All households are affected by unplanned medical expenses.  In fact, out-of-pocket costs influence 26% of bankruptcy cases —most are due to out-of-network billing.

Unfortunately, it takes more than purchasing medical insurance in Seattle, WA, to reduce out-of-pocket healthcare expenses.

You also need to be aware of  healthcare network costs and how to decide on a medical plan to best fit  for your needs.  This can be hard without seasoned guidance.

In-Network vs. Out-Of-Network Costs

What is the difference between in-network and out-of-network providers?

In-network healthcare providers have a contract with your insurance company.  This means you pay either a co-payment or a deductible. Out-of-network healthcare providers are those either not affiliated with your insurance company or just not covered under your particular insurance plan.

Out- of- network billing happens more often than you think. According to Benefits Pro Magazine, balanced billing or out-of-network billing, accounted for $40 Billion annually in healthcare earnings.  Just think, if out of network billing is eliminated, patient spending on health care would drop 3.4% annually!  Yikes!

Let’s take an example.   Let’s say your kiddo’s leg blows up red and inflaming  at 11pm in the evening.  Is it a spider bit? Flesh-eating MRSA?  The 24hour Hotline nurse tells you to go to the hospital.  Urgent care is closed and you need to go to an emergency room.  The hospital is affiliated with your network, but the attending emergency physician is not.   Most of us assume if the hospital is covered, so is everyone on the premises. It often is not the case.

How often does this out -of- network billing occur?   More often than you realize.  In fact, a study from Yale University, “Out-Of-Network Billing And Negotiated Payments For Hospital-Based Physicians,” found that a significant portion of high out-of-network costs came from hospital-based physicians.

The Rise of Out-Of-Network Costs

There is no shortage of surveys supporting the continuous increase of out-of-pocket expenses due to out-of-network costs. Here are some of the most significant takeaways in recent studies:

  • A study from the Journal of General Internal Medicine found that approximately 137.1 million adult Americans experienced medical financial hardship in 2018.
  • One in six people in the US incurred unexpected out-of-network costs despite having a health plan, in 2017.
  • An Ohio State University study has found that out-of-pocket costs for non-emergency, out-of-network hospital care have almost doubled in the past five years.

Good News!  Effective January 2020 Washington State Law now offers Balanced Billing-Out of Network Protection Act.

The new Balance Billing Protection Act will now prevent people from getting surprise bills from emergency room or surgery services where the doctor discovered to be out- of- net-work.  Before 2020, it was on the patient to negotiate reducing fees or getting on a payment plan to pay for out- of -network services.  Both the insurance carrier and the providers would claim the patient as the responsible party to pay the out-of-network fee.

As of 2020 if an insurer and a provider can not agree on a price for the covered services, they can go to arbitration.  However, they cannot bill the consumer for the amount in dispute. (  This is great news for patient protection.

If you wish to know more about this issue, please feel free to contact me at Guyer Benefits NW, llc.

Darcie Guyer, Your Benefits Geek