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Advice on Medical Bills & Insurance Claims

Advice on Medical Bills & Insurance Claims

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UpdatedFeb 11, 2014
Key Takeaways:
  • Medical debts in collections can appear on your credit report.
  • You are responsible for correcting any billing errors.
  • Resolve any debts in order to avoid negative marks on your credit report.

Upon reviewing my credit report I found numerous negative medical bills, turns out that the claims were not filed correctly.

Upon reviewing my credit report I found numerous negative medical bills on my report. After further investigation I found out the providers had not submitted the claims to the correct administrators even after receiving information from the insurance company. Since my employer has changed carriers, the previous carrier says it will not pay the claims. Do I have legal right to ask them to be removed from my credit report because I have no control over the filing of these claims?

Insurance questions are difficult to resolve because they involve three parties, including the:

  • Insurance company or claims administrator
  • Medical service provider
  • Patient or insured party

Your question touches on three possible problems:

  • The insurance company denied the claim(s) in error
  • The provider submitted the claim(s) incorrectly or after the deadline
  • The service provided was one not included in your insurance coverage

Here, it appears the medical provider filed the claims incorrectly. This is frustrating for patients because medical providers almost always require a patient or insured party to sign a waiver stating the patient will pay the bill if the insurance provider denies the claim. That seems an unfair and one-sided contract.

If a doctor tells you, “My office will probably goof-up the billing. Want us to handle it for you?” You would probably say, “No, thanks, I’ll do it myself or find a doctor who hires competent billing people.”

Your expectation was the medical provider would, once it agreed to handle the insurance forms, take reasonable care in processing your insurance claim. But it failed, and now demand you pay for its incompetence. You mentioned resubmitting the claim to the insurance company. The insurance company rejected the claim based on a failure to meet a deadline.

A cynic would view insurance deadlines as arbitrary, and intended to accomplish exactly what you described in your question — an excuse to deny a claim. However, the medical provider is still to blame when they miss a deadline for two reasons:

  1. They were put on notice of the deadline when they agreed to join the insurance provider’s network
  2. The provider had the information necessary to make a claim.

See the article Health Insurance Claims to learn more about how health insurance companies process claims.

Credit Report & Delinquent Medical Debt

You have no legal right to require the consumer credit reporting agencies or the medical providers to remove the delinquent accounts from your credit reports. The medical provider will claim you have liability for the debts. Regardless of any issues you may have had with your insurance, the waiver you probably signed gives the medical provider an argument you owe the debt, even if the provider submitted the insurance claim in an incompetent manner. The medical provider may claim you were responsible for notifying the provider of the new insurance information, or you should have paid the bill and filed the insurance claims yourself.

How to Handle Medical Debt

No law requires a medical provider to file an insurance claim on a patient’s behalf. Providers do so as a courtesy to patients, and to help ensure the provider is paid in a timely manner. Review the following table to learn how to handle common medical claim problems.

Medical Bills & Medical Insurance Claims
Insurance Claim ProblemPatient Liability & What To Do
Claim for covered service denied through no fault of the medical providerPatient or insured party has liability to provider for debt, and potential cause of action against insurance provider
Claim denied because it was filed outside of the policy's time limits due to medical provider's negligenceInsurer may be within its right to deny claim. Consult with a lawyer to learn if you have liability for debt, or cause of action against medical provider for failing to file claim in timely manner
Claim for covered service filed in a timely manner but rejected, then re-filed after deadlineInsurance company required to pay the claim as the delay would have been due, at least in part, to its improper rejection of the initial claim
Medical provider tells you services were paid by insurance company, but later says they were not paidMedical provider may be liable for all or large portion of unpaid debt
Medical provider tells you covered services were not paid by insurance companyPatient or insured party must file claim with insurance company
Medical provider tells patient its service is covered by patient's insurance, which later denies claimAsk medical provider to resubmit claim using proper or different coding. Consult lawyer if you believe medical provider's statement about your coverage had fraudulent intent

How to handle common medical insurance claim problems. Source:

Regardless of the reason given by the insurance company for its denial, you have the right to appeal the decision if you feel that the claim should have been paid under the terms of your policy.

