Co-pays, Co-insurance & Deductibles

Marty Kotlar, DC, CPCO, CBCS

Question:
The recent increase in deductibles and co-pays has negatively affected my patients and practice. I am out-of-network with most insurance plans. Do I have to collect the full deductible? Is it possible to waive a portion of the co-insurance? Should I lower my fees to improve patient compliance?

Answer:
Let’s begin by discussing fees.  There are 3 factors that usually determine a fee.

1. the work and skills utilized by the provider
2. the provider’s overhead/administrative costs
3. the malpractice expense of the provider

You should select your fees based on a combination of the following:

1. your practice location
2. the local Medicare fee schedule
3. in-network fee schedules
4. out-of-network rates
5. what other DCs, PTs and MDs charge in your town
6. what you feel most comfortable with (remember, you can’t sell what you don’t own.)

Is it possible to have “one fee” across the board for every man, woman and child that walks into your office? NO WAY! It’s practically impossible to do that in today’s healthcare world. Here’s why.

Many chiropractic offices have a combination of standard (regular) fees, managed care fees (ASH, Optum, Multiplan, OrthoNet), mandated fees (Medicare, Medicaid), workers’ compensation fees, personal injury fees, TOS fees, offer pre-pay plans, hardship fees, DMPO fees (ChiroHealthUSA) and on and on.

Being part of all or some of the above does not mean you have a dual fee schedule.  Having a dual fee schedule is inappropriate.  Make sure all patients are aware of your “regular” fees.  Some providers give discounts without advising patients of the regular fees.  This could cause unnecessary confusion if a cash patient returns as an insurance patient (sticker shock).

Now more than ever, patients need to be educated on what THEIR insurance company pays for. It’s not only about educating patients about chiropractic care anymore. The doctor or insurance CA must address the difference between medically necessary/insurance reimbursable care vs. maintenance care with the patient on the initial visit and on every re-exam.  Patients need to understand that they may not be able to use ALL their visits. It’s not okay for patients to get upset at the front desk CA or billing manager because insurance does not want to pay.

Now back to co-pays, deductibles and co-insurance.  These amounts vary and could be difficult to manage. You could have 30 patients come in with 15-20 different patient financial arrangements.

Most insurance carriers require healthcare providers to attempt to collect any unpaid portion of the annual deductible, co-pay and co-insurance. According to Medicare, routine waiver of deductibles, co-pay and co-insurance is inappropriate because it results in false claims, violations of the anti-kickback statute, and excessive utilization of the services and items that get paid.

A carrier may consider a provider to be misstating the actual charge. For example, the provider charges $100, but routinely waives the co-insurance (20%/$20) then the actual charge is $80.  The Federal government may exclude healthcare providers from participation in Federal healthcare programs for violating certain statutes.

However, certain conditions may permit a healthcare provider to waive (partially or fully) the collection of these amounts.  One of the conditions is financial hardship. The U.S. Department of Health and Human Services provides information on how to create a discounted fee schedule. Send an email to info@targetcoding.com if you’d like to receive a copy of this document.

We have recently seen a few insurance carriers request to see proof that the patient paid some or all of their co-pay, deductible and/or co-insurance.  Clear financial policies are very important for insurance CAs to be able to discuss with patients.  Good financial policies allow patients to understand your office insurance billing and collections procedures.  Patients should understand that collecting money from insurance companies is not that easy.  Good financial policies allow patients to understand that they are responsible for a portion of the bill and can prevent you from providing care that will never get paid.

How would you feel if you got a letter from an insurance carrier or state board today asking to see your office financial policy? Remember, if they cannot get it from you, they can very easily contact the patient and ask them how much they pay you on every visit.  Get comfortable and compliant with your financial policies and get your staff trained on collecting the money the right way.

Marty Kotlar, DC, CPCO, CBCS is the President of Target Coding. Dr. Kotlar is Certified in CPT Coding, Certified in Healthcare Compliance and has been helping chiropractors nationwide with billing compliance, documentation and coding for over 10 years. Target Coding can be reached at 1-800-270-7044, website – www.TargetCoding.com, email – info@targetcoding.com.