Buckle up and and prepare for a long post on this one as we dive into how to understand the basics of your insurance and what you need to know to see your healthcare provider. Since we are a Physical Therapy provider, many of our examples will be related to the therapy world- it's what we have the most experience in.
Health insurance is a pain to say the least. If we have it, they make it obscenely difficult to use it, and if we don't have it, we run the risk of a major event knocking us off our feet physically and financially. So what do we do?
Well, I can't answer that for you. It's a choice you have to make when choosing your plan. You need to understand your numbers and how they are going to affect you with each visit to a healthcare provider.
Part 1: What do the numbers mean?
To break it down into the simplest parts, there are 4 main numbers you need to be aware of regarding your specific insurance plan: premium, deductible, co-pay, and coinsurance.
If you're a reading kind of person, keep reading. If you prefer to watch something, we made a video on this, too.
Premium: the cost of your insurance plan, typically billed monthly
Deductible: this is the amount you have to pay before your insurance will cover any expenses. This typically ranges anywhere from $1,000 to $6,000 and will differ between and in-network provider and and out-of-network (OON) provider. The more you pay in monthly premiums, the lower your deductible usually is.
In-network providers: providers who have negotiated a contracted reimbursable rate from the insurance company for visits and billed medical items.
OON providers: providers who have no contracted rate with an insurance company. The insurance company decides a predetermined rate that will be reimbursed for services.
Co-Pay: the amount you will be expected to pay to the provider at each visit, often regardless of whether you've met your deductible or not. This typically ranges from $20-$75 which can get expensive real quick if you have to see a provider (ex: Physical or Occupational Therapy) multiple times a week.
Co-Insurance: an additional amount you may be expected to cover per visit, even after you meet your deductible. This generally ranges from 10%-50% of the visit cost.
Now let's pull this all together with a few examples to see these numbers in action. For the sake of simplicity, we're going to use simple and basic numbers for math and follow a typical therapy clinic model.
Ex #1: Steve needs Occupational Therapy after a Total Shoulder Replacement. His OT estimates he will need to be seen 3x/week for the next 8 weeks (24 visits total). The contracted rate "Move Therapy" (totally made up clinic name) has with Steve's insurance company is $100/visit for reimbursement. Steve thankfully already met his $5,000 deductible because of the cost of surgery. He has a co-pay of $20/visit and has a 20% co-insurance for "specialty visits" which include PT and OT. Over the course of the next 8 weeks, Steve will pay $480 in co-pays and $480 in co-insurance for a total of $960.
Ex #2: Laurie recently started having back pain with numbness and tingling radiating down her leg after she tripped and fell down the stairs and landed on her tailbone. Her Primary Care Physician (PCP) recommended Physical Therapy at the local hospital. Laurie really likes this clinic as she is able to get 1 on 1 attention compared to busier outpatient clinics in her area (who are often seeing 3-4 people at a time). Unfortunately for Laurie, hospitals often have higher contracted reimbursement rates with insurance companies. Laurie's PT determines she will need 2 visits a week for the next 6 weeks to manage her back pain. Laurie has been fortunate with good health and needed no other care so far this year and has not met her deductible of $6,000. Laurie has a co-pay of $40/visit and a co-insurance of 50%. The hospital bills $350/visit for every 60 min session. Since Laurie has not met her deductible, she is responsible for the entirety of her therapy with a grand total of $4,200 over the next 6 weeks.
True Story: This second example is based off an eye opening experience for me when I happened to be in the front office when a patient walked in and said she could no longer attend therapy as, 3 weeks in, her insurance sent her the first bills and the total was ranging $300-$400 per visit that she was unexpectedly responsible for. Until this time, she had only been responsible to pay her co-pays each visit. And no, I had no idea the hospital charged that much, but you best believe the therapists got nosy after that so we could make appropriate decisions with our patients.
This is why you need to know your numbers ahead of time! Have you met your deductible already? If not, how much left do you have to pay out of pocket until you do? Do you know your co-pay and co-insurance? Have you requested a Good Faith Estimate from your healthcare provider? Have you shopped around the clinics in your area to see whether you're getting the care you need at a price you can afford? Will you bee seen 1 on 1 or with multiple people an hour?
By no means can you put a price tag on good rehab and long term wellness, but it is a factor few people consider when they whip out their insurance card and assume it will mostly be covered (happens daily) and then get an awful surprise bill in the mail weeks to months later.
Go learn your numbers!
Part 2: Getting in to see a healthcare provider- Navigating Referrals and Prior Authorization
This is another doozy in our healthcare system. For most specialties in healthcare you have to get a referral from your PCP or they will not see you. Once again, if you like reading, keep reading. But we did make a video for this one, too.
Fortunately, all 50 states in the USA now have some version of direct access for Physical Therapy. This is state dependent. For example, North Carolina has full direct access meaning you never need to see a physician to address your pain or injury unless it falls outside of the PT's scope of practice (ex: we determine your pain is actually referred from a kidney issue or we find a cardiac abnormality) or