If you have completely out-of-network practice, you can set your self-pay rates at whatever the free market will support. But what if you are in network with some 3rd Party Payors? What if you are trying to grow your private pay patient population, while remaining in contract with some insurances … are you still free to set your cash-pay pricing at whatever level you see fit? The answer to this question may surprise you.
Quick side note, being successful in the Private-Pay business model goes way beyond understanding the legalities outlined in this blog post…at the bottom of this article you’ll find a handful of resources to get you started on your path to Cash-Pay practice success.
There is a quickly growing number of insurance-based practice owners with a strong desire to convert to a cash-based practice or at least try to increase their percentage of self-pay patients. When these entrepreneurs reach out to me, many do not initially understand the legalities of this process and the issues they can run into; especially when it comes to setting their cash-pay rates. There are certain things that must be kept in mind to ensure you are not violating your contracts with insurers, and possibly breaking state laws.
Insurance Contracts and Cash-Pay Limitations
First and foremost, carefully check the contracts you have with 3rd party payors. They unfortunately may not allow you to “just take cash” from a patient with that insurance, even if the patient wants to be self-pay. There is often a clause that mandates you directly bill the insurance company for any covered services provided to their insureds.
Most Favored Nation Clause and Self-Pay Pricing
Check for other contractual billing restrictions as well. A common one is called a “Most Favored Nation” (MFN) clause, which generally means that you agree to charge the insurer no more than you charge others. If the contract has this clause, you need to determine if it is specific to what you charge other insurance companies or if it includes patients themselves. Let’s look at why this is an important distinction…
Suppose the contract does Not have a clause that mandates direct billing for any of their insureds, and you could see those patients on a private-pay basis; but the contract does have an MFN clause, it could have an effect on what you can charge that self-pay patient with that specific insurance. For example, it may be required that your cash pay rates for the patient be no less than what you would bill the insurance company for the same services.
Now, if you are in-network with an insurance company, it may not be that common that one of their insureds will want to see you on a self-pay basis; but if you’re offering longer one-on-one treatment times for those willing to go private-pay, you may run into this scenario. There may also be patients who don’t want their insurance billed for a few PT sessions because they figure it will result in higher premiums over time and cost them more money in the long run. Many deductibles are so high now, it would take a ton of sessions to reach it and they would rather go cash-pay and keep it between them and you. The point is this: If you are actively trying to build your private-pay patient population, this scenario will likely become more and more common for your practice, and you need to know how to deal with it.
Same-Day-Payment Discount … a Viable Loophole?
Some practitioners see this situation as easily fixed by offering a “same-day-payment discount.” The rationale is that they offer the same discount to patients and any 3rd Party Payors who are willing to pay for the services on the same day they were given. In theory, this sounds good (and I quite like the idea), but that doesn’t mean it’s absolutely legal for everyone reading this! This is an area where caution is needed, and even more so, confirmation from an attorney. State Laws and individual contracts vary widely, so what works for some practices out there may not be a legal option for your practice.
There are a number of take home points here but the primary one is that if you are planning to provide both cash-pay services and remain in network with any insurance companies, you need to review your contracts with an attorney, and also have the attorney find out if there are any laws in your state that would further dictate your pricing to self-pay patients vs. the 3rd Party Payors with whom you have a relationship.
What strategies have you used to deal with this situation in your practice? This is a complex topic, so please share your advice and/or questions in the comments below.
FREE Cash-Based Practice RESOURCES
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These resources will help give you all the information you need to successfully transition or create a Cash-Based Practice as quickly as possible.
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Again thanks for the insight. I have been working on a cash base system for the last year and I am building my base, as my time allows as this is a part time venture, and I have just been approved for medicare. I needed to go this route because a large percentage of my rural population is MC and unable to go cash. I am not giving up my private pay, and want to increase it but need to balance it legally with my new MC folks. I planned to charge everyone MC rates but I best go to an attorney for advice.
Thanks for keeping us thinking.
Thanks for contributing, Dan. Best of luck!
I have a question about this. If one takes Medicare patients does this automatically set the cash pay rate for all other patients?
