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DV Letter to Provider Help


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Around July/Aug 2020 I was sent to a local healthcare provider to have a simple procedure done. They never sent it to the insurance until closer to the end of 2020 and by that time my insurance benefit was used by other claims. When I had the procedure done I paid a portion up front and they were anticipating the insurance payment. Around January of this  year I got a letter stating that I needed to pay or I would be sent immediately to collections. I called them and explained I wasn't aware that I owed them b/c I received no call or EOB's b/c they just submitted shortly before they sent me a letter. I told them had I known I had a bill I would have paid it or made arrangements and b/c I felt like it wasn't my fault they waited that threatening collections in this circumstance didn't seem right although legally they probably could send me to collections even though I didn't know until much later.

 

When I called the office the person who took the call said they would need to talk to their Office Manager and I should receive a call shortly. I didn't hear anything for another 6-7 weeks. That call was if you can pay the balance today we won't send it to collections. I told the rep that I made an offer to clear the balance in 2-3 payments...but never heard anything back. I called my insurance and found out (and I don't know what the law is) that the amount they were trying to collect minus what I paid at time of service was too much. The insurance said even though they didn't pay anything b/c of reaching my annual maximum...that they have agreements/writeoffs and what the provider was trying to collect was more than the "don't pay more than this" on the EOB. I called the Provider back and we talked about it and they were like...let me call you back again. That call came in 2 weeks later. By that time I said I can clear the balance in 2 payments and the person was like we need payment in full. I asked for the persons name and they were like I would rather not disclose who I am. I just wanted proof that what we discussed was communicated via someone at the Office.

 

They ended up sending it to a local attorney...but the letter states the person sending the letter wasn't an attorney just trying to collect the debt. Now what they say I owe was over double what the insurance said I should pay no more than and even significantly more than the amount the Provider said I owed. I realize that there are fees associated with collecting a debt that is passed on to the person who owes the debt...but the fee is roughly $500-$600 more than what the Provider billed me for. I called the Provider back and said look I got the collection letter and I can pay you what I owe you...but you need to recall the debt. She called me the next day and said you will have to deal with them now and that exhorbitant amount is what you owe.

 

At this point it has been a while since I have sent a DV letter to anyone and I still have some time in the 30 day window to respond...but wanted to find out if that is the approach to handle with this local Attorney/CA. If so...is there a DV letter that I can review or get some help in writing to them? I owe a balance...it's just not as much as they are trying to collect and if it wasn't such a large amount just for collecting...I probably would have just paid it and been done with it. I am looking for advice on how to proceed in this matter if someone can advise me.

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Before you can devise a strategy by which to deal with this, you need to know your liability with confidence.  Your post suggests that your provider has a contractual relationship with your insurer to accept the insurer's "reasonable and customary" reimbursement schedule as payment in full for any procedures that are rendered.

 

If so, the provider is bound to accept that amount, no matter whether you or your insurer is on hook for the charges. 

 

So, this area of grayness needs to be cleared up  with your insurer and the provider.  It should be a straightforward matter to have your insurer reaffirm an insurer agreement with the provider that stipulates the scheduled procedure reimbursements will be accepted as payment in full and to establish the appropriate amount you should have been charged out of pocket (usually detailed in the EOB in response to the claim ... get another copy, if necessary.)   If the insurer affirms that the billing should be settled in a reduced amount from the gross charge, have them provide sufficient documentation (again, likely an EOB), then go back to the provider. 

 

You assert to the provider that you were improperly billed for the procedure under their agreement with your insurer, and that you raised concerns about this which they failed to address.  In failing to do so, their referral of the account for collection was inappropriate and shouldn't have occurred unless they can demonstrate there would be no adjustment to the charges under the insurance agreement. 

 

Advise them that the remedy demanded is to retract the account from collection, adjust the charges appropriately and work with you to arrive at an acceptable schedule for payment.  State that you intend to refer for legal action if they fail to respond within 15 days.

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22 hours ago, centex said:

Have you sought to actually go IN and talk to your provider?  They ARE local after all...

