When recovering from a major illness, the last thing you want to do is wade through stacks of medical bills, decipher confusing insurancestatements and fight your health insurer over claim denials.

So how about hiring someone to do it for you?

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As the medical payment system has grown more complicated, a cottage industry has sprung up of specialists who help people deal with medical bill and health insurance disputes.

“The business of helping people with medical bills has been around a long time, but as the health care system has become more complex and consumers have borne more of the brunt of medical bills, the industry has become more popular,” says Becky Stephenson, president and CEO of VersaClaim, a claims assistance business in Austin, Texas, and co-president of the Alliance of Claims Assistance Professionals, a trade group of about 50 members.

Claims assistance professionals provide a wide range of services, including:

• Tracking, organizing and filing medical claims.
• Filing health insurance appeals.
• Negotiating charges for services that generally aren’t covered by health insurance, such as gastric bypass surgery.

Consultants called medical billing advocates specialize in disputing incorrect hospital and physician bills, but many also help clients dispute claim denials from health insurance plans.

“We work based on what the consumer would like us to do,” says Katalin Goencz, co-president of Alliance of Claims Assistance Professionals. “In my practice I file a lot of health insurance appeals, file just as many claims and of course do a lot of follow-up.”

Through her nine-year-old business, MedicalBillsAssist in Stamford, Conn., Goencz estimates she has written about 1,000 health insurance appeal letters, and so far only two have been unsuccessful. In one case, she warned her client there was a 50-50 chance at best for winning the appeal. In the other case, she urged her client not to appeal, but the client begged her to try.

Who are these health insurance claims specialists?

Goencz is a former trauma nurse who later worked in hospital and physician billing offices.

“I was in charge of technical appeals and insurance contract interpretation,” she says. “It was a natural transition from there to my present business.”

Stephenson is a registered nurse with an MBA who gained experience in billing and coding when she ran large physician practices and audited hospital billing practices for insurance companies.

“In doing that, I realized I could turn it around and work for the consumer,” she says.

She helps clients dealing with their own medical bill and health insurance issues as well as baby boomers who are assisting elderly parents.

“Medicare has become very complicated with people having secondary and even tertiary coverage,” she says. “Americans are living longer and longer, and we’ve got this elderly population out there that doesn’t understand what comes in the mail.”

Pat Palmer, founder of Medical Billing Advocates of America, a trade group, got into the business 15 years ago after her teenage daughter broke her arm roller-skating. She took her daughter to two hospitals because she didn’t think the first one provided adequate treatment.

When the bills arrived, she disputed the charges from the first hospital, which ultimately agreed to write them off. She also requested an itemized bill from the second facility and got some of those fees reduced or eliminated. Among those was a charge for the use of an overhead light, Palmer says.

Soon she was helping friends and family members. A local newspaper did a story about how she saved one woman $20,000, and the Associated Press picked it up.

“I was overwhelmed with calls from one end of the country to another,” she says.

Her business, Medical Recovery Services Inc. in Roanoke, Va., also helps clients file medical insurance appeals. Recently it was successful in helping a client appeal a denial from Medicare for a $6,000 air ambulance service, which originally was deemed medically unnecessary.

Getting help from an insurance pro

Palmer says members of her trade group usually charge a percentage–typically 35 percent–of how much they save you, or an hourly fee ranging from $85 to $175 an hour.

Goencz says members of her claims assistance group usually charge an hourly rate of between $60 and $150. Most claims assistance professionals are willing to provide a free 15- to 30-minute consultation to see if it’s an issue they can handle.

When should you hire help?

“If you’re asked to pay thousands of dollars out of pocket in excess of a health insurance deductible and don’t understand why, or things are piling up and you don’t know how to deal with it, then you want to get someone to help you,” Stephenson says. “You don’t want to get to the point where you’re getting collection notices. This is not the time to bury your head in the sand.”

If you decide to hire a professional, look for someone with experience in handling situations similar to yours. For help with health insurance claims, Goencz and Stephenson recommend looking for a specialist who has professional experience working for physicians, hospitals or insurance companies in the medical claims, billing and appeal processes.

Frustrations can run high when it comes to your health and finances or those of a loved one. Besides experience and knowledge, a savvy professional brings a cool head and passion for the client.

“I like a good fight,” Goencz says. “And I like winning.