Seems silly but I cant find this information.
I’m in family medicine, but we have been doing cash pricing for some time, initially affiliated with Simple Care, an organization out of Kent, WA, but I believe the key is not to use ICD-9 or CPT codes on these visits, make them cash at the time of service to alleviate the need to do expensive billing and collections, and this combination makes the visit enough different to not be billing less than contracts because it’s not the same service.
Is it truly “not the same service” or just the fact that you’re not using ICD-9/CPT codes? I ask and bring this up because I wouldn’t want all readers to see that statement and figure it must be legal for them too. I’m sure you’ve checked it out with an attorney but this approach sounds like it could be questionable for a PT practice … for instance, I know my practice act demands that I bill for exactly what I provide, so ignoring/omitting codes could be in the “gray area” at best.
It is customary for an insured patient to self-pay a provider for individual healthcare services that he refuses to offer at discounted insurance prices.
Hi, My question to you is this…How do I find out what the “fair market value” of services are for PT in the Tampa area? Most all PTs I know have contracts with Medicare and/or commercial insurance. I accept cash and we are out of network for any insurance my patients present with, except Medicaid and Medicare (we do not accept these). We are trying to set our prices reasonable but also interested in making a profit after taxes (we are sole proprietors). Any suggestions? Thank you for your knowledge and your website. Very helpful ~Lynn
Find out how much the most expensive massage is in your area, and double that price … just kidding!!
I would ask around to your colleagues to see what they typically get reimbursed from their best paying contracts for an hour of treatment (not what they bill … what they actually receive). Also, look at what your overhead is and calculate your cost per patient/hour worked. In a cash-based practice, it’s not unreasonable to shoot for 50% profit margins or higher; but you should of course consider what is “affordable” and fair based on your area and what your ideal client will be willing to pay. There are a lot of factors to be considered, but going back to my first sentence … make sure you’re charging more than the massage therapists in your area 🙂
I just watched you on the healthy, wealthy, and smart which was great and reading this article brought an idea to mind. Can you do private pay and except medicare to get those patients? So Medicare would be the only insurance you except or would you have to charge them the same rate as the private payers? Love the site.
Glad you enjoyed the interview, Jeff.
Yes, there are definitely practices that only accept Medicare, and are completely out of network with all other insurances. In that situation you still must send all billing directly to Medicare, and abide by the Medicare fee schedule.
Thanks for the help. Just to clarify I can still charge the non-medicare patients whatever I feel is fair correct not according to the medicare fee schedule?
Yes, you can charge non-Medicare patients whatever the free market will support (i.e. agree is fair and pay it) as long as you are not in contract with their insurance.
And if we are in network, then what?
Thank you for this article Dr. Jarod. I have a question; what if you offer services that are not covered by insurance? I’m a gynecologist, I take insurance (Medicare and private insurance) for routine visits and other gyn issues but now I’m branching into laser therapy and hormone pellets that are not covered by insurance. Are there any precautions to be taken? Do I need a separate tax ID or separate entity to offer these services? Can they all be under my one entity but count as non covered services? Thank you so much
I have a patient that was in an auto accident and had surgery. Am I aloud to bill the patient the full price of the services or do I only bill the patient what an insurance would allow for these services, since we take insurance discounts for those other cases? The self pay patient is penalized because they have not health insurance and is required to pay full price. Is this aloud?
If the patient is insured by a company that you are in network with, then the contract you have with that company will determine what you can bill them / discount them. If the patient is not insured, then you shouldn’t be limited in what you can charge them as long as your billing is not in violation of any state laws or if you have contracts with insurance companies that actually dictate what you can bill any of your patients (I certainly hope that’s not the case).
This is definitely one of those topics where you really really need to confirm everything with your own attorney… I have no idea what contracts you have or what laws your state may have, so this is really important to check out with a legal professional.
