Fee Schedules - Usual and Customary vs Caps on Billed Claim Amounts


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I had a question presented to me in regards to fee schedules and pricing to Insurance Payers vs Private Pay. This is in regards to Laboratory billing, when we are unable to obtain In-Network status, our claims have been processed at 100% by some BCBS, and the patients are upset saying that is unreasonable. We do not ask for that amount, BCBS chooses to process the charge at 100%, and for our other Payers that we are In-Network, the contracted rate applies and no problems. The question was raised, can you cap a claim to an Insurance Payers that you are not In-Network? And what governs the amount you set your Usual and Customary Fee Schedule, are there guidelines written somewhere to help advise what method could be used? We do realize the normal industry is I believe 2 and half times medicare allowable, but is this a law, or requirement, are there limits, are the fee considered excessive? Just trying to educate myself on Fee Schedules and what can and can not be done, correctly! Thanks!


True Blue
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This is a fairly complex question you're asking and it may be best if you work on this with your organization's compliance officers and/or legal department - I always recommend caution before acting on advice from discussion boards when legal issues are involved. I'd just mention a couple of things:

You say that "We do not ask for that amount, BCBS chooses to process the charge at 100%", but if you are submitting a claim to the insurance, you actually are asking for that amount, that's what a claim is. Your fee schedule states what your charges are, and those charges represent the amount that you will accept as payment in full. BCBS doesn't "choose" to pay that, they will pay at 100% when their contract with the patient requires that there is no copay or patient share for that service.

I'm not aware of any particular rules governing or limiting how much you can charge. It's common to get patient complaints about charges no matter what you set them at, but of course the higher you set the charges, the more complaints you're likely to get.

It's usually considered a violation of the false claims act if you represent one charge on a claim, but then accept a different amount from the patient as payment in full, so I don't believe it's compliant to "cap" your charges for particular patients or payers. You can also run into problems if you're routinely charging one amount to certain patients or payers and a different amount to others. You are only really permitted to waive patient responsibility based on financial hardship of the patient, or if no payer claims are involved at all.

I think the best practice for dealing with all these issues is to have management set the fee schedule and write a clear and consistent policy for application of discounts and financial hardship exceptions and run it all by the lawyers to make sure it's compliant. Hope this helps a little.


Flowery Branch, GA
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Everything the poster above said is solid advice. You may want to consider utilizing www.fairhealthconsumer.org to spot check your charges against what the average charge for same service/procedure in your area.

You will want to read the rules for what you can & can't do with the data, but if you find it helpful, contact them for pricing if you want to use it to fight insurance for more $$