Healthcare reimbursement is a process in which your hospital, healthcare provider, diagnostic facility, or doctor gets paid for providing you healthcare or medical services. This payment method begins right after you receive a medical service. Here in this blog, we will share interesting insights about the healthcare reimbursement process in detail to help you while planning your health insurance coverage.
- Healthcare Reimbursement is a complex process for paying out healthcare providers for services patients get from them.
- In most cases, all or part of your healthcare payment is paid by the government or your health insurer.
- For instance, you have paid your copayment, coinsurance, or deductible, along with all paid bills, and your healthcare provider asks you to pay an additional amount. In that case, it will be considered balance billing.
- Concierge care refers to a contract with a consultant or practice to get extra attention.
- Health reimbursement arrangements (HRAs) are employer-funded plans offered by some companies in the United States. They reimburse employees for medical expenses.
What is the Healthcare Reimbursement Process?
Mostly, the transaction and payment method for any service or product is simple. You need to make the payment and get the item or service; this procedure will take your few seconds or minutes. Healthcare reimbursement is far more complex and time-consuming. Healthcare reimbursement is a process in which your hospital, healthcare provider, diagnostic facility, or doctor gets paid for providing you healthcare or medical services. This payment method starts right after you get a medical service.
Often, all cost or part of your healthcare payment is paid by the government or your health insurer. Sometimes you need to pay half of the cost, or even you may be responsible for reimbursing your health care providers for the full cost of your health care if you don’t have health care coverage. You must understand several things about health care reimbursement before planning your health insurance coverage.
How Does Healthcare Reimbursement Work?
Government payers and health insurers pay the payments to the healthcare providers over a system of reimbursement. Your provider will send a bill to the responsible party for covering your medical costs after you avail of healthcare service. The billed amount depends on the service you receive and the contract that Medicare or your health insurer agreed upon for that specific service. Through a common procedural technology (CPT) code, you can see the procedure and get an idea about how much Medicare reimbursement it would get. Private insurance companies negotiate with hospitals and providers and set their reimbursement rates. Some healthcare providers and hospitals do not accept patients whose insurance doesn’t reimburse them enough until there is an emergency.
Difference Between Copay and Coinsurance
The set rate for a particular procedure, prescription, or healthcare visit is known as a copay, whereas if a certain percentage is allocated for the medical services you availed, it is termed as coinsurance. In some cases, you need to pay a part of the medical service, and the health insurance company pays part of your healthcare cost. The amount you require to pay will be mentioned very clearly in your coverage contract.
If your healthcare provider has accepted your insurance for services, it means that your doctor will receive it without paying any additional expense to you except your copay and coinsurance. But, after you have paid your copayment, coinsurance, or deductible, and your insurance company has also paid all bills. Your doctor still asks you to pay an additional amount; it will be considered balance billing. Under normal situations, balance billing is illegal.
If you pay for your medical services out-of-pocket, your doctor must provide you with all the associated information regarding services’ cost. However, you need to understand that you may receive some unpredictable costs or surprise bills in the end.
For instance, if you have undergone a diagnostic test, you may experience an allergy to the contrast material. It would require you to attain another service to treat your allergic reaction. The cost for that service could not be predicted before your test if you didn’t know about the allergy ahead of time.
Extra Charges for Additional Services
If your health insurance covers your healthcare cost, you still need to pay some part of it by yourself. This payment is your responsibility and is not the same as balance billing. Additionally, your insurance company will not pay for your care cost, especially if they insist on availing an option for the service within your network. In such circumstances, your healthcare provider is allowed to bill you an additional cost above what your insurer pays.
Another term is known as concierge care. It refers to a contract with a consultant or practice to get extra attention. It usually involves high costs that your health insurer does not cover.
Health Reimbursement Arrangement (HRA)
Health reimbursement arrangements (HRAs) are employer-funded plans offered by some companies in the United States. They reimburse employees for medical expenses. Employers are allowed to challenge a tax deduction for the payments they make through these plans, while employees’ reimbursement is usually tax-free.
If your health plan contains a high deductible, you can get exceptional benefits from HRA. It allows you to reimburse for the costs of your medical services before you reach the deductible amount.