Healthcare Payment Methods

Study Notes

Private-pay patients save practices time and costs related to benefit research, claims filing, reimbursement, and payment posting.
A prompt-pay discount can be offered, but it should not exceed a 20% reduction.
Discounts should also be available to insurers willing to pay immediately.

Creating an Excel chart of common CPT codes and their payments from various payers is beneficial for periodic evaluation.
Accepting an insurance plan means agreeing to its payment terms and fee schedule.
In the U.S., there are twelve regional Medicare Administrative Contractors (MACs) with varying fee schedules by region.
The Federal CMS Physician Fee Schedule lookup tool is essential for researching reimbursements across different CPT codes and regions.

Setting fees involves understanding practice overhead, financial demographics, and desired patient volume for income.
Fees should not be excessively high or low to avoid deterring patients or struggling to break even.
All patients should be charged the same fee per code, referred to as the “usual and customary fee.”
It is essential not to differentiate fees based on insurance status; a specific code must have a uniform charge.

Optometry offices are typically not classified as Medicare facilities, leading to the choice of non-facility fees for reimbursement.
Accepting Medicare requires adherence to its fee schedule, designating providers as either “Medicare Participating Providers” or “Non-Participating Providers.”
Participating Providers receive full reimbursement from Medicare, while Non-Participating Providers receive 95% and can bill patients for the excess up to a "limiting charge."

The Limiting Charge for Non-Participating Providers is 15% above what Medicare pays Participating Providers.
Patients are not accountable for any billed amounts exceeding the Limiting Charge for covered services.

Example comparison between Doctor A (Participating Provider) and Doctor B (Non-Participating Provider) reveals differing reimbursements:
- Doctor A receives a higher payment with lower patient out-of-pocket costs.
- Doctor B has higher reimbursement but incurs administrative burdens and potential patient dissatisfaction due to additional charges not covered by Medicare.

Setting excessively high fees can lead to patient backlash upon receiving their Explanation of Benefits (EOB), creating customer service challenges.
The example highlights that optimal fee setting should consider both operational sustainability and patient access to services.

Private-pay patients save practices time and costs related to benefit research, claims filing, reimbursement, and payment posting.
A prompt-pay discount can be offered, but it should not exceed a 20% reduction.
Discounts should also be available to insurers willing to pay immediately.

Creating an Excel chart of common CPT codes and their payments from various payers is beneficial for periodic evaluation.
Accepting an insurance plan means agreeing to its payment terms and fee schedule.
In the U.S., there are twelve regional Medicare Administrative Contractors (MACs) with varying fee schedules by region.
The Federal CMS Physician Fee Schedule lookup tool is essential for researching reimbursements across different CPT codes and regions.

Setting fees involves understanding practice overhead, financial demographics, and desired patient volume for income.
Fees should not be excessively high or low to avoid deterring patients or struggling to break even.
All patients should be charged the same fee per code, referred to as the “usual and customary fee.”
It is essential not to differentiate fees based on insurance status; a specific code must have a uniform charge.

Optometry offices are typically not classified as Medicare facilities, leading to the choice of non-facility fees for reimbursement.
Accepting Medicare requires adherence to its fee schedule, designating providers as either “Medicare Participating Providers” or “Non-Participating Providers.”
Participating Providers receive full reimbursement from Medicare, while Non-Participating Providers receive 95% and can bill patients for the excess up to a "limiting charge."

The Limiting Charge for Non-Participating Providers is 15% above what Medicare pays Participating Providers.
Patients are not accountable for any billed amounts exceeding the Limiting Charge for covered services.

Example comparison between Doctor A (Participating Provider) and Doctor B (Non-Participating Provider) reveals differing reimbursements:
- Doctor A receives a higher payment with lower patient out-of-pocket costs.
- Doctor B has higher reimbursement but incurs administrative burdens and potential patient dissatisfaction due to additional charges not covered by Medicare.

Setting excessively high fees can lead to patient backlash upon receiving their Explanation of Benefits (EOB), creating customer service challenges.
The example highlights that optimal fee setting should consider both operational sustainability and patient access to services.