Haris Ashley
The billing process can be complicated and difficult to understand. After visiting a healthcare provider that accepts your insurance, they will typically file a claim on your behalf. Your insurance company will pay your provider a set rate for each type of service, regardless of how much the provider has listed in their claim. If your healthcare provider is in-network, they will zero out the balance, but if they are out-of-network, you will be billed for the remaining amount.
In the case of a Primary Care Physician (PCP), they are responsible for managing all the details of a patient's healthcare. This includes making referrals for any other necessary services or specialist visits within the health plan network. If you do not have a referral from your PCP, your insurance is unlikely to cover the service.
It is important to understand what insurance will and will not pay for, and how much they will pay, before visiting a healthcare provider.
| Characteristics | Values |
|---|---|
| Whether a PCP has to submit a bill to insurance | Depends on the insurance plan |
| Whether a PCP has to submit a bill to insurance if it's an emergency | Yes |
| Whether a PCP has to submit a bill to insurance if it's out-of-network | Depends on the insurance plan |
| Whether a PCP has to submit a bill to insurance if it's in-network | Yes |
| Whether a PCP has to submit a bill to insurance if the patient has a rare illness | Depends on the insurance plan |
| Whether a PCP has to submit a bill to insurance if the patient has a serious illness | Depends on the insurance plan |
What You'll Learn
PCPs and referrals
Your primary care physician (PCP) is a physician who meets state requirements and is trained to provide basic medical care. PCPs are usually internists, general practitioners, family medicine physicians, paediatricians, physician assistants, or nurse practitioners. They are your first line of defence when it comes to your healthcare and are trained to take care of most routine health matters. However, there are times when a PCP will refer you to another healthcare provider.
PCPs refer patients to specialists when they determine that another practitioner can best handle a particular health issue. This could be for routine preventive care, such as being referred to a lab for a blood draw, or for diagnosis and treatment. For example, if you are experiencing ongoing foot pain, your PCP might refer you to a podiatrist or an orthopedist specialising in foot and ankle issues.
Referrals are usually made in writing, although some insurance plans may accept a verbal referral from the PCP. The PCP's office will send a referral form to the specialist, which typically includes the patient's relevant medical records, the reason for the referral, and any applicable treatment parameters. After the patient visits the specialist, the specialist will send a report to the PCP detailing the results of the visit, diagnosis (if applicable), and their recommendations for follow-up or further treatment.
Insurance requirements for referrals
Whether or not a referral is required, and whether it needs to be in writing or can be verbal, depends on the type of insurance plan the patient has. For example, patients with a health maintenance organization (HMO) or point-of-service (POS) plan will probably need to get a referral from their PCP before seeing a specialist, while those with a preferred provider organization (PPO) or exclusive provider organization (EPO) plan may not need a referral. Additionally, some plans may have rules about coverage levels for in-network or out-of-network providers. Patients should always check their insurance coverage for referral requirements.
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In-network and out-of-network care
In-network care is when a healthcare provider has a contract with your health insurance plan, agreeing to accept a discounted rate for their services. This means that you will pay a lower cost for your treatment.
Out-of-network care is when a healthcare provider does not have a contract with your health insurance plan. This means that you will likely have to pay the full price for their services, which is usually much higher than the in-network discounted rate.
Most health plans provide access to a network of doctors, facilities, and pharmacies to help you save money. These healthcare providers must meet certain credentialing requirements and agree to accept a discounted rate for covered services under the health plan to be part of the network.
If you go out-of-network, you will likely have to pay the full price for their services, and your insurance plan may not cover any of the costs. Even if your insurance plan covers some of the costs, you will still have to pay a higher amount than you would with an in-network provider.
For example, if you have a copay with an in-network provider, you will not have a copay with an out-of-network provider. Instead, you will be responsible for paying the coinsurance, which is a percentage of the covered charges. This amount is usually much higher than the in-network copay or coinsurance amount.
Additionally, out-of-network providers can bill you for anything over the amount that your insurance plan recognises or allows. This is called "balance billing". A network doctor has agreed not to do this.
There may be times when you need to go out-of-network, such as in an emergency or if you have a rare illness that requires specialist treatment. In these cases, you may be able to get prior approval from your insurer to receive out-of-network care at an in-network rate.
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Health insurance plans
Your health insurance plan offers coverage for certain healthcare services and treatments, and outlines how much it’ll pay for each service and how much you’ll be responsible for. If you have a managed care plan, which most Americans with health insurance do, your plan will also provide information on which healthcare providers and facilities are in-network. It is always a good idea to ask and understand what insurance will and will not pay for, and how much they’ll pay, before visiting a healthcare provider.
After you visit a healthcare provider that accepts your insurance, they will typically file a claim on your behalf. Your insurance company will have set rates that they will pay out for each type of service, and they will pay your provider that amount regardless of how much the provider has listed in their claim. If your healthcare provider is in-network with your insurance plan, then they will zero out the balance. However, if they are out-of-network, whatever the insurance company does not pay for will be billed to you. This is why you may still receive medical bills after insurance pays its portion of your costs.
