PHOTO: Surprise medical bills stem from patients going to hospitals that are in-network under their insurance plans, while unaware that some or many of the physicians on staff are out-of-network. Photo credit: Parker Knight/Flickr.

AUSTIN, Texas - Legislation at the state Capitol aims to put an end to surprise medical bills, or so-called "balance billing," which has left a growing number of Texans facing a financial crisis while trying to recover from a health crisis for which they thought they were covered.



Trey Berndt, associate state director for outreach and advocacy with AARP Texas, says the problem is many hospitals that are in-network under the state's major health insurance providers use physicians that are outside the network, unbeknownst to patients.



"Most consumers pay their premiums and look at their insurance card and it says usually a co-pay and some coinsurance, and that's all they expect to pay," Berndt says. "Yet they come home and get maybe sometimes thousands of dollars of bills later on."



A proposal now awaiting a committee hearing in the Texas House would end such surprise medical bills by limiting the patient's out-of-pocket to no more than they would have paid in-network.



Berndt says the legislation would also take consumers completely out of any billing disputes between insurers and providers.



"When somebody is in the ER, the last thing they're going to be thinking about is in-network doctors, out-of-network doctors," says Berndt. "They've gone to a hospital they believe is in their network and they expect the providers to work with their insurance company and that's not happening and that's what we absolutely need to fix."



Among those Texans who have had insult added to injury with a surprise medical bill is Hugh Smith of Cypress. His wife broke her back three years ago and while in the hospital, they explicitly requested only doctors within their insurance network.



"I met my deductibles and all the co-pays and everything and then all of a sudden we get a doctor sending us a bill for a full amount, not willing to talk about it and says he's exempt from the process because he was not a doctor requested by us or used by us," says Smith. "He was an advisor to the chief of surgery at the hospital."



After battling over that surprise bill for two-years, the Smiths were able to get the amount reduced, but still ended up having to pay $3,000. While the practice of balance billing is legal, Berndt says AARP considers it one of the most unfair practices in commercial health insurance today.