 

Yes we did. At first we had a discussion with them on the phone with a person who identified as the Office Manager who said she doesn't usually talk to anyone...but would not identify her name. We had an agreement for me to pay the amount that the insurance said we owed...but she also said they were going to check with their attorneys and the insurance as to whether  we only have to pay the insurance amount minus what we paid at DOS or what they say we owed. I tried to pay the payment and get it in writing...but no one was available at the office when instructed to come by and by the next day available working day it all changed. This Provider has a reputation of not accepting even minimal payments. I know some people would send them $50 - $100 payments and they would send a letter and the check back saying they wouldn't take partial payments. As contentious as it got on the phone and with the Office Manager not wanting to really talk...I was afraid at that point that it would be a big scene if I went back again after our first attempt. The Provider did a good job and had good manner. I do owe a portion and I want to pay it...but now with it in Collections the amount has nearly doubled and I have to deal with the Collections people (who are also local) according to the letter. I have to do something in the next few days as my 30 day window to dispute is running out.

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19 hours ago, hdporter said:

Before you can devise a strategy by which to deal with this, you need to know your liability with confidence.  Your post suggests that your provider has a contractual relationship with your insurer to accept the insurer's "reasonable and customary" reimbursement schedule as payment in full for any procedures that are rendered.

 

If so, the provider is bound to accept that amount, no matter whether you or your insurer is on hook for the charges. 

 

So, this area of grayness needs to be cleared up  with your insurer and the provider.  It should be a straightforward matter to have your insurer reaffirm an insurer agreement with the provider that stipulates the scheduled procedure reimbursements will be accepted as payment in full and to establish the appropriate amount you should have been charged out of pocket (usually detailed in the EOB in response to the claim ... get another copy, if necessary.)   If the insurer affirms that the billing should be settled in a reduced amount from the gross charge, have them provide sufficient documentation (again, likely an EOB), then go back to the provider. 

 

You assert to the provider that you were improperly billed for the procedure under their agreement with your insurer, and that you raised concerns about this which they failed to address.  In failing to do so, their referral of the account for collection was inappropriate and shouldn't have occurred unless they can demonstrate there would be no adjustment to the charges under the insurance agreement. 

 

Advise them that the remedy demanded is to retract the account from collection, adjust the charges appropriately and work with you to arrive at an acceptable schedule for payment.  State that you intend to refer for legal action if they fail to respond within 15 days.

 

Thank you for your response. I just wanted to clarify that in taking this approach...do I need to still do some type of DV disputing the amounts inside the 30 day window as well or do I somehow also reference a DV with the same correspondence to the Provider and the Attorney?

 

They did state that what the insurer was saying was not right (in their opinion) and they didn't have to adhere to the mandated writeoff's the insurance said they did. I talked with the insurance multiple times on different days to make sure this was right. The Provider never said what the outcome of checking with their attorneys regarding which amount was the correct one. They just kept stating that I signed an agreement stating that I would pay what the insurance didn't in a timely manner and had they contacted me within the DOS and nearly 4 months later when I received the initial correspondence...I could have cleared the balance and we wouldn't be at this point. They are trying to make it look like I knew about it and just didn't want to pay and I do. 

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I need to stress that the obligation of a provider to accept reimbursement at an insurer's scheduled rates depends upon their contractural relationship with the insurer.  I'll broad brush the possibilities, but ultimately you need to review the literature provided by your insurer to determine what details specifically apply to your coverage ...

 

Under the insurance with the most strict reimbursement guidelines, service is only covered by a patient's insurer when they use see a member of their provider network (typically, we're talking a standard HMO here).  Reimbursement is pretty much cut and dried.  The provider accepts the reimbursement rates defined by the insurer, the insurer pays their portion under your coverage benefits, and the patient is obligated for any balance due under that reimbursement rate.

 

Traditional indemnity insurance permits you to use any provider of your choice.  There's no contractual relationship between providers and the insurer.  The insurer will typically provide reimbursement based on a set of "usual and customary" fees for procedures.  The provider is free to charge any fee they wish, and may choose to accept the insurer's reimbursement schedule but is not obligated to.  The patient is on the hook for any amounts ultimately billed that the insurer doesn't pay.

 

A hybrid of these two plans are "Preferred Provider Organizations" (PPO).   There is a set of preferred providers who participate and have agreed to a reimbursement schedule set with the insurer.  If a patient visits one of these providers, out of pocket expenses are typically nominal, subject to plan deductibles and co-pays. 

