The patient’s financial responsibility

Most MCO health insurance contracts require patients to pay a copayment, which is collected at the time of service. Copayments can range from $10 to $75 for office visits. They vary depending on whether the patient is seen by a PCP or specialist, in urgent care, or the emergency department. Office visits and prescription copayments do not count toward the yearly deductible. The medical assistant must make sure that the proper copayments are received and credited to patients’ accounts.

A deductible is a set dollar amount the policyholder is responsible for each year before the insurance company begins to reimburse the healthcare provider. The deductible amount is stated in the insurance policy.

Co-insurance means that the insured and the insurance company share the cost of covered medical services after the deductible has been met. The insurance company and the patient split the cost of the services. An 80/20 split is very common, especially for traditional insurance. This means that after the yearly deductible has been met, the insurance company pays 80% of the fee, and the insured pays 20%. The patient’s deductible or co-insurance responsibility is shown on the EOB.

To help patients understand their health insurance benefits, the medical assistant must be confident in defining the terms copayment, co-insurance, and deductible (Procedure 18.5).

The medical office can contact the insurance company on the patient’s behalf to determine the amount of the deductible the patient has already paid in the calendar year. The process of precertification enables the healthcare provider to inform patients of how much the procedure will cost them

Calculating the co-insurance and deductible

Consider this example: Mrs. Anita Jones’ health insurance plan has a $500 annual deductible, after which the insurance company pays 95% of all charges. Mrs. Jones, therefore, has a 5% co-insurance expense, in addition to the deductible. Mrs. Jones has incurred a $10,000 charge for cardiac surgery performed by her provider.

Allowed amount

Another factor to be considered when determining the patient’s financial responsibility is whether or not the provider is a PAR provider. To become a participating provider in an insurance network, the provider must agree to accept the insurance plan’s fee schedule as payment in full for services rendered. This means that if the provider’s fee is higher than the plan’s allowed amount, the difference should be adjusted. For example, a provider may charge $80 for a Level I office visit; however, the insurance plan’s allowable amount may be only $60. Providers who are participating providers are obligated to adjust the difference between these two amounts—$20. The patient is not responsible for that $20. However, providers who are not participating providers can bill the patient for the $20 balance. Because contracts between insurance companies and providers vary greatly, it is important for the medical assistant to closely examine the EOB to ensure that the proper adjustments are made.

Discussing the patient’s financial responsibility

The guarantor is the person legally responsible for the entire bill. It is important that the patient and the guarantor understand what the financial responsibilities are for services provided. Some patients expect insurance to pay all costs simply because they are paying a premium. Often patients do not even read their insurance policies and have no idea what is and is not covered.

The medical assistant may need to educate patients about their policies and help them work with their insurance company to get answers to questions and make sure they are receiving all the benefits to which they are entitled. If problems come up with the insurance company, it is in the practice’s best interest to actively assist the patient. The medical billing staff is usually more knowledgeable than the patient is about health insurance. Helping patients with issues can help ensure that the provider is compensated for his or her services.

Medical assistants gain knowledge about the insurance industry when they actively assist patients with their concerns. The more experience a medical assistant has in working with insurance, the more helpful that assistant can be to patients. As mentioned previously, medical assistants should keep a manual of medical billing policies and procedures for most of the insurance plans they handle; this can serve as an excellent source of guidance and suggestions for working with a particular payer.

Always be sure to obtain the guarantor’s signature on an agreement to pay for services. Most patient information sheets have a section referring to the guarantor. A statement may be included that serves as an agreement to pay the costs of medical care. States have statutes that deal with guarantors, so be sure the office’s policies comply with those laws. It is especially important to secure a written agreement to pay for services when the care will be long term or involves costly treatment or surgical procedures.

Showing sensitivity when discussing the patient’s finances

Most patients use health insurance, but they do not always recognize that they will have financial obligations after the insurance plan pays its share. This is common among Medicare patients, who often feel they should have all their medical expenses paid because they have government insurance. It usually falls to the medical assistant to inform patients of their financial responsibilities.

Advance Beneficiary Notice (ABN)

Medicare does not cover some healthcare services, so the Advance Beneficiary Notice (ABN) is presented to patients in these circumstances. The ABN provides an option for patients to pay the provider’s fee in full to receive services that Medicare does not cover. Patients then decide whether they still want to receive the services from the provider and complete the information on the form.

Patients seeking medical care are not usually feeling like themselves because they may be suffering from pain and discomfort. As a result, their behavior may not be typical when the medical assistant suggests discussing their financial responsibilities.

Medical assistants should show patience and sensitivity when discussing a patient’s financial obligations. Patients should never be harassed to make a payment or forced into payment arrangements. Medical assistants should always be courteous when discussing payments with patients. In addition, the medical practice should offer a variety of payment options to meet patients’ needs, including credit card and online payment options.

Accurate insurance billing practices are essential for the financial success of every healthcare facility. Medical assistants are strong assets to the healthcare facility when they can submit claims electronically, manage denied and rejected claims, and discuss financial responsibilities with patients professionally. Medical assistants should always maintain a positive attitude toward patients and keep in mind that those who are ill or facing challenges are not always at their best and may not respond in a positive way when discussing their financial responsibilities.

Patients often do not have a strong understanding of health insurance. There are so many different options out there, and their policies can change often. By explaining just what deductibles, copayment, and co-insurance are, we can help our patients understand just what their financial responsibilities are, even when they have health insurance. We can also help smooth the way for a good relationship with our patients by making sure that they understand the payment policies. No one likes to be blindsided by a request for payment. By patiently explaining why a patient owes a balance, you can have a positive discussion about how to resolve that balance.

Legal and ethical issues

From time-to-time patients may ask for a reduced fee after the insurance has already paid. If the provider is a participating provider with the health insurance plan, then he or she is obligated to follow the terms of the contract. This includes collecting the patient’s financial responsibility detailed in the EOB. The routine waiving of copays can be considered a fraudulent practice. The insurance plan can penalize the healthcare facility if a concerted effort is not made to collect the patient’s co-insurance and deductible amounts, thus not following the terms of the participating provider’s health insurance contract.

Patient-centered care

Most patients are unaware of their benefits and coverage through their insurance policies. The medical assistant should encourage patients to read the entire policy to become familiar with its limitations and exclusions. Inform patients that when they call the insurance company with questions, they should always write down the date, the time, and the name of the person with whom they spoke. Using email is helpful because a record of the correspondence can easily be saved or printed. Making sure that patients have a general understanding of their health insurance coverage is well worth the effort.

Often patients do not dispute the decision or question the insurance company when a claim is rejected or not paid in the expected amount. Encourage them to call the company and question rejections if they do not understand why the claim was denied. Medical assistants must show respect and sensitivity when discussing financial issues with patients.