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Health Plan expert?


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Can anyone enlighten me about this ? I had someone whos pretty savvy tell me that in this state, at least, Drs. who are participating plan providers with your health insurance, cannot by law demand payment of charges in excess of health plan allowances. Of course they all overcharge the plan, and bill the patient for remainder of their charges, and we all feel that we have to pay.

But my friend says the patient is not legally bound to pay these "over the plan allowance" charges...and should refuse to pay. Docs and other providers have no choice but to eat this portion of the charges, since they have agreed to be a participating provider for the health plan, and have to accept what the plan pays them, and eat the rest, if we dont pay/? Any one know about the law on this? Or where we could find out? Medical law kinda thing, I g;uess..?

Thanx for anything you know on this subject.....Rich B.

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I am not an expert on medical insurance by any stretch of the imagination, but here's how mine works:

I am in a PPO, which means I have participating providers. If I go to a participating provider, that provider, whether it is a hospital, doctor, or any other sort of covered service, has agreed to accept a certain amount of payment for the services they provide.

For example, I may see a doctor and an office visit is $75.00. The insurance company may have negotiated a fee with him to pay $50.00 for an office visit. He only gets $50.00 for that service, BUT I have a 20% copay on some things. So, the insurance is responsible for 80% of that $50.00, which would be $40.00, and I would have to pay the remaining 20%, or $10.00.

My explaination of benefits forms are pretty clear, of course I have loads of experience reading them, thanks to my medical fiascos of recent years. On them, they plainly say what the ins co will pay, what the physician or other provider agreed to for the particular service, and the amount I may owe the provider, which would be that 20% in some cases.

Now, if I don't choose a participating provider, with my particular insurance plan, my coverage is 70% of the covered expenses. But, since there is no agreement with this person since he or she or the institution is not in my PPO, there was no negotiation for fees, so what happens is this:

If I go there and the office visit is $75.00, my insurance says they will cover at a rate of $50.00 for an office visit. They will pay 70% of that 50.00, or $35.00. I am then responsible for the entire remainder of that $75.00 charge, or $40.00. Big difference, and I found out the hard way last summer what a difference this can make in what gets paid by them and what gets paid by me.

Confusing for sure, but that's how mine seems to work. I hope this helps. Like I say, this is how my ins works....and, it is really great coverage, for which I'm thankful, with all the claims I've had to file.


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Rich, you ask about something that can be SO complicated!

This is a thumbnail of how these things work most of the time --

First, the type of plan you are in may be one not covered by state law, so no matter what your state law says, your plan doesn't have to comply. That is what they call a self-insured, or self-funded plan, covered by federal ERISA regulations. ERISA, among many other things, exempts plans from state laws concerning insurance, and came about mostly so that large employers who have employees in more than one state weren't burdened by having to follow up to 50 potential sets of state laws.

Even if your plan is an ERISA plan, you are entitled to copies of what they call "plan documents." They are required by law to make these available to you, so ask for them. Also ask what kinds of agreements they have in place with their providers as to your being billed for excess amounts. An ERISA plan may not be subject to state laws, but may operate just the same as a non-ERISA plan in terms of provider agreements and contracts that determine what you do/don't pay.

If your plan isn't an ERISA plan, then the amount you and the insurance pay is probably part of a contract between the provider and the insurance company. If the agreement calls for the provider to render services at the agreed amount and (like Cindy described) you pay a percentage, then that would be all you have to pay according to the contract. This is what you will need to check on -- what the provider contract says. They probably won't let you have a copy, but the plan administrator can surely help you with it, and maybe intervene with the provider if necessary.

You can probably contact your state insurance commission to find out what, if anything, the law in your state has to say about this, but if you are in an ERISA plan, it probably won't matter what the law says.

Just make sure to keep copies of everything and write down names, dates, times of people you talk to and an outline of what they tell you.

Good luck.


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Most doctors have a simple piece of paper that you sign either when you decide on them as a provider or everytime you go into the office. What all that fine print says on the back of the form (the place where I sign at my doctor's office) says that you are responsible for funds that your insurance may not cover.

Cindy's example on a common doctor visit is right on, you have to pay your co-pay as that is an agreement between you and your insurance provider. I was told that if I did not pay my own co-pay (when applying for help through a local agency), the insurance company could refuse all payment and then I would have to pay the FULL amount, not the negotiated on, all on my own. Ouch!

For procedures, even those performed in your doctor's office, the insurance may not cover it. If the billing is coded incorrectly, it may be read by the insurance company as a "not needed" or "elective" service and you will be responsible for fees beyond your normal co-pay.

Normally, there is a deductible with insurance, as well. This varies and adds separately for in-network providers, out-of-network providers, etc. Until the entire deductible is paid, you will be billed for "services" at the percentage set aside in your PPO information. After the deductible is paid, you will be responsible for your co-pay only.

As Cindy stated, read your EOB (explanation of benefits). It should show you in more black and white what you are dealing with. If you have questions, refer to the literature your insurance company sent you upon enrollment. More questions? Call the information number/s and talk to someone.

There could be errors made at the doctor's office, at the insurance company, etc. If you receive a bill from the doctor that you think should have been covered, talk to their billing department and see if it can be recoded and resubmitted under the new code. All procedures have codes, sometimes the codes are subjective...

Good luck!

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IMO supplemental billing by healthcare providers is more prevalent than most people realize. Whether it's illegal vs. just plain unprofessional depends on the particular plan in question. The problem with supplemental billing is that if you dispute it or refuse to pay it sets up an ackward relationship with that healthcare provider. Out of a couple of dozen healthcare providers we had two that sent us supplemental billings. One of them waived the billing after I phoned and complained. The other provider was more resistant so I just paid it and simply won't use his services again.

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