PHYSICIAN BENEFITS

Some networks simply offer a straight discount off of a provider’s service. When you are dealing with a discount, there is often no way to tell if you are truly getting a savings. For example, if you were buying an item, and the person you were buying it from did not have a “published” rate, so you didn’t know what the regular price was, what’s to stop them from raising the price before applying your discount? Nothing. On the other hand, if there were a set fee schedule, that already has the “discounts” built in, with someone to monitor the process, you would know that you are getting the agreed-upon rate. That is the reason that most reputable medical PPO networks base most of their fees on fee schedules rather than using a discounted percent.

The other nice thing about using fee schedules rather than discounts is that most doctors in a given area will have the same fee schedule, and thus you’ll pay the same rate no matter which one you use. For example, assume doctor (A) charges $150 for a standard office visit, and doctor (B) charges $79 for a standard office visit, and they are in the same city; if the PPO rate was $50.00, it wouldn’t matter which doctor you chose, they would still each accept the $50 payment. (Please note that the same is not true for hospitals).

The medical network utilizes fee schedule based on CPT4 codes to determine the PPO allowable on charges from doctors, labs, and most ancillary service providers. How these codes work is described below.

Current Procedural Terminology 4 (CPT4) Codes

With a complex network of providers, there has to be a way to ensure standardization. This is done with the CPT4 code. CPT4 codes organize all of the services available for proper pricing and documentation. When a doctor files a claim, he or she must provide a CPT4 code for payment. The price that is attached to that code is known as the PPO allowable. The amount charged is all the PPO will allow a provider to collect, thus the term “PPO Allowable”.

A good example would be a member who went to see his doctor for the flu. His visit was a standard office visit, and he is an established patient. When it came time to pay the bill, the receptionist billed a CPT4 code of 99212 for which they normally billed $50. The fee schedule rate for that particular procedure code in that particular city, however, was $33. Therefore the PPO Allowable was $33, andmember would pay $33.

Many patients call the network before going to the doctor’s office in an attempt to find out what payment will be required at the end of the visit. This is very difficult (and often impossible) to determine because we cannot predict what is wrong with them, how long the visit will be, or whether any tests will be required. An office visit can be coded with any of the numerous office visit CPT4 codes depending on whether the patient was new or established, the length of time the doctor spent with the patient, the severity of the illness, the number of conditions treated, not to mention what tests are performed. For this reason, we discourage the members from requesting this information on doctor’s visits in advance. (Hospitals work differently, this is explained later).

When making a doctor’s appointment, members should follow these procedures:

Select a doctor from the provider directory included in the member kit. Please note that only the most commonly used physicians are listed in the directory (Internal Medicine, General Practice, Family Practice, OB/GYN, Pediatrics, Allergy, etc.). The member can call customer service to locate a specialist in their area.

When calling to make an appointment, the member should identify himself or herself as a member of the appropriate medical network stated on your card. No further information should be given.

When arriving at the doctor’s office, present your ID card. If the office staff has any questions about the program, please direct them to call the toll-free number on the back of the card. Do not try to explain the program yourself.

Be prepared to pay at the time of service. The doctor’s office will be instructed to call customer service at the end of your visit to get the fee schedule rates. They will then charge you those amounts. Some doctors’ offices prefer to mail the bill for repricing. If this happens, the provider will send you the bill, along with an “Explanation of Repriced Bill”. (The doctor’s office will also be sent a copy of this “Explanation of Repriced Bill”). You should then make your payment of the repriced amount to your doctor immediately upon receipt of this statement.

HOSPITAL BENEFITS

The Hospital Referral Network is one of the largest hospital networks in the country, including some of the finest facilities in the U.S. Members may save up to 50% or more on their hospital stay at participating facilities.

The Hospital Savings Program IS NOT INSURANCE, nor is it intended to replace insurance. It is a medical savings program that saves members money provided they are capable of making the full discounted payment. There are no restrictions, limits on savings, pre-existing condition limitations or waiting periods.

Using Hospital Services

Unlike doctors, hospitals do not use CPT4 codes. Hospitals bill differently based on what type of service is being rendered.

In-Patient

Hospitals generally bill a per day rate for an in-patient stay. In addition, they will add on charges for any use of surgical or other facilities, any tests performed, any drugs given, and any specials provided. The average hospital bill runs about $3,600 per day.

Hospitals all have unique and separate contracts with the PPO networks. Some refuse to give any discount and some give a normal discount of 10% to 25%.

You will note that hospitals are not published in the directories that we send to our member. This is because we want to be involved in the process of helping the member select the hospital prior to their admission. Remember that all hospital contracts are not the same. Simply selecting a hospital from the directory could cost you thousands of extra dollars when it comes time to pay the bill. We don’t tell you which hospital you must go to, but we can allow you to make an informed choice.

Our contract with our medical networks does not allow us to publish the rates for the hospitals because that is considered confidential information. We are only allowed to provide this information when someone is ready to utilize those services. All members are required to call prior to utilizing any in-patient (or outpatient) services. We do this for two reasons:

We want to make sure that our members are making informed choices.

We want to make sure that the member can afford to pay the bill. Remember, one of the critical points of this program is that we must make sure that the providers are getting paid on a timely basis. Members who utilize the program and then do not pay the bills promptly can seriously damage the program for everyone.

You will find that hospital bills are not generally available at the time you check out. You will receive the bill in the mail, or it will be mailed to the provider network. The hospital will bill you based on its normal prices. The provider will reprice the bill and send you and the hospital the “Explanation of Repriced Bill”. (If you received the bill directly, please mail it to the provider so we can reprice it for you). You will need to pay the hospital immediately in order to receive the lower rates. We cannot guarantee that those rates will be honored unless you have followed all of the procedures and you pay the bill within 30 days of the date that the hospital mailed the bill.

Emergency Room

The emergency rooms around the nation serve a distinct purpose…to save life or limb in an emergency. However, many people tend to use it more as a walk-in clinic. If they have a cold, they walk into the emergency room for service, and have a heart attack when they see the bill. Remember this: a big hospital has big rent; every service performed in that emergency room is priced to pay the rent.

A hospital understands that much of its business comes from the emergency room. Therefore, when it negotiates contracts with PPOs, it will only agree to give a percentage discount (25% on average). With this being the case, they will bill everything they legally can, since they will be reducing it by the agreed upon amount. Accordingly, the smart consumer will only use the emergency room when medically necessary. Utilizing the nurse hotline is a good way to tell when a condition is serious enough to warrant the use of the emergency room.

Hospitals sometimes require payment for emergency services at the time of service, so be prepared to pay the bill immediately.

Average Savings: Reasonable expectations - some will be more, some will be less:

Physicians & Hospitals 20% to 50%
Ancillary Service (Lab, x-ray, etc.) 20% to 50%

Physical Therapy 15% to 20%
Psychiatric Treatment 15% to 25%

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