I’ve been thinking of starting a mobile PT business. I have my medicare numbers and serveral insurance numbers through an out patient business I’ve been working for. In Pennsylvania can you bill for mobile services. I see others have started this in other states. Can you give me some help/advice in this area. Thanks
The mobile approach can be a nice low-overhead business, though the travel time can be extensive and I would suggest charging something for ‘travel surcharge’ based on how far away the patient is. Scheduling can also be tricky for the same reasons … start times may need to shift from one day to the next and you have to build in a good bit of traffic time cushion that can’t all be paid for. Remember that the travel charges are not medical expenses that can be billed (by the patient via self-claim) to the insurance companies… your per unit charges need to be consistent among all patients. The travel charges can be on the invoice but I would delineate “medical expenses” and “non-medical expenses” to keep them separate and avoid a denial of the entire patient self-claim based on the “you’re trying to get reimbursement for non-billable services” argument from the insurance companies.
Also know that in some cases, your connection to Medicare and private insurers via your current employment do not simply disappear when you go to work for yourself (especially if you are doing both at the same time for a little while).
My doctor is charging me $150 cash per 45 minutes. Says he doesn’t take insurance. When I called blue shield to see how I can get reimbursed, they say doctors is contracted with them. They say he shouldn’t be charging me cash price. They say I should only pay $40 co pay. They still weren’t clear on how I could get reimbursed for my costs which total over $10k for two years.
That sounds like a legal issue between the doctor and the insurance company, that your physician needs to address and help you through the process of getting reimbursed. If he truly is in network with that insurance company, then he is likely breaking his contract by charging cash rather than taking copays and billing them directly.
This should be between and patient and the Dr. What if a patient does not want to use their insurance (due to the fact of high co-pays and deductibles) they would like to be a cash paying patient is this their right? When offering cash payments will be using the Medicare pay schedule. Is this legal in the state of Michigan? Or should I contact an attorney? Thank you, Cindy
I’m actually having a hard time understanding exactly what you are asking .. perhaps you should review your question, make grammatical corrections, and ask again ???? but I can say this: yes, you should ask an attorney about the legalities of your questions in ANY state.
So if a doctors office is in network and they allow $61 for a service and it was applied to their deductible, but only charged the patient $45 is this legal or no?
Like with other comments here, I really can’t speak to the legalities or governing laws of physicians. This one is best asked of an attorney
I understand her question. Doesn’t the ACA now say that a patient can choose NOT to have a claim filed to his/her insurance and instead pay cash on the date of service even if the provider is contracted with the patient’s insurance carrier?
If I have a medical weight-loss business can I charge out of pocket even if I am affiliated with insurance companies.
If you are contracted with an insurance company and the patient has a high deductible you are to bill the insurance company and the patient pays the allowed amount on the EOB
Small claims court to recoup your cash prices as you were lied to about him not being contracted with Blue Shield. You can also call the medical board and report this. They may know the best way to recoup all of your $ minus co-pays. They could be in big trouble for lying to you and having a contract with Blue Shield. Big no-no & the doctor knows better.
How about this scenario: a patient wants to use her HSA/FSA instead of her insurance which I’m in -network with? Looking forward to your reply!
Sorry for the delayed reply!
Again, you have to check your contract with that insurance … if it mandates that you bill the ins company directly for any services provided to their insureds, you could be in breach of the contract if you bill the patient in full and don’t send the bill to the ins company.
I believe the practice that I worked for is doing fraudulent billing. They also fired me because of this and I believe I have a case for wrongful termination. I will explain what was asked of me: So I live in Utah and my employer is trying to sent me unemployment because they feel they are in the right. They asked me to charge the insurance $200 for a particular CPT code . However, if the patient was selfpay then for the same code they wanted me to charge $300. I went to Coding school and everything tells me this is unethical and illegal. Can you give me any insight and proof of this being wrong? They also did ishother things that were illegal but I won’t get into it here. I wish I could afford an attorney right now.
So sorry for the delayed reply, Brandi. Certainly sounds shady. Can’t really say much beyond that without more information, and of course, I’m not an attorney so it really doesn’t matter what I say in this situation.
To add to above, they are trying to deny me unemployment. My auto correct changed it. Oops.
Is a physician able to charge a patient cash for a visit, then bill an out of network insurance company for the same visit? Once the company pays the out of network fees. The credit is not offered to the patient unless asked or used for future visits. Is this legal?
