Patients should be able to ask their clinics how much a patient visit costs, but patients should also be encourgaged to put the price of a clinic visit in context. Patients are often unaware of what actually happens to that clinic visit charge as it passes through the various paths to payment. This conversation with patients can get particularly dicey if a nearby clinic is charging what appears to be less for a visit than our own clinic.
Comparing Apples to Apples
In our clinic, when patents receive their clinic bills, the initial clinic charge submitted to the insurance company is listed, along with all the information about what the insurance company paid and what the insurance company expects the patient to pay. This information comes from the Estimation of Benefits (EOB) about which I’ve written at some length before.
However, when trying to keep track of which pea is under what walnut, it is important to compare apples to apples.
The price clinics submit to insurance companies is always discounted (the euphemism is “adjustment”) by the insurance company, sometimes almost as much as 50%. This “adjustment” in the charge for a clinic visit is something the clinic has no control over. Medicare sets the discount, and most other insurances follow Medicare’s lead. Except Medicaid, which discounts the patient visit even more than Medicare. That is why many practitioners, especially in larger cities, will no longer see Medicaid patients. There are even large cities where it is difficult to find a practitioner to take Medicare.
If you are trying to determine whether another clinic charges less for a visit than ours, for example, it is important to compare the “adjusted” cost of the clinic visit, that is, each clinic’s discounted charge for the same level of service. Medicare, Medicaid, and insurance companies have a standard amount they will pay for a given level of service, so in effect, it doesn’t matter what the clinic charges for a visit. Each will get the same “adjusted” payment if the clinic has been unable to negotiate a higher reimbursement rate (translation: large enough medical-industrial complex o have the clout to do so).
This may seem odd to patients, but it’s the way health care reimbursement works.
The Services the Patient Receives in a Clinic Visit
When you come to our clinic, a nurse will take your vital signs (pulse, weight, blood pressure). Then the practitioner will take the time to review the history of your bodily “systems.” How do you feel? Do you have angina? Do you have allergies? Do you have seizures? You may even get tired of telling your practitioner this every time you come to the clinic, but there’s always the possibility that something new may have turned up.
After that, the practitioner will actually do a physical exam, checking your general appearance (do you look pale, do you look very ill), the condition of your eyes (shine a light in them), ears (look in them), throat (push your tongue down with a wooden stick), lungs and heart (listen with a stethescope), skin (any rashes, cuts, bruises), gait (any trouble walking). Review your medication list with you. All this information is recorded for the record in your patient chart.
Does this information have to be reviewed every time you come for a clinic visit? It should be. Maybe you’ve had some trouble with pain in your foot since you last came in. All this data is very important in helping the practitioner diagnose what is wrong with you, even if you’re just there for a sore throat. For a clinic to be paid for any patient visit, the practitioner has to supply a “diagnosis.” A sore throat describes a symptom. Insurances are looking for the cause of the sore throat, a diagnosis of a disease, such as sinusitis. All the information gathered in the exam contributes to the accuracy of the “diagnosis.” And most important of all, forms the basis of the clinic’s payment for your visit.
After gathering this information, the practitioner may discuss with you having some blood work done, or a chest x-ray, an ultrasound, or an MRI. Or perhaps the practitioner will discuss with you the value of making an appointment with a specialist. Or review labs and reports from other specialists with you. You may even remember to bring up something you hadn’t even thought about when you made your appointment. If you need antibiotics, the practitioner may suggest a shot or IV therapy. Or write a prescription for medications for various conditions you may have, based upon the examination.
All these activities on the part of the practitioner are transposed into a “level of service” for the visit. There are cheat sheets to help practitioners wade through the decision-making required to arrive at the appropriate charge code for the visit. If you are wondering why a cheat sheet is needed, you could take a look at the federal government’s Center for Medicare and Medicaid Services (CMS) guidelines for determining the level of service. But that’s another story…er, book.
The Cost of Your Office Visit Depends upon Your Insurance
So, back to the question of how much does our clinic charge for these services.
The answer. That depends upon your insurance.
For example, a patient comes to the clinic and receives an array of services for which the patient is charged $192.
The patient has Medicare, which “allows” $90.24 for this level of service. That is, Medicare has categorically lopped $101.76 off of the cost of this visit. The clinic never sees this money. Its just gone. Nor will Medicare pay the clinic more for this visit if the clinic submitted a bill for, say $210 instead of $192. Medicare will simply lop more dollars off the charge to get the number to the “adjusted” amount.
By “allows” Medicare means that $90.24 is the total amount the clinic may charge for this patient’s visit. That’s not what Medicare pays on the claim.. Of that $90.24, Medicare says that the patient is responsible for paying $18.05 coinsurance. So Medicare actually pays the clinic $70.75 for a visit billed at $192, and allows the clinic to bill the patient for $18.05.
What the Clinic Charges is Irrelevant
In summary, our clinic will bill this patient $18.05 for a visit which the clinic submitted a claim to Medicare for $192, and for which the clinic received a total of $90.24—provided the patient pays the coinsurance. And yes, we have had patients complain about paying the $18.05.
The critical issue, then, is not what the clinic charges, but what you pay for the visit. And whether you, at another clinic that bills less than $192 for the visit, pay $18.05 for a similar visit. Since we have demonstrated that the payment for a given array of services at a clinic is fixed, regardless of the charge, it really doesn’t matter what any clinic charges. The clinic will get the designated level of reimbursement from the insurances for that level of service.
So before concluding that one clinic charges more for an office visit than another, be sure to check whether the billing level of sevice for those office visits are the same.
Always compare apples to apples.