To read more about the insurance appeals process, and various other insurance related topics, visit the Medical Billing Advocates of America Web site to find a local medical advocate who may be able to help you.

Get a Free Debt Consultation

Talk to a debt resolution partner about your options to free yourself from medical debt. The advice is free, and comes without obligation.

In situations where the medical provider sends you a bill in a timely manner and indicates the insurance company did not paid its claim, you are likely responsible for paying the bill and making sure any errors in the insurance claim are corrected. In situations like these, the medical provider’s attempts to collect on this debt and it placing the item on your credit reports are likely acceptable practices. You need to negotiate a resolution with the medical provider.

For more information about credit, credit reports, and credit scoring, visit the credit resources page.

I wish you the best of luck in your efforts to resolve this debt.

I hope that the information I have provided helps you Find. Learn. Save.




DDan, Feb, 2014
In August of 2012 I visited my cardiologist for my annual checkup. The claim was not filed with my insurance until May of 2013. Insurance denied the claim and sent me an EOB explaining that the time limit for filing the claim had expired. The doctor's billing service started sending me bills and I provided them (twice) with copies of the EOB. I even sent them a letter explaining why I didn't feel I was responsible for this bill. It is not my fault they didn't file the claim in time. They have now turned it over to a collection agency. Am I wrong? Am I responsible because they didn't do their job on time?
BBill, Feb, 2014
This is a highly frustrating situation because you pay for your health insurance with the expectation it will provide coverage for procedures it promises to cover. It is also frustrating because the medical provider made an implied promise it would file a claim with your health insurance provider in a timely manner. It didn't, and now the insurance you're paying for is denying a claim it would have paid had the doctor filed the claim on time. Now, the doctor expects you to pay for its negligence.

What to do? Have a heart-to-heart with the doctor's office manager, and explain it's not fair for you to pay for both your insurance and the procedure that would have been covered had they not been negligent. Try to work out a compromise of some kind, especially if you have a good relationship with the doctor.
TTina, Feb, 2014
I am on Medicare. I had my annual pelvic exam in Dec. It is a covered service. Medicare denied the claim and I have a $200 bill. When I called, Medicare said it wasn't submitted as an annual pelvic exam, but as a general doctor visit with no other codes. I called the hospital billing office and explained. The man said he would email his supervisor to add the correct code. I've received a 2nd bill and called back again. Yesterday I received a collections notice. What do I do? This is covered by my insurance, but only if correctly coded.
BBill, Feb, 2014

It sounds like the collections notice you received is from the hospital, not from a collection agency. Call the hospital back and speak to them, again, about changing the code. Keep records of the time you called, the person with whom you speak, and what is said. I think you should also call Medicare again, at 1-800-MEDICARE (1-800-633-4227). You can also file a complaint with Medicare, using the form on this page.

bbo, Jan, 2014
I was required by my college to carry insurance during my time there. I did not feel well for two years and regularly saw my doctor. I was sent to a couple specialists and finally a cardiologist. He found three blocked arteries and put in stents. The insurance company through the college is refusing to pay any medical bills because I did not see their nurse beforehand. Should the insurance be liable for my medical bills? And how long is the period to file a claim against the insurance company? Thank you
BBill, Feb, 2014
Ask the insurance carrier if it has an ombudsman's office or appeals process to help you work through this issue. In this case, the nurse referral satisfies a bureaucratic requirement, but seems ridiculous in light of your diagnosis. How many nurses, as wonderful as they are, would have diagnosed blocked arteries in an interview?

If the insurance company does not budge, then consider hiring an advocate, such as Medical Cost Advocate or Hospital Bill Review.
NNarayanan, Jan, 2014
I went to ana optometrist along who was covered under Cigna medical insurance but not under Cigna Vision. However the diagnosis was deemed to be purely vision related and so it was deemed to be out of network, I have a squint and a family history of eye problems including night blindness etc. Should I ask the doctor to resubmit the claim so it is covered?
BBill, Feb, 2014
Never hurts to talk to the office manager to learn if the office can resubmit a properly coded medical claim.