When Healthcare Coverage "Loopholes" Leave Consumers Holding the Bag

By pokitdok,

Recently, my family had first-hand experience with lack of access to transparent cost information about healthcare procedures. We thought we had platinum insurance coverage through my husband’s large financial firm's (LFF)’s group coverage plan, but as it turned out, it wasn’t as straightforward as it had first seemed.
ear checkup


Surgery only Partially Covered

In our situation, our 18-month old daughter was in need of ear tube surgery after suffering 9 ear infections in a 12-month period. It was a medically necessary, albeit minor outpatient procedure, which, being on the platinum plan, we assumed would be fully covered, less a small standard co-pay. Right? Well, no, actually as it turned out. As I learned a few days before the surgery, although the surgery itself was covered, there was no guarantee that the anesthesia necessary for the surgery would also be covered, because the hospital could not guarantee that that anesthesiologist on staff that day would be “in-network”. As it turns out she was not in-network, leaving us on the hook for the $700 anesthesia bill even though we were on a covered plan for a “covered” procedure.

Sneaky Cost-cutting Techniques

How could this be? Who would have thought we’d need to shop around for the price of anesthesia? (Not that we were willing to skimp on quality of care when our daughter’s health was in question). At first we naturally blamed the insurance company, but when I called to log a complaint, they explained that this was a specific clause in LFF’s contract which they identified as one of their top costs, and specifically contracted NOT to pay for. It was a way for them to save money, which most of their employees would never know about, but the ones that would, also would find themselves in our same predicament - left holding the bag after all was said and done.  The big corporation saved money and cut costs as a business, making this not only sneaky, but also very characteristic of the Wall Street ways they had become known for in recent years.

Corporate Loopholes

In a world where premiums were increasingly going up, large corporations, especially ones with self-funded plans were getting increasingly savvy about ways to dodge paying out frequently used, yet expensive health care procedures in obscure and obtuse ways. The insurance company referred to them as “loopholes” - through sophisticated analysis, companies would be able to weed through historical claims data, identify costly outliers and underhandedly opt out of covering part of the procedures if they didn’t meet specific criteria, such as being in-network in a blue polka dotted room, while touching one finger to your nose (well not really the last part, but you get the idea).

Reading the Insurance Fine Print

However, as I later found out,these types of loopholes are actually not that uncommon. From annual spending caps to prescription drugs that are not on the list, companies are slowly integrating more and more ways to shirk their coverage responsibilities, leaving consumers responsible for reading the fine print and becoming health insurance experts. For those with chronic conditions or kids that get sick frequently, it can sometimes feel like a second job. And, that’s not even adding the paperwork and claims portion into the mix.

The Trend Toward Consumer-friendly Solutions

Is this likely to change in the near future? Probably not. If anything, we can expect more fine print and more loopholes to come. Luckily healthcare retail leaders such as PokitDok, Walgreens, Doctor on Demand and One Medical are working to make the process more transparent and consumer-friendly. By knowing the costs before you go into any healthcare procedure and choosing low-cost nearby retail solutions for common procedures like flu shots and blood tests, consumers can save themselves money and hassle, even if they have health insurance coverage.  It’s definitely a step in the right direction, for a frustrating system that's not likely to completely fix itself in the near future.

Oh, and as for our daughter?  She’s doing fine - no more ear infections, thank you!

Have you had issues with the “fine print” or healthcare “loopholes”? Write us about your personal situation, to be featured in an upcoming PokitDok blog.

The opinions expressed in this blog are of the authors and not of PokitDok's. The posts on this blog are for information only, and are not intended to substitute for a doctor-patient or other healthcare professional-patient relationship nor do they constitute medical or healthcare advice.

  Tags: Healthcare consumerism

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  Comments: 2

  1. Mary Pat Whaley


    I find it completely irresponsible that physicians that are performing the procedure cannot give patients more information about other costs - anesthesiology, radiology, pathology, facility fees, etc. Having said that, no one makes it easy for physicians to get that information for the patient, and physicians rightfully do not want to assume the liability for being wrong! It is one more service that physician practices should supply, but no one is willing to reimburse them for.

    This is one of those healthcare problems that needs a smart technology solution to put this all together for patients - it's a matter of collaboration.


  2. Physicians' costs and administrative paperwork are high enough. Insurance or health care coordinators would be a lower cost option, rather like a concierge service. Oh, separately, I agree with the importance of transparency but most folks aren't sophisticated enough to handle in their own esp. With the myriad options out there and the infrequent need to use. Although I fully understand the current healthcare requirements, I disagree with the general premise that companies should be responsible for providing coverage and I totally resent having to buy a plan that conforms to some minimum, govt dictated level of coverage. I'd much rather have a bundle that is more consumer age/health centric.

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