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Contract Clauses on Administrative Fees

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Are there any precedents for physicians losing insurance contracts because patients were billed for “administrative” or other noncovered services?

 

Question: I came into my office one morning and found two volumes of one of our BCBS contracts that I was supposed to sign. I love how insurance companies “negotiate” with physicians. “Here, sign this” is more like how it is done. Each book was roughly 200 pages and, as I looked through one of them, I found a paragraph stating the physician was not to charge any fee above the billed charge for any administrative, office, or overhead costs.

Are insurance companies routinely putting language like this in their contracts? Are there any precedents for physicians losing insurance contracts because patients were billed for “administrative” or other noncovered services?

Answer: First, how impressive that you actually read the contract!

Sure, some, maybe not most, contracts include such language.

Your goal is to edit it in a way that makes sense. The payer does not want you billing patients for things it considers covered in the billed service. That is quite separate from things not covered by a billed service.

And there is the big gray area that makes this such a difficult topic.

But here’s a concrete example: If during a regular scheduled appointment, you do a routine E&M and write a script or update an immunization record with the chart right in front of you, it wouldn’t be fair game to bill an additional administrative fee.

But what about those school forms that come in completely unrelated to a patient visit (billed service), forcing you have to pull a chart, spend 20 minutes filling it out? I think there are grounds here to bill a set fee.

Certainly, you can discuss with your payers. But this sort of fee-per-form concept is used widely.

I have heard of practices getting warning letters from payers; I’ve not heard of anyone losing a contract, but that doesn’t mean it hasn’t happened.

It is gray, but charging for some specific thing outside a service seems more clear than charging an annual fee.

 

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