so I want to go through some of the terms, what they mean to make sure there’s a clear understanding, because I’m finding often there’s a lot of misunderstanding, and because of that, there’s It creates some problems on collections.

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Hey, greetings, my friends. It’s Sam Collins, your coding and billing expert for AcupunctureU, and of course, the American Acupuncture Council, giving you another episode here. And what I want to talk about today is a lot of questions I’ve been getting recently about what are the different meanings of terms and understanding.

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I think this is often affecting our reimbursements. And so I want to go through some of the terms, what they mean to make sure there’s a clear understanding, because I’m finding often there’s a lot of misunderstanding, and because of that, there’s It creates some problems on collections. So let’s go to the slides.

Let’s talk about understanding insurance and the billing language that’s associated with it in the terms. Cause like with everything, the better you can express or understand, the better we like to get paid is I think it’s going to create problems with reimbursements. Let’s talk about first, what the heck is health insurance?

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You know, it’s a contract between. The patient and an insurance company often remember that contract is not between us, meaning the doctor and the patient, but the insurance and the patient. So ultimately with insurance, that’s their contract. If it doesn’t pay, that means the patient owes unless you’re in network.

So understand health insurance is a contract not between the doctor and the insurance company, but the patient and the insurance company. Now we may be part of that if you’re a network to some extent, but ultimately it’s their contract. What I want to hit on though, is it really? Health insurance. I mean, there’s preventative things, screenings, but is it really health insurance, or is it sick insurance?

And I think from an acupuncture standpoint, it’s often important to think of it as a There’s got to be something wrong. There’s got to be something where they’re sick, they’re in pain or the dysfunction, otherwise it’s not going to pay. Now, what type of insurance are we talking about? What are we going to see patients with?

Well, we all know HMOs, Health Maintenance Organization. This is a type of a plan that essentially the patient has to go to an in network provider. Now the benefit here is it’s generally going to be cheaper, but they’re limited to go to just those providers. You must stay in network. If you go out of network, not covering, you’re Maybe in an emergency.

Now, the reason this is chosen by many people, it’s just frankly lower premiums and copays because the insurance company gets to control the doctors where they go. So these are the lowest. This is also the lowest in reimbursement for Accu. Now, You may think, can an acupuncturist really join an HMO? Not directly, frankly, but often you join tangentially through joining groups like American Specialty Health.

That often gives access to things like, uh, HealthNet or Kaiser and so forth. So again, these will get access, but they pay very little, so we’ve got to be careful if you’re in these. Is the reimbursement going to be very high? No. This is going to be a volume thing, not really one that’s a fee for service.

Now, what about a so called PPO Preferred provider. Well, this plan allows access to patients to go to in network providers, but it says preferred. So if you go to the preferred doctor, that’s good. It’s cheaper, but you can also go outside so you can access other doctors. But when they do, Or the patient does it, I should say, they’re going to have more out of pocket.

So by example, if you’re not in network with the plan, can the patient still choose to come to you? Oh, absolutely. But the plan may pay less, may have a higher deductible and so forth. So they’re going to realize lesser out of pocket. If they go in network, out of network, maybe more, but maybe the values there.

So this is why many of us will join a PPO with the idea of getting more patients. And, but do remember when you’re part of it. That means you’re accepting a lesser amount. You may not balance bill your full rate. So patients still have a choice of providers, but it’s going to be cheaper if they go in network, hence why many times we join.

Now, of course, it’s greater choice in the HMO, but a little bit greater cost in premiums. I won’t say often a lot more, but certainly more. Now, here’s one that’s unusual, or I shouldn’t say unusual, but is often misunderstood. An exclusive provider organization. Now, you’re going to think, what is that, exclusive?

It’s really an HMO, but it’s a very small HMO. It’s going to be a group of doctors. Or clinics that all group together, sometimes an independent physician association or IPA, and they don’t offer any network benefits. Now these often can be less expensive, but it really limits where the patient can go generally the only way they’re going to get acupuncture.

On this plan is if they have a direct referral because actually the insurance doesn’t cover it. It has to be paid by the group. So they’re often not pushing out a lot of people. This is not a very common policy, but they’re out there for some companies. We’ll do these because they figure it’s going to give greater access and cheaper for them and more access to their patients.

