Confusing Medical Bills: 101


Several years ago, our family found ourselves paying over $18,000 in annual medical insurance during a job transition - not including copayments, deductibles, coinsurance, and non-covered health care expenses. And my story isn't an anomaly - as health care costs trend higher than overall inflation, the typical family will spend a staggering sum of money over a lifetime.

Which makes you think - why do financial advisors never offer a strategy for managing lifetime-medical costs (LMC)?

Billdog helps answer that question by addressing a thorn in everyone's side - confusing medical bills. At Billdog, we know that if we can help you solve your confusing, headache-inducing medical bills with ease, then this may be a step toward managing your LMC, saving you and your family money to invest in your future.

Now in our second year, we want to share our top tips.

1) Optimize your medical insurance!

  • If possible, select a high-deductible plan and Health Savings Account (HSA), and max out your HSA with pre-tax dollars. 
  • Pay provider copayments and deductibles using your HSA debit card.  
  • DON'T pre-pay deductibles, like some providers will ask you to do. And, if you have reached your annual out-of-pocket maximum, don’t pay your copayment at the point of service, since insurance will cover the visit in its entirety.  
  • Pro tip: Explore secondary gap insurance to cover a high deductible, and if you can't lay off the action sports, consider single-day accident insurance from

2) Know your insurance

A prerequisite:  Know your provider network, but also know that some providers (eg. doctors or labs) that are out-of-network will work within an in-network facility. If you are treated by them, then you will receive an out-of-network bill. Although you may not know they are out-of-network at the time and will thus be surprised by the bill, you shouldn't be confused!

After that, focus on the following.

Preventative vs. sick visits

Understand that you have an allotment of "preventative" visits that are fully covered versus "sick" visits that may be applied to deductible. Pro tip: for ER situations where follow-on hospitalization or procedures are required, you may realize enhanced benefits.


This is usually a fixed amount you pay to a provider for all types of visits including regular, specialists, inpatient, outpatient, and ER. Pro tip: if you have eclipsed your annual out-of-pocket maximum, you should not owe a co-payment for a visit and should call for a refund if you’ve paid one.


Pay close attention to individual and family deductible. Your deductible obligation starts after copayments have been paid. Be aware: you may have two separate deductibles: one that applies to in-network provider charges and a second that applies to out-of-network charges.


This is your cost share with insurance after copayments and deductibles. For example, after deductible, insurance may pay 80% and you pay 20% of the remaining medical expense. Pro tip: Check your in-network and out-of-network coinsurance rates and pay special attention if your plan has a tiered network because coinsurance rates may vary based on provider tier.

Out-of-pocket-maximums (OOPM)

This is the maximum you are obligated to pay in a plan year including copayments, deductibles, and coinsurance. After the OOPM is met, insurance pays 100%.  Pay close attention to individual and family OOPMs.  Beware: Many plans have in-network and out-of-network OOPMs, for example, $6,000 for in-network providers and $10,000 for out-of-network, which would result in a $16,000 total out-of-pocket maximum.  

Plan year

Know when you plan year starts and stops.  Pro tip: Look out for new insurance cards since granting old insurance cards to a provider will cause denials and a flurry of medical bills.

Know your local network

Make sure your preferred providers are in-network, paying special attention to ER, Urgent Care and labs.  Check your plan for tiered networks wherein benefit levels vary based on tier that a provider belongs to. Pro tip: Before you travel, develop a basic understanding of your medical options at your destination(s).


This varies between HMO and PPO plans so take time to understand how your plan treats these. Then, when a provider orders a procedure and performs a pre-authorization, make sure you double check this with your insurance. Insurance places this responsibility on you. Pro tip: If pre-auth is missed but you act quickly, a retro-authorization may be granted.

3) Match EOBs to the bills from providers

Your EOB is the thing that says: “This is not a Bill”.  Your insurance company will send this to you when a claim is processed. When received, you will then match these against the invoices from providers, which may arrive days or weeks later. If you have not received an EOB, then it’s possible the provider has not sent the claim to insurance for processing.  Pro tip: Don’t throw away your EOB!

We hope this post is helpful. Please reach out if we can ever help you with a confusing medical bill!