PreferredMD has been involved in the care of thousands of patients over the last 20 years. Our experience has brought to light that patients are frequently unaware of the details of the insurance product that they or their Employer has purchased until they make a claim.
All insurance products are not created equal. A slogan like ‘access to great doctors’ is only truly applicable when you have very good out-of-network benefits – as the Doctors you want to see may not be contracted with your Employer’s medical benefits carrier. That said, not all out-of-network benefits are ‘equal’ either.
To clarify, a great plan will be one that pays a Physician or medical facility their Usual and Customary (U&C) fees.
Out-of-network benefits which payout at anything short of that may require significantly higher out of pocket payment from you.
Our team will analyze your insurance plan and make suggestions as to how to maximize your benefits. We may even be able to suggest a modification of the plan you have, without necessarily increasing your out of pocket expense.
This information may prove invaluable in the event you ever have need for surgery or specialized medical services. We can advise you on your best insurance benefits strategy so that you have access to the very best Doctors and facilities.
Our client, Mary, was concerned that the medical insurance that her Employer offered did not provide the flexibility to utilize the Doctor she wanted for an upcoming knee surgery.
The team at PreferredMD was able to contact her health insurance company and ask specific questions about her employer’’s plan. In particular, the PreferredMD team was able to ascertain which Doctors and Specialists were in Mary’s network. Our team also determined that though Mary had ‘out of network benefits’, she would incur significant cost to use her preferred surgeon using these benefits.
Our PreferredMD Solutions consultant explained to Mary that the type of “out of network” coverage Employers negotiate with insurance companies determines the way Doctors are reimbursed, and that she would be responsible for whatever the insurance benefits did not cover.
Here are 3 examples of the typical of “Out of network” surgeon fee used by insurance carriers for the surgery Mary needed. An Employer will usually offer one of these:
- 140% of Medicare Fee (the percentage may vary from 130% to 150%)
- 90% U and C (90% of the Usual and Customary fee of the surgeon)
- 60% R and C (60% of the Reasonable and Customary fee of the surgeon)
Using Mary’s upcoming knee arthroscopy as an example:
- The approved Medicare fee for a knee arthroscopy is approximately $644.74
- The Usual and Customary fee for a New York City Surgeon for the same procedure is approximately $12,170. (According to data provided by fairhealth.org)
- The Reasonable and Customary fee for a New York City surgeon for the same procedure is approximately $7,800
Assuming Mary’s deductible has been met, here are 3 examples of her insurance reimbursement and out of pocket expenses using these fee schedules:
|Out-of-Network Surgeon’s Bill||Insurance Rate Schedule||Insurance Payment||Patient Responsibility|
|90% U and C||$12,170||$12,170||$10,953||$1,217|
|60% R and C||$12,170||$7,800||$4,680||$7,490|
It is clear from the above illustration that the out of pocket expense for Mary could be significant depending on the type of out of network reimbursement her Employer negotiated.
Mary used this information to approach her Employer and change her insurance coverage to include out of network benefits that reimbursed her doctor at his/her Usual and Customary fee, so as to reduce her out of pocket expense by several thousand dollars.
We later learned that the Employer used the same information we gave Mary to re-negotiate their Employee Benefits package and upgrade out of network benefits for the entire workforce. The Employer was able to obtain upgraded benefits at no additional cost given the number of employees.
We are very proud of our part in this. Our seemingly small accommodation resulted in many employees having access to their preferred Doctors. The Employer benefited too, their employees are being treated more efficiently, with reduced downtime, and with the best clinical outcomes.