If you’re the special kind of person who’s interested in medical billing, I’ve had an exciting past few months. One day this spring, I was frantically chopping carrots after work when I noticed that my left hand was covered in lukewarm blood. When I washed it off, I saw my skin splaying open to reveal my pale-blue thumb joint. That necessitated not one, but two trips to an urgent-care center, a strange hybrid of an emergency room and doctor’s office where payment can be similarly muddled.
I also got a new mouthguard, something my doctor says I must wear, or else I will grind my teeth away to tiny nubs while I sleep. I tried to pretend the little session where they make a mold of your mouth using what looks and tastes like melted-down Crocs was a 15-minute spa retreat from my work emails. My bubble was burst when, on my way out, the front-desk woman told me the mouthguard would cost more than $400, which I let her charge to my credit card because the alternative was to press my sawed-off hand to my nub-toothed mouth and run screaming out the door.
Another doctor I see regularly told me “I don’t deal with insurance,” with the same nonchalance that 20-somethings with rich parents say they “didn’t feel like having roommates” to explain their one-bedroom condos. She has no in-network equivalent.
These experiences softened me up for a pitch from Remedy, a new start-up that aims to help people fight their medical bills. Though estimates of billing errors vary widely, at least 10 to 30 percent of medical bills contain a mistake. I figured my recent medical misadventures might make Remedy worth my while.
Remedy was founded in 2015 by John Schulte, a software engineer, Marija Ringwelski, a public-health worker, and Victor Echevarria, a former executive at the errand startup TaskRabbit. Echevarria sought to apply TaskRabbit’s duty-delegating model to disputing medical bills, another chore many can’t wait to offload. By the end of November, Remedy had raised $1.9 million from investors, and it’s expected to formally launch this week.
At first, Remedy relied on individuals texting the company photos of bills they found dubious. Before long, though, the team realized people “felt they were being taken advantage of and wanted a constant protector,” Echevarria told me. Now users connect their insurance to the platform and have Remedy scrutinize every one of their claims. To the layman, disputing medical errors can prove so tedious and complicated, Echevarria said, that “it makes cancelling Comcast look like the simplest thing in the world.”
Remedy’s bill-sleuthing is performed in part by a network of medical-billing contractors who work on each patient’s “cases” on their own schedule. For any errors uncovered, providers are supposed to refund the money directly to the Remedy user. Remedy is free to use, but it takes a 20 percent cut of the savings they find, up to $99 for a single bill. (Though the company said that $99 cap could change.)
Remedy said that based on “research from CMS [The Centers for Medicare & Medicaid Services], statistics from academia, and independent investigations,” medical errors are responsible for $120 to $150 billion in overcharges each year. It uses that figure, divided by the population of insured Americans, to bolster its claim that it would save the average family $1,000 per year.
It’s not clear yet how much money Remedy would save for the average healthy-ish person, however. Echevarria told me Remedy focuses on the mistakes made by doctors’ offices, rather than on bargaining with insurers. In the U.S., all diagnoses are assigned a code, and an improper code might lead to a denied claim, as might a clerical error like a misspelled name. It’s easy and common for doctors or billing clearinghouses to make these mistakes, Echevarria said. Insurers, meanwhile, are so strict in what they cover that negotiating with them can be like “banging your head against a wall of futility, even for us,” he said. Still, the company said it would appeal some denied claims, like those for services that should have been covered by the plan.
Since its founding, the company says it has discovered errors in half of its users’ bills. For patients who can’t afford their bills, Remedy said they will help set up monthly payment plans for free. Eventually, Echevarria said, “our hope is to negotiate for discounts in every single case” where a patient desires one. In my case, though, steep, correct bills weren’t reduced; I got an email from Remedy saying “everything checks out” with my three-figure mouthguard.
The service can make things a bit awkward with your medical providers. My no-insurance doctor sent me a worried email when Remedy asked her about my tab. Without thinking, I sheepishly apologized for the inconvenience. Several billing experts told me I should have argued with the dentist about my mouthguard bill rather than paying it, but the reason I turned to Remedy was because I find haggling with doctors to be more painful than, well, pulling teeth. Remedy says its service is actually good for doctors, since sometimes patients simply dodge bills they feel are unfair.
Perhaps most critically, several cybersecurity experts warn that it can be risky to entrust a private company with personal medical data. “When you use the service, you’re agreeing that these third-party people can look at your data,” said Sandy H. Ahn, a professor at the Center on Health Insurance Reforms at Georgetown University. “It’s concerning. There are certain medical conditions that you might not want people to know about.”
When I called Avi Rubin, director of the Johns Hopkins Information Security Institute, he peppered me with frightening questions: “Once you use them, how do you know you can delete your medical records? Can you put a lid on it? Is the cat out of the bag? How do the specialists safeguard it? How do they destroy the data when they’re done with it?”
Rubin added that while it sounds like Remedy could be a valuable service for those who are slammed by unaffordable medical bills, he personally wouldn’t find the savings worth the risk of a medical-data leak.
Christine Arevalo, vice president at the cybersecurity firm ID Experts, provided a chilling example of what this type of medical identity theft might look like.
“A lot of times [medical identity theft] lurks in the shadows,” she said, until “you get a bill in the mail for an ambulance ride that you didn’t take.” She described a scenario where someone could use your insurance and pollute your health record, and when you’re lying in a hospital, unconscious and unable to speak for yourself, you could receive improper treatment because your health record shows you have an allergy you don’t really have.
Granted, cybersecurity folks are a cautious crowd who study worst-case scenarios. If you use the Internet, chances are your data has already been exposed to hackers many times over. Remedy says it uses hospital-grade data encryption, and the billing specialists in its network only have access to a patient’s medical information while they’re actively working on their case. Remedy is not a covered entity under HIPAA, the federal law that guards patients’ medical information, but Echevarria said the company treats its data as though it were. They never share users’ data with anyone but the billing specialists, they said, and they delete users’ data if they deactivate their account.
Perhaps that’s one way to reap the upsides of Remedy without chancing becoming inspiration for a Homeland episode. In the 20 days that I tried Remedy, the company did find one $50 error. It turned out the urgent-care center charged me for my stitches twice.
Chuck Bell, the programs director at the Consumers Union, pointed out that people can also try to resolve their billing issues without the help of apps like Remedy, simply by contacting their state insurance department or local consumer assistance program. Those options might be more time-consuming, but they also don’t dip into the patient’s savings. According to a recent Consumer’s Union survey, two-thirds of respondents took action to dispute a surprise medical bill, and 28 percent of them were happy with the resolution.
Bell said that while services like Remedy might make financial sense for some, we shouldn’t lose sight of the underlying problem: Medical bills are too high and too wrong, too often.
“Do we really want to encourage the growth of a new industry to scrutinize inaccurate bills?” he said in an email. “The dead elephant in the room is that if the consumer had been billed correctly, they would not need this service.”