What is Balance Billing (Health Care) and How Does It Impact You?
Definition & Meaning
Balance billing occurs when a healthcare provider bills a patient for the difference between the total charges for a medical service and the amount covered by the patient's insurance plan. This practice usually happens when the provider believes that the insurance reimbursement does not fully cover the costs of the service rendered, often because the charges exceed the usual and customary rates for that service.
Legal Use & context
Balance billing is primarily relevant in the context of healthcare law and insurance practices. It is often encountered in managed care and Medicare settings. Legal issues can arise when patients are unexpectedly billed for significant amounts after receiving care, leading to disputes over what constitutes reasonable charges and insurance obligations. Users may benefit from legal forms and templates to address balance billing disputes effectively.
Real-world examples
Here are a couple of examples of abatement:
Example 1: A patient receives treatment from a specialist who is not in their insurance network. The insurance pays $1,000 of the $2,500 billed. The specialist sends a bill to the patient for the remaining $1,500.
Example 2: A patient undergoing surgery at a hospital is billed for additional charges that their insurance does not cover, leading to a balance bill for the patient. (hypothetical example)