With all of the changing federal regulations surrounding transparency in healthcare–particularly with hospital pricing and employers’ roles as plan fiduciaries–considering switching to a transparently managed health insurance plan may be a good choice for your business. But for a member group used to a traditional broker with a Preferred Provider Network, the language and management of a transparent health insurance plan may seem confusing or even not make sense at first.
Today, we’ll break down the logistics of a transparent health insurance plan, how they work, how they differ from a traditional broker model and how they can ultimately benefit employees.
What Is a Transparent Health Insurance Plan?
At its core, a transparent health insurance plan just means that you can see where every dollar is spent in your plan, who it goes to and how vendors are fairly compensated. This eliminates the behind-the-scenes overrides, rebates and non-reported income of a traditional network, because members can clearly see where their money is going. Transparent models remove any opportunities for a conflict of interest because they are not concerned with creating a network of established agreements with healthcare providers.
How Does Billing Work With a Transparent Health Insurance Plan?
A benefit of not using a provider network is that it simplifies the billing process for all parties involved. Since a transparent health insurance plan doesn’t use an established provider network, the costs of charges associated with a provider network are not passed along to the members. This saves both employers and employees money on their medical bills.
Auditing claims before they are passed along to members for payment is also a common practice for transparent health insurance providers. Unfortunately, hospital billing practices are not always in the best interests of the patients. Billing departments use CPT (Current Procedural Terminology) codes so that billing is universal for insurance purposes. Say, for example, a patient needs a knee replacement. A CPT code comprised of multiple different CPT codes encompassed within that procedure is assigned to surgery, and this is used for billing.
However, in an effort to make more money off of a procedure, a hospital billing department may unbundle the CPT code for a knee replacement and bill the patient for multiple different procedures through these codes. If this isn’t caught by the health insurance provider, the member will then pay a much higher price for the surgery. If a strict auditing process is in place with the health insurance provider, though, these erroneous charges will be caught before they’re passed along.
For example, here at ClearChain Health, we’ve saved member groups up to $44,000 on a single claim through our auditing process.
What About a Provider Network?
Are you an employee who currently has a traditional Preferred Provider Organization (PPO) plan? If so, how many times have you encountered the frustration of finding a medical provider you’d love to go to, whether it be for cost or services they provide, only to find out they’re not covered by your network?
Conversely, transparent models generally operate as network-free, meaning that members can nominate their healthcare providers to participate with their plan instead of going to a preset list of providers approved by their insurance carrier. You as a member have total freedom to choose who you’d like to see for any medical service you may need, you just need to see if the medical provider will participate with your insurance. This also saves you money because you won’t have to pay an out-of-network penalty.
Your health insurance will likely have a clear path to follow for provider nomination, and you’ll just have to get cleared with your doctor first. Then submit your nomination form to your health insurance, and they will confirm participation for your future billing.
This direct relationship between you, your health insurance and your medical provider is just one additional step to promote transparency within your plan and eliminate opportunities for confusion.
What Do You Mean by “Direct Relationship” With My Provider?
A “direct relationship” just means that there is no network or overbearing broker acting as the intermediary between a member and their doctor. Instead, everyone is included equally in the conversation to prevent unfair, fraudulent billing and overcharging.
Get Started With a Transparent Health Insurance Plan
At ClearChain Health, our model utilizes a direct relationship between you, your medical provider and your health insurance. By eliminating the outdated PPO network, employees can nominate their provider and visit whoever they’d like for treatment. Learn more about our competitive model and contact us today!