Why Medical Bills Are Different
Unlike almost any other purchase, when you receive medical care you typically don't know the price in advance, you don't receive an itemized receipt at the point of service, and the bill you receive weeks later is often incomprehensible. This opacity enables billing errors — both accidental and intentional — to go unchallenged at enormous scale.
The most commonly cited estimate is that 80% of medical bills contain some kind of error. Even if the true figure is lower, medical billing errors cost patients tens of billions of dollars annually in the United States.
The Most Common Types of Medical Billing Errors
Duplicate billing: The same service billed twice, usually under the same CPT (Current Procedural Terminology) code on the same date of service. Often an administrative error that's trivially easy to dispute once identified.
Upcoding: Billing for a more complex or expensive version of a service than was actually performed. For example, billing a Level 4 emergency room visit (CPT 99284, typically $800–1,200) when the visit was actually Level 2 (CPT 99282, typically $300–500). This can add hundreds of dollars to a single encounter.
Unbundling: Some procedures are required by CMS guidelines to be billed together as a package at a lower combined rate. Unbundling means billing each component separately to maximize reimbursement. It's illegal under Medicare/Medicaid billing rules and still improper for private insurance.
Balance billing: When a provider bills you the difference between their charge and what your insurance paid, even when they are in-network. In-network providers have contractually agreed to accept the insurance rate as payment in full.
Charges for services not rendered: Billing for procedures or tests that were ordered but then cancelled, or simply not performed. Always compare your bill against any notes you kept about what actually happened during your visit.
Step 1: Request an Itemized Bill
You have the right to request an itemized bill from any healthcare provider. Ask specifically for an itemized statement that shows every CPT code billed, the date of service for each charge, a description of each service, and the amount charged for each line item.
This is different from the summary bill or Explanation of Benefits (EOB) you typically receive. Many hospitals and large practices will initially try to give you a summary. Persist: "I am requesting a complete itemized bill showing every CPT code and charge individually."
Step 2: Review Against Your EOB
Your insurer's Explanation of Benefits shows exactly what services were billed to them, what they paid, and what they applied to your deductible. Cross-reference this against your itemized bill:
- Are there charges on the itemized bill not reflected in the EOB?
- Does the description of services match what you actually received?
- Are there duplicate line items?
- Are there charges for dates when you were not receiving treatment?
Step 3: Write a Formal Dispute Letter
Once you've identified suspect charges, write a formal dispute letter to the hospital or provider's billing department. Your letter should:
- Reference the account number and date(s) of service
- List each disputed charge by CPT code and description
- State the reason for each dispute (duplicate, upcoded, not rendered, etc.)
- Request a corrected itemized statement within 30 days
- State that you are preserving all records of this dispute
Send via certified mail. Keep a copy of everything.
The Hospital Must Respond Within 30 Days
Federal law (and many state laws) requires healthcare providers to respond to billing disputes. If they don't respond or dismiss your dispute without addressing each point, escalate:
- File a complaint with your state's insurance commissioner if the dispute involves insurance billing
- File a complaint with CMS (Centers for Medicare & Medicaid Services) if Medicare/Medicaid is involved
- File a complaint with the CFPB (Consumer Financial Protection Bureau) if the bill has been sent to collections
One More Thing: Charity Care
Nonprofit hospitals — and most large hospitals are nonprofit — are legally required by the IRS to offer financial assistance programs (charity care) as a condition of their tax-exempt status. If you are uninsured or underinsured, you may qualify for significant bill reduction or elimination regardless of whether there are billing errors.
Ask directly: "Does this hospital have a financial assistance or charity care program, and can you provide me with the application?" Many hospitals do not advertise this proactively.