 

Under a PPO, a patient may alternately opt to chose an "out of network" provider.  These aren't "participating providers".   For coverage to apply, it may be necessary to pre-certify care with the insurer prior to a visit (some plans require this, some don't).  Reimbursement for services is based upon the insurer's schedule of "usual and customary" charges.  Frequently, only a portion of those charges is charged (say 80%), with the balance due from the patient as "co-insurance liability".  Plan deductibles also apply.  In this case, the patient is again on the hook for any amounts billed that aren't reimbursed by the insurer.

 

------------

 

The best tool you have to help determine your liability after the insurer has satisfied it's coverage obligation is an Explanation of Benefits (EOB) in which the insurer has spelled out how it determined what it was liable to pay against the claim.  Typically an EOB will state if the provider has an agreement in place (i.e. is a plan participant) to accept the insurer's reimbursement schedule as payment in full.  If so, then your liability is equal to the insurer's scheduled reimbursement rate less what the insurer paid after applying deductibles, copays, and/or co-insurance.  Our PPO EOB's actually set out a specific amount of "What You Owe".

 

If there's no such language on the EOB, then it's may be reasonable to assume that any shortfall between the provider's charge and the insurer's reimbursement is payable by you.  This suggests there's no reimbursement agreement with the provider.

 

------------

 

I apologize if I've managed to excessively draw out this discussion and have stated much you're already aware of.  I tend to err on the side of excess detail, preferring that over gaps.

 

I hope this is helpful.  I'm happy to respond to any additional questions.

 

 

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On 4/16/2021 at 6:02 AM, hdporter said:

I need to stress that the obligation of a provider to accept reimbursement at an insurer's scheduled rates depends upon their contractural relationship with the insurer.  I'll broad brush the possibilities, but ultimately you need to review the literature provided by your insurer to determine what details specifically apply to your coverage ...

 

Under the insurance with the most strict reimbursement guidelines, service is only covered by a patient's insurer when they use see a member of their provider network (typically, we're talking a standard HMO here).  Reimbursement is pretty much cut and dried.  The provider accepts the reimbursement rates defined by the insurer, the insurer pays their portion under your coverage benefits, and the patient is obligated for any balance due under that reimbursement rate.

 

Traditional indemnity insurance permits you to use any provider of your choice.  There's no contractual relationship between providers and the insurer.  The insurer will typically provide reimbursement based on a set of "usual and customary" fees for procedures.  The provider is free to charge any fee they wish, and may choose to accept the insurer's reimbursement schedule but is not obligated to.  The patient is on the hook for any amounts ultimately billed that the insurer doesn't pay.

 

A hybrid of these two plans are "Preferred Provider Organizations" (PPO).   There is a set of preferred providers who participate and have agreed to a reimbursement schedule set with the insurer.  If a patient visits one of these providers, out of pocket expenses are typically nominal, subject to plan deductibles and co-pays. 

 

Under a PPO, a patient may alternately opt to chose an "out of network" provider.  These aren't "participating providers".   For coverage to apply, it may be necessary to pre-certify care with the insurer prior to a visit (some plans require this, some don't).  Reimbursement for services is based upon the insurer's schedule of "usual and customary" charges.  Frequently, only a portion of those charges is charged (say 80%), with the balance due from the patient as "co-insurance liability".  Plan deductibles also apply.  In this case, the patient is again on the hook for any amounts billed that aren't reimbursed by the insurer.

 

------------

 

The best tool you have to help determine your liability after the insurer has satisfied it's coverage obligation is an Explanation of Benefits (EOB) in which the insurer has spelled out how it determined what it was liable to pay against the claim.  Typically an EOB will state if the provider has an agreement in place (i.e. is a plan participant) to accept the insurer's reimbursement schedule as payment in full.  If so, then your liability is equal to the insurer's scheduled reimbursement rate less what the insurer paid after applying deductibles, copays, and/or co-insurance.  Our PPO EOB's actually set out a specific amount of "What You Owe".

 

If there's no such language on the EOB, then it's may be reasonable to assume that any shortfall between the provider's charge and the insurer's reimbursement is payable by you.  This suggests there's no reimbursement agreement with the provider.

