Q: The fee schedule I received from PREFERRED for XYZ PPO Healthplan indicates that I will be paid at a per diem (per visit) of $100. I saw two different patients under XYZ PPO Healthplan. For Patient A I received the full $100 payment from the insurance company; for Patient B I only received $50 from the insurance company, what is going on?
A: More than likely, the difference is a patient benefit design limitation. Health policies and patient benefit programs vary in which services they will cover, and in some cases the dollar amount they will pay for those services. In the case of patient B, even though physical therapy visits may be a covered benefit, that particular employer’s benefit program limits the amount the insurance company will pay per visit. Therefore, the patient would be responsible for the difference between your contracted amount for XYZ PPO Healthplan ($100) and the amount paid by the insurance company ($50). Patient B would owe you a $50 payment. Note: This is not considered “balance billing”. You are entitled to the contracted amount from the combined payments of the healthplan and the patient. “Balance billing” is when you try to collect the difference between the contracted amount and your billed charges, which is prohibited if you are in-network with the patient’s healthplan.

Q: Why is there a variation in the payment amount if both patients are under the XYZ PPO Healthplan agreement?
A: There are several “clients” who access the XYZ PPO Healthplan. Clients are names you may recognize because they are the employer groups, TPAs, and insurance companies.

Q: Why would a client choose the benefit design that limits the covered services or the amount allowed per service? A: With healthcare cost constantly on the rise, employers have been faced with continuing to provide healthcare while keeping cost reasonable. The insurance companies have developed limited benefit plans as one option. Although not ideal, by limiting the covered services, and/or the amount allowed per covered service the client lowers their premium amount so that they are able to offer some form of health coverage. Other trends patients may be faced with are increased co-payment, co-insurance and in-network deductibles.