The bill for his COVID test in Texas was a staggering $54,000
Click to enlarge the image and toggle caption Laura Buckman, KHN Laura Buckman
Travis Warner's business grew faster than ever after COVID-19. His company installs video and internet systems in Texas. Service calls soared because of the influx of people working remotely.
His employees and he took preventive measures such as wearing masks, distancing themselves physically and using masks. The coronavirus was a serious threat to clients' health when they visited their homes every day.
Warner comments, "It was like doingdging bullets every single week."
An employee was positive for HIV in June 2020. Warner and his wife were sent on a hunt for a test.
Due to limited testing available at the time they drove 30 minutes from Dallas to Lewisville, Texas. They were given rapid antigen and PCR diagnostic tests.
Warner said that Warner was relieved when all the results came back negative. Warner eagerly returned to work.
The bill was then sent.
Travis Warner, 36, a self-employed individual, purchased his health plan through Molina Healthcare via HealthCare.gov.
Medical service: There are two "COVID" tests for coronavirus. One is a diagnostic PCR test that takes several days and is very accurate. The other is a rapid antigen test that is more accurate and produces results in minutes.
Total bill $56,384, which includes $54,000 for the PCR and balance for antigen and ER tests. Molina's negotiated rate and facility fee for both tests totaled $16,915.20. The insurer paid the entire amount.
SignatureCare Emergency Center in Lewisville is the service provider. This is one of over a dozen free-standing ERs that the company has across Texas.
What's the deal? Stories of outrageously high coronavirus test prices have been common during the COVID-19 pandemic. Recent data from an insurance trade group shows that price gouging by some providers is still a problem. According to our health policy research, Warner's $54,000 PCR bill was "astronomical" as well as "egregious."
It's legal. Loren Adler, associate Director of the USC-Brookings Schaeffer Initiative for Health Policy, said that there is no limit on how much providers can charge for coronavirus testing.
However, testing for coronavirus was only available to a select group of people. Because of the fear that cost-savings might be avoided, lawmakers were concerned about the impact of the pandemic. They passed legislation that required insurance companies to pay for these tests, without cost sharing or copays.
In-network providers can negotiate the prices of the tests. Out-of-network providers are generally required to pay the price that providers publish publicly. Warner's plan did not include a freestanding ER.
Analysts in health policy say that the policy was meant to help patients but that it has given health care providers unintentionally leeway to charge absurd, sometimes arbitrary prices. This is because they know that insurance companies are required to pay and patients who are not billed will be unlikely to complain.
Niall Brennan is the president and CEO at the Health Care Cost Institute. The institute studies prices in health care. "Even a well-intentioned provision such as this can be taken advantage of by unscrupulous providers to accomplish nefarious ends."
Kaiser Family Foundation's annual report found that hospital costs for coronavirus testing ranged between $20 and $1,419, not including facility or physician fees. These fees can sometimes be more than the actual cost of the test. The report found that only half of the test costs were under $200 and 1 in 5 were over $300.
The authors stated that they observed a wide range in COVID-19 testing costs, even within the same hospital.
Brennan believes that the real cost of such a test would be in the low double digits. "Low triple digits if we're being generous."
Medicare pays $100 for the test. At-home tests can be purchased for as low as $24 (for an antigen test) or as high as $119 (for a PCR test).
Warner's expenses were fully covered under his insurance.
Insurance policy premiums are a reflection of how much money is paid to providers. Adler states, "If the insurance company pays astronomical amounts of money for your care that means that you will be paying higher premiums."
Premiums rise are a burden on taxpayers who help to subsidize market-based insurance plans. Even those with employer-sponsored health insurance feel the pain. Research has shown that every $1 increase in employer's healthcare costs correlates with a 52-cent reduction in employee's overall compensation.
Brennan states that the high cost of health care has been rising even before the pandemic. These discrepancies "happen every day, millions of time a day."
Resolution: Warner was relieved to see that his insurance company paid the bill.
The $54,000 fee was absurd. His wife, who had received the same tests at the same time, was charged $2,000. The claim was settled for less than $1,000 by a separate insurance policy.
Warner called his insurance company to find out if they could help him. Warner was able to get another letter from his insurance after a lengthy wait and a game with the ER billing firm. The insurer said it had audited the claim, and that the ER was owed most of the money originally paid.
Molina Healthcare spokesperson said in a written statement that the matter was caused by a billing error. Molina has corrected it.
SignatureCare Emergency Centers issued the $54,000 charge. However, it said that it would not comment on any specific patient's bill. It stated that its billing errors rate is less than 2 percent and that it has an "exhaustive audit process" to identify them. SignatureCare ERs processed thousands of records per day during the peak of the pandemic.
SignatureCare now lists the cost for coronavirus testing at $175 on its website.
The bottom line: Consumers should have free testing for coronavirus during a public health emergency. Current extension is through October and will likely be renewed for another 90 days. Warner did his insurance company a huge favor by carefully reviewing his bill, even though there was nothing owed.
Insurers should have systems to flag billing errors and prevent overpayment. This includes authorization requirements prior to services being rendered and audits following claims have been filed.
Adler states that "there's a problem of how they work." "In this instance, it's fortunate [Warner] noticed."
According to at least one estimate, 3% to 10% of U.S. health care spending goes to overpayments, which includes fraud and waste.
This means that the patient is responsible for keeping charges reasonable.
Experts recommend that you always carefully read your bill. If you feel the cost is excessive, contact your insurance company to have it double-check the bill and provide an explanation.
Experts agree that this shouldn't be your job. However, in the long-term, less overpayments will save you money and others in the American healthcare system.
Bill of the Month is an NPR/KHN crowdsourced investigation that examines and explains medical billing. Have a unique medical bill that you would like to share? We want to hear about it!
