Home Forums Discussions Coding and Billing Cash price verse insurance price

What are the rules for offering different price services as cash?

I want to make sure i am ethical about this. And what can you do with a fee for service?

Thanks!

Ben

You must offer the same price to all customers.

You may be able to offer a "discount" to some customers based on method of payment. Depends on your state. So you'd still have to charge them $100 if that is the charge for the service. But you may be able to give them a 10% discount if paying by cash or credit card. maybe not. Or you may be able to give them a discount if "the entire fee is paid at the time of service."

Well lets say we have an IV that we charge $80. Can we discount it 20% for a patient that pays before hand?

The insurance will take the $80 and make it lower in most cases.

Thanks!

Ben

Wayne, I don't that is really true, though perhaps it varies state-by-state. You can charge different insurance companies different amounts. For example, there are even billing programs that will calculate the price the insurance company has paid, and charge that, so you have a 100% collection rate. I think the only rule is that you cannot charge other insurances less than you are charging Medicare. I will look for documentation of this, but others may know better.

My understanding is that it is really only legal to have one billed amount - I know some programs do that but I have been told that is not legal, it is also not smart as when a company raises their reimbursement you will not find out. I charge an amount higher than all my insurance companies reimburse and then do write offs - if an insurance company starts paying 100% then I assess what I am billing.

I reduce the charge by 35% if it is self-pay. Couldn't care less if it is legal or not. Save some of that by not having to do all the billing. It has to be up front.

I guess you could just down code if necessary.

I guess this would be the same police as the HIPAA police.

I believe you can do a discount for cash at time of service - no billing and not eligible for insurance reimbursement (should put that on receipt so pt. don't then try to turn it in to insurance) and clearly mark %discount for payment in full at time of service.

I think you can legally give any discount you want, the issue is what "contracts" you have with the insurance companies.
Most insurances make you list your "standard fees" lets say $100 for a 99213. Medicare compensates you $69.11. The insurance companies compensate you $60. If the insurance companies find that you have given cash discounts to uninsured patients and charged them $60 they will sue you stating that $60 is your "standard fee" and therfore they should be compensating you $36; they will usually ask for reimbursement of $24 for every patient that they have compensated you for a 99213 dating back to the date of the contract being signed.
Doctors gave away 25.4% of their gross charges to needy patients prior to Medicare and the insurance companies taking over what they love to call "The Healthcare Industry" beginning in 1964. Doctors in 2009 were able to only give 3.6% of the charges.
Medical Doctors need to do what the Dentist in Atlanta do; and let the patients file their own insurance claims after they have paid for services rendered.

This is the big reason we opted out of Medicare. We have been told that by participating in Medicare, we agreed to charge them our lowest fee. Needless to say, they don't pay what we charged, but we had to charge them our lowest, and we could not discount anyone, even those uninsured or with low income. Charging anyone less was considered fraud, and one Anchorage physician was actually prosecuted for this several years ago. It will also depend on the specifics of any contracts that might be worded similarly if you have any.

There may be issues of skewing your "usual and customary" fee if a third party payor is involved as well.

We came up with our fee schedule based on a precentage of what medicare will reimburse since that is public knowledge. We then offer a 30% discount to anyone who pays on the day of service. This is legal because we offer it to everyone, including the insurance companies but since they will never be able to do this, it's only the cash pay patients that benefit.

You can also legally write off part or all of a bill later down the road, but you must first charge everyone the same and the person will have to tell you they can't pay it at which time you "negotiate" what they can pay, if anything at all.

There is a way to legally charge people different prices based on income but it's so tedious that I'm not going to attempt it. There are a few clinics in town that do that but you have to verify tax forms, paystubs, etc..yuck.