 

------------

 

I apologize if I've managed to excessively draw out this discussion and have stated much you're already aware of.  I tend to err on the side of excess detail, preferring that over gaps.

 

I hope this is helpful.  I'm happy to respond to any additional questions.

 

 

Thanks for the help! I think what you said helps me to understand the part about determining what we owe. The other part of the equation is where I really don't know how to proceed. I don't know if I should respond to the Collection Letter that I received. Even going off of what the Provider states that I owe them...the fees associated with the collection seem to be double what the Provider states. I have had collections before...but this is the first time where a collector has added roughly $500-$600 (which is about the same as what I owe the Provider) in addition to the stated balance with the Provider. Maybe they can charge what they want for collection fees...but I didn't know if I should respond within the 30 days we have to dispute what the CA says that I owe.

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14 hours ago, bravesfan said:

Thanks for the help! I think what you said helps me to understand the part about determining what we owe. The other part of the equation is where I really don't know how to proceed. I don't know if I should respond to the Collection Letter that I received. Even going off of what the Provider states that I owe them...the fees associated with the collection seem to be double what the Provider states. I have had collections before...but this is the first time where a collector has added roughly $500-$600 (which is about the same as what I owe the Provider) in addition to the stated balance with the Provider. Maybe they can charge what they want for collection fees...but I didn't know if I should respond within the 30 days we have to dispute what the CA says that I owe.

 

So, first, about that "30 days" notice (and I welcome any other board member to chime in if I'm inaccurate in any way).  When a CA contacts you the first time about a debt, under the FDCPA there's a 30-day wait until they can proceed with any time of further action, allowing you time to dispute the information if it's inaccurate.

 

This doesn't mean that you ONLY have 30 days to dispute such debt; it's just a window during which their hands are tied from further activity.  You can dispute that debt at any time after the initial 30 day period; it's just that during a subsequent dispute their hands are no longer tied while the dispute plays out.  In your case, it's not a biggie distinction.

 

In your situation, I assert you don't have sufficient information from which to make such a dispute as of yet and so the first step is to work with the insurer and the provider to nail down with confidence what your liability is here.  In the event that the provider has not applied fee reductions that they're required to allow under their contract with your insurer, you use documentation from the insurer (possibly the claim EOB is sufficient) to induce the provider to adjust their billing to you.  (Again, because this would be under the terms of their agreement with the insurer, in all likelihood you should be able to engage the insurer to enforce that agreement and do the necessary footwork to arrive at a fee adjustment by the provider.)

 

So again, assuming that the provider is obligated to reduce your fees, your next step is to demand that the provider retract the debt from the CA, on the grounds that the amount due was improperly determined.   This gets the CA out of your hair, removes the CA record from your credit report (if it has been reported), and lets you settle the adjusted balance directly with the provider.

 

What I'm suggesting here is that you really don't want to engage the CA until you've exhausted all other options (and you want to engage in those with all deliberate speed). 

 

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If, after you've reviewed the charges with the insurer and the provider, you determine (and/or the insurer informs you) that the provider isn't obligated to adjust your charges to the schedule otherwise determined as acceptable to the insurer.  Then you're likely on the hook for the full billing by the provider (which I grasp is in the ballpark of $600, before adding any CA fees).

 

You tactic now is to try and negotiate elimination of some/all of the CA fees.  You call the provider, ask to speak to a billing manager, and apologize for your confusion (play the "idiot card" and explain that you find the insurance details very confusing ... not terribly far from the truth).  Tell them that you're anxious to settle what's due ASAP (and your hand is strongest here if you can pay any agreed amount pretty much on the spot).

 

Tell them that you very much regret not resolving your confusion about the claim until after they referred the billing to a CA.  Admit that you grasp your responsibility for any added fees, but state that they impose a hardship and ask if there's anything that might be done reduce the fees owed.  Again, if feasible, convey that you're prepared to pay on the spot.

 

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In this latter case, you don't have much leverage in the situation.  In their eyes, there was suitable time to resolve any confusion before the account was sent out for collection.  So what you're trying to do is connect with the person you speak with empathically and get them to exercise their leeway to cut you a break.  It's simply a "cross you fingers" situation.

 

Please don't hesitate to reach out further as you engage with this situation.

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