Hi everybody! It’s Kate Plageman with Central Jersey Insurance. Most of us have a health plan that has good in-network benefits.
If you do have a plan that has an out-of-network benefit feature, it’s really important that you understand that there can be a lot of hidden costs.
I’m going to give you an example of a claim and how that was likely processed with a typical direct access product with say Horizon Blue Cross Blue Shield of New Jersey.
Say you’re in the hospital and you see a doctor that is out-of-network, does not take any insurance. A lot of orthopedics, dermatologists, psychologists, psychiatrists won’t take any insurance whatsoever. That’s where the out-of-network benefit comes into play.
So, as an example, you go into the hospital, you see a doctor, you incur a claim, say it’s $5,000 total. That claim will come through to the carrier, in this case Horizon, and be discounted to what is considered to be reasonable and customary on an in-network level, okay?
So, that $5,000 will be discounted to say, $3,000. That’s considered reasonable and customary in-network. That difference between the $5,000 and the $3,000 is on you to pay and you will be responsible for that difference.
The out-of-network provider can balance bill you that. That $3,000 that’s left will then be subject to the out-of-network deductible, which is most commonly separate from your in-network deductible.
So, that usually is around $2,500. So, that $3,000 is now $2,500 on you, So, that $3,000 is now $2,500 on you, and then that difference of $500 will be paid at the coinsurance rate which is usually between 60% and 70%.
So, you may have a benefit of a couple hundred dollars out of that $5,000 claim, yet the provider can balance bill you all of that difference.
So, it’s really, really important that you understand how those benefits work before you get involved with out-of-network providers. Also as a footnote to that, if you have a plan that has out-of-network benefits, the premium is significantly higher than those that have in-network benefits only.
So, it’s just a little tip that I wanted to share with you, buyer beware.
Many professionals with gainful employment have group health plans that offer in-network benefits. This means that in-network health care providers have agreed to discounted rates for those covered by specified insurance companies.
Did you know that some plans also have out-of-network benefits? When seeing an out-of-network doctor, you may still receive a discount from your insurance provider, but won’t get a discounted rate on behalf of the doctor.
Keep in mind there are other hidden costs and complexities that can leave you with a hefty out-of-pocket bill to pay. In this post, we’ll break down the difference between in-network and out-of-network benefits and discuss some situations you may encounter.
Why Don’t All Doctors Accept All Insurance Plans?
There are a number of reasons all doctors don’t just accept all insurance plans. Most of the time, it comes down to cost, meaning the doctor believes that the rate offered by the insurer is not enough to warrant their participation.
Some doctors prefer to keep their networks small, working with only a few, or sometimes one (or no) insurance providers. This helps them simplify operations and increase leverage with patients and potential providers.
Another reason is that insurers may have a limited number of provider slots available, whether they are based on the total number of doctors or the services they provide. For example, they may already have enough in-network orthopedists, or they can’t take on over 100 individual practices and have hit their limit.
That said, several states have “Any Willing Provider” or “Any Authorized Provider” statutes which allow any healthcare provider to be an in-network provider if they meet certain requirements. This prevents insurers from blackballing providers and limiting access based on several factors. Depending on the state, these laws can be broad or limited in scope.
Accepting Insurance vs. In-Network
There’s also a difference between a physician “accepting your insurance” and them being an “in-network” provider.
Often when you call a doctor’s office and ask if they accept your insurance, they will tell you they do. But it’s important to dive a little deeper.
A doctor may accept your insurance carrier, Selective for example, but not your specific plan under Selective. This would make them on out-of-network provider vs. in-network.
This is an important distinction to make before making appointments and seeing particular doctors.
Emergency Care
If there is an emergency and you have insurance, you should have access to out-of-network services. Insurance and healthcare providers can’t require you to pay a higher copayment or coinsurance if you receive emergency care from a hospital not in your network. This is thanks to the Affordable Care Act.
The same applies if you don’t have insurance, and hospitals can’t refuse to give you emergency care. This is all because of the Emergency Treatment and Labor Act (EMTALA). If you’re still concerned about costs, you might go to an urgent care center of the emergency room.
What Should You Do?
The most important thing to do if you’re not sure about in-network or out-of-network benefits is to speak with customer service for your insurance provider. They can check for you if a doctor you’re looking to see is covered under your current plan.
Many insurance providers also have online portals where you can see which doctors are covered under your plan. It’s also recommended you confirm specific details with your doctors.
Still Confused?
Thinking of seeing a doctor that is out-of-network or still feeling confused? Before you take the leap and see a doctor you’re unsure of, click below and download our helpful guide to better understand the hidden costs.
