Balance billing
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Balance billing refers to the practice of billing a patient for the difference between the provider's charge for a medical service and the amount negotiated by the patient's insurer for that service. Balance billing can be a source of surprise medical costs.[1][2]
Overview
Balance billing refers to the practice of billing a patient for the difference between the provider's charge for a medical service and the amount negotiated by the patient's insurer for that service. Health insurance networks make agreements with medical providers for discounted rates on medical services. These agreements typically do not allow the provider to bill the patient for any difference between the amount covered and the full amount charged.[1][2]
Out-of-network providers, however, may not be bound by these agreements, and their patients can be liable for the difference. Insurance networks generally set a limit on how much they will pay for out-of-network services, with the remainder of the cost to be paid by the patient. For example, a network may only cover 50 percent of the usual cost (the amount they allow for the service) for out-of-network providers. A patient who receives $2,000 in services for which the insurance plan allows $1,000, will only have $500 paid by the insurance company, leaving the medical provider with an unpaid balance of $1,500, which can then be billed to the patient. Preferred providers within a network may not balance bill a patient for covered services.[1][2]
See also
- Obamacare overview
- History of healthcare policy in the United States
- Cost sharing
- Out-of-pocket costs
External links
Footnotes
