Physician Lauren Hughes was on her way to a clinic about 20 miles from her home in Denver when another driver collided with her Subaru, causing it to be totaled. After the crash in February, she was taken by ambulance to Platte Valley Hospital in Brighton.
Once in the emergency room, Hughes, feeling quite shaken, was diagnosed with bruising, a significant cut on her knee, and a broken ankle. Doctors advised immediate surgery, and she agreed. “I thought, ‘Yes,’” she recalled hearing them say they needed to take her to the OR to clean the wound and prevent infection.
After the procedure, she spent the night at the hospital, with a friend taking her home the following day.
Then the bills began to arrive.
The Medical Procedure
During the surgery, surgeons repaired the cut on her knee and realigned a broken bone in her ankle, securing it with metal screws. It’s standard practice to recommend surgery when there’s a risk of improper healing with just a cast.
The Final Bill
The total charge from the hospital was $63,976.35, and since this facility wasn’t in-network with her employer-sponsored insurance, it was a shock.
The Problem: Should I Stay or Should I Go?
Her insurer, Anthem, covered the nearly $2,400 ambulance ride and some radiology costs from the ER, but it denied coverage for the surgery and overnight stay at the out-of-network hospital.
“Sixty-three thousand dollars for a broken ankle and a knee cut, and I didn’t even have a head injury,” Hughes remarked, astonished at the cost for just an overnight stay.
Insurance companies hold significant power in determining what care is considered medically necessary, which directly influences payment decisions. Four days post-surgery, Anthem informed Hughes that, based on clinical guidelines, her hospital admission for the ankle repair wasn’t deemed medically necessary.
The letter stated that if she had additional surgery or symptoms like a fever, an inpatient stay could have been warranted, but since she didn’t exhibit serious complications, they denied the claim.
Hughes found this reasoning absurd. Her car was at a junkyard, she had no nearby family for support, and she was on opioid painkillers for the first time.
When seeking clarification on the medical necessity determinations, Hughes was directed to her policy’s guidelines, which stipulated that documentation should show that outpatient care couldn’t provide safe and adequate treatment.
The reason behind the denial boiled down to a quirk in the insurance contract. Anthem explained that its agreement with the hospital required that claims submitted before and after a patient’s admission be considered together. With the hospital stay classified as unnecessary, the entire claim was denied.
According to Anthem, while they agreed the ankle surgery was necessary, the bundled nature of the outpatient and inpatient claims led to the denial.
Confused about the outcome considering the emergency circumstances, Hughes believed the No Surprises Act, effective since 2022, should apply. This law mandates insurances to treat out-of-network emergency care as in-network, thus providing some protections.
“Had they deemed the surgery medically necessary, they would have had to apply the No Surprises Act costs,” suggested Matthew Fiedler from the Brookings Center on Health Policy, emphasizing that the act doesn’t override medical necessity determinations.
Another intriguing aspect of her case emerged during numerous calls to her insurer. An Anthem representative informed her that had the hospital billed for her overnight stay as an observation instead of admission, the situation might have been different.
Observation status indicates that patients are monitored to determine if they need to be admitted later. Generally, that designation results in lower costs for insurers.
This classification can be particularly crucial for Medicare patients, as care post-hospitalization without a three-day formal admission may not be covered.
“It’s a classic conflict between providers and insurers regarding how a claim is categorized,” Fiedler noted.
The Resolution
As a health policy expert and physician, Hughes was no ordinary policyholder, yet she still felt overwhelmed by the back-and-forth communication with her insurer and the hospital over the course of several months, especially when it seemed her account might go to collections.
To combat the denied claims, she contacted her employer’s HR department for assistance, which reached out to Anthem. She also got in touch with KFF Health News for help, which then contacted Anthem and the hospital.
By late September, Hughes received a call informing her that the hospital had downgraded her case’s billing level and resubmitted the claim to Anthem.
A representative from Platte Valley Hospital expressed regret over the situation, acknowledging that the initial bill had been sent prematurely before the balance with Anthem was resolved.
Following a review, the hospital ceased all billing to Hughes, assuring her that if her insurance assigned any remaining costs to her, she wouldn’t be responsible for them.
Anthem confirmed that the bill was resubmitted for outpatient care services, which led to a reduction of around $40,000 from the original charge due to an Anthem discount, resulting in the hospital receiving nearly $21,000.
Ultimately, Hughes only owed a $250 copayment.
The Takeaway
This case illustrates how patients in emergency situations at out-of-network hospitals can sometimes slip through the cracks of federal billing protections, particularly during the sometimes ambiguous “post-stabilization” phase.
Stable patients may be advised to move to an in-network facility using nonmedical transport, a process where out-of-network providers can ask patients to waive billing protections through consent forms.
“Patients need to read those forms carefully. They could lead to unexpected bills,” Hoadley warned.
Ideally, patients should ask both their insurer and the hospital’s billing department about their admission status and medical necessity to better understand potential coverage outcomes. Hughes, however, did not remember being informed of her stability for nonmedical transport or being asked to sign any consent forms.
She advises others to challenge any insurance denials promptly, seeking escalation to leadership within both the insurer’s and hospital’s management. Expecting patients to navigate complex billing during a hospital stay after a serious injury is unrealistic. “I was busy calling family, notifying colleagues, figuring out care for my pet, and processing everything that happened,” Hughes recounted.
