3 Ways to Know Your Reimbursement Rates from Insurance
One of the most difficult parts of running your own private practice is gauging how much the insurance company will pay you for claims that are submitted. It should come as no surprise that the reimbursement rates from the insurance companies are not always the easiest to find or to guess how much they will pay you. This blog post will take you through the 3 ways to know how much insurance will pay you for each session that you complete and claims that you submit. parts of this blog post will include some nonanswers like "depends on what state you were in" or "you will need to check with your insurance company", but we will do our best to make sure that we are giving you specific information as possible.
The first way that you know how much the insurance company will pay you is a document insurance company sends you called a fee schedule. The fee schedule is a spreadsheet or a PDF document that the insurance company will send you either before you sign your contract with them or after you sign a contract with them. Obviously, it is better if the insurance company sends you this document before you sign the contract so you know how much they're going to pay you. However, this is not always a consistent process. the spreadsheet or PDF that the insurance company will send you will have thousands of rows and maybe columns that you will have to search through. To make this process alone easier you will want to look for the CPT codes that you will be billing with.
A common CPT code that you will want to search is 90791 and 90837. If you are billing these two codes the most you will want to search for those codes using the search feature in whatever browser you are using. For most people, the fastest way to search for a code in a large document is to hold down the Ctrl key on your keyboard and click the F key on your keyboard. That keyboard shortcut should bring up a search bar where you can type in the code in the document. as soon as you find the code you are looking for you will want to look for the correct column. Often times the spreadsheet below outlines the doctor rate, the Ph.D. rate, and the masters-level rate. Sometimes the spreadsheet will have a social worker rate and a masters-level rate that is different from each other.
It is important for you to identify the correct rate based on your educational level in the fee schedule that you are examining, so take your time in searching for this rate and ensure that you completely understand the rate that you will be paid. It is also important to understand that the rate you are looking at will be a shared rate between your client and the insurance company. The rate that you are looking at will not be the rate that the insurance pays you plus the whatever the client will owe your practice. The rate on the fee schedule is the total rate that you will be paid between the insurance company and your clients. This is important for your practice because it helps you calculate the exact amount your client owes should they have a coinsurance. If your client owes a copay, or a flat amount, the copay will be deducted from the rate on the fee schedule.
The reason why the fee schedule is important is because this is the agreed amount that the insurance is legally obligated to pay your practice for services rendered to clients. The reason why you want to keep this document on hand is so that you can monitor and audit the amounts that the insurance company is paying your practice. It is not uncommon that the insurance company can make a mistake and pay you the incorrect amount. If the insurance company pays you the wrong amount then you have the grounds to issue an appeal, or you can take legal action if they continue to pay you the incorrect rates. We would recommend taking the fee schedule and saving the rates somewhere in your electronic health record system so that when you are doing eligibility checks they are readily available for you to tell your clients the exact amount they will owe. This will make the client experience much better and it will save you tons of administrative time in searching for the rate that you should charge your client.
Be careful with the fee schedule!
Fee schedules are confidential and you could get in a lot of trouble if you were to be found distributing the fee schedule to colleagues in your area. Don't tell your colleagues the specific rates that you are paid because those are confidential between you and the insurance company. It is important to protect you and your business first before putting your practice at risk by engaging in an activity that could jeopardize your ability to practice long term.
The second way that you know how much the insurance company will pay you for services is to contract with an insurance company and then to submit claims. Once the claims process and pay, you will then have the fee schedule in terms of actual paid claims. We don't recommend this option as a good option because if the insurance company makes a mistake on the first payment you could go months and even years without fair compensation. However, there are some insurance companies that don't provide a fee schedule when you are in the credentialing process and they offer fee schedules only on request. Again, we don't like that the insurance companies do this but it is something to be aware of.
If you choose to use this method to know your contracted rates, our caution to you is to verify the rates with the insurance company by contacting the insurance directly. By verifying the rate then you will know that they are paying you the correct amount. Once you have a few paid claims, we recommend saving the rates in your electronic health record system so you can have easy access to those rates and are not bogged down everytime you need to access them.
The last way to know the rates that the insurance company will pay you is by looking at the Medicare rates. Often times, providers don't know how a fee schedule is calculated because the process involves a fair bit of statistics, but fee schedules are also calculated based on the Medicare rates. If you need to know a general number, without knowing the specifics, you can always look for the Medicare rates on the CMS website found here.
Fair warning this is a giant spreadsheet that includes every CPT code found in the handbook (which is thousands and thousands of codes). You will definitely need to do a code specific search to find it, and this rate will give you a general sense of what the insurance company might pay you for services. You can also ask your colleagues to give you a range of payment that the insurance pays for each CPT code. This is also not recommended because it could put your colleague at risk, but it does happen from time to time. If you have a biller that is working with you or has industry experience they will also be able to give you good feedback on the range of payments that you can find.
Your contracted rates are very important to know because they determine what your practice makes for each CPT code. Not every insurance company pays the same, so it is important to know how your revenue will be impacted based on the type of insurance client that you take on in your practice. Make sure that you keep these rates, and know that they are subject to change every year, so be aware that every year that goes by the insurance companies can change your rates and adjust the amount that you are paid.
If you have questions or concerns about your fee schedule or need more help feel free to contact us and a team member would love to help you!