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Allowed Amount

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kittykat:
I am trying to understand something that is probably really simple and that is the allowed amount. I do understand that that will be all the insurance will pay. But let me give you a scenerio and see if someone can help me make sense of this.

This is in inpatient residential facility that cost $30,000 for 30 days. The lady with the insurance told me that they will cover up to the allowed amount then after that the facility can write the rest off since they are in network with them. So I guess what I am trying to understand is if the allowed amount is only $5,000 and the patient will owe their portion of lets say $5,000 is the facility out the rest of that money?

Also, the insurance lady told me she could not tell me the allowed amount. So I just bill for whatever and then they will send a check for the allowed amount? That doesn't seem right to me. Or could they at least not tell me what that number will be? And does the facility have to write it off or could the rest of the money not fall onto the patient?

As you can see I am a little confused haha if someone could help me I would really appreciate it!

kristin:
If the facility is contracted as in-network with the insurance, then they agree to accept the fee schedule the insurance has for their services. You can request a copy of that fee schedule, so that you set your fees appropriately. So, if for a 30 day stay the insurance allows $5,000, and they pay their portion of that $5,000, then all that can be billed to the patient is the difference between what is allowed, and what insurance paid. Anything beyond that is a provider write-off, for being over the allowed amount.

Michele:

--- Quote from: kittykat on October 31, 2016, 04:37:03 PM ---
Also, the insurance lady told me she could not tell me the allowed amount. So I just bill for whatever and then they will send a check for the allowed amount? That doesn't seem right to me. Or could they at least not tell me what that number will be? And does the facility have to write it off or could the rest of the money not fall onto the patient?


--- End quote ---

When the facility enrolled to be in network with the insurance they should have been given the fee schedule at that time.  Usually a facility would see what the allowed amounts are prior to enrolling to make sure they are ok with the allowed amounts.  But like Kristin said you can request a copy of it now if you don't have that original copy.

PMRNC:
If they are telling you they can't give you a fee schedule it is because if you were in network you should have the fee schedule with your contract. If you are not contracted with the carrier than it's not "allowable" but in fact Reasonable & Customary (R&C) or Usual & Customary (U&C). If you are non contracted you may bill the patient for any balance above U&C or R&C, but if you are participating with a contract, you can only bill the patient up to the allowable amount.

kittykat:
OK thanks everyone this is a lot of help. I will ask the facility owner to look up her contract and see what it says. Thank you!

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