Helena woman’s struggles with insurance company over $17,000
bill highlight complicated world of insurance ‘provider
By Mike Dennison
Independent Record State Bureau
Sunday, September 2, 2007
Nancy Davis went to the only hospital in town this spring for
hip-replacement surgery, having had the procedure pre-approved
by her health insurance company.
But two months later she received a $17,000 bill from St.
Peter’s Hospital, which said the insurance company had declined
to pay, because it didn’t have a “contract” agreement with the
“That was when I said, ‘You’ve got to be kidding me,’ ” Davis
The company is United HealthCare, the largest private health
insurer in the nation. A week ago, United HealthCare paid most
of the bill — but not before Davis spent many hours over several
weeks on the telephone, questioning United, its contractors and
the hospital about what had happened.
As of Friday, Davis still hadn’t received word from United or
its surrogate that the bill had been paid.
She found out Wednesday from a Lee Newspapers State Bureau
reporter, who had been working more than two weeks on a story
about her case. In response to inquiries from the reporter, the
insurer and the hospital last week revealed that final payment
was made August 24.
Davis said she’s glad United HealthCare agreed to pay what she
thought was covered, regardless of the status of any “contract”
with the hospital.
But she doesn’t see why anyone should have to spend hours on the
phone to enforce their own health insurance policy.
Davis, who has health insurance as a retiree of Qwest, the
telecom giant, said she also knows of other Qwest workers who’ve
run into the same problem and ended up fighting to have United
pay bills from the only hospital in Helena.
“You’re telling me that each patient is going to have to go
through all the same hoops?” she said. “Every person shouldn’t
have to go through this frustration and anxiety. That’s
absurd. This should have been (settled) months ago.”
A United HealthCare spokeswoman said the process worked how it
should. A subcontractor reviewed what it thought might be a
too-high charge and United eventually paid the bill, said Cheryl
The only error was made by the hospital, which sent Davis the
bill “prematurely” before the review process played out, she
“Sometimes things take longer than we’d like,” Randolph said.
“At the end of the day, (the bill) was paid. If the hospital
had never sent her a bill, this would have been a non-issue.”
If nothing else, Davis’ tale is a $17,000 example of the thicket
of insurers, “provider networks” and contracts that must be
navigated before money is paid for health coverage.
Davis, 54, scheduled her hip-replacement surgery in May, and
said she spoke twice with a United HealthCare nurse beforehand
to make sure the surgery was pre-approved by the insurer. At no
time did the nurse or anyone at United HealthCare say anything
about not having a contract with St. Peter’s, she said.
A month after being released from the hospital, Davis received a
letter from Concentra Preferred Systems, a Texas firm hired by
United to negotiate bills from providers not under contract with
The June 7 letter said Concentra had determined that the
“reasonable and appropriate amount” for the surgery is $8,600,
rather than the nearly $25,000 that St. Peter’s had charged.
It said the hospital might bill Davis for the remainder, and
that she should contact Concentra should that occur.
St. Peter’s did send Davis a bill for $17,000, which included
the $900 that Davis thought was her share of the bill and the
$16,000-plus difference that United hadn’t paid.
On Aug. 4, Davis received a letter from Concentra saying St.
Peter’s wouldn’t reduce the charge. The company said it would
take the charge back to United HealthCare for possible payment,
and that the review could take six to 10 weeks.
Meanwhile, the hospital was telling Davis she owed $17,000, and
would have to make some payment to keep her credit in good
standing. She agreed to pay $100 a month.
Randolph said last Wednesday that United HealthCare had decided
by Aug. 16 that the claim would be processed. St. Peter’s
Hospital received a $16,000 payment on Aug. 24, leaving $940 to
be paid by Davis.
Randolph said the quick resolution of the case had nothing to do
with inquiries by the Lee Newspapers State Bureau, which first
contacted United Healthcare about the case the week of Aug. 13.
United HealthCare, like many health insurers, arranges contracts
with health-care providers such as hospitals. The provider
agrees to a discounted price for their services, and United
includes them in its network, sending patients to these
However, United does not have a contract with St. Peter’s
Hospital or several other major Montana hospitals.
John Solheim, chief executive officer at St. Peter’s, said the
hospital has been negotiating with United for two years, but has
yet to reach an agreement.
“United can enforce much more strict parameters on their clients
when they negotiate a direct contract,” he said. “That’s how
they make their money.”
While United has no contract with St. Peter’s, it has had an
agreement with First Health Group, a managed-care company that
sets up “provider networks.” First Health arranges discounts
with certain providers, and then sells access to those providers
and the discounts.
First Health has had a contract with St. Peter’s for the past
decade, but that contract lapsed last December and wasn’t
renewed until July 1 this year, hospital officials said. Davis
had her surgery on May 1.
Randolph said since United had no contract agreement with St.
Peter’s at the time of the surgery, it hired Concentra to
negotiate “affordable payment for the services provided.”
How Concentra initially decided that $8,600 was adequate payment
is unknown. Hospital documents show that the cost of hip
replacement surgery at major Montana hospitals ranges from
$19,500 to $26,500. The cost to the hospital of buying Davis’s
hip replacement hardware alone came to $9,600.
Randolph did not respond to a request on how Concentra
calculated the “reasonable and appropriate amount.”
As Davis wrestled with whether United HealthCare would pay its
share of her hip replacement surgery, she also was preparing to
have carpal-tunnel surgery on each of her wrists.
This time, knowing United didn’t have a contract with the
hospital, she asked the insurer in advance what it would cover.
She ended up having the surgery Aug. 23 at the Helena
Surgicenter, which is not associated with St. Peter’s, but which
also has no contract with United Healthcare, Davis said.
Davis said she spoke with a United official earlier by telephone
and asked for the “reasonable and customary” amount that would
be covered. She got a number — $1,432 per wrist — and asked to
have that statement in writing.
That was three weeks ago. She said as of Thursday, she hadn’t
received it, and hopes she won’t have to go through the same
Editor’s note: Davis waived her privacy rights specifically
to allow the hospital and insurance firms to talk to the Lee
Newspapers State Bureau about her case. No privacy laws were