Frugal Friends Podcast
Episode: Negotiating Medical Bills with Dr. Virgie Bright Ellingham
Release Date: December 24, 2024
Hosts: Jen Smith & Jill Sirianni
Guest: Dr. Virgie Bright Ellingham
Knowledge Cutoff: October 2023

Introduction

In Episode 470 of the Frugal Friends Podcast, hosts Jen Smith and Jill Sirianni welcome Dr. Virgie Bright Ellingham, a medical billing expert, to discuss the crucial topic of negotiating medical bills. This episode is a re-airing of one of the podcast’s most recommended segments, emphasizing its practical value for listeners grappling with medical expenses, debt, and the complexities of healthcare billing.

Understanding Surprise Billing

[08:07] Dr. Virgie Ellingham:
Surprise billing occurs when patients receive unexpected charges from out-of-network providers who were involved in their care, such as anesthesiologists or radiologists, without the patient's choice of these physicians. Dr. Ellingham explains that this often results in patients being billed the full retail price, which can be exorbitant and financially crippling.

Key Insights:

• Definition: Surprise billing involves out-of-network providers charging patients unexpectedly.
• Impact: Patients are often stuck paying high bills despite believing they are within their insurance network.
• Business Practices: Many healthcare facilities hire out-of-network physicians to maximize profits, leading to inflated costs for patients.

New Federal Protections

[11:23] Dr. Ellingham:
As of January 1, 2023, federal law mandates that out-of-network providers negotiate directly with insurance companies, removing the patient from the middle of the billing dispute. This law aims to protect consumers from bearing the financial burden of surprise bills.

Notable Quote:
"As of January 1st of this year, a bill was passed. It's now federal law where if you have insurance and you go to an in-network provider and you are given a bill by out-of-network physicians, they have to negotiate directly with your insurance company."
— Dr. Virgie Ellingham [11:23]

The One Right Way to Pay a Medical Bill

Dr. Ellingham outlines a three-step process to effectively manage and negotiate medical bills, ensuring financial protection and reducing stress.

Step 1: Obtain an Itemized Bill with CPT Codes

[14:59] Dr. Ellingham:
Request a detailed, itemized bill that includes CPT (Common Procedural Terminology) codes. These codes are essential for verifying the services rendered and their corresponding costs.

Key Actions:

• Verify the Bill: Ensure the bill contains CPT codes, which are standardized codes representing specific medical procedures.
• Identify Services: Cross-reference the CPT codes with the services you received to confirm accuracy.

Notable Quote:
"The first step is to call your provider and get a real bill, which is an itemized bill with CPT codes."
— Dr. Virgie Ellingham [14:59]

Step 2: Research Medicare Rates

[15:20] Dr. Ellingham:
Use resources like Medicare or the Healthcare Blue Book to determine the standard rates for each CPT-coded service. Medicare rates serve as a baseline for fair pricing.

Key Actions:

• Google CPT Codes: Look up each CPT code to understand the typical cost of the service.
• Compare Rates: Compare the billed amount to what Medicare pays for the same service to identify potential overcharges.

Step 3: Negotiate with Your Provider

[26:57] Dr. Ellingham:
Armed with accurate information, approach the medical billing department to negotiate a payment plan or a reduced rate based on your findings.

Key Strategies:

• Start with Medicare Rates: Use the Medicare rate as your starting point for negotiation rather than inflated estimates.
• Propose a Budget-Friendly Plan: Request an interest-free payment plan that aligns with your financial situation.
• Persistence Pays Off: Be prepared for pushback but remain firm on your negotiated terms to avoid long-term debt and credit damage.

Notable Quote:
"The reason why you want to stick with your budget when you're calling the facility... is because a little bit of something is better than all of nothing."
— Dr. Virgie Ellingham [16:30]

Handling Medical Debt

Dr. Ellingham provides guidance for those already deep into medical debt, emphasizing the importance of taking proactive steps to manage and mitigate financial strain.

Financial Assistance and Medicaid

[23:23] Dr. Ellingham:
For bills less than six months old, apply for financial assistance or Medicaid based on your state’s eligibility criteria. Many nonprofit healthcare facilities offer sliding scale discounts that can significantly reduce or even eliminate your bill.