The answer to your question depends on a ton of information not included in your question, and whenever someone asks “is this legal,” I really have to encourage you to ask the question of an attorney.
I’m an attorney and while I am not your attorney and do not have the specifics of the case, I cannot imagine that double billing the patient directly and then indirectly through her out-of-network insurance is legal.
My understanding is (not a lawyer)… if the OON deductible has not been met then the insurance company just reduces the deductible by the allowed amount on the submitted claim (usually more than the cash pay or patient responsiblity) but doesn’t provide any re-inbursement. The provider keeps the cash pay and doesn’t balance bill the patient for the difference (and in some states its illegal to balance bill OON). When the deductible is met, then you collect the co-insurnace amount (not a full cash pay amount) and submit the claim and the insurance will pay the remaining amount. If the out-of-pocket is met, then the patient pays nothing up front and you get the full re-imbursement of allowed amount from the carrier. These things are not always easy to figure out and that’s why you need a good lawyer and an experienced medical biller. Feel free to email me if you have any questions on this.
I have a doctor that was dropped from 2 different insurance companies. If patients see her they are out of network now. Can she charge a cash price to them?
I would need quite a lot more information and detail to answer that question… and even with more information, it may be one for an attorney in your particular state since state laws can differ and affect the answer.
A mobile ultrasound company wants to perform in-office cardiovascular testing on my patients. I would pay the mobile company $500 per test, bill insurance $2600 per test, collect about $800 per test and have a $300 profit per exam. Is that legal?
You getting pretty far outside the scope of PT, and my scope of knowledge, so I have to say this is a legal question best asked of an attorney
What mobile Ultrasound company do you use that charges $500 per test? $That is far above what our mobile ultrasound company charges in CA.
I am presently working for a chiropractic office that is looking to go cash only. I have a few questions-
1. Am I safe to assume that we still have to partake with Medicare and workers comp along with mva?
2. With all the audits with ins co, do you feel its that best way to go?
3. Are most offices successful with cash plans?
4. Can we just give pts a super bill to send into their insurance themselves.?
5. Is their a website that can help me transition over to a cash office>
Thanks for your time 🙂
I’m in the same boat, any help in all these questions would be great! Thank you!
We are attempting to open a High end gym and wellness center that offers “rehab and mobility services”. I am a licensed PT, but am trying to stay away from the classic PT clinic model. If we are strictly self pay and are not on any insurance plans, can our services be covered by a clients health savings acct and/or count towards their deductible?
If you are provided “skilled PT” it should be something they can utilize HSA/FSA for. As for deductible, that totally depends on the specific insurance plan.
One of my doctors is eager to have a VIP Practice and therefore charge premium prices for one-on-one time with MD. We a group practice contracted with all main payers for Florida. Is this legal?
It depends on what your contracts with the Payors actually says .. if they include clauses that require you to directly bill them for any services to their insureds, you may not be able to bill the patient a separate “VIP” fee. Whenever someone has the question “Is this legal”, I’m obligated to let you know that only an attorney is going to be able to give you a solid answer to that. There may in fact be ways to create this MDs VIP practice, but you’ll need an attorney to walk you through it.
I am an Occupational Therapist/Certified Hand Therapist working PRN for a small PT practice. I was given the option of making a % off of insurance reimbursements instead of a “per hour” rate of pay. My rate of reimbursement is at 37.5%. To my surprise and dismay-my first check worked out to be an average of 21.00 for an hour of treatment. Ouch! My question is….is there a way they could be hiding part of the reimbursement from me? And…aren’t I also entitled to part of the co-pay? I am leaving the job but I am wondering if you happen to know anything about this model of running a Physical Therapy practice.
Thanks for the question Elizabeth, but this is more suited for an attorney to answer. I’m not sure if the model you describe is even legal.
Greetings Dr Carter,
My Question is: Are there any legal restrictions to start and operate a 100% cash based PT private practice while at the same time working part time for an established Private practice that takes insurance? The contracts are with the practice and not each individual staff therapist, correct?
