Out-of-network costs spin out of control

People who have health insurance but get sick with rare diseases that require out-of-network care continue to face potentially unlimited costs.

The big picture: Federal regulations cap how much people pay out of pocket for in-network care, but no such limit exists for out-of-network care.

Zoom in: Cindy Beckwith, 57, of Bolton, Connecticut, was diagnosed with pulmonary artery sarcoma, a rare tumor on a main artery. She also has fibromuscular dysplasia, a rare blood vessel condition.

• She has ConnectiCare health insurance, which she gets through her husband's employer.
• Her local doctors suggested she see specialists at the University of Pennsylvania Health System because her conditions were so uncommon, but the system was out-of-network.
• "I had to go out of my network," Beckwith said. "I didn't have a choice."

The bill: $20,138.40 from Penn Medicine, the parent of UPHS, a profitable system with $8.7 billion of revenue last year.

• Over a few years, Beckwith received a lot of care from the hospital, including two open-heart surgeries and inpatient chemotherapy.
• This bill showed charges of $270,000, just for services received in 2019. Beckwith and the hospital settled on $20,138.40. Penn Medicine "insisted" she pay a minimum of $441 per month until 2023, she said.
• Beckwith and her husband have already paid more than $11,000, and even though she says they are doing OK with her various medical bills, "there's not a lot of extra money left over."

Between the lines: The new surprise billing regulation only protects patients if they get non-emergency care from out-of-network doctors at in-network facilities.

• That means people with employer coverage that doesn't have an out-of-pocket maximum for out-of-network care could experience large bills based on hospitals' inflated charges, and have to negotiate payment on their own.
• "Out-of-network charges kind of seem like a little bit of funny money to consumers," said Katherine Hempstead, a health insurance expert at the Robert Wood Johnson Foundation. "These are the things that make people feel kind of defeated."
• "We didn't expect this to happen," Beckwith, who has worked in medical coding for 30 years, said of her condition. "When it does, it can wipe you out."

The other side: Beckwith's hospital and insurance providers did not make anyone available for interviews.

• A ConnectiCare spokesperson said the insurer does "not speak about our members' private health information."
• A Penn Medicine spokesperson said in a statement the system "has a longstanding commitment to work with patients to help them understand the costs associated with their care, including out-of-pocket costs."

The resolution: After Axios submitted a HIPAA authorization waiver, signed by Beckwith, to Penn Medicine to discuss Beckwith's case, Beckwith received a call from Penn Medicine, whom she hadn't heard from in months.

• The hospital knocked $4,000 off her remaining balance, telling her they reprocessed some old claims. She still owes almost $4,800.

This is part of Axios' new series, Billed and Confused. Have you been hit with an unexpected medical bill? Maybe the overall medical billing experience left you feeling puzzled or upset? Email [email protected], so we can dig into what's happening.

More from the series:

• Many surprise medical bills are now illegal (Jan. 1, 2022)
• When you're charged a copay you shouldn't owe (Jan. 20, 2022)