It is also possible that the claim will be denied completely and you will be responsible for the entire bill. If your insurance company decides to deny the claim, they must notify you in writing of the reason for the denial and provide information about the appeals process, all within certain time frames. There are many possible explanations for why your health insurance company may not pay certain claims. For example, your insurance company may have made an error in processing your claim, or they may have given you misinformation that led you to undergo a treatment that isn’t fully covered. Alternatively, your healthcare provider may have billed your visit incorrectly, or your insurance company may have required additional information that was not provided.
Different types of health insurance plans include Health Maintenance Organization (HMO), Preferred Provider Organization (PPO), Exclusive Provider Organization (EPO), and Point of Service (POS) plans. HMO plans require members to select a primary care physician (PCP) who is responsible for managing all of their health care and making referrals to specialists. PPO plans, on the other hand, do not require referrals and allow members to choose their care or service out of the network, although this will typically result in higher costs. EPO plans are similar to HMOs in that they require members to use health care providers within the plan's network, but they do not require referrals to see a specialist. POS plans are a mix of HMO and PPO plans, as they require referrals from a PCP to see a specialist but will generally cover some of the cost of out-of-network care.
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Medical billing
In most cases, health maintenance organizations (HMOs) require individuals to select a primary care physician (PCP) who is responsible for managing all of their healthcare. This includes making referrals to see a specialist. Some modern HMOs have relaxed these rules, allowing members to visit specialists within the plan's network without a referral. Point-of-service (POS) plans also require referrals from a PCP to see a specialist but will cover some of the costs of out-of-network care if a referral is provided. Preferred provider organizations (PPOs) and exclusive provider organizations (EPOs) do not require referrals, but out-of-network care is generally more expensive.
If an insurance claim is denied, it is important to understand the reason for the denial. It could be due to an error in processing the claim, misinformation, incorrect billing, or a lack of pre-approvals/referrals. In such cases, it is advisable to call the healthcare provider and insurance company to rectify any errors and, if necessary, go through the insurance company's appeals process.
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Appealing a rejected claim
Step 1: Review your policy and paperwork
Before you begin the appeal process, you should review your insurance documents to understand what is covered, what is excluded, and why your claim was denied. Your insurance company is required to notify you in writing about the denial, including the reason for it and how to appeal the decision.
Step 2: Know who to call for answers
Some claim denials are due to billing errors or missing information, which can be easily rectified. Call your insurance company to clarify the reason for the denial and ask if it was due to such an error. If this is the case, your doctor's office can fix the error and resubmit the claim. You can also call your employer's HR department for assistance. They may be able to send a letter or make a call to your insurance company explaining why your claim is valid.
Step 3: Learn about the appeal process
You have the right to file an appeal and request an internal review by your insurer, as well as an external review by an independent third party. Check your plan's website or call customer service to understand the specific steps, forms, and deadlines for the appeal process.
Step 4: File your complaint
If your claim was denied for treatment you've already received or will need to receive, ask your doctor's office to send a letter to your insurance company explaining why you needed or need the treatment. Make sure to send this letter to the address listed in your plan's appeals process and keep a copy for your records.
Step 5: Keep the problem from happening again
To reduce the likelihood of future claim denials, follow these steps before receiving medical services:
- Know exactly what is covered by your plan.
- Follow the rules of your health plan, including any requirements for pre-authorization.
- Find out about any limits on your benefits.
- Learn if your provider is in your plan's network, as your insurer may not pay for out-of-network care.
Additional steps for a rejected insurance claim
If your claim was rejected due to a factual issue or because it doesn't fall within the operative clause, you can take the following steps:
- Internal dispute resolution: Request your insurer to launch a formal internal dispute resolution process. They are legally required to review the decision within 45 days, and they may overturn their original decision.
- External dispute resolution: If the internal dispute resolution is unsatisfactory, you can pursue an external review by an independent third party. In the US, this is typically handled by state departments such as the department of insurance, attorney general's office, or office of consumer affairs.
- Court proceedings: If all other options have been exhausted, you can launch legal proceedings or seek recourse through a Fair Trading Tribunal, depending on your state.
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Frequently asked questions
If your PCP is out-of-network, your insurance company will likely not cover the service. In this case, you will be billed for the full amount. To avoid unexpected medical bills, always check with your insurance company to understand what is and isn't covered under your plan.
PCP stands for Primary Care Physician. This is a doctor you choose to be your main contact for all your health care needs. They will refer you to specialists if needed and coordinate your care.
If you have a Health Maintenance Organization (HMO) or Point of Service (POS) plan, your insurance company will likely not cover the service. In this case, you will be billed for the full amount. If you have a Preferred Provider Organization (PPO) or Exclusive Provider Organization (EPO) plan, you usually do not need a referral to see a specialist.
If your insurance claim is denied, you can appeal the decision. Contact your insurance company to understand the reason for the denial and follow their appeals process. You may also need to contact your healthcare provider to rectify any errors in the billing.
