Navigating the confusing world of insurance as a PT patient.

Co-pays, deductible amounts, co-insurance, in-network, out-of-network, stop-loss, HSA, HRA…. If you know exactly what all of these terms mean, and know how they apply to you when you seek to use your insurance benefits, you are in very sparse company. The goal of this entry is to help you better understand health insurance coverage as it relates to a PT patient. Insurance confusion

The region of Southern California that our office is located in, is dominated by large HMOs (Health Maintenance Organizations). They provide PT services for a single flat fee called a co-pay. The co-pay amount is related to the insurance plan purchased by the member. Generally, the higher premium plans will have a lower co-pay and vice-versa. To use those insurance benefits, you can only go to the contracted PT provider. In very rare cases (if you have a condition that requires a specialty that the HMO group does not have), they will allow you go to a provider that is not affiliated with the HMO group. 

The alternative to the HMO plan is a PPO (often called a “Preferred” Provider Organization, but is rather a “Participating” Provider Organization).  The benefit to the patient is the perceived freedom of choice of whom they may see, but there are a few nuances to understand about these arrangements. You pay your insurance premium the same way you do in the HMO system, and when you seek care from a PT, you see how wildly variable your benefits are in paying for service. These organizations contract with providers in these regions to create a “network” of providers. Those offices generally accept a negotiated (lower) rate for services in exchange for easier access to patients. They are listed as “preferred” providers  or “in-network” with the insurance company, and out of pocket costs are lower for the patient. As a response to the lower reimbursement for services, in-network providers often delegate care to assistants and aides, or the appointment slot is shared with many others to make up for the lower contracted rate. 

Due to the reimbursement environment, in-network providers that increase their volume to make up for the decreased contractual pay may actually cost more to the patient and the health plan than an out-of-network physical therapist that provides more one on one care because the patient requires fewer sessions to get better. 

Recently, there have been increased documentation and administrative requirements to justify payment from the health plans. As a result, there is a shift to more cash-based practices opening up. There are many benefits paying cash directly to a provider. (See our Blog titled “Why paying cash for PT is best“). 

With higher deductible amounts (the cost to the patient prior to the insurance company paying), there are additional plans available to bridge the gap. HSA and HRA plans are becoming more popular. HSAs (Health Savings Accounts) are funded by the policy holder and withheld from your pay pre-tax and placed in an account for your use on qualifying medical expenses like physical therapy. You can use those funds to pay for your deductible, co-pay, or cash services or goods. 

HRAs are health reimbursement agreements, which are funded by your employer. You pay for your services and if the services qualifies for reimbursement, the plan pays you back. HSAs and HRAs are excellent options for those that need the flexibility to go where you want to go, and the financial flexibility to do so. 

What many don’t know is that you don’t need a doctor’s referral or insurance to be seen by a physical therapist. You simply need to find someone who is open with you about the cost of their services and how many sessions they anticipate you will need, and are willing to work with you to find a solution to your problem. 

For answers to specific questions regarding insurance or physical therapy, contact us through our website.

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