Your Money: Avoiding insurance overbilling requires constant vigilance
August 13, 2013
If it can happen to me, it can happen to you. I always try to keep my columns looking on the positive side of things, but in the past few years I've noticed an increase in insurance and billing issues of which I believe consumers should be aware. While I will not reveal the names of the companies, I can personally attest to each of these situations because I was the consumer. I hope these problems aren't happening to others, but the likelihood that I'm the only one being overbilled is pretty slim. I challenge you to scrutinize your bills closely to make sure you are catching the same sorts of issues.
My first experience happened with my homeowners insurance while we were settling a flood claim. I was instructed to send my hotel receipts to them, and they would reimburse me. Sounds simple, right? Over the course of a few months, I noticed the company either only reimbursed partial amounts, conveniently lost the receipts I sent, or just denied various bills with no explanation. Fortunately, I made copies of every receipt before sending it to them and I was eventually reimbursed for every penny of expense, but I always wondered if this was the insurance company's strategy and if others weren't as tenacious in their fight for reimbursement.
My latest fights have been against medical billers and insurance companies. One doctor's office charged us our co-pay twice. I shrugged it off as a billing error and got the duplicate charge reversed, but the next time we visited that doctor, the same thing happened. I'd like to give them the benefit of the doubt and say it was just a simple mistake, but since it happened to me twice in one month, how many other "mistakes" are being made?
Another issue I came across was when I reached my out-of-pocket maximum midyear with my medical insurance. Let's say you have a $2,500 out-of-pocket max, and you have already spent $2,475. If you have a $300 expense, you should only be liable for $25, not the full $300. Last year, I found myself in this situation and my insurance company billed me for the entire $300. A few dozen phone calls later and they told me that it was just a software glitch, refunded my $275, and assured me it would never happen again. Can you guess what happened this year when I reached my out-of-pocket max? That's right, the glitch happened again and I had to start the process all over.
Of course, there is a value to your time, and you may choose to let the small things go and not focus on every single dime. But, I do recommend you consider these situations and at least make a conscious decision on what to fight and what to let slide. Mistakes do happen and I'm the first to give someone a second chance, but with so many of these mistakes appearing in my own bills, I can't help but imagine what goes on system wide.
Michele Knight, owner of Knight Accounting & Technology, is a CPA and QuickBooks ProAdvisor based in Dillon. For more info and to contact her, visit http://www.cpamichele.com.
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