The News & Observer (Raleigh, North Carolina)

In the hierarchy of annoyances that burden people’s lives, paying bills ranks up there with a head cold: Nobody dies, but it’s a joyless experience that saps energy few have to spare. The biggest problem with bills, of course, is scrounging the money to pay them.

But some bills have become hopelessly complex, as anybody who has sifted a stack of medical bills or really looked at the charges on a phone bill can attest. Complexity not only compounds the hassle of processing the monthly pile, but also provides cover for mistakes and unwarranted charges that add up to billions a year, consumer advocates warn.

Finding overcharges in the mystifying columns of fees and taxes can be tough, even for bill-payers reading with a querying eye.

When did I order that add-on? That’s not the rate I thought I was getting. Just what is a “bill processing fee,” anyway?

Busy with more pressing demands, many consumers give up and just send in the total. After all, who has time to really understand all the obscure taxes, charges and fees, asked Claudio Romero, an assistant manager at a McDonald’s in Cary. He hesitates to estimate the time he puts in on bills every month.

“I probably need an accountant,” Romero said. “I have a lot of bills.”

But he said that he tries to go over the fine print to see what charges he is paying. “A lot of people say, ‘Hey, it’s just a nickel and dime.’ “

But Romero said he has caught mistakes, including a cell-phone overcharge that saved him more than $20.

More people should take the time, advises a consumer group that received so many complaints from those annoyed by inscrutable or erroneous bills that it finally decided to launch its own study of the problems.

Hard numbers are hard to come by, but the nickels and dimes add up, said Harvey Rosenfield, president of the Foundation for Taxpayer & Consumer Rights, based in Santa Monica, Calif.

The group’s study is not done, but Rosenfield said it’s no secret that bills are loaded with phony charges, overcharges, illegal fees and mistakes.

“As consumers and taxpayers, we’re being nickel-and-dimed out of tens of billions every year,” he said. “It’s epidemic.”

Established businesses generate fewer complaints than industries where technology and service options change fast, Rosenfield said. Cell-phone and medical bills are frequent sources of ire.

Better Business Bureaus around the country got more complaints last year about cell-phone companies than any other industry, said spokeswoman Sheila Adkins. With 21,534 complaints, wireless companies edged car dealers for first place.

Not all the complaints were about billing, however, and cell phone companies have their own billing gripe: 43 percent of their customers pay late, according to a survey last year by Western Union.

Medical bills are themselves a source of elevated blood pressure. Not only do they often arrive at a time of stress, but they also can be perplexing to figure out and frequently contain mistakes.

A survey published in the January 2003 issue of “Consumer Reports” found that 5 percent of 11,000 readers who reviewed their medical bills had found major errors. Those who paid at least $ 2,000 out of pocket were twice as likely to have found errors on the bills, the magazine said.

“It drives you wild, the paperwork,” said Bob Buzenberg, 85, of Chapel Hill. A retired manager of a Kansas equipment-manufacturing company, Buzenberg figured he has run up as much as $200,000 in expenses from a series of procedures at Duke University Hospital over the past couple of years.

The hospital stays generated a mound of paper for Buzenberg to go through.

“I would get maybe two or three envelopes a day,” he said.

“Everything you do, they send some sheets to you, which aren’t always bills, but they’re something — and there’s always a residual” that the patient is asked to pay, he said.

Hospital bills can be daunting for anyone, acknowledged Ken Morris, chief financial officer of Duke University Health System, which runs a central billing office where 8 percent of the organization’s total work force is employed.

But there is little that a medical provider such as Duke can do. Complexity is the nature of the health-care system.

“It would be nice to be able to issue a bill that looks like your MasterCard bill,” Morris said. But the form and content of the bills are dictated by insurance companies that want to know “every little detail,” he said.

Some of Buzenberg’s statements would include charges from three or four doctors, not to mention fees for X-rays and services in the operating and emergency rooms, he said.

Buzenberg said he had no idea which charges were legitimate, which ones his insurance ought to cover, and how much he should pay himself.

“I’d have paid more than I owed,” Buzenberg is convinced.

But instead of tackling the mess himself, he hired Medical Claims Rx in Chapel Hill to sort out his bills. The company’s business is to help individuals track medical expenses and keep
from paying too much. Medical Claims Rx troubleshoots problems and makes sure clients don’t get stuck with costs that their insurance should cover.

