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Old 01-20-2009, 12:40 PM
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Harrison Harrison is offline
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Default The Insurance Intelligencer - 1/19/09

The Insurance Intelligencer

Usual, Customary and Reasonable

The phrase "Usual and Customary" has been in the news recently. "Usual and Customary" nets health insurers billions of dollars every year. It puts dedicated medical providers out of business. It costs patients hundreds of millions of dollars that they never expected to spend.

The tables were turned last week. The Attorney General of New York took a long, hard look insurance company reimbursement policies, and "Usual and Customary" just cost United Healthcare fifty million dollars.

Remember, the entire insurance industry runs on words. Words with secret meanings. Words that the insurance company uses to shift costs from themselves to you, and to your doctor. Words which are carefully crafted to make you not question.

What words do health insurers use to save money BEFORE you get your treatment? They deny the treatment, by deploying the words "Experimental/Investigational." Most patients believe that the insurer has some type of proof behind these words. Further, they have no idea how to prove that the lifesaving treatment which they need is NOT experimental. So they give up.

What words to health insurers use to save money AFTER you get your treatment? "Usual and Customary." UCR is a mystery to even the most sophisticated medical consumers.

Let's see how it works ...

A new person calls me with insurance troubles. He needs very expensive out-of-network cancer treatment. I ask, "Do you have a PPO, or an HMO? He replies, "I have a PPO, so I can go wherever I want." I continue, "If you go out of network, how much will they pay?" People invariably reply, "80% (or 70%, or whatever percentage).

Then I ask the quiz question: "80% of what?"

I have asked this question of attorneys, bank vice presidents, college professors. Nobody has ever answered the question correctly.

80% sound like "a lot," doesn't it? No matter how much it is, I won't have to pay much, right? WRONG. Your insurer is not offering to pay 80% OF BILLED CHARGES. They are offering to pay 80% of Usual, Customary, and Reasonable charges.

Wait just a doggone minute? Usual and customary according to WHOM?

The one surgeon who can remove your difficult brain tumor is not contracted with your insurance company. Since you are especially diligent, you obtain an estimate for the surgery plus hospitalization: approximately $100,000. You say to yourself, "OK, I can manage to pay the $20,000 that they won't cover."

You have the surgery, return home to recuperate, and the bills start rolling in. Here is how UCR works. Your insurer deems ten percent of your $100,000 treatment to be "usual and customary." That would be $10,000. They pay 80% of that amount, which is $8,000. Since there is no contract between your insurer and the out-of-network doctor, the doctor is perfectly within his rights to balance-bill you for whatever the insurer doesn't pay: $92,000.

The surgeon who saved your life can either take a huge loss ... or bill you, and look like the bad greedy guy.

You may well ask, "How do insurers determine what is "usual and customary" for all of these surgeries and treatments?"

If you ask your health insurer, they will give one of two answers:

"That information is proprietary (secret)."
"Independent research from all across the industry."

Alrighty then! Independent research!

Guess where the figures really come from? A number-generating company called Ingenix. Ingenix is a subsidiary of ... drumroll please ... United Healthcare!

Makes sense to me. Truly the most brilliant case of cost-shifting ever. Truly the world's worst conflict of interest.

What do these words mean, and why are they so persuasive?

Usual: In accordance with custom or ordinary practice; Normal.
Customary: Based on or established by custom.
Reasonable: Possessing sound judgement; not extreme or excessive.

UCR is the most powerful piece of propaganda that I have ever seen. You couldn't possible dispute the insurer's offer to pay what is Usual, Customary, and Reasonable, could you? Because then you would be abnormal, excessive, and downright crazy.

Who suffers from this massive swindle? The ill and recuperating patient, who believed he was "covered at 80%," who never drilled down to find out what that meant, and who suddenly has to come up with $92,000." And the one who actually did the work, and saved your life -- the surgeon.

You pay more for your PPO. The premiums are higher than the HMO, the deductibles and co-pays are higher. For this, you get an illusion of choice, and the privilege of boing broke if you need to go out-of-network for medical treatment.

Think about it. Patients don't go out-of-network for the fun of it. They go because they are in trouble. Big trouble. Expensive trouble.

Will your entire out-of-network treatment cost more than you could afford to pay in cash? If the answer is "yes," then prepare to write your appeal. In the appeal, you will prove that there is no comparable treatment IN the network, and that the in-network doctors made some very embarrassing mistakes in your case. You will persuade them to sign a contract with your doctor-of-choice, requiring that your insurer pay 90% of BILLED charges.

I do it all the time, and I win them all the time.


**********

If this is news to you, Fight Your Health Insurer and Win should be on your shelf.
www.theinsurancewarrior.com

Happy and peaceful Insurance Warrior-ing,

Laurie Todd
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"Harrison" - info (at) adrsupport.org
Fell on my ***winter 2003, Canceled fusion April 6 2004
Reborn June 25th, 2004, L5-S1 ADR Charite in Boston
Founder & moderator of ADRSupport - 2004
Founder Arthroplasty Patient Foundation a 501(c)(3) - 2006
Creator & producer, Why Am I Still Sick? - 2012
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