I work for doctors. They literally can’t upsell because insurance won’t pay.

Your doctor makes a bullet pointed list of diagnosed conditions called medical codes. A licensed medical coder (whose license is dependent on accuracy) reviews the doctors codes and edits the bill to only charge for conditions that are within the scope of the specialty and justified by the data collected in the visit notes.

The bill is then passed to the insurance company who has their own medical coders who review the work of the previous medical coder. If they believe the bill is inaccurate, it is reviewed by another doctor who works for the insurance company. If the bill is determined to still be inaccurate, the insurance company refuses to pay and kicks the bill back to the practice.

If many bills are determined to be inaccurate, the medical practice is audited to see if there has been a pattern of upcharging or inaccurate coding.

This is the point where a multi-million dollar lawsuit can start, and the practice finds themselves in court to have a judge determine if they should be paid for their work. If they lose those lawsuits, they lose coverage from the whole insurance company, and that is how a practice goes bankrupt.

Don’t get me wrong—for profit healthcare can lead to problems, but believe it or not, the system is designed to keep things above board and make sure that people are charged accurately.

The real issue is that each insurance company has contracts with each network of practices to pay them a designated percentage of the overall bill as a deal to keep them in network, so healthcare costs are extremely high because the practice will only get a percentage of the billed cost as pursuant to the individual agreement with that insurance provider. If you have to pay out of pocket because you went out of network, you are eating a huge cost while an in practice provider would be getting much less money after it was processed by your insurance company.