If there’s enough providers. Now, the one plan I think we all prefer, it’s the most expensive, is a traditional fee for service plan. This is your traditional insurance. It’s not a PPO or an HMO, but one that just simply has a simple deductible, and pays for you. 80 20 or whatever the case may be. This is the most expensive plan.

Patients will have lower deductibles and coinsurance. I, by example, have one of these plans. My company is very good to me. They give me a good rate here. I have no deductible and I have no out of pocket. You’re like, how does that happen? It’s very expensive. These have the highest. In fact, they have a platinum.

Here’s what I’m pointing out. If someone comes to you with a platinum program, even if you’re not thinking you want to take Insurance. This is probably one you do, because these offer the most generous benefits, less out of pocket, so forth, because it’ll simply just pay more. Bigger companies often offer these because they can buy it because they’re buying a little bit bigger in bulk.

These are fantastic. Now, if it’s a platinum, it’s great, but if it’s a bronze policy, uh oh, maybe not as good. So keep in mind, fee for service is not as common because it’s more expensive, but obviously the one preferred from a provider standpoint, because it just pays better. But here’s the terms I want to get into.

When you hear a loud amount, the plan pays 80%. Don’t be fooled because it’s 80 percent of what? This is where you have to be careful. Allowed doesn’t mean what you billed. It means what they allowed. So they’re going to have a maximum that will be paid. So let’s say you bill 100, but the plan only allows 50.

That means they’re going to pay 80 percent of 50. Which means they’re going to pay 40. Now, because you billed a hundred, what will you be looking from the patient? 60. Cause you remember you’re not in their network. So be careful with the allotment because patients will say, Oh, it pays 80%. Yeah, 80 percent of what?

Now, if you’re billing within their range, maybe, but many times you might have a fee that’s much higher. And let’s keep in mind, can you just write off a billed amount when you’re out of network? Technically, no. You’re to collect it. So be careful. Now, what about health savings accounts? These are pretty good.

They’re not as popular as I think they should be. But what these are, a patient can set aside money, pre tax dollars, for medical expenses. And they can use it for qualified medical expenses. These I like. This is something that if your patients have these, this is something to let people know, do you accept HSAs?

I would say you do because when they come in, the patient will pay you. You give them a receipt, they submit it and assuming that they have some type of benefit towards it. They’ll cover it. I’ve seen them cover things that often aren’t covered any place else, such as just simple massage for nothing else.

It’s tax free when they use it, so for a lot of people it’s something that’s a good thing, but it’s one that they have to have enough money to do that. You’ll often see this where people have high deductible policies. It makes sense to do that. There is something else, though, that people will see that’s called an FSA.

And they think, oh, okay, FSA is one through the employer. They call it flexible. I’ll say forced. In other words, the company does it, but you can only use it towards out of pocket expenses. So it only pays for like the deductibles and the co pays. It doesn’t allow them just to choose care. HSA is great. They can come in directly to you.

Now here’s something else that is often misunderstood. What about deductibles? Well, deductible, of course, I’m sure you understand the traditional deductible. It’s 1, 000. In other words, the patient has to pay 1, 000 before. Insurance begins to cover. In other words, they’re going to look at the covered costs and once it adds up to 1, 000, then of course, the insurance begins payment.

Keep in mind, the patient doesn’t have to pay it all at once. They could be paying over time, but they have to meet that amount. Now, here’s the parts where it’s confusing. Some services may not be included. There are going to be times you’re going to bill and you’re going to, your bill may be 500, but maybe the insurance only allows 200.

So even though you’ve billed 500, 200 applies towards deductible, but there’s 300 that’s not covered. How much does the patient owe you? 500. So when you start billing, be careful of what you’re billing. The intention is you’re collecting it. So you can’t just bill a high amount saying, well, we’ll see what’s going to happen.

This is why you want to be careful. Do not set your fees off of your highest based insurance. Okay. But not necessarily your lowest, because you want to be somewhere in the middle, but deductibles can fool you. So keep in mind if you’re billing a thousand, 500 is considered, you know, the covered services.

Great. Will the patient owe you 500? They will, because that’s deductible. But what about the other 500? That other 500 they still owe you because you billed it. This is why often people will choose in network. Because if they go in network, then because you’re limited to the fee, maybe that’s where the 500 comes in.

