Proven Balance Billing Strategies

What Is Balance Billing?

A balance bill is any amount the provider bills you over the plan amount. It is the difference between what the provider charged and what your health plan paid, minus any copay, coinsurance, or deductible, if applicable.

Balance bills most commonly occur when the consumer chooses to see a provider or specialist who falls outside the plan’s network. In other cases, a balance bill happens when the patient does not have a choice in deciding which provider they will see; for instance, a hospital patient may have no say as to which radiologist provides them services.

Balance Bill Example:

The doctor charges $100 for services rendered. The plan’s allowance at a certain percentage of Medicare is $70. The patient then receives a bill from the provider for the $30 difference – this is a “balance bill.”

What a Balance Bill Is Not:

• A balance bill is not a health plan deductible. Patients must pay their agreed-upon deductible before the health insurance plan kicks in. If the patient sees a doctor at a total cost of $150, but the annual deductible on the plan is $1,000, the patient owes the full $150. The patient is now responsible for the next $850 in medical services before the insurance provider covers the rest.
• A balance bill is not a copay. A copay is a flat fee when you receive covered care, such as attending a doctor’s appointment or receiving prescription medication. For instance, you may have already paid the $1,000 annual deductible, but a doctor’s visit may cost you $20 out-of-pocket as a copay. In most cases, the copay does not go toward the deductible. Plans with lower monthly premiums often have higher copays.
• A balance bill is not coinsurance. Coinsurance is very similar to the copay, but instead of a fixed price, it is based on a set percentage. An example of coinsurance might be to bill you 30% of the total, so if your service costs $100, you’d owe $30. Some health insurance plans have both a copay and coinsurance. These are agreed-upon, shared costs that are spelled out from the beginning in a contract.

Is Balance Billing Legal?

Patients can predict and plan for costs like deductibles, copays, and coinsurance, but balance bills are often unexpected. Balance bills can arise when a patient assumes full coverage by the “in-network” hospital, but later learns, for example, that the treating anesthesiologist was “out-of-network.” Twenty-five states prohibit commercial health insurance plans from sending a balance bill, but self-insured employer-sponsored plans are not protected.

Most states also require “in-network” providers to accept the rates the health plan promised to pay. California, Connecticut, Florida, Illinois, Maryland, and New York offer the most protection from balance bills, but they are still possible and legal in many cases – which can be stressful and costly for consumers.

How Innovate360 Protects You From Balance Billing

Innovate360 offers a two-prong approach to combat balance billing by:

1) Preventing balance bills from happening in the first place

When a Reference Based Pricing solution is implemented, balance bills account for less than 2% of all bills. The TPA reviews and drafts the health plan document to ensure the explanation of benefits and stop-loss policy are airtight against balance bills. Members receive education, support, and direct communication to ensure they understand their network and make the best choices for care. The option of a maximum capped payment is also possible, so the benefit plans never go above a fixed amount.

• Plan members may choose any doctor, hospital, treatment, or provider, as there is no PPO network.
• Members can contact a dedicated Patient Advocate 10 days before a scheduled appointment with any questions about the plan, the provider, or the cost.
• Patient Advocates act as liaisons to the providers to encourage acceptance of the plan’s rate as “payment in full” so a balance bill will not occur.

2) Advocating on the patient’s behalf when the rare balance bill arises

Once contacted by a patient advocate, most providers accept the amount allowed under the plan as payment in full. If the plan administrator confirms that a balance bill has occurred, Payer Compass steps in to handle appeals and negotiate with the provider to write off or significantly lower the bill. Members are kept informed of the bill’s status throughout the resolution process.

Protect Members From Balance Bills With Innovate360

Payer Compass’ Patient Advocacy program is a valuable service provided as part of the Innovate360 platform to defend against balance bills.

The Patient Advocate will:

• Help patients and providers understand how the plan works.
• Assist you in finding out who accepts the reimbursement rate as full.
• Locate accepting providers in any area and specialty.
• Support patients who have received balance bills.

Contact Payer Compass to learn more about our balance billing solution.