Percentage of billed charges is a common contract term for commercial payors. It means exactly what it says, they pay a percentage of billed charges. By that very definition, what a charge is matters. To say otherwise is simply not true. It’s not at all accurate to suggest that most insurance payors are APC/DRG payors when that’s simply not the case.
How common is it for in-network treatment?
Sure, if we’re talking about out-of-network treatment, then patients should expect to get maximally screwed by the bill.
The PPO plans have an in-network and out of network component. The percentage of the co-pay and co-insurance would just shift dependent on whether you are in network or out. The question doesn’t make a lot of… sense.
You’re acting like all the commercials are HMO’s, or APC/DRG based payors… they’re not.
A PPO negotiates a rate with certain hospitals for specific procedures. It’s not necessarily APC/DRG based, but regardless this means those hospitals don’t charge the patient the chargemaster rate (or, technically, they do but then write off the difference).
If you need treatment at an out-of-network hospital, then you don’t have the benefit of those prenegotiated rates and therefore are stuck with whatever that hospital charges, minus whatever the PPO is willing to cover.
I hope we can agree on that. I mean, BCBS-MI spells it out right on its website.
[quote]PPO plans
Here’s an example of how in-network and out-of-network benefits compare in PPO plans.
In-network: You go to a doctor and the total charge is $250. You get a discount of $75 because you went to an in-network doctor and our negotiated rate with them is lower. We pay $140. You pay what’s left, which is $35.
Out-of-network: You go to a doctor and the total charge is $250. You won’t get a discount because the doctor is out-of-network. We still pay $140, but you’ll be responsible for what’s left, which is $110. We call this balance billing.[/quote]
This is not true for a percentage of billed payor. Your’re crossing your terms to support your argument. Some insurance are percentage of charge and then they have what is called reasonable and customary rates. This prevents a provider form just jacking up a rate and the insurance company paying a percentage of whatever is. The charge amount isn’t going to change between Medicare, SP or the percentage of billed payors. The contracts are built to acknowledge the expected reimbursement will change though.
You’re also acting like a percentage of billed charges is something I made up. I didn’t. But hey, what do I know… it’s not like I work with someone who literally builds these contracts, and I build the payors in our system so she can do that.
No, I don’t think you made it up. Percentage of billed charges certainly applies to out-of-network payments, for instance.
But the key question is whether the chargemaster rates are usually important to a typical patient, as Strollen suggested. I don’t think they are. Because insurance companies usually negotiate for lower rates, or pay URC. And as you just pointed out, hospitals usually don’t expect to be reimbursed according to their chargemaster rate.
I assume we agree that hospitals end up writing off the difference between what they charge and what they collect? If so, the details behind the contracts really aren’t that important.
This is not true. It also applies to in-network for percentage of billed payors. That’s what I am telling you.
Let me put this another way, a PPO is usually an indication of whether or not a provider is contracted with the insurance or not. A percentage of billed is more about what the terms of that contract is. Percentage of billed charges still exist as a contract term.
Nesrie, true or false:
If a hospital bills $15,000 for a broken leg, they will usually collect $15,000 from the insurance company and/or the patient.
That’s really all I need to know.
You’re changing your question.
Is the insurance company contracted with the health system or not? This sounds like an ER visit as well.
No, I’m not changing the question.
Because my post was originally to Strollen, who claimed he or the insurance company was on the hook for the full “list price” hospitals decide to charge.
And you can assume the patient is smart and went to an in-network ER.
In an Emergency situation, I would assume that they will take the patient, driven or by ambulance, to whatever facility is close and can handle the situation depending on the severity of the injury. A broken leg could be a friend driving them to a close facility or a leg broken in three places because a fell tree hit them.
For simplicity sake, there are cases when an insurance company is going to cover an ER visit with only a co-pay amount if the patient is actually admitted. The admission is often key to how much the patient is responsible for. The ER visits though are often cover. I ER visit for me as a patient is 200 dollars if I am not admitted. It’s an entirely different conversation if I am admitted. That’s the patient side of things.
On the provider to insurance piece, if they’re contract, they’ll have an agreement that may be based on percentage of charges or maybe some other rate.
If they’re not contracted then there is no agreement. You could say they’re out of network but it’s really dependent on what the patient is enrolled in how they handle it.
