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  1. #1
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    Question Primary And Secondary Coverage Differences In Negotiated Costs

    I am a resident of the State of Texas. My question concerns when the insured patient has both primary and secondary group health insurance coverage in which there is coordination of benefits. If the medical provider is a participating provider for EACH plan and has therefore agreed not to bill the patient for an amount exceeding the allowable costs of each plan, what expected guideline should be followed when the primary and secondary plans each have a DIFFERENT negotiated amount of allowable expenses that they have contracted for?

    Put another way: If the secondary carrier has negotiated a lesser amount of total allowable costs (greater amount excluded) than what the primary coverage allows, and if the secondary carrier consequently determines a lesser portion of patient responsibility than what is determined by the primary carrier, is the medical provider still bound to honor its contract with the secondary carrier by not billing the patient for anything over and above the secondary carrier's negotiated contract amount, irrespective of the secondary status?

  2. #2
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    I guess I'm not seeing the point of your question.

    Let's say that the bill is $1,000. Plan A (primary) has a usual and customary rate of $1,300, and Plan B (secondary) has a U&C of $1,100. You get $1,300 from Plan A.

    Now we'll flip that, so that the U&C is $1,100 for Plan A and $1,300 for Plan B. You get $1,100 from Plan A and $200 from Plan B, for a total of $1,300.

    In both cases you recover the same amount, and in both cases you've contracted not to bill the patient a greater amount.

  3. #3
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    it first depends on the wording in the insurance plan as well as the contract the provider has with the different PPO'S. First is this a self funded plan or is this an insured plan. Also it depends of the wording in the plan for coordination of benefits. Does the secondary plan use carve-out for cordination of benefits? is the provider balance billing you the difference on the bill? what was the total bill, what did the primary allow and pay and what did the secondary allow and pay?

  4. #4
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    Quote Quoting Mr. Knowitall
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    I guess I'm not seeing the point of your question.

    Let's say that the bill is $1,000. Plan A (primary) has a usual and customary rate of $1,300, and Plan B (secondary) has a U&C of $1,100. You get $1,300 from Plan A.

    Now we'll flip that, so that the U&C is $1,100 for Plan A and $1,300 for Plan B. You get $1,100 from Plan A and $200 from Plan B, for a total of $1,300.

    In both cases you recover the same amount, and in both cases you've contracted not to bill the patient a greater amount.

    Here is the point of my question: $350.00 in total charges are filed by the IN-network participating medical provider. Of the total submitted charges, Plan A (the primary) approves $164.00 as the allowable cost negotiated with the provider. Plan A (the primary) pays the provider 80% of the allowable cost ($131.00) and deems the remaining 20% ($33.00) as patient responsibility.

    Plan B (the secondary) approves only $136.00 of the $350.00 total submitted cost as THEIR allowable cost negotiated with the in-network participating provider. The secondary carrier takes the $136.00 covered charge and subtracts the $131.00 that the primary carrier has already paid, and then pays the medical provider the difference of $5.00. The secondary carrier then deems that the patient responsibility is $0.00 (ZERO). $136.00 less $131.00 less $5.00 equals $0.00.

    If the medical provider takes the amount the primary carrier considers patient responsibility ($33.00) and subtracts the $5.00 paid by the secondary carrier, the medical provider could still try to bill the patient for the remaining $28.00 based upon the PRIMARY carrier's negotiated rate.

    It is BECAUSE of the different negotiated rates with the medical provider that the two insurance companies are coming up with different amounts deemed "patient responsibility." I am finding that the medical provider tends to go by whichever carrier will deem more funds into their trough, and especially if that happens to be the primary carrier, they believe they are justified in balance billing the patient accordingly. When they do that, the patient is then being balanced billed in excess of the negotiated costs with the secondary insurance carrier.

    It would seem that when the "allowed costs" differ between insurance companies (and when there are no other legitimate grounds for billing the patient), the ONLY way that an in-network provider can stay true to BOTH contracts is to abide by whichever company determines the LESSER amount of patient responsibility. In so doing, the patient would not be billed in excess of the negotiated costs of EITHER plan and the medical provider would remain in compliance with EACH of the contracts. After all -- a contract IS a contract, and it does not seem appropriate that one should preclude the other irrespective of primary or secondary status.

