Hospital Sticker Shock

Wyatt Andrews is a correspondent for CBS News based in Washington.
Forget the actual cost of health care, for one moment, and focus on this question: why are hospital bills so buried in code, so averse to plain English? The simple answer is: hospital (and most doctors') bills are written in codes endorsed by the AMA (American Medical Association) and used by reimbursement specialists with the Federal Government and insurance companies. We the patients, simpletons that we are, aren't supposed to understand.

But it's deep within these overly complex codes that many experts believe mistakes get buried--and that most "mistakes" are usually overcharges.

One growth industry in America today is the rise of a specialty service whose practitioners are called "Billing Advocates." An advocate is trained to read a complex bill from the doctor or a hospital and find the errors. In our interview for tonight's CBS Evening News, Nora Johnson, a no-nonsense billing advocate from West Virginia says that of the thousands of medical bills she has reviewed for clients, maybe three have not had errors. To be clear, that's three clean bills out of several thousand. Nora showed me one bill with a $1,000 charge for giving a patient a toothbrush.

"Are these errors deliberate?" I ask. "I call it profitable error," she responds.

In other words, the bizarre and complex system of medical codes is making it easy for providers to hide overcharges. At a minimum it's a system where providers have very little incentive to avoid overcharges, because if an insurance company, Medicare or a patient finds an overcharge the hospital can usually just correct the error.

Which is why, in our story tonight, we also interview Joe Manchin, the Governor of West Virginia. Manchin's unique proposal is to deputize the state's Medicaid population into becoming watchdogs over their bills, paying them 10 per cent of any error they discover! Manchin believes the patient watchdog approach will both lead to plain language bills and save the state money.

Still, this is one more area in health care where patients themselves can take charge. You can act to protect yourself. Especially when you get a hospital bill, don't settle for a summary bill, get an ITEMIZED BILL. Look for charges on procedures doctors did not perform and then check for duplicate charges.

If you want a billing advocate like Nora Johnson, start with this website, then scroll down and click on "find an advocate." Advocates charge either a percentage of the money they help knock off your bill, or they charge you by the hour.

  • Wyatt Andrews

    Wyatt Andrews is a CBS News National Correspondent based in Washington D.C. He is responsible for tracking trends in politics, health care, energy, the environment and foreign affairs.