And that’s before we even start to talk about plans with HSA’s, typically high deductible plans, and while they still have contracts, the patient certainly cares a lot about the price since they’re paying the bulk of it through a large chunk of the year. They still benefit from negotiated rates though IF the insurance company has them.
And that’s before we even get to the piece about a service even being covered or not.
Billing is complex. It does no one a service to try speak as if it’s not.
Billing is complex, but so is repairing a fracture. We can still speak generally about both.
The fact is that hospitals generally do not get fully reimbursed for what they charge. You can make this as complicated as you like, Nesrie, but you cannot change that basic fact.
And that basic fact means that any discussion of health care costs has to be based on actual payments, not on hospital “list prices”.
Hospitals not generally getting fully reimbursed for what they charge and charges don’t matter are not the same statement.
It’s kind of like saying ACA did nothing to address cost, which isn’t true, to saying it didn’t do enough to address costs, which is true.
I was referring to the negotiated price the patient sees when they checkout, not the uninsured price (that nobody pays). So even using your prices, under bronze you owe 1000+7000+3x200= $8600 which is less than the $9800 deductible so you pay everything.
if you have silver plan with a mere $7k you pay $7,000 + 30%*$1,600= $7480 such a bargain, in addition to your $1,300/month for insurance.
I know you and Nesrie know more than I about the price hospitals and doctors pay for stuff. But I’m pretty confident as consumer I know what I pay and other individuals. It’s only 40% after you pay a huge deductible.
Silly me I thought something called the Affordable Care Act might have have someting do with a affordably.
Let’s what does wiki say.
“The Affordable Care Act was intended to increase health insurance quality and affordability, lower the uninsured rate by expanding insurance coverage and reduce the costs of healthcare.”
We established above though that the ACA did in fact slow the growth of premium costs, and stabilized the overall expenditures on healthcare in the US. While also increasing coverage to literally tens of millions of people.
My girlfriend has type 1 diabetes, and prior to the ACA she was being literally killed by our healthcare system. It was consuming all of her savings, and she was forced to make hard choices about things like whether to test her blood as often as she medically should.
This type of thing was not only devastating to those people with pre existing conditions, but has an economically negative impact on our society. It meant that people were far less free to change their jobs and move around than they should be, because abandoning their jobs meant abandoning their insurance, and then risking being put into the position of my girlfriend.
Paul Ryan actually cited the system she was involved in, the high risk pools in Washington state, as a triumph. This is a thing he suggests is a model of what he wants to do.
Her deductible was like $20k. Her premium was twice what normal folks paid. And her insurance covered only a third of her expenses.
So when we say that this is an acceptable solution, what we are really saying is that those people don’t matter, and should die because they had bad luck. Not being over dramatic here, just saying it as it is. If that’s the choice that we want to make, as a society, then we should make it without pretending we are doing something else. We should admit to ourselves what we are doing. Because to do otherwise is cowardly.
And what do we get for this? Nothing about such a plan will reduce costs. We have historical evidence from before the ACA showing that it won’t. Premiums are going up faster then than they are now.
We are going to be ruining the lives of millions of people, and for what? This is a serious question. What are we getting in return for abandoning those people?
ACA was also supposed to help guide people out of using the ER as their primary care; hint running ERs is expensive, and guiding people to actual primary care providers, is a lot less expensive. That was never going to be something we would see over night. We’d actually need to see that behavior shift over time… not something those seeking a miracle over night change to the system would actually be patient enough to study and examine the results.
In 2016, the individual out-of-pocket-maximum could not legally be higher than $6850. So that’s all you would pay in your broken leg example, or pretty much any other in-network example. After you’ve paid $6850, the insurance company must pay for 100% of covered in-network care for the rest of the year.
Are you thinking of the family OOPM? If so, that is in addition to the individual OOPMs for everyone in your family. As of 2016, family limits cannot replace anyone’s individual limit.
ACA seems like it was a real boon to musicians
I saw Betsy Wright play with Ex Hex a couple of years ago and she was awesome, it would have been a real shame if she wasn’t able to tour with them.
And the problem there was that it turned out that once people had gotten insurance, it turned out that they were sicker than predicted. It turns out that not going without health insurance for years or even decades is really bad for you.
But letting people go without health insurance is really r bad for all of us, because those of us who are insured end up paying for the uninsured through higher premiums.