You would need to see the contracts and confirm that you are not listed individually on the contracts … if not, should be fine to move forward with the scenario described, but this is also a good one to confirm with your attorney (since there could be legal implications).
Thank you for such a quick reply.
Is becoming accredited by each insurance provider the same thing as going into contract with them? Or is it different since it is provider vs. facility based?
I’m actually not quite sure what becoming “accredited” means, or why that would even be necessary … seems like you’re either under contract with them or your not.
Oh sorry I meant to say credentialing..But I will advise and review contracts with my attorney.
Thanks for your time!
We have just opened our outpatient PT clinic in a fitness center are still in pending status with most insurers. We’ve had multiple potential clients inquire about relatively minor issues that could be addressed in 1-2 sessions at most and they have no desire to follow up with the MD or go through their insurance. We have direct access. Could we create a cash based charge for a “consultation” instead of evaluation and treatment to avoid complications with insurance charges? Are we obligated to bill through any applicable insurance network for the services rendered?
Great question and I like where your head is at, but unfortunately that answer needs to come from an attorney who has reviewed the contracts you signed with the private insurance companies
A DPM wants to offer physical therapy to her patients.
She is going to be doing the PT herself – Hands on Manual Therapy.
She currently accepts Medicare and All kinds of Insurance however for this specialized service she wants to run as a Cash Pay option.
Typically PT is done by PT, PTA or even Medical Assistant – since it will be a doctor performing the therapy she wants to charge a premium. Is this possible?
I have read from prior responses that all she needs to do is check with her carriers to see if they allow cash pay. Does this also include Medicare?
I really can’t speak to the legalities or governing laws of physicians or podiatrists. sorry I can’t help on this one
Hello Dr Jarod! I am working part time at a pediatric urgent care and would like to start a private direct primary care monthly membership practice. I am credentialed with many insurances in western New York as an urgent care physician. Is it possible to start such a practice while continuing to be credentialed and contracted in the urgent care? The sites will be in separate counties of New York with different names and tax ID numbers. Thanks so much-
As with many of the comments on this post, the answer to your question could vary from state to state based on the laws of that state; so it’s very important to ask an attorney your questions to make sure you’re staying in line with the law
Can you charge your insurance patients for things that are not covered by their insurance ie: cupping and massage?
Generally, yes… but it depends on your ins contracts and may also be influenced by state laws
This is all quite helpful. I am a psychologist and work in a hospital and am covered through them on bc/bs, medicaid and MassHealth (the Massachusetts version of ACA coverage). I have opened a small private practice that is self-pay only, which is clearly spelled out on my informed consent, signed off on by the patient. Is there something additional I need to do for this? I have malpractice through the group plan at my hospital but also purchased independent malpractice to use for my private practice work. I’d appreciate any guidance!
A psychiatrist is employed by and works for a hospital on a part-time basis. The psychiatrist is in-network with all of the hospital’s contracted insurers. The psychiatrist also maintains a private practice, is not in-network with any payers and is 100% self-pay.
BCBS is now indicating that he must be in-network with his private practice because he is in-network at the hospital. Is this correct? Can he keep his private practice 100% self-apy?
If he is individually and specifically named on his employers contracts, then the insurance company may be correct in their assertions that he must abide by that contract eventhough it’s not a contract with his “private practice”
Hi Dr. Carter,
I’m a little late to this post but I’m starting an Independent Research Project about the business logistics of a professional collaboration between a personal training studio and an in-house physical therapist for their clients. I chose this topic because I’m least comfortable with the topics I have to present on yet highly interested in this type of collaboration. Of all the research I’ve done so far, I have found this article the most informative with down-to-the-issue advice and scenarios. Many articles are fluffy, describing cash vs in-network and all end with, but check with the insurance companies. You were the first person I’ve seen (so far hopefully) to bring my attention to the possible scenarios we could face trying to have a cash and in-network system in place. These details of the MFN clause or the same-day payment loophole are the needed meat in many other articles on this topic. Thank you, thank you, thank you.
Kenzie Worthington, SPT
UMES DPT Class of 2017
I am a mental health therapist, but I believe a lot of the same billing issues apply. What type of attorney would I contact to discuss these issues?
