Changes in Pay Rate Increases Likelihood of Higher Balance Billing Costs from Out-of-network Providers
When the fiscal year began this July, we changed how UA Health Plan costs are paid to out-of-network providers. Prior to FY16, Premera paid out-of-network health care providers at rates based on Alaska costs. We didn’t pay at the highest rate, but we paid at the 80th percentile of billed charges per service. Under this model there is little incentive for providers to not increase costs in order to receive higher payments. It also offered less incentive to join Premera’s network of providers.
Under the new model, Premera pays based on 125 percent of what the federal Medicare program pays for these services. This shift saves the plan money, but may catch members unaware when the balance billing, the amount left over after Premera pays the providers, increases, sometimes substantially, when you use out-of-network providers. This is especially surprising for members who have regularly seen a particular provider and are seeing the increased balance billing for the first time under the new payment arrangement.
The percentage the plan pays has not changed. If it was 80 percent of the allowed amount for in-network and 60 percent for out-of-network providers before, it’s the same now. What’s changed is the allowed amount to which that 80 percent or 60 percent is applied.
Balance billing is a difficult area for consumers to navigate, and is one of the strongest motivators for using an in-network provider who has agreed not to balance bill members as part of their contract with Premera. If you are using an out-of-network provider it is important to discuss balance billing with them, or to utilize our patient advocacy service PatientCare, 1-866-253-2273, for individualized assistance in health management and care provider research.
You can also call Best Doctors at 866-904-0910 to find other treatment options or get help finding an expert who is in the Blue Cross network. Getting services from an in-network provider will always be the better deal. Premera has the largest network of providers in Alaska. To find an in-network provider, log in at Premera.com and use the Find a Doctor tool. Or call Customer Service at 1-800-364-2982; you can find the number on your member ID card.