When Insurance Companies Don’t Pay
There’s a story in the local news about Excellus Blue Cross, one of the larger Blue Cross companies in the nation, discovering a billing glitch in their system (a misnomer since they’re actually paying claims) which has led to both hospitals and physicians not getting paid on claims for a couple of months now. Supposedly, one physician received a letter from them saying that physician claims would be paid by April of this year.
Insurance companies have a negative approval rating because many people believe they have rules that are designed to automatically deny some claims for payment just so they can hold onto their money for awhile and let it accrue interest. Though I tend to believe that, for the most part, that’s a stereotype that grew because of both the book and the movie named “The Rainmaker”, there are true stories of some insurance companies doing exactly that.
I don’t see that as the case here, but I do see that, if some entities haven’t been paid, there will be serious repercussions that will transpire because of it. Neither hospitals nor physicians are made of money, contrary to belief. There are great expenses related to health care that most people never think about, many of those expenses related to regulation. And, of course, supplies and payroll are the two biggest expenses both have to deal with. If insurance companies don’t pay on time, days in cash will dwindle, and hospitals are suddenly in trouble because they won’t have the money to pay either their bills or their employees. This type of thing happened locally many years ago when one of our hospitals changed billing systems, then suddenly cash stopped coming in and the hospital had to declare bankruptcy to protect itself. They did end up surviving, but it was dicey for awhile.
Hospitals can’t really survive on one insurance company paying them on time. There has to be a balance between all of them, otherwise there will be trouble. The same goes for physicians that participate with certain insurance companies. Those who don’t participate (this means they’ve signed an agreement for the insurance companies to pay them directly) get their payments up front, so they don’t worry about it as much, but if the insurance companies aren’t paying either the hospitals or physicians, what makes us think they’re paying their subscribers any quicker?
I’m hoping that the hospitals, at least, are getting weekly lump sum payments, which is common in health care. That will at least keep them financially stable, even if their accounts receivables look bad for awhile. However, I know of few physicians who get the same kind of deal, so that’s problematic. There’s nothing anyone can do, but if your physician suddenly decides he can’t see you for awhile because your insurance company isn’t paying him, you should be ready to probably either have to pay out of pocket and bill the insurance company yourself, or try to find another doctor who’ll see you. But if that other doctor also isn’t getting paid, you’re going to be out of luck.