Hi! I work for an internal medicine practice. If a patient has insurance, but does not “want us to bill it.” He just wants to pay a “cash pay price that we have for people that truly have no insurance, is that legal? I have had people ask us to do this because it is cheaper then “paying their deductible.” My fear is the insurance requests records for whatever and they have no claims for said dates of service. I fell like it looks like we are hiding something from the insurance company. It just seems fraudulent to me.
It is their legal right to request that their PHI not be shared with anyone … including their insurer: https://drjarodcarter.com/cash-based-medicare-hipaa-loophole/
Now, whether this applies to the clients you are describing is better asked of an attorney, but in some cases this opporunity to allow them to be cash-pay patients may exist
I was wondering in regarding to billing out of network when I am in network. My company wants me to bill out under another therapist (and have him co sign) who is out of network with a private insurance although I am treating. By him co-signing he will be overseeing the patients care but is it legal if I am technically in network?
I am a independent consultant – Medical Biller – Coder/RCM.
I wanted to suggest a site to review average cost in the geographical area for different procedural services, regardless if Office Visit, A Procedure, Hospital Stay, a RX.
It is important to read those contracts for legalities. Especially if a provider is contracted and the patient wants to pay up front 100% as a self pay patient. I know that most providers will have a affidavit signed protecting the practice from these legalities. It does not guarantee that the patient will go and submit to their payer, the itemized billing. Then this turns into a snowball effect. Insurance companies will research if the provider is contracted or non – contracted and process the claim, and claim may ultimately end up with recoupment payments, due to the claim will process, and because the provider is contracted, payment will be sent to them, and then the practice has money to refund. Best To Check with an Attorney, and check your contracts. I hope this helps.
Thanks so much for the resource, Charlie!
Hello, I am a psychotherapist in private practice and accept a few insurance plans. I am also certified in EMDR, a sought after psychotherapy treatment. While I plan on continuing to accept insurance, is it legal to only accept private pay for EMDR services even if I am in-network with a plan? Or is it only OK to do this with out of network patients or those who choose to pay privately?
If EMDR is a covered service by that plan, and your contract states you are required to bill the insurance for all covered services to their insureds, then you’re out of luck. BUT if it’s not a “covered service” you might be okay to provide on a cash-pay basis. defintely something to confirm with your attorney
Are there any guidelines to the amount submitted to insurance as the billed amount? And can it be more than their cash rate?
Hello, and thank you for this informative site. One question: Does this apply universally or is it site-specific if one is employed at two separate entities? For example, I have a cash business called XYZ, LLC, where no insurance is accepted and all payments are cash. I also offer my services a few hours per week as a 1099 private contractor at ABC, LLC, where I am registered with the insurance companies that ABC accepts and where my services are billed to insurance (no cash payments accepted). Since these are two separate entities, is it kosher for me to take cash at XYZ? Or am I still in violation simply by virtue of being registered with the insurance companies at ABC?
If Medicare is not involved in your question, you’d probably be okay in TX with the scenario you describe, but what you’re asking/suggesting could easily be affected by state law… so the take home point (and I’m sorry I can’t give a definitive answer) is that you’d need to ask these questions of an attorney in your state.
Thanks for all of your information. I am curious about something. If you are in network with only one insurance company because they reimburse well but out of network with all the others, can you bill the patients less who are out of network? (This is assuming you are giving a superbill to the patients who are out of network and they are submitting to the insurance company). Is there where the MFN clause comes in? For example, the insurance company would reimburse me approx $160/hour (depending on the codes) but I don’t want to have to charge that much to the OON patients–I would like to charge $120/hour for the OON patients. Is this ok? On that note, can you give a patient a discount if the $ goes towards their deductible? I.E. You charge the insurance company $160–it goes towards their deductible, but you give them a 20% discount. Thanks so much! I just can’t get answers to these questions anywhere!