The existence of the business — and it’s hardly the only one that has sprung up to help consumers handle medical bills — is an indictment of an overly complex health-care system in need of reform, said Brad Fox, who founded the company 17 years ago.

A typical billing problem he said he encounters: A medical provider, tired of waiting for a payment from the insurance company, bills the patient.

It happens over and over, Fox said. “We stay busy.”

Legislative efforts

Aiming to make companies of all kinds more accountable for the bills they send, the Foundation for Taxpayer & Consumer Rights is drafting a “Bill-payers Bill of Rights” that would require companies to itemize all bills. Rosenfield’s group proposes a fine of three times the amount of the overcharge, up to $ 1,000, for any company found to have overbilled on purpose.

Once the “landmark” consumer-protection legislation is drafted, Rosenfield said his group plans to introduce it through ballot-box initiatives.

Some consumer safeguards for bill-payers are in place already. The federal Fair Credit Billing Act, for instance, allows consumers to challenge billing errors on credit cards and store charge accounts without the creditor going to a collection agency or damaging the buyer’s credit rating.

The Federal Communications Commission adopted “Truth in Billing” guidelines in 1999 to make it easier for consumers to understand their phone bills by explaining fees and charges. The rules were a response to thousands of complaints about cramming: companies tacking on unauthorized fees and services.

Phone companies have since revised their bills.

BellSouth, the Atlanta-based phone company, set up focus groups before announcing a redesigned bill two years ago.

Now some wireless companies are tweaking their bills, too. Alltel, the Little Rock, Ark., phone company, is introducing an easier-to-read bill this month, in response to customers clamoring for a more understandable statement.

“They were asking for this,” said Philip Junker, vice president for marketing at Alltel. The company used surveys and focus groups and spent nearly a year redoing the bills in an effort to make them clearer and more concise, Junker said. Among other changes: reordering items on the bill to list the amount due and the due date first, with details below.

A redesign is not always the answer, however — as American Express and MBNA discovered recently when they changed the way their bills listed the total due.

The credit-card companies caught a backlash from consumer groups for de-emphasizing the total amount due while prominently listing the minimum payment a consumer could pay.

Paying online

Making bills clearer isn’t the only possible solution for consumers fighting the bill bogeyman.

Alison R. Taylor of Hillsborough, who pays the bills for her family, said she has reduced her workload with an online bill-paying program that taps her bank account.

“I used to spend maybe an hour or two every other weekend,” Taylor said. “Now I just enter the bill as it comes in, and it just goes off. It’s paid.

“I don’t use a checking register anymore,” she said.

Some consumers shy away from online bill paying because of concern about hackers invading their accounts. But Taylor said it has never happened in six years of going online to pay a battery of bills: cell phone, Internet, telephone, student loans, credit cards, mortgage and insurance, in addition to the usual utilities.

Such a stack is typical; the average bill-payer has 12 to 16 monthly bills, including eight credit-card bills, according to Celvia Stovall, family resource management specialist at the N.C.
Cooperative Extension Service.

And saving time by paying them all online salves only so much of the pain. Nothing in the computer program insulates a bill-payer from getting nicked by overcharges, so they still must
scrutinize the bills — and find the money.

Said Taylor: “It’s still no fun paying the bills.”
———-
Resolving billing disputes
The Foundation for Taxpayer & Consumer Rights suggests these techniques to resolve problems:

– Read what the bill says you should do in case of an error. Many bills say how to contact the company, and laws require some companies — utilities, banks and credit companies — to print a
statement on each bill telling you how to protect your rights.

– Call the company. Look for the toll-free number.

– Give the date of the bill and explain the problem in detail. Make sure the person you’re talking with has a copy of the bill so he can see the problem and make a correction right away.

If your bill is not itemized or indecipherable, ask for an explanation or request a fully itemized and explained bill. Demand that any overcharges or phony charges be removed. Ascertain from the representative the amount you owe and agree you’ll pay that amount.

– If you have a problem, ask for a supervisor.

– Once the problem is solved, pay the bill. Write an accompanying note explaining the mistake and whom you talked to at the company.

– If the company won’t fix the problem, you can pay; refuse to pay and risk being sued or have your credit rating damaged; sue the company yourself; or seek help from consumer-protection agencies such as the N.C. Utilities Commission, Better Business Bureau or the N.C. Attorney General’s Office.