Is the Concern About Balance Billing Out-of-Balance?
When networks were first created (nearly 25 years ago), you had a select few groups of providers who agreed to a discount, with the notion that giving a discount will drive more business to the provider. Right idea, but where did we go wrong? Fast forward to today and nearly every provider is in a network; so are you really getting a discount? In fact, somewhere between 2% to 8% of claims occur outside of PPO network. A very small number.
So between 92 - 98% of the population are in a PPO accessing a network where there is a “contract” between the provider who agrees to perform services at an agreed-upon rate. For those who seek care within the “network” of providers, a member supposedly gets a discount off a billed charge and no balanced billing is to occur. That has been the “mantra” for years. Go to the network of providers, get a discount and no balanced billing. If you go outside the “network” you pay a higher portion of the fee and deal with potential balance billing issues.
Cost containment organizations like NCN have worked with providers in the out-of-network setting: clients want some rate reduction for out-of-network claims and don’t want to pay retail. However, the moment you work on out-of-network claims, clients have a “deep concern” about the patient not being balanced billed.
I can understand the need to work in partnership with the provider and patient to create a resolution that provides a rational payment for the provider. However, when the focus is placed squarely on the issue of “balance billing” in the out-of-network setting, clients assume that balance billing does not occur in the in-network setting when in fact, balance billing could possibly be bigger issue for in-network claims. As provider incomes continue to be cut due network agreements, government cuts, etc, balance billing may be a bigger problem for in-network claims than out-of-network claims.
An article published in BusinessWeek in 2008 highlighted a growing issue with balance billing occurring with providers who had network agreements but were balance billing anyway. I realize this can occur accidentally. Providers have so many different networks they work with that it is hard for them even to know what is to be reimbursed. Add this to the fact most hire outside billing/collection agencies to handle their business and you have another layer of potential miscommunication. All said, it is important for all of us to realize that balance billing is not an exclusive issue for out-of-network claims. It is occurring in the in-network environment.
Members should be given tools, such as data and support, to negotiate with providers for a satisfactory solution. NCN published an article, Negotiating a Balance Billing Solution, that a member recently used to save more than $1000 on a balance bill for ambulance services. Download it here.