Contracting with Insurance Companies

Are you a contracted provider?

As new providers, you know how the story goes; especially if you’re a young audiology practice operating on your own. As veteran providers, this story is a familiar one, and goes something like this.

John walks in the office and is greeted by the patient care coordinator. He hands his documents to the coordinator, and she obtains all the proper-signed documentation, making copies of important cards, and confirming demographic information for claims submission. Side note–If you’re unsure of what these “proper-signed documents, important copies, and demographics” are, you may be a good candidate for Hear Billing Solution’s Front-Desk Book Camp now being offered.

The audiologist gives an assessment, after asking multiple discovery questions, and then proceeds with the audiogram (AKA hearing test). After realizing the patient has significant hearing loss (which can be corrected) the audiologist then needs insurance benefits verified by the patient care coordinator, in order to better know how to proceed with a hearing device purchase based on John’s hearing aid benefit.

The patient care coordinator begins asking the insurance company for verification of different codes. Before she’s given an answer the insurance representative on the other end of the line asks a very important question.

”Are you a contracted provider with the member’s plan?”

In-network Vs. Out-of-network providers

This story is about to go one of two ways.

IN-NETWORK

When the provider is a contracted provider, he/she is considered an in-network provider with that company.

If this audiologist or hearing instrument specialist were in network with John’s plan, then John’s co-pay, deductible, and any co-insurance amounts are all pre-determined amounts. This means the benefits are already set. The provider agrees to accept the insurance company’s fee schedule (AKA allowables for specified codes) and understands a write off is necessary for any codes that aren’t covered over the allowed amount.

For instance—An audiogram (92557) costs $100 at the audiologist office. Cigna allows $44.10 (let’s say).
This means the audiologist would need to write off the difference of $100 and $44.10—or $55.90.

Being in-network with an insurance company also means the provider has the option of being listed on the directory of providers. This is beneficial for both patients and providers. Patients who are new to the area and don’t know anyone who can refer them to an audiologist can use this directory. It also comes in handy for the provider because patients get a sense of “trust” knowing the provider has been approved as a trusted source.

OUT-OF-NETWORK

On the other hand…if John’s plan is not contracted with the provider, then the provider would be considered an out-of-network provider. This means the provider won’t be listed as a “trusted” source on the insurance company’s directory. Something to keep in mind in today’s day and age is, more and more patients are being referred to an audiologist, rather than looking online for a participating provider. Word of mouth goes a long way!

Additionally, remember the scenario above where the provider must take a write-off because of contractual obligations? Well, as a “non-participating” provider, we are not obligated to take a write off. Instead we can balance bill the patient for services the out-of-network benefits didn’t cover. Reimbursements are generally a little higher for out-of-network providers too.

BALANCE BILLING

Balance billing is when we bill the patient for services the insurance company did not cover under the out-of-network benefit.

Using the example above where the audiologist had to write-off $55.90 for the audiogram (due to being in-network), we would not need to take a write off. Instead we can balance bill the patient for the remaining balance.

These numbers would no doubt be different as there are different fee schedules for in-network and out-of-network providers.

A FEW THINGS TO CONSIDER

Just because a provider is in-network does not mean payments are issued any faster. Nor does it mean there isn’t a benefit at all. Most of the time patients have some type of out-of-network benefit for diagnostics…not always for hearing aids, but again, sometimes! This is why verifying insurance is so important. Another service Hear Billing Solutions proudly offers.

In conclusion, be careful whom you agree to be contracted with. Some insurance companies offer reimbursement rates so horrible, that it’s not worth it to be a participating provider in the first place.

One last piece of advice…always read your contracts and know your fee schedule before signing on the bottom line.

Need help with contracting your office or providers? Contact us today and learn how we can help get you on your way!