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The Secret to Getting Paid for Implants

Be sure to submit invoices when you bill insurers, court rules.

Published: July 10, 2012

If you want to get to paid for expensive implants, be sure to submit invoices to the insurer when you bill for the case. That's the lesson to be learned from a recent court ruling that admonished a Michigan hospital for not revealing the true costs of hardware so insurers could determine "reasonableness of the charges."

The court ruling centers around a pair of surgeries performed at Bronson Methodist Hospital in Kalamazoo, Mich., in July 2009 for which the hospital billed insurers about $90,000 in plates and screws.

The insurers paid most of the patients' bills on time, but refused to reimburse Bronson Methodist for the implants until the hospital produced invoices showing how much the facility actually paid for the hardware. Without the invoices, the insurers argued, they could not determine the "reasonableness of the charges for the implants," court records show.

The hospital sued to recoup the unpaid amounts, claiming it fulfilled its obligation by submitting uniform billing forms, itemized statements and the patients' medical records. A hospital spokesperson did not respond to a request for comment.

A trial court sided with the hospital, granting the facility summary judgment. A state appellate court, however, overturned the ruling, stating insurers are permitted to consider the cost of providing treatment — not merely the cost of treatment as billed by the provider — when evaluating the reasonableness of the charges submitted for payment. Ultimately, the court ruled, the burden of proof is on the provider to show how and why the charges are reasonable.

The appellate court conceded its ruling could send insurer-hospital payment disputes down a slippery slope. "We recognize that permitting insurers access to a provider's cost information could open the door to nearly unlimited inquiry into the business operations of a provider, including employee wages and benefits," court documents state. "However, we explicitly limit our ruling to the sort of durable medical-supply products at issue here, which are billed separately and distinctly from other treatment services, and which the insurers claim (and the hospital has not disputed) require little or no handling or storage by a provider."

The insurers' attorney was unavailable at the time of publication. Attorneys for Bronson Methodist did not respond to requests for comment.

Daniel Cook


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