The answer to these questions really should come from an attorney because the answers I have for someone in Texas could change from state to state depending on state law. I wish I could give you a set answer but I can’t since I’m not an attorney in your state
Can a private clinic (we are primarily PT, OT, ST, PSY) apply a fee to each visit for things like, disposables used, etc, even if there is not a code that applies? I know with Medicaid they will deny the payment, and other insurance like BCBS may as well. But could a fee like what we are discussing be applied and collected at the time of appointment (not including Medicaid or medicare patients) as long as the same fee was applied to all? In other words, we spend money on various props, food for feeding therapy, etc. There is some sort of expense related to each visit. Could we apply a $20 fee across the board?
Hello all, sorry to revive an older post but here’s my question. What if, for example, you have a patient with a commercial insurance you’re in-network with, but that patient will not commit to a PoC that shows any progress or just wants to come in prn? FLA is a limited direct access state. I have a patient who is very non-compliant and basically only will come in every once every other week or so and mostly just wants soft tissue work. I’ve already advised them that a) this isn’t therapeutic, and b) I can’t justify the services to their insurance because they’re not making any progress. Aside from just discharging them entirely, is there an option where I have them pay cash, and sign an ABN since their insurance won’t cover services without progress? Can they then submit the receipt to their insurance and deal with it directly with them? I do not want to keep them as an active patient if they won’t commit to a PoC but I also don’t want to deny them care entirely. Any insights or suggestions would be appreciated. Thanks in advance.
Would like to see patients in office 1 – insurance, and in office – 2, cash
If a patient comes in decides to be cash pay for PT and then after a few sessions wants us to bill their health insurance or the opposite bill health insurance and then decide to be cash after realizing that its cheaper to be cash pay can patients flip flop once they are in treatment.
I have started a cash-based practice and plan to not have any contracts with insurance companies to prevent the headache of different contracts with different insurance companies. Can I just plan to charge the same cash-based rate for all patients no matter what their insurance is and they submit to their insurance company or is there no way insurance companies will reimburse patients unless you are “in-network”?
Also have you ever known anyone to separate orthopedic/sports injury cases verses women’s health and charge more for women’s health/pelvic floor as it is more specialized and there is a higher demand for pelvic floor PTs? Can you charge a different rate for different types of treatment? I know a chiropractor that can charge separate rates but understand our practice laws are different.
Thank you so much for sharing so much good info. I love following your podcasts. Thank you for your time.
Depending on their out-of-network benefits, they will sometimes receive reimbursements, but the receipts that they send in need to have these components. As far as charging two prices, state laws will occasionally affect this but in general it is standard of practice to have one set fee schedule from which you operate. Since we as PTs don’t have seperate treatment codes for services to different parts of the body (example, we don’t have “manual therapy for pelvic floor” vs “manual therapy for knee”), and since your charge per CPT code shouldn’t be changing from one patient or visit to the next, I’m not sure how you could legally do what you are wanting to do when providing niche based services like pelvic floor rehab. Given legal implications of this topic, I’d have to recommend you’d check any future options with an attorney.
I am an slp and just started to be in network for ONE insurance carrier. I am based in NY. I’ve been private pay and some of my private pay go out of network. I keep it that it’s their responsibility to get reimbursement. I had the very question as above : setting the amounts to charge a client. And wanting to do a “prompt pay” option time of visit deduction. I’m so lost lol
If these are insured patients you are in-network with, you cannot give them discounts off a copay as stipulated by the contract. If you are talking about your cash-pay patients, I am unsure why they are not paying at the time of service in the first place.
I have a questions about out of network doctors. This patient had to go see a specialist that was out of network with their insurance. The office billed the insurance but since the patient was out of network payment was sent to the patient, the insurance only paid an allowed percentage of the proposed treatment plan and the office is saying the patient has to pay the remaining balance. The patients insurance is protected by the balance billing act and Is the patient protected? or do they have to pay the remaining balance?
When you say “since the patient was out of network payment was sent to the patient” do you mean the patient received money from the insurance company or that the bill was sent to the patient? Those would be two very different situations. I’m not a legal expert, I’d recommend you take all the information to an attorney to get their opinion.
My question is this; we have clients that have ins. carriers that we are NOT in network with, the client is financially strapper and we want to offer discounts as a cah pay client. My understanding is that if we offer a discount and then that client picks up different insurance that we are in network with we are only allowed to charge that same (discounted) amount when submitting claims to the insurance carrier. Is this true?
