Understanding Your Insurance
When seeking health care services, it is important to know and understand your insurance benefits so there are no surprises when it comes to your financial responsibility.
When making an initial appointment, office staff will most likely ask to collect your insurance information from your insurance card so they can verify your policy is active. Some offices will even check your insurance benefits for the services you may receive at their facility. Please note this is a professional courtesy to you and not a requirement or a guarantee of payment. It is beneficial for you to call and also verify your financial obligation prior to being treated.
First, an office will verify that you are in-network with their providers. If a provider is in-network, that means they are participating with your insurance plan. If they are out-of-network, depending on your insurance plan, you may still be able to see the provider, however, your financial obligation may be higher.
Second, an office will check to see if you require prior authorization from your insurance to receive services. Not all insurance require this prior authorization, however if your insurance requires it, the office will request the authorization to make sure you are approved prior to being seen. Once the request is made your insurance will either approve or deny your visits. If approved, they will award you a certain amount of visits before a new request must be made to continue your care. Typically, your therapist and the office will track your visits and make sure you are covered prior to continuing your services.
Third, if the office is looking to obtain your insurance benefits, the following information is what they will be asking:
- What is your annual deductible and how much of it has been met so far this year?
- A deductible is the amount you owe for health care services before your health insurance plan begins to pay.
- For example, you may have a $1,000 deductible per year. This means, you must pay the first $1,000 of medical bills before your insurance will pay anything.
- In some instances, physical therapy does not go toward the deductible and may be covered. However, you may only be responsible for a coinsurance or copay. If neither is the case, your physical therapy services will be your responsibility until your deductible is met.
- Do you have a coinsurance?
- A coinsurance is a certain percentage you are required to pay after your deductible has been met.
- What this means is your insurance plan will cover a certain percentage of the cost and you are responsible for the remainder.
- For example, if you have a 20% coinsurance, your insurance plan will cover 80% of the allowed amount and you will be responsible for paying the other 20%. We call this an 80/20 plan.
- Do you have a copay?
- A copay is a fixed dollar amount you must pay to be seen at an office visit.
- Copay’s do not go towards your deductible.
- For example, if you have a $20 copay, you will be expected to pay $20 at each therapy visit and the insurance will cover the rest of the visit.
- Do you have an annual cap for the services being received?
- A cap is the maximum dollar amount that an insurance will allow on a service.
- Primarily with Medicare insurance programs, there will be an annual cap instead of a certain amount of visits that we must stay under.
- For example, Medicare has a $2010.00 annual therapy cap. The office keeps track of how much is used up so you do not exceed your benefit amount.
- Do you have a maximum number of visits? If so, have any been used yet this year?
- Similar to a cap, sometimes the number of visits will be limited annually.
- For example, as part of your insurance plan, you may only be able to receive 30 visits of therapy per year before your benefit maximum is reached. Again, the office will keep track of this to avoid exceeding your limit.
How does this all work after we verify your benefits?
When a provider sends a claim, or an outline of services rendered along with a charge amount and a corresponding code to your insurance provider, the insurance company will adjust the amount the provider charges to an allowed amount based on a prearranged contracted fee schedule the provider has with the insurance company. The insurance company will then write off part of the charged amount and the remainder is what you are responsible for, what they pay, or a combination of what you and the insurance pay based on your benefits.
Let’s break down what this means into numbers.
Claim charge/billed amount: $200
Allowed amount by insurance: $100
If you have a deductible you will pay $100 toward the deductible until met. Once the deductible is met you will be responsible for a coinsurance if you have one or the insurance will cover the service for you.
If you have an 80/20% coinsurance you will be billed $20 per visit for your coinsurance and the insurance pays $80.
If you have a $10 copay you pay the $10 per visit for the copay and insurance covers $90.
Note: this is just an example. Each insurance company has its own “allowed amount” or “fee schedule” indicating how much you pay. We can predict some, however not all insurances are predictable and depend on the billed amount (claim charge) by your provider.
We hope this has helped you understand your insurance and how it pertains to your physical therapy. As always, we encourage you to verify your benefits with your insurance company to ask questions so your financial responsibility doesn’t come as a surprise.