As provider networks continue to shrink and more non-network facilities like free-standing emergency rooms pop up, it’s crucial that brokers explain the importance of staying in network to their clients.

Most brokers do, of course. As we present options to clients and prospects, we discuss the difference between more flexible but more costly PPO plans and less costly but more restrictive HMO plans. It’s a tradeoff; some clients choose a PPO for the larger provider pool while others are willing to go through the referral process in order to get a more competitive rate. In either case, most advisors stress that the in-network benefits are far better than any out-of-network benefits that are included in the plan.

Still, it’s easy for members to make a mistake, even when they’re trying to use the plan correctly. When searching for a participating provider, for instance, some clients are told by the doctor’s office that they “accept their insurance” only to find that the provider is, in fact, out of network. That’s because there’s a difference between accepting the insurance and actually contracting with the insurance company. Most health care providers are perfectly happy to accept a payment from a carrier; fewer providers, though, are willing to sign a contract with the carriers and agree to accept lower payments for the services they provide. The result is that the member often receives a “balance bill” from a non-network provider who “accepts the insurance” but wants more money for the procedure.

We’re beginning to see this happen more and more with free-standing emergency rooms. These facilities look a lot like urgent care centers, but they tend to charge more like hospital emergency departments. Unfortunately, because these facilities usually do not contract with many health plans, the carriers reimburse far less than the billed amount.

For example, in a recent local news piece by WFAA in Dallas, Texas, the report included a story about a Fort Worth resident who went to a free-standing ER near his house when he was experiencing chest pains. The facility told the patient “it accepted his insurance even though his insurance company was not in-network.” That was true, but the patient’s health plan only paid $215 of a nearly $12,000 bill.

According to Dr. Paul Hain, the Chief Medical Officer for Blue Cross Blue Shield of Texas, who was interviewed for the story, most free-standing emergency rooms charge entirely too much, even for minor illnesses: “When you walk in we get to charge you several thousand dollars for walking in, which urgent care doesn't do. Just by crossing the threshold, it can be $3,000.” That’s part of the reason his company has made the decision not to include any of the facilities in its provider network.

The point here is not that free-standing emergency rooms or any other providers are doing consumers a disservice, but rather that brokers need to emphasize to their clients the importance of asking the right questions to ensure that they are seeing in-network providers whenever possible. Again, the question is not “do you accept my insurance?” but rather “are you in my provider network?”

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