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There Is A Penalty If You Pay Cash For Medical Care?

Posted By : Michael Phillips  |   Posted On:March 10, 2017  |   Views: 157

See if this makes sense to you.  My wife and I have Medicare and a good supplement plan, however I noticed something the last time we got a statement from Medicare.  There is an amount that the doctor billed to Medicare… this is the standard rate for the services we received at his office.  It is the rate that anyone who does not have insurance must pay for the services, even if the person is paying cash at the time of services.  In fact, most doctors require payment before you see them if you do not have insurance.

Here is the part that makes no sense at all.  If you have insurance, the amount the insurance company pays to the doctor is much less, usually it is about 1/3, or less, than the amount charged to a patient paying cash to the doctor for his or her visit.  This is highly discriminatory and it is something that should be taken into consideration by congress when writing the replacement bill for The Affordable Care Act.

Let me be clear.  Cash payment at the time of service is the only thing I am questioning.  If anyone is fortunate enough to find a doctor who will bill him or her, the doctor should charge a higher price, to cover the cost of writing off a percentage of the billings as uncollectable.  If you do not have insurance and the doctor agrees to bill you, the higher price is your penalty for not carrying insurance and not paying your bill at the time of service.

Congress can resolve this issue for those who do not choose to purchase health insurance, since it presumably will no longer be against the law if someone decides to not purchase insurance.  In other words, the mandatory requirement is going to be dropped when The Affordable Care Act is repealed and that requirement will not be in the replacement bill.  At least that is one of the things the Republicans are touting about their replacement bill for The Affordable Care Act.

So, when someone chooses to not have insurance coverage and goes to the doctor, this protection under the new law should be provided for him or her; you have the option to pay cash at the time of service, not to exceed the lowest negotiated insurance company rate.  Again, should the doctor agree to bill you for his services, allowing you to pay later, he is free to bill you at a higher rate than the lowest negotiated insurance company rate.  Payment at the time of service means you pay the bill before you leave the doctor’s office.

Example; For an office visit in which the doctor orders a blood draw in his lab, the total bill may be $300.  For a patient with medical insurance, the doctor bills the insurance company for $300.  The insurance company discounts the bill to a previously negotiated amount of $140, then pays $130, leaving the patient to pay a $10 co-pay.  Of course, the insurance company may not pay the bill for 60 days, so the doctor carry’s a receivable on his books for 60 days.

Using the same example above, the doctor can now charge a patient $300 for the services even if he or she pays cash before leaving the doctor’s office on the day of service.  This is a discriminatory issue that the new healthcare bill should fix.  In the previous example, the patient must pay only $140 cash at the time of services.  That is fair to all concerned in the transaction.  The patient pays no more than an insurance company and the doctor gets his or her money immediately.

So, be sure to tell your congress person to put you on a level playing field with insurance companies when paying cash for your healthcare.  Make sure your congress person takes care of you, not the lobbyists who are lining his or her pocket.


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