by Julie Appleby, KFF Health News
Thomas Zordani flew from his home in Denver to Phoenix for a consultation with a Mayo Clinic neurosurgeon, hoping to find out what could be done to treat his debilitating headaches after worrisome brain scan findings.
When making the appointment, Zordani said, he’d been told the clinic was in his insurer’s network. Upon arrival, Zordani was summoned to the clinic’s financial office and told he had to make a $5,000 preservice deposit, because Mayo had since determined it did not accept his insurance. He was automatically designated “self-pay,” even though his plan had out-of-network benefits.
Not having that kind of cash on hand — and angry on principle — he refused. His appointment was canceled.
“I was so livid,” Zordani said, recalling that day in early April 2024. He later learned that Mayo had sent a message to him in his insurance carrier’s patient portal shortly before his visit with an estimate of the cost: $565, not the larger amount it later demanded.
Traditionally, patients usually receive bills for their share only after getting treatment. But what Zordani faced is becoming increasingly common — hospitals or other medical providers seeking prepayments.
“We regret that this individual’s experience did not meet the high standard of communication we strive to provide when helping our patients understand their insurance coverage and financial responsibility,” Andrea Kalmanovitz, Mayo’s communications director, said in an emailed statement.
The trend of hospitals asking for money up front represents a double whammy for patients. Medical providers are collecting larger shares of what patients might owe at a time when rising deductibles mean patients are owing more for care. The preservice charge could be all or part of a remaining deductible, for example, or a sizable percentage of what the visit or treatment might cost. Those deductibles go up when hospital prices, drug costs, and labor expenses increase, as insurers try to slow premium growth by shifting more costs to patients.
People are “basically being asked to self-insure,” said Richard Gundling, a senior vice president at the Healthcare Financial Management Association, an organization for finance professionals. As that happens, hospitals figure more patients will have trouble meeting those deductibles, so they want to get as much up front as possible.
Consumers are increasingly worried about paying for healthcare. A recent KFF health tracking poll found that lower out-of-pocket costs ranked as the top change insured adults would like to see from their coverage plans. The average deductible in family coverage offered by employers is $3,762 per person, according to KFF, while the average deductible in Affordable Care Act plans jumped 37% this year to a similar amount, $3,786.
Community Health Advocates, a health insurance consumer assistance program in New York state, hears from people who are concerned about prepayments, said Diane Spicer, a supervising attorney. “We see this mostly with insured folks who are seeking out-of-network care but who have out-of-network coverage,” Spicer said, “and also sometimes for care that is not covered.”
This story was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California Health Care Foundation. KFF Health News is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. Learn more about KFF Health News.