While health insurance is marketed as a benefit for employees, often it can be a costly drain on their paychecks. This is largely due to unchecked, fraudulent practices in the health insurance industry and noncompliant medical billing practices.
Health insurance fraud as a concept likely calls to mind images of intentional manipulation of patients to make the most money from them, or theft directly from the billing process. However, fraud can take many different forms by way of unbundled CPT codes, hidden rebates and overcharging for lackluster benefits.
What Counts as “Stealing” From Your Health Insurance Plan?
For the sake of this blog, we’ll define “stealing” as any way a broker or third-party billing service is taking extra money from you and not providing a fair service in return. For example, when different vendors, brokers or carriers are charging a large amount of money and providing mediocre benefits, we’d consider this stealing because your member group is not receiving what they’re paying for.
Who’s Stealing From Your Plan?
Theft and fraud in health insurance exists at multiple different levels. Primary culprits include prescription rebates and fraudulent medical billing procedures.
Prescription benefits are often unregulated and provide space for thieves as well. Once a member refills a high-cost, name-brand prescription, there is often a rebate available. However, most members aren’t aware of rebates that exist for them. A rebate aggregator will go in and claim the rebate, and take a portion of the dollars for themselves before presenting it back to the employer group. In some cases, the employer group doesn’t even see any of the money presented as a rebate because the rebate aggregator keeps it all.
Billing, like that from a third-party or specialized billing agency, also presents an opportunity for fraudulent practices in the form of unbundled CPT codes. These are medical codes that are used in medical billing for different surgical, medical and diagnostic procedures. A bundled CPT code includes the pricing for a single procedure, such as a knee surgery. However, a billing department may unbundle the procedure CPT code and use several different codes to raise the price. This could be considered stealing as more money is being taken by using different codes.
When considering the amount an employee is responsible for with their deductible and coinsurance, which often can be up to $8,000 annually per person in their family, extra costs incurred by unbundled CPT codes can be detrimental.
How To Stop Fraud in the Health Insurance Industry
The key to stopping fraud in the health insurance industry comes down to two factors: accountability and transparency.
Accountability and Auditing in Health Care
Auditing medical bills and claims is the best way to promote accountability in health care. This way, fraudulent charges, excessive charges and unbundled CPT codes are easily caught and stopped before the bill is passed along to the patient. In our experience at ClearChain Health, we’ve seen employees save thousands of dollars annually from our auditing and repricing of claims.
Transparency in Health Care
By utilizing a health insurance plan that prioritizes cost transparency, member groups can see where every dollar spent is going. This includes eliminating any opportunity for stolen rebates, and sharing all data regarding revenue with the member group. This transparency prevents members from overpaying in their plan and holds the health insurance provider accountable for their spending.
Are You Ready for Transparent Health Care?
At ClearChain Health, we believe in a direct relationship between you, your health insurance and your medical provider. This provides total transparency in your billing, lowers your out-of-pocket costs and eliminates the outdated, restrictive PPO network model. Learn more about our model and contact us today!