3 Reasons Why You NEED to Know Your Contracted Rates
Mental health billing requires a great degree of accuracy and precision. And most billers love being accurate and precise, especially when it comes to finances and coding.
However, their job is greatly hindered if they don't have the contracted rates for services. What do we mean by "contracted rates"? And why would your biller need to know these rates in order to do the billing correctly?
Contracted Rates: The amount that an insurance company will pay for a given service code according to the contract. This applies to providers that are in-network with a specific payer.
Here are 3 reasons why it is imperative for your biller to know the contracted rates:
1. Your Contracted Rates Help Calculate What Patients Owe
The first reason why your biller needs your contracted rates is to calculate what the patient will owe before they walk in your door. Granted, this is applicable to those patients who have a co-insurance. However, this can greatly reduce tension on the patient's end if they know precisely what they owe.
By knowing what the patient's responsibility is, they won't receive an invoice they weren't expecting and will pay the correct amount each time they come into your office.
2. Your Contracted Rates Help Monitor If Insurance is Overpaying or Underpaying
The second reason why your biller needs to know your contracted rates is to monitor to see if insurance is overpaying or even underpaying.
Don't think this is an issue? According to research produced in 2009 the top 3 insurance companies underpaid, on average, 28.9% of claims. If you could recover 30% of that money every year, you would. But if you don't know your contracted rates, you will never know what they owe you.
Conversely, if insurance companies overpay (and sometimes they do) you will want to know if they ever decide to come back and request that money from you.
3. Your Contracted Rates Help Project Revenue
The last reason why your biller needs to know your contracted rates is to help you project your annual revenue. This will help you when it comes to managing your personal finance, business accounts, and staff. Without knowing what exactly insurance owes, you can't do this accurately.
Don't be caught not knowing what you should be paid. In many cases providers don't know their contracted rates and therefore can't track if they are being paid accurately. In some cases, their patients don't know what they owe and either leave treatment or never pay their bill.
Save yourself time, stress, and money by knowing your contracted rates!
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