Medical Billing in Dentistry
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      Estimating a patients out of pocket cost (as an in-network provider)

      This article will show you how to estimate a patients out of pocket costs as an in-network provider

      Estimating a patient's out-of-pocket costs as an in-network provider involves understanding several key factors that contribute to the overall expense. Here's a breakdown of how to approach this:

      1. Insurance Plan Details

      • Deductible: The amount a patient must pay before their insurance starts to cover costs. If the patient has met their deductible for the year, this can lower their out-of-pocket expenses.
      • Co-payments: A fixed amount the patient pays for a specific service (e.g., a doctor’s visit or prescription). Co-pays are usually lower for in-network services.
      • Coinsurance: The percentage of the total cost that the patient must pay after meeting their deductible. For in-network services, coinsurance rates are typically lower than for out-of-network care.
      • Out-of-Pocket Maximum: The maximum amount a patient will have to pay for covered services during a policy period. Once this is met, the insurance company typically covers 100% of the costs for the remainder of the year.

      2. Covered Services

      • Ensure you know which services are covered under the patient’s insurance policy and if there are any exclusions. In-network services are generally covered at a higher percentage compared to out-of-network services.

      3. Negotiated Rates with Insurers

      • As an in-network provider, you have agreed to accept a set, negotiated rate with the insurance company for services provided. This is typically lower than your standard rates for patients paying out of pocket. Estimating the cost involves understanding these agreed rates.

      4. Pre-authorization or Referrals

      • Some insurance plans require pre-authorization or referrals for certain services. If the service requires this and the patient hasn't received it, they may face higher out-of-pocket costs or denial of coverage.

      5. Procedure Codes and Billing

      • Always make sure to use the appropriate billing codes (CPT, ICD-10)

      Example Steps to Estimate Out-of-Pocket Costs:

      1. Review the patient's insurance information to identify their deductible, coinsurance rate, and out-of-pocket maximum.
      2. Check the negotiated rate for the service being provided as an in-network provider.
      3. Account for any remaining deductible the patient needs to meet before insurance starts contributing
      4. Estimate any co-pays or coinsurance that may apply based on the type of service..
      5. Provide the patient with an estimate that includes any expected out-of-pocket costs, ensuring transparency and clarity.

      By following these steps, you can provide a more accurate estimate of a patient’s out-of-pocket costs when acting as an in-network provider. Next, I will give you an example.

      Scenario:

      • Patient's Insurance Plan: BCBS PPO
      • Plan Deductible: $1,500
      • Out-of-Pocket Maximum: $4,000 remaining
      • Coinsurance: 20% (after deductible is met)
      • In-Network Procedure: Oral device/appliance used to reduce upper airway collapsibility (CPT E0486)
      • Cost of Oral Sleep Appliance (In-Network Negotiated Rate): $2,500

      Step-by-Step Breakdown:

      1. Check if the deductible has been met:

        • Let’s say the patient has already paid $1,000 toward their deductible for the year.
        • The patient still has $500 remaining to meet the deductible.

      2. Understand the costs and apply the deductible:

        • The full cost of the oral sleep appliance is $2,500 (in-network rate).
        • Since the patient has only $500 left to meet the deductible, they will pay the first $500 of the $2,500 to fulfill the deductible.

      3. Calculate the remaining amount after the deductible:

        • After the $500 is applied to the deductible, the remaining balance is $2,000 ($2,500 - $500).
        • Now that the deductible is met, the insurance will cover the majority of the remaining balance, but the patient will still need to pay coinsurance.

      4. Apply coinsurance:

        • The patient's coinsurance is 20%. So, the patient will pay 20% of the $2,000 remaining balance after the deductible.
        • 20% of $2,000 = $400.

      5. Final out-of-pocket cost estimate:

        • The patient will pay $500 (remaining deductible) + $400 (coinsurance) = $900 for the oral sleep appliance.

      6. Out-of-Pocket Maximum Consideration:

        • If the patient had already reached their out-of-pocket maximum of $4,000 for the year, the insurance would typically cover the entire $2,500 cost of the oral appliance. Since, in this case, the patient has not yet reached the out-of-pocket maximum, they will pay the full $900 as their share of the cost.

      Final Estimate:

      • Deductible: $500 remaining, paid first
      • Coinsurance: 20% on the remaining balance of $2,000 = $400
      • Total Out-of-Pocket Cost: $900

      Recap:

      • Deductible: $500 to meet
      • Coinsurance: 20% of the remaining $2,000 = $400
      • Total Out-of-Pocket for the Patient: $900

      While the estimate can be very helpful in giving patients an idea of what to expect, it is not a guarantee of payment. Final costs will depend on the insurance company's determination, the patient's benefits, and whether all requirements (e.g., pre-authorization) are met.