Is this also true when negotiating a single case agreement with the insurer that we were out of network with?
I’d need to know a lot more details to give an appropriate answer, but really many of the components of this question would be better handled by someone who deals regularly with insurance companies. One thing related to your first question is whether or not your contracts contain a “most favored nations” clause, which could have an effect on how much you are able to discount services for your cash pay patients but still charge a certain amount to insurance companies for the same services. Because of the legal implications of the topic, I’d have to encourage you to run these things by your attorney.
Hi Jarod! Great discussion you’ve got here! So…If I am a private practice that is in-network with all providers and MC, then I have to bill insurances. What if I started a separate corporation, at the same location, and this corporation was completely out of network with everything. I have all of my providers also employed by this corporation. Then, when a patient comes in and we want to provide cash services, we simply have the work done and billed to them under the out of-network corporation’s employees. Who could say anything about it?
I have to preface this one by saying this is not legal advice and you should check this legally sensitive advice with an attorney: with that said, I think this may be a valid plan as long as your employees are not specifically listed by name on the insurance contracts that you have in your in-network practice. If they are listed by name, they could still be tied to the regulations and clauses of those contracts, even when “operating” as an employee of the out-of-network practice. You might check out podcast episode 72 (drjarodcarter.com/72) where I talk with Maury Hayashida, who if I remember correctly, does just this and discusses within the episode.
I have found this site to be incredibly helpful in regards to trying to navigate through the insurance confusion. I am a Physician Assistant in Texas and am currently employed with a practice that has contracted me with multiple major insurance companies. I believe some of the contracts specifically have my name listed and others are billed under the practice and my supervising physician.
I am in the process of leaving my current practice to work at a completely cash-pay clinic and have given my practice a 30 day notice. If I no longer work under my previous employer and the new cash practice is billing under a completely new tax id not associated with insurance plans am I good to go? I know that some of the contracts say it can take 90 days to terminate, but I need to work … so does that mean I can’t see patients who utilize that insurance company until my contracts created by my previous employer are terminated? Thanks for the advice!
I have a patient that has a daughter that is currently without insurance. I want to help her out and charge only a nominal fee to see her until she gets insurance. We do take insurance at my practice. Could this be problematic in an insurance/legal sense?
If she doesn’t have insurance, you should be okay to charge her whatever you choose on a cash-pay basis as long as your contracts with insurance companies don’t include a “most favored nation” clause that specifically dictates what you can charge other patients (Not just other insurance companies or entities)
one pt place told me they accept my insurance but did not specify they were out of network. Other places did tell me they were out of network and gave me their rates. is this a red flag?
If they are not in-network, they should make it clear that they are not in-network, even if they will bill on your behalf as an out-of-network provider.
Hello Dr Carter, I have been working in private practice, only out-of-network or self-pay from the very beginning, for twenty five years. I recently have more free time and am wondering about opportunities for supplementing my practice by working part-time for a wellness company that has psychotherapy services and is looking for part-time providers. The company’s services are in-network. Working there would require me to complete the CAQH application and connect with all the insurance companies the wellness company accepts. My question is, would doing the CAQH for the purposes of working part-time with an in-network wellness company, impact my status as “out-of-network” in my solo private practice? It’s definitely not worth it to me to fill a few more hours, to give up my solo out of network practice! Thanks so much in advance.
Good afternoon, I have a question.
We are a license laboratory based in Illinois, however we currently have an out of state client who would like to start sending us certain laboratory testing, do we need state license to receive samples from patients paying with cash?
Hi, we were working with a child whose parent was self-pay; all bills were paid. Then, we were told that the child has BCBS and that the subscriber wants us to bill BCBS (for appointments already paid in cash). We were never told that the child had insurance. What are we supposed to do? Are we supposed to refund the cash payments and then bill BCBS?
Hi Dr. Carter:
I previously worked in a previous group practice. If I leave the group practice and open my own cash pay practice, do I need to opt out each individual insurance I was previously contracted with in my group practice?