Using Compliance Programs to Resolve Patient Billing Complaints

By Ronald L. Scott

Although not intended to address patient billing complaints, health care compliance programs can sometimes provide an effective mechanism to resolve such complaints.

The Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) has long promoted voluntary compliance programs for the health care industry.  OIG issued its compliance program guidance for hospitals in February 1998. Compliance programs promote ethical and lawful corporate conduct. Specifically, compliance programs promote prevention, detection, and resolution of instances of conduct that do not conform to federal and state law, health care program requirements, and the hospital’s ethical and business policies. Under federal sentencing guidelines, the Department of Justice and OIG look to see if an entity guilty of misconduct has exerted reasonable efforts to avoid and detect any misbehavior that occurs within their operations. The existence of an effective compliance program may determine the level of sanctions, penalties and exclusions that will be imposed on the health care provider. See The Office of the Inspector General's Compliance Program Guidance for Hospitals at Fraud/980219OIGCompliance.html.

A typical compliance program’s Standards of Conduct may provide in pertinent part:

I entered a hospital in 2001 for minor surgery not covered by insurance.  Prior to the surgery I was quoted a fee of $700 for hospital services, and as required prepaid such amount in full. I received a bill for an additional $3980.42, and despite repeated and time-consuming attempts to resolve the billing error, I was unable to do so. Additionally, I was quoted a fee of $550 for anesthesiology services to be performed by an exclusive contractor for the hospital, which was also prepaid in full. My receipt showed a zero balance. I received a bill for an additional $115. When I disputed the additional charge, it was referred to a collection agency, which threatened to report the bill to credit reporting agencies. Although the anesthesiologist was an “independent contractor” it seemed possible that the hospital had contractual undertakings requiring them to adhere to the hospital’s  Standards of Conduct.

Both the initial billings and the failure to resolve them in a “timely” manner were clearly in violation of the hospital’s Standards of Conduct, so I sought the compliance director’s help in rectifying these violations and insuring that such conduct does not occur in the future. After a review by the compliance director, the hospital quickly agreed to drop the additional charges.  The anesthesiology contractor also agreed that its billing was in error.  But these sorts of problems are not supposed to happen to health care lawyers and professors!

Resort to a compliance program complaint should be considered a possible  “intermediate” method of resolving a billing dispute—somewhere between trying to resolve the issue with the provider’s billing department and the last resort of a lawsuit.  Usually, resolving a patient billing error is no different than dealing with any other consumer billing problem and the same advice applies.  First, keep a copy of every bill and other correspondence related to the matter.  Keep an accurate record of any telephone attempts to resolve the matter, including the name and title of each person you speak with as well as notes of your conversation.  If the dispute involves a significantly tardy bill, a recent Texas law may offer some help. Generally, Texas health care providers are required to bill patients or insurers within 10 months from the date of service.  Failure to bill in a timely manner may absolve the patient of responsibility for the bill. See Shifting Responsibility for Health Care Billing Mistakes in Texas at HealthPolicy/981125Shifting.html.