Medical bills: Knowing what to avoid

NEW YORK (CNNMoney.com) -- For people who have health insurance, the level of fine print is rising along with the costs.

"Compared to 10 years ago, health insurance plans are much more complicated. So many more things can go wrong," said Jane Cooper, president and CEO of Patient Care, a national patient advocacy group.

With insurers doing all they can to cut their costs, it's important for you to know exactly what's covered and what's not, and to understand when and why you're going to shell out for care.

That's your "responsibility," according to Lisa Norris, co-president of the patient advocacy group Alliance of Claims Assistance Professionals.

"It's not fun going through all the insurance information," said Norris. "But it's also not your doctor's job to educate you on your insurance."

In network vs. out of network: A key to saving money is finding a doctor or other provider who's in your insurer's network, or an insurer whose network includes your doctor.

If you choose an in-network provider, your cost usually will be a small co-payment of about $15 to $20 for an office visit. Should you decide to go out of network, the costs can soar.

First, you have to pay the provider up front. For a service that costs $300, "you have to pay $300 before you leave the office," said Norris. "You then send the paperwork to your insurer."

Your insurer may say they'll reimburse 50% of what you pay for an out-of-network visit. But even that doesn't mean you're getting back $150, warned Norris, because the insurer may only pay for what's called an allowable amount.

Norris said the allowable amount can be based on what the insurer would have paid an in-network provider for the same service.

"If the in-network doctor was paid $100 for an office visit, then based on that rate, you will get back $50 for going out of network and you have to pay the balance of $250," she said.

Covered vs. not covered: Your doctor may be part of your plan. But the services or specialists he or she recommends may not. You'll pay for that.

For example, when your doctor orders a blood test for you, the lab performing the test may not be covered by your insurance.

Cooper said consumers should ask for information about the facility and check for coverage with their insurer. You always have the option to shop around for an in-network lab.

"But if your doctor trusts a particular lab and that lab isn't in-network with your insurer, try to work it out with your doctor," said Dr. Margaret Lewin, medical director of insurer Cinergy Health and clinical assistant professor of medicine at Cornell University.

"Ask your doctor if he can write a letter to your insurer explaining his preference for the lab and get coverage for it," said Lewin.

Many insurers require "preauthorization" from your doctor for expensive procedures such as MRIs and CAT scans, explaining why the tests are needed.

If you get the MRI and later find out that your doctor never got preauthorized for it, you could end up with a bill for hundreds or even thousands of dollars, said Cooper.

The same rules apply to specialists recommended by your doctor.

"Your surgeon may be covered, but there's an anesthesiologist, maybe a radiologist or a neurologist as well," said Lewin. Each of those specialists may or may not be part of your plan.

"If you didn't know about this ahead of time, then you are stuck with their bill," said Lewin.

Beware "balance billing": One thing you shouldn't have to pay, if a provider is part of your network, is a balance for a service given.

Insurers typically pay providers less that what their actual fees are. Providers that participate in insurance plans accept this fact and eat the remainder of their costs.

But sometimes they try to bill you for the remainder of those costs. This is a practice known as "balance billing," and it's illegal in several states.

However, if your provider is out of network, then he or she can bill you the remainder of their balance, said Lewin.

Most doctors who are in a contract with insurers are well aware that they cannot bill their patients for the portion of the bill that insurance did not pay, said Lewin.

If you think you are being billed more than what you owe according to your benefits, immediately point it out to your insurer and your doctor, said Norris.

Bargaining: Nothing in the fine print should prevent you from trying to negotiate your bill with your doctor or hospital, advised Lewin. And always point out any errors on your bill to your provider and insurer.

"Virtually every doctor offers a payment plan that is reasonable," she said.