“Why is there a discount on this EOB? I’m out-of-network!” “I already collected the patient’s co-insurance, but now the EOB says they should have gotten a discount and now they’re mad.” Sound familiar? You’re not alone. Providers call us with these exact questions frequently.
You may have read some of our previous articles discussing out-of-network discounting activities and what they mean. So, are these activities legitimate, or are they “Silent PPO’s”?
The truth is that “Shared Savings”, or “Out-of-Network Wrap” programs are most often a legitimate lease relationship between a Health Plan and a PPO. In theory, there are benefits for patients and providers under a “Shared Savings” environment. Unfortunately, theory and implementation don’t always meet in the middle.
Below is an attempt to provide insight into “Shared Savings” activities, and identify various Health Plans which are prominent in their interaction with other plans and PPO’s to apply discounts to out-of-network claims (“OON”). Terms are generalized for the purpose of this article.
“Primary plans”: payer of the claim, who seeks to save money on out-of-network claims, for example: UHC, Aetna, Cigna, Great West, Humana.
If you are in-network for any of the primary plans, your in-network agreement and terms will be applied, and the patient’s in-network benefits will apply.
“Shared Savings” programs: PPO’s or other administrators offering cost savings on out-of-network claims to the Primary Plans, for example: Multiplan, Beech Street, First Health, Three Rivers (TRPN), Integrated Health Plan (IHP), PPONext, Fed Med.
Under a “Shared Savings” program (also referred to as “Accelerated Payment Program”, “Supplemental Network” or “OON wrap”), if you are NOT a provider for the primary plan (UHC, Aetna, etc.), but you ARE a provider for the PPO offering the “Shared Savings”, most of the time you will still be considered out-of-network for the patient. The patient’s out-of-network benefits are applied, but the “Shared Savings” PPO discount will be tacked on to your out-of-network claim. Sometimes, the patient has “reduced” benefits rather than total “out-of-network” benefits under “Shared Savings” plans, but this is rare.
** It is important to note that each of the PPO’s above has their own book of “in-network” business, where the patient is attached to their network and will have in-network benefits. However, as a separate line of business, they also offer their network discounts to the Primary Plans for cost savings on OON claims.
How these work under PREFERRED agreements:
If you are participating ONLY through PREFERRED for Multiplan, Beech, First Health, TRPN, IHP and PPONext, below is the breakdown on which of them can and cannot apply a discount to your out-of-network claims.
If you have a DIRECT agreement with any of the PPOs listed, your direct contract might over-ride PREFERRED’s, and you might be subject to OON discounts unless or until you contact the PPO to discuss or adjust your direct agreement.
Multiplan: can apply discounts to OON claims for a Primary Plan ONLY if a Multiplan brand logo is on the card (usually small, usually on the back of the card). Refer to your Multiplan Fee Schedule for clarification.
Beech Street: Their “Accelerated Payment Program” does not apply. Beech is not entitled to apply discounts to OON claims under Preferred’s agreement. If you have a direct, you may be subject to APP discounts.
First Health: First Health is not entitled to apply discounts on OON claims under PREFERRED’s agreement for DOS after 1/1/08. First Health is in the process of “de-linking” the “Shared Savings” product from PREFERRED’s directory.
TRPN: not entitled to apply discounts on OON claims under PREFERRED’s agreement.
Integrated Health Plan: not entitled to apply discounts to OON claims under PREFERRED’s agreement. IHP is de-linking our providers from the UHC Shared Savings program.
PPONext: not entitled to apply discounts on OON claims under PREFERRED’s agreement. They transitioned systems in January of 2008 and linked our providers to the “Shared Savings” product as an oversight. They are correcting this and are in process of “de-linking” our providers from this product.
Watch your EOBs carefully, and let PREFERRED know if you are unsuccessful
in appealing and reversing non-qualified discounts on OON claims.
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