the email, and I will re-send it another time, just to cover my ass, in case they will claim the email got "lost". There is a high chance I will never hear from them again.

Paper Wars

I am getting ready to be involved in some major paper-pushing. There is a lot of material on the internet, how to be dealing with bureaucrats, but this case is different. Usually, it is you who wants something from bureaucrat. This time, they want something from me. Another thing to consider here, is that even though their system is heavily embedded in government, they are not cops, so they can not bust into your house if you have not promptly paid them, so that really limits amount of damage they can do.

So, the rules, I've laid out for myself would be:

1. Be courteous and professional. No rudeness, rants, or insults
2. Do not talk too much. Any extra word will give them ammo, especially if this word could be potentially misinterpreted. This applies to both written word, and the one you say over the phone, since all calls are recorded.
3. Stick to the facts. Facts are: they entrap people by obfuscating their processes, grossly overcharge, and provide extra expensive services which could be avoided.
4. Ask questions, do not make statements. Have them make statements, and then demonstrate that they are invalid. They have the burden to prove you owe them, you don't have to prove anything.
5. Do not agree to be bound by any conditions, especially non-disclosure. The sole reason they could get away with that, is people avoid speaking about it. People going public is their greatest threat.

What else can we bill for?

Got a phone call, this time a lady from some satellite radiology place. She called with regards to the CT scan, which was already in another bill. I told her, I have already billed for that and it's being disputed. She said, this is not for CT scan. This is for READING CT scan.

Well, I was not about to go argue with her, and told her to send me an explanation in writing, what they did and what the bill is for. She said, they will not do it. I said, you will not explain in writing, I will not pay. So, she said "I will put a note on your account" and that's how our friendly chat ended.

Unfortunately I was driving and my call recorder was off, I should have pulled over and turned it on.

Anyway, this certainly deserves a million dollar letter

Tap your phone

If it is an option on your phone, make sure you have a call recording software installed. Some phones have add-ons, which will record calls automatically. If you get called from hospital (or by collector), it is important to hold on to the call recording so that you can recall what exactly you and they said, and to make sure your words are not misrepresented.

WARNING: in some states it is illegal to record calls without consent of both parties. If you are in one of these states, you can get in ridiculous amount of trouble for automatically recording calls. Something insane, like 10 years in jail, people get less for manslaughter. If you are in one of those states, make sure you don't get in trouble. You can still record call, but you should mention to the other party, that call is being recorded.

Initial communication

I wanted to make it perfectly clear: I am not a lawyer, what I do might get me in legal trouble, and it might get you into one a well. Do your research before following my steps. Also, keep reading this blog, if anything I have done was a mistake, it will show in further posts.

Now that we cleared that, down to business.

It is important to establish, that you are not going to simply write a check. But it is also a mistake to outright refuse to pay. In the end, hospital provided me a service. I do pay my bills, tip waiters, and I don't shoplift in Walmart. Hospital is no different. What I'm ranting against really boils down to two issues:

1. They will not tell you upfront what they are going to charge you: Every service starts with people given a price. You can have a big mac, or quarter pounder with cheese, and/or french fries. You can fill your car with premium gas or regular. Each option has it's own price, and you choose which option to take. Doctors don't give you options. You must have the best (read: the most expensive) option, and that is it.

Just imagine what would happen, if you went to a car upholstery service, and all they would offer you is: you write them a blank check, they will reupholster the car with most expensive leather, and there's no other choice.

Make no mistake: medical lobby is mafia. They drove out all the competition using legislation. So, when you at the clinic, you are dealing with people who work for thugs. It's their way or highway. This is unacceptable.

2. They flat out overcharge: As I wrote in my earlier post, the price they charge is not even a fair one. So, not only you pay for most expensive option, you could be paying as much as 5-10 times higher prices, than the fair market one, and they are well aware of it, it is not a mistake. Not good at all.

So, the first order of business is to make it clear, that you will dispute the charge. And to minimize amount of harassment you get, it will not hurt to write an official letter to CFO, referencing Fair Debt Collection Practices Act. You can usually find a CFO's name on the internet, but if not, just write to "Chief Financial Officer" at both hospital address, as well as the address where they want to send you a bill. Latter is necessary, because hospitals often outsource billing, so you want to make sure both parties know that the bill is being disputed.

In theory, you should send the letter with certified mail, to make sure it arrived. I don't normally do that. When I get a reply, that is as good as a delivery receipt.

The good template for the letter could be found on www.hospitalvictims.com. Make sure you take time to read and understand what it says, and remove inapplicable sections. Another good template to use is "Million Dollar Letter to Stop Debt Collectors Cold", courtesy of keepyourassets.net. You can get it as PDF, or in Open Office format

What is the fair price?