  5. #5
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    here is the kicker: what is the wording in the plan/policy booklet on the secondary insurance plan when it comes to coordination of benefits. They are not allowing up to the highest allowable, which means there is different wording on how they administer coordination of benefits. if you have that wording please post it and i can go into a little bit more detail for you.

  6. #6
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    Quote Quoting donnasasse
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    Here is the point of my question: $350.00 in total charges are filed by the IN-network participating medical provider. Of the total submitted charges, Plan A (the primary) approves $164.00 as the allowable cost negotiated with the provider. Plan A (the primary) pays the provider 80% of the allowable cost ($131.00) and deems the remaining 20% ($33.00) as patient responsibility.

    Plan B (the secondary) approves only $136.00 of the $350.00 total submitted cost as THEIR allowable cost negotiated with the in-network participating provider. The secondary carrier takes the $136.00 covered charge and subtracts the $131.00 that the primary carrier has already paid, and then pays the medical provider the difference of $5.00. The secondary carrier then deems that the patient responsibility is $0.00 (ZERO). $136.00 less $131.00 less $5.00 equals $0.00.

    If the medical provider takes the amount the primary carrier considers patient responsibility ($33.00) and subtracts the $5.00 paid by the secondary carrier, the medical provider could still try to bill the patient for the remaining $28.00 based upon the PRIMARY carrier's negotiated rate.

    It is BECAUSE of the different negotiated rates with the medical provider that the two insurance companies are coming up with different amounts deemed "patient responsibility." I am finding that the medical provider tends to go by whichever carrier will deem more funds into their trough, and especially if that happens to be the primary carrier, they believe they are justified in balance billing the patient accordingly. When they do that, the patient is then being balanced billed in excess of the negotiated costs with the secondary insurance carrier.

    The provider bills at the primary insurance plan's rate. You owe the $28.

  7. #7
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    Quote Quoting momm2500
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    here is the kicker: what is the wording in the plan/policy booklet on the secondary insurance plan when it comes to coordination of benefits. They are not allowing up to the highest allowable, which means there is different wording on how they administer coordination of benefits. if you have that wording please post it and i can go into a little bit more detail for you.
    There is no wording in the secondary insurance plan's policy that addresses what happens when they have a different negotiated rate than that of the primary carrier (in terms of coordination of benefits). In fact, I have not found anything in writing that addresses this issue anywhere. That was the reason I initiated this post. The secondary carrier's negotiated contract rate IS their maximum rate and, to my knowledge, that rate does not vary or change just because there is primary insurance involved.

    I did have phone conversation with a representative of the secondary carrier who confirmed that it would be "inappropriate" for the provider to bill the patient for anything in excess of what they determined to be patient responsibility, irregardless of their secondary status. The representative also stated that unfortunately, they have nothing in writing that addresses this in terms of coordination of benefits with another carrier. Since my initial post, I ALSO spoke with a representative of the Texas State Board of Insurance who concurred that the patient should not be billed in excess of the negotiated rates with EITHER carrier. Again, it was reiterated that "a contract IS a contract." How else can that be interpreted, except that in order to be compliant with both contracts, the provider would have to abide by the carrier determining the lesser amount of patient responsibility, whichEVER one that happens to be. It would just be nice if this clarification were not so difficult to find in written form.

    Don't think the extra $28.00 is owed!

  8. #8
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    Quote Quoting donnasasse
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    There is no wording in the secondary insurance plan's policy that addresses what happens when they have a different negotiated rate than that of the primary carrier (in terms of coordination of benefits). In fact, I have not found anything in writing that addresses this issue anywhere. That was the reason I initiated this post. The secondary carrier's negotiated contract rate IS their maximum rate and, to my knowledge, that rate does not vary or change just because there is primary insurance involved.

