Restaurant not included!


You walk into a restaurant, sit down, and are greeted by a cheerful waitress.   She hands you a menu and you order the burger and a coke.  She returns a few minutes later with your food and everything is delicious.   You take the bill, have a look, and then your jaw hits the floor. The coke and burger are reflected at the menu price, but what's this $30 restaurant fee? You summon the waitress.  “There looks to be a problem here,” you say.  “Nope, sorry, the restaurant charges its fee, too,” she replies. The owner has been watching from behind the bar and strolls over. She informs you that you’re paying to use the restaurant. "Think of it like a rental fee," she says, pointing to a small sign on the wall. You mumble something and pull out your credit card.  

What’s happening?  There’s a joke about the hip replacement surgeon that can tell you anything and everything about the surgery— except for what it costs!   This is an oversimplification of the pricing dynamics in healthcare, but it emphasizes the point that price transparency – and making healthcare “shoppable” by regular people, is notoriously difficult.  

Variable “Facilities Fees” contribute to the challenge.  These fees are a way for hospitals, clinics, surgery centers, radiology groups, and other medical locations to manage their operations.  Often these charges are separate to the doctors and other providers that work in the location.   They include things like room and board, syringes, aspirin, and the use of specialized medical equipment.   Insurance companies have negotiated rates at which they pay. Very often the fee is shown as a lump sum on the explanation of benefits and a patient’s deductible and coinsurance can apply to all, none, or a portion of the charges.

What to do?  Insurance companies pay facilities fees at contracted rates for the diagnosis. Costs can be complicated by service location indicators for the treatment. (For example, the doctor has a different rate if seen at the office versus in a hospital.)   To understand the fees, a request for an itemized statement from the facility can be made, however, it may require many phone calls, faxes, and paper forms before documents are furnished. While all of this can seem deliberately onerous, Bill Dog’s Chief Medical Officer, Tom Wolk, M.D. points out that HIPAA compliance is a real concern and many providers and insurance use fax as the preferred method of communication since it is ubiquitous and secure.

At Bill Dog, we sometimes see facilities fees that result in thousands of dollars in patient obligations including deductible, co-insurance and a balance bill.   Because multiple diagnosis, procedures, and service fees can be wrapped into a single EOB, just  getting the paperwork in good order can take weeks.   It's important to engage the insurance companies and providers early to avoid timely filing exceptions and collection agencies.   If you are having a problem with a medical bill, please reach out to us, we might be able to help.