Internet is a fascinating place for the one who wants to find more information. Here's a person in similar situation, and some interesting comments:

dzbike writes:

Why was it so expensive? Complicated but, basically it is the fault of the insurance/medicare circus that finances health care in this country. If someone with medicare (the biggest insurer out there, who sets the benchmark that other insurers use to decide their own payment rates) walks in with a UTI and they get treated, their record goes to an office where somebody goes through the chart and tries to figure out what we did for that patient that we can bill medicare for. When their done they decide to bill medicare $3000, like the bill they gave you. Totally ridiculous number? Yes, but medicare will probably look at that bill and decide to pay $300 of that, which probably doesn't even cover our costs (it's friggen expensive to run an ED). So the OP and medicare get the same bill, but OP has to pay because they are uninsured little guy whereas medicare can say "we are only paying $300" because in an attempt to reduce costs, they've reduced reimbursement for everything, making it necessary to bill for more and more things just to cover our costs.

here's another interesting quote from riotous_jocundity :

It is insane that it could cost $3000, but not unlikely. I live in Texas too and a few years ago (when I was a broke college student without insurance) I tore my cornea on a Sunday. Everything else was closed, eye felt like it was about to fall out, so I went to the emergency room. They looked at my eye, pronounced it torn, wrote me a prescription for numbing eye drops, and sent me on my way. I was there for maybe 10 minutes. $2500 bill. I called the hospital billing number crying, and told them that I was a broke uninsured college student and that I COULD NOT PAY THE BILL and was not interested in being put on a payment plan. I told them I had $400 and that I could pay it immediately, over the phone via credit card. They said yes. In retrospect, I really should have asked for an itemized bill too, but the point is that you never just accept what the bill is--you argue and you cry and you bargain them down.

What I'm getting out of it is: when hospital bills you, the actual, fair price for procedure is somewhere in vicinity of 10-20%

My crapz are pricey

My little kid fell sick at night. He came to my bedroom telling me his stomach hurts real bad. Unsure what to do I brought the guy to the ER. Doctor said, it's likely appendicitis. He turned out to be slightly constipated. The hospital billed $10,934.00.

Insurance got most of the bill covered, but there was a $1,189.40 portion they wanted me to pay. I got curious, what was it exactly that they did, that costs $11K. In the end, this is how much money you will make in half a year working full time for minimum salary. What could they possibly do in a couple hours that's worth so much?

I called and requested the itemized bill. Here's what they sent me:

I am certainly not an MD, so it is not very clear to me, what is what, and how much does it actually cost, but this item clearly stood out: CT ABDOMEN PELVIS W CON. That was a CT scan. $7K is pretty pricey for a CT scan, but what do I know? So I googled up, what's the actual price for one.

According to this, "If you are paying cash, you'll probably start searching for CT scan prices online. You'll find a wide range of prices $300 to $1500", and you could actually be double-charged if both abdomen and pelvis are scanned. We were in hospital for appendix, so it's either in abdomen, or in pelvis, and it must be clear for medical practitioner where exactly, but what do I know.

Per this, the fair price customized for zip code 85224, is $646.

How about this? $370. Kidding? Picking up URLs? Not really, just going through search results, top to bottom.

Well, that's quite a difference. Definitely, not $7K, looks like a pricing mistake. So, I called a hospital to explain, that there was a billing error, and that they have to recount the bill amount. Hell, if you are not happy, ask for money back. Well, not that fast. The guy in the billing department explained me why they charged so much, and the reason was "because these are our prices".

Needless to say, I was foreseeing something like that from the very beginning, and asked the billing lady in the hospital: "I would like to know the procedure cost before they administer it". And needless to say, she said they "can not" do it. That is certainly a lie, of course they can. But I decided at that time not to argue with people, who might be operating on my son.

I am pretty sure, I am not the first guy in that situation. That hospital is not unique, and their practices are not different from any other hospital in this country. But what makes my situation unique is that I will not do as I'm told. This is a rip-off. This is misrepresentation and fraud. This is taking advantage of people in distress.

More people must refuse to pay, but this is hard, stressful, and there is a lot of unknowns. People are afraid of being sued and harassed. I am sure I will be harassed a lot. I will share my experience, so that you know what to expect, when you decide to take a stand and not pay.

I hope, this will be useful. Stay on this blog, I will be posting the updates.

Thou shalt pay what we tell you

You have probably been to the hospital or a regular doctor. Have you been told upfront how much will procedure cost? It's often true that insurance covers your costs, and all you pay is deductible, but you are in a sense paying customer. You would imagine your dialog with doctor should look like that:

You: Hi doctor! My throat hurts.
Doctor: Hi, nice to see you here! Thank you for choosing our clinic. Have receptionist already told you that we will charge you a fee for just looking at you?
You: yes, of course, $80, correct?
Doctor: yes, $80. Okay, now lets look at your throat... Okay, looks red. I cannot tell by the looks of it what is wrong, I would need to do some tests on you
You: sure, no problem, what you need?
Doctor: just a bacteria swab and blood test. This will cost you $40.50 for one and $87.00 for another.
You: okay, fine. Can we do without blood test?
Doctor: probably, lets just do the swab, I only offered so that you don't need to wait should another test be needed.

Why does this dialog sound so unrealistic? You can visit auto mechanic, and you will be told how much each procedure costs. You could call a plumber, and he will tell you what he charges. But not doctors, never.

What's even more irritating - most doctors would flat out refuse to tell you what their service costs. This might be explained by the fact that insurance covers everything above deductible, so there should not be any difference if your physician charges you plus or minus several dollars, but that is not true. You are considered financially responsible, next time you are at the doctors, take a time to read all those papers they want you to sign. But if you try telling receptionist that you are paying cash, and that before the procedures are performed, you must know the cost and approve them, they will flat out say no.

And then, of course the problems start. Most of us have health insurance, where you only supposed to cover deductible. But the doctors also have multiple other services, such as blood lab, x-ray, and others. Each one of them will charge you separately, so it will not be a single bill, there will be many. Each one will trigger deductible.

I decided to open this blog for two reasons. First, share my frustration with the system as a whole. Second, try to find solutions to the problem. Each one of us is clearly racketeered by medical mafia, but we don't have to bend over, and we certainly don't have to stay silent. When someone hurt you, there is no benefit in keeping that under the rug.