    I did have phone conversation with a representative of the secondary carrier who confirmed that it would be "inappropriate" for the provider to bill the patient for anything in excess of what they determined to be patient responsibility, irregardless of their secondary status. The representative also stated that unfortunately, they have nothing in writing that addresses this in terms of coordination of benefits with another carrier. Since my initial post, I ALSO spoke with a representative of the Texas State Board of Insurance who concurred that the patient should not be billed in excess of the negotiated rates with EITHER carrier. Again, it was reiterated that "a contract IS a contract." How else can that be interpreted, except that in order to be compliant with both contracts, the provider would have to abide by the carrier determining the lesser amount of patient responsibility, whichEVER one that happens to be. It would just be nice if this clarification were not so difficult to find in written form.

    Don't think the extra $28.00 is owed!
    Again I will state that the provider goes by your primary insurance policy.

    You are not being charged an "excess rate". You are being charged for the difference between your primary and secondary's policy. You owe the $28.00.

    Is your secondary policy the primary policy for some one else in your family? If that person received medical care, the provider would bill and collect at their primary (your secondary) policy. Get it? That's the way it works.

    BTW...I found the "more funds in the trough" statement offensive and un-necessary. I would have to ask why some patients spend hours trying to find every possible loophole in their policy to avoid paying their portion of the fee. How long has your Physician waited for the $28.00??

  9. #9
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    Quote Quoting lealea1005
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    Again I will state that the provider goes by your primary insurance policy.

    You are not being charged an "excess rate". You are being charged for the difference between your primary and secondary's policy. You owe the $28.00.

    Is your secondary policy the primary policy for some one else in your family? If that person received medical care, the provider would bill and collect at their primary (your secondary) policy. Get it? That's the way it works.

    BTW...I found the "more funds in the trough" statement offensive and un-necessary. I would have to ask why some patients spend hours trying to find every possible loophole in their policy to avoid paying their portion of the fee. How long has your Physician waited for the $28.00??
    My initial inquiry on this was intended as a general inquiry and the calculation I provided was a SAMPLE to explain the question. It doesn't matter whether the difference is $28.00 or $128.00. If the amount is important enough for the medical provider to see fit to bill the patient for, then it is enough to be questioned when the rules are not being properly followed. It is not a matter of the amount of money, but it is the principle of the thing. When improper procedures are not being followed, multiplied by many patients who get taken advantage of in these situations, it IS a problem. A person should not be expected to pay more than what is legitimately owed.

    The question about which family member has the primary/secondary coverage is relevant to which carrier gets filed on first and how the rules of "coordination of benefits" are followed as specified in each policy. I do not see the relevance of that question as it would relate to the negotiated rate contract compliance issue.

    As already explained multiple times in this post, the reference to "excess rate" is used strictly to define that portion the provider is attempting to bill over and above his contracted negotiated rate with the insurance carrier and what has been contractually determined as patient responsibility. If that gets billed to me, then I AM being charged an "excess rate." If there is any "loophole," to be found here, it might be on the part of the medical provider who is precluding one contract over another. If the provider does not want to honor the contract, then they should not have agreed to it.

    And BTW, I pay ALL bills I legitimately owe without hesitation or question and I am not looking for "loopholes." However, over the past many years of dealing with many medical providers (on behalf of various family members), I have encountered so many cases of billing abuses in an attempt to collect every DIME possible, that causes me to still stand by my "trough" analogy. I had one medical provider who tried to bill me several hundred dollars before even filing on the secondary insurance (and yes, patient had already correctly furnished ALL necessary information). When they finally filed on the secondary insurance, and after already receiving from patient what was correctly owed, they misapplied the adjustments and still kept dunning the patient with bills even for an amount less than $10.00. It took much time and THREE letters on the patient's part before the provider finally properly adjusted the account. THAT is what I find offensive.

    If the shoe doesn't fit, it does not have to be worn, but quite frankly I've had enough of getting nickled and dimed over such issues, and if a procedure is not being properly followed, it should be questioned and corrected. GET IT??

  10. #10
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    Default Re: Primary And Secondary Coverage Differences In Negotiated Costs

    since you want to know the bottom line, YES YOU OWE THE $28.00

    i personally asked what is the wording on how they handle coordination of benefits, i did not ask if they addressed the contracted fees. that is a difference. the reason being is that the secondary insurance in normal NAIC guidelines for COB will allow up to the highest UCR or PPO rate for that provider not to exceed 100% of the total cost. This is why I asked for the wording so I can advise you if your secondary insurance carrier paid the claim right or not!

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