So my wife has a Med Supplement policy. We just got a statement about a recent claim.
Billed amount 3,726
Medicare approved amount 459.68
Medicare payment 366.25
Not covered amount 0
Our payment 93.43
You may owe 0.
My main question is about the Medicare approved (in combination with the Medicare Payment and Not Covered Amount, I suppose). Does that mean she would have only been responsible for 93.43, even if she did not have this Medicare Supplement policy?
I know my Medicare Advantage plan includes some negotiated prices with some facilities. My EOB’s show what the provider billed, what the plan approved, and my cost as the difference. There, at least for in-network, I think the approved amount is those negotiated prices.
As far as I’m aware, her Medicare Supplement does not have a network. So why is the total cost the facility is getting so much lower than the billed cost?
This is just for curiosity/understanding. We’re not going to drop her Med Supplement regardless of whether it helped her by just 93.43 or over 3,000 on this claim.
rant\]Wife refuses to recognize there is a difference between Medicare and Medicare Supplement. She insists on referring to statements from the Medicare Supplement insurer as "From Medicare". So today she got the statement "from Medicare" and "they paid $93.43"\[/rant\] (This after we had received two bills from the provider for over $3,000 each because of confusion over what coverage she had. Though \[rant\]provider should beyond any doubt have known that she at least had medicare, IMO\[/rant
What I’ve seen from a general health insurance perspective is that there are “layers” of items to work down through.
The provider has a set cost for a given procedure, facility use, physician cost, etc. that is part of their “starting” point. Who know how they determine that, but I believe it’s part of the necessary accounting for the business to assess/reconcile their tax liability.
From there, you’ll see something that would be “amount approved” which I believe is the negotiated cost between the provider(s) and the insurer. This is the amount from which all of your benefits/coverage is assessed against. In your case, this would be $459.68. The difference between this and the “billed amount” of $3,726 is NOT your responsibility. I’ve seen some providers try to get you pay some/all of this difference, but if you have your EOB, they can’t enforce any sort of collection against you.
“Medicare Advantage” plans I believe are essentially a private party coverage that is “Medicare approved”.
IIRC, Medicare Supplement is a policy to help cover those OOP costs that would be your responsibility to pay; like deductibles, coinsurance, and copays.
Assuming that you received the above billing from Medicare (not Med Supplement), your responsibility of the bill is $93.43. This is the amount that the Medicare Supplement is intended to help cover. However, the provider is expecting you to pay this in a timely manner and they’re likely do know (and don’t care) if you have the supplemental insurance coverage. If it’s not paid, they’ll come after you for collections.
Not sure of the mechanism for getting that $93 paid by the Supplement. Either you just pay it and seek reimbursement (what I’m thinking is going to be the case) or you can submit it to the Supplement and they’ll pay it on your behalf.
Bottom line, for this bill, you only need to pay that $93.43 and no more.
Thanks. And the e-mail I was describing was from the Med Supplement insurer, which confirms they did pay the 93.43, so we don’t need to pay anything more.
But I still don’t fully understand your response. The letter says 459.68 is the “Medicare approved amount”, which you describe as a negotiated amount between provider and insurer. So in this case should I interpret this as “a negotiated amount between provider and Medicare” since Medicare is an insurer in this claim? That’s how I was interpreting it at the time I made my first post.
After seeing your response, perhaps I should interpret it as “the negotiated amount between the provider and Med Supp insurer for this treatment when Medicare coverage is primary”.
I do believe that Medicare is an insurer in that context and my interpretation of “Medicare approved amount” is the maximum amount the provider can collect on that line item (or bill) from all sources.
The Medicare Supplemental has zero impact to what that maximum amount will be. That maximum is determined entirely by Medicare and Medicare Supplemental is ancillary to this process.
Thanks. So Medicare regulates total provider can collect from all sources. I didn’t realize that, consciously. But I suppose it makes perfect sense in conjunction with “provider accepts medicare”.
for Part B Medicare generally pays 80% of the cost, Med Supp the other 20%.
Medicare does the Reasonable and Customary calculations and all the adjudication and negotiation. Med Supp pays what they are told.
So, yes. Without Sup, you would have had to pay the $93
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I would add that it’s not just Medicare that does the “reasonable and customary” calculations. Every insurer does that.
The size of the insurer–and Medicare is pretty significant–can have a big influence on what they’re able to “get” in terms of the “allowed”. The balance with this is that a provider isn’t obligated to take a particular insurer/program . . . for example, Medicaid is a program with guaranteed payment but it has restrictions on how the provider sets their initial billing amount. So some providers won’t take it.