Key Points:

• Tax-Exempt Hospitals: 65% of U.S. hospitals are tax-exempt and must provide income-based discounts.
• Financial Aid Programs: Contact the billing department to inquire about financial aid or charity care options.

Dealing with Collections

[40:59] Dr. Ellingham:
Recent changes require that medical debts are no longer reported to credit agencies once paid, and there is a 12-month waiting period before debts can be sent to collections. For existing collections:

• Validate the Debt: Ensure the debt is legitimate by requesting documentation.
• Negotiate Payments: Work out a payment plan or negotiate a reduced lump-sum payment.
• Avoid Credit Damage: Prioritize essential expenses like housing and transportation over medical debt.

Notable Quote:
"Medical debts are treated differently from consumer debts because no one chooses to be sick or injured."
— Dr. Virgie Ellingham [21:53]

Personal Stories and Experiences

Throughout the episode, Dr. Ellingham shares personal anecdotes highlighting the challenges and successes in negotiating medical bills. These stories serve to illustrate the practical application of her advice and emphasize the emotional relief that can come from effectively managing medical debt.

Dr. Ellingham’s Experience:

• Large Balance Bill: Received a $90,000 balance bill from an in-network facility due to out-of-network billing errors.
• Resolution: By applying her three-step process, she identified discrepancies and managed to contest the unjust charges, preventing the debt from being realized.

Notable Quote:
"If I'd applied the three steps, I would have gotten a real bill and figured out that I didn't actually owe that $90,000."
— Dr. Virgie Ellingham [54:34]

Negotiation Tips and Strategies

In the Lightning Round segment, Dr. Ellingham and the hosts share their best negotiation experiences, emphasizing the importance of kindness, persistence, and relationship-building in successful negotiations.

Key Tips:

• Be Kind and Friendly: Building rapport can lead to more favorable outcomes without confrontation.
• Bundle Requests: Negotiate for multiple concessions simultaneously to maximize benefits.
• Persistence: Stay firm and consistent in your negotiations to achieve your financial goals.

Notable Quote:
"Negotiation tip is be kind and be friendly."
— Jen Smith [66:25]

Conclusion and Takeaways

The episode underscores the importance of medical financial literacy and proactive management of medical bills. By understanding billing codes, researching standard rates, and negotiating effectively, listeners can significantly reduce their medical expenses and avoid debilitating debt.

Final Takeaways:

• Educate Yourself: Knowledge is power when dealing with complex medical billing.
• Take Action Early: Address bills promptly to prevent them from escalating into debt.
• Utilize Available Resources: Leverage nonprofit assistance programs and federal protections to safeguard your finances.

Notable Quote:
"Don't give up or risk your ability to get to work or the roof over your head. Medical bills should not compromise your financial stability."
— Dr. Virgie Ellingham [22:34]

Additional Resources

• Dr. Ellingham’s Website: crushmedicaldebt.com
• Podcast Hosts’ Book: Buy What You Love Without Going Broke – Pre-order at buywhatyoulovebook.com
• Healthcare Blue Book: A resource for comparing medical service rates.

Notable Quotes with Timestamps

1. Dr. Virgie Ellingham on Federal Protections:

   "As of January 1st of this year, a bill was passed. It's now federal law where if you have insurance and you go to an in-network provider and you are given a bill by out-of-network physicians, they have to negotiate directly with your insurance company."
   — [11:23]

2. On the Importance of Itemized Bills:

   "The first step is to call your provider and get a real bill, which is an itemized bill with CPT codes."
   — [14:59]

3. Dr. Ellingham’s Personal Story:

   "If I'd applied the three steps, I would have gotten a real bill and figured out that I didn't actually owe that $90,000."
   — [54:34]

4. Negotiation Tip – Be Kind:

   "Negotiation tip is be kind and be friendly."
   — Jen Smith [66:25]

5. Preventing Financial Strain:

   "Don't give up or risk your ability to get to work or the roof over your head. Medical bills should not compromise your financial stability."
   — Dr. Virgie Ellingham [22:34]

Final Thoughts

Episode 470 of the Frugal Friends Podcast serves as an essential guide for anyone facing medical bills and debts. With actionable steps, personal stories, and expert advice from Dr. Virgie Ellingham, listeners are empowered to take control of their financial health amidst medical challenges. By fostering financial literacy and advocating for fair billing practices, the episode contributes significantly to the frugal and financially independent mindset promoted by the podcast.