Now there is something else that you’ll see with these, where you’ll see there’s an individual deductible. That’s what we’re talking about here, just a simple one. But you’ll often see a family deductible. So let’s say there’s a family of four. Each person may have a 1, 000 deductible, but maybe the family deductible is 2, 500.

So if other people in the family have met 2, 500 towards the deductible, That means it covers everyone in the family. So someone coming in who hasn’t been to the doctor, that will be covered. So particularly when you’re seeing a family, that family deductible could be a real important thing to know that the patient has greater access just because they haven’t gone to someone else has.

So that’s an added benefit that you’ll find or see there. Now, what does that actually, when you see the term co payment, This is often confused. What is a copayment? A copayment is a fixed amount for a covered service, generally for an in network provider. When you’re in network, you get exactly that. Like some of you are familiar, when you see an ASH patient or that type, it will say we’re paying 50.

And the patient’s co pay is 10. Well, what that means is the plan is going to pay 40 and you get to collect 10. That’s the co payment. It’s always fixed. It’s a set amount and it’s part of the contract we have with an insurance. So think of a co payment is more of a payment when you are in network.

Because it’s a fixed set amount. Now, it’s confusing, because what about co insurance? It’s like, well, how is that any different, Sam? Well, the difference here, I’d like to make the designation, co insurance means you’re not in network. And it’s the money difference that’s not paid, because there is no co pay, because they can’t demand what you charge.

So, let’s take an example. You bill 500. The patient has a plan that pays 200, okay? Okay. They pay 200. How much does a patient owe you? Well, the insurance didn’t pay for 300 of it, so the coinsurance is that difference. That 300. So this is where you can see why a lot of people choose a network because they can just control how much they know they’re going to pay.

Because of course that co insurance is everything that you built. So again, I’m going to state to you, be conscientious that if you’re not collecting the differences and you’re out of network, You probably should just lower your fees because you’re not collecting it anyway. And why set yourself up for a sense of fraud, meaning you’re billing an amount you have no intention of collecting.

So keep in mind, the difference is, is the coinsurance. In other words, what’s not paid by insurance out of network, and you get to balance bill for the full amount. Now that means of course, you’re no longer limited to their amounts, but now. Do the patients feel enough benefit from you to come in and pay that extra?

And that’s what we call balance billing. This is where you don’t get a surprise. Balance billing is, or it can be a surprise when a patient comes in and they thought, Oh, I thought I was only going to pay 50, but it turns out they owe 250 because balance billing is the amount left over from what the insurance paid.

And that difference again, out of network, please be mindful, make sure the patient’s fully aware of your fees. Let them know our service is 100. Your insurance may pay some part or none of it. And so ultimately, you may owe us 100, but let’s say one patient’s insurance pays 20, that patient owes you 80.

Another patient’s insurance pays 50, they owe you 50. In other words, you’re still getting your 100, just different amounts from the patient depending on their plan. This is why I often will tell people that insurance is an aid. It’s going to help pay for some of the care, not all of it. But if I can come to you and only have to pay 50 out of pocket instead of a hundred, what I’d be more likely to come in is the, is it there?

So that’s balance billing. Balance billing is like coinsurance, if you will, but it’s what’s left over when you are out of network. Now you’re going to see some where you’ll find, they’ll say it’s an out of pocket maximum. This you’ll see maybe towards the end of year. Let’s say you have someone that’s had.

Pretty good sized illness, went to the doctor for something significant. Once they’ve met that out of pocket max for the year, the insurance actually pays 100%. So your bill of 100 will be paid 100. But one thing to keep in mind, this 100 percent is not of what you billed. It’s, again, always what they allow.

So if you’re in network, great. If you’re out of network, it may or may not cover the full amount, but at least they’re no longer going to put it into a place of The patient has extra co pay. Now they may have extra co insurance out of network. So out of pocket max just simply means once they’ve hit that, that plan continues to pay.

These are ones that are good, particularly you might see towards the end of the year. Now here’s an important one. Where’s an assignment of benefits? This is block 13. You’ll see it towards the top here. And it says insured or authorized person signature. I authorize the payment to be made to the provider of service.

This is how you get the money. If you leave that blank, block 13, the money goes to the patient. So make sure your claims are assigned. If you don’t assign the benefits Check goes to the patient. So if the patient’s paid you in full, no problem. Let them get the money. But if they haven’t, please make sure you’ve done the assignment.

Keep in mind, unfortunately, if you are not part of Blue Cross and Blue Shield, often the assignment Won’t apply. Now with other insurers, they have to follow it, but Blue Cross Blue Shield is exempt. So keep in mind if someone has a plan Blue Cross Blue Shield, you’re out of network. Chances are it’s better for them to just pay up front and let them know they’re going to get the check from the insurance.

That way you’re not chasing after it. But assignment means they’re assigning the payment to be made to you. Simply block 13 puts signature on file, meaning they’ve signed an assignment that’s in the file. Now when we hear the term self pay, Well, what does self pay mean? Well, someone could have insurance, but they may not want to use it.

So they’re just a self pay patient. This is a patient that says, I just want to pay cash. But can a person who has insurance be a self pay patient? Actually, yeah, this is the United States. If a patient says, I don’t want to use my insurance, do they have a right to do so? They do. One thing to keep in mind though, if you’re in network, can they make this choice?

Yes, but make sure the patient signs a document in your office where they’ve said it. And agreed that I understand I have insurance and you’re a member, but I do not want my insurance to be billed and I will pay out of pocket, understanding that I will not want my insurance billed by you or by myself.

In other words, they’re saying they want to be a hundred percent cash patient. Nothing wrong with that. You know, one of the reasons people may want to do that, do you know records can always be kept private? No one can get access as long as you pay cash. The only time an insurance company can get records is if they paid for it.

If you will, but if a person has paid cash, they can completely hold them out. But this could be the case where somebody just goes, my plan is terrible. I’d rather pay your cash rate. Well, nothing wrong with that. Now, this brings me to what about offering cash discounts? We’ve done some other programs with that, but you’re going to often see now for acupuncturists, something called a discount health plan.

These are not insurance. I want everyone to bear in mind, but what it does, it kind of creates your own little PPL. The patient joins this discount health plan. You’re also a member. Now you can offer them a different price. In other words, like the insurance offering a discounted rate, you can do the same.

So for those of you who want to offer steeper discounts for cash. Well, you know, you can’t unless you’re in California. But otherwise the best thing to do is maybe get into a discount health plan. The patient joins that. Now it allows you to offer like an insurance. Think of it. How is it that an insurance says you can’t give a cash discount, but yet when you join ASH, they cut your fee to a third.

Well, a discount health plan is your way of kind of doing that. You just have to make sure the patient’s willing to participate and understands it. Realize someone with a discount health plan may come to you and say, do you take it? No, not unless you remember, but this is a way that has been used to help people get care.

Particularly when they have high deductibles or have very bad insurance or no insurance, it can offer it in a way that it makes it affordable and changes it from your regular amount. And when we talk about regular amounts, what are we talking about? Usual, customary, and reasonable, UCR. This is the average amount paid in your area.

I’m going to suggest take a look in your geographic region, take a look at your Medicare rates, take a look at what you see other providers charge, and kind of get a feel for it. Am I way undervaluing or overvaluing? I’m going to suggest go back to our other video that we did on relative values. But my concern is many offices often charge below, not understanding.

If you’re going to sell a house, wouldn’t you look at the neighborhood to see what what are houses selling for? Because what if you’re going to sell your house at half the price it’s worth? Well, you’re going to sell it. But it’s way below market. You’ll sell it in three seconds. So be careful of undervaluing, but also overvaluing.

I want a way for you to look at your fees to make sure they’re fair. That’s what I do for our network members, network members who join. That’s one of the first things we do with a meeting is to go through. Let’s look at your fees. Are they reasonable? I will tell you my experience. Acupuncturists bill eight or nine codes regularly, probably up to eight or nine, six.

I’m going to tell you half of you have fees that make no sense based on your usual customer and reasonable. So what if someone says your fee is too high? If you go through this properly, your fee will never be too high because you’ll know what that fee is going to be. I’m here to help. The American Acupuncture Council is always your advocate, as am I.

We do that one on one service I mentioned. If you really want to get some help to really make your business thrive, come and see me. I look forward to seeing all of you in the future and keep in mind, we’ll be doing something later. Uh, there’s going to be new codes beginning October 1st for diagnosis. We have seminars for that as well.

Talk to you soon, everybody. Best wishes.

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