Make sense of your hospital bills

If you've just learned that you need to schedule surgery, or you landed in the hospital due to an accident or sudden illness, your main focus should be on getting the best care possible. But understanding what your medical insurance covers and what it doesn't is also essential to preparing for a planned or unplanned hospital stay. And, it's critical to avoiding medical bills you can't afford. Indeed, some evidence has shown that medical debt is a factor in as many as half of personal bankruptcies in the US.

Know your coverage before you go

While some out-of-pocket expenses are inevitable, there's a lot you can do to prevent unnecessary hospital costs and identify billing errors:

• Verify which hospitals and their specialists are in your plan's network.
• Understand the difference between in-network and out-of-network costs.
• Find out if your procedure requires pre-authorization.
• Determine the amount of your hospital deductible.
• Learn about your plan's coverage limitations for certain procedures including pre-existing conditions, elective procedures, and experimental procedures. Even if some of a procedure is covered, you may need to supplement the cost.
• Clarify the life-time limits of your plan.
• Bring along an advocate (a family member, a partner, or a friend) to any meetings with doctors or hospital staff.
• Write everything down. Your doctor, hospital, and insurance provider will give you a lot of information-too much to remember. Better yet, ask your advocate to take notes while you're asking the questions.

"If you don't understand your coverage and end up with a bill you didn't know about it can be financially devastating," says Maura Carley, a health-insurance expert and advocate with Healthcare Navigation. And don't expect your doctor to know what's covered. "Not that many years ago health care costs weren't as significant as they are today, but now people have to assume responsibility because the stakes are high," says Carley.

Many managed care insurance plans and Medicare plans negotiate in-network contracts with certain hospitals and physicians who work in these hospitals. If you stay in-network, you'll have much more control over your costs than if you go out-of-network. But even if you choose an in-network hospital and surgeon, you need to make sure that all hospital-based specialists who treat you are covered by your plan.

"What I tell people is to make sure that the anesthesiologist participates with your plan, and demand that all doctors accept your insurance payment as payment in full," says Nora Johnson, Director of Education and Compliance at Medical Billing Advocates of America and co-author of The Medical Bill Workbook. Ask the hospital how many specialists, including anesthesiologists, pathologists, and radiologists, will be involved in your care and be sure to check if they participate in your plan. Many won't be. You can try to find an in-network specialist through your insurance company.

It's not easy to ask these questions, especially when you're worried about your health, but a family member or friend can help. And if you're confused about your coverage or you meet surprises along the way, continue to ask questions. For example, if the anesthesiologist who shows up isn't the same one you were scheduled with, make sure he or she is takes your insurance. "There can be glitch, but if you learn about your insurance and what's in network, that's the best you can do to avoid negotiation after the fact," says David Wilcox, MD, an emergency medicine specialist and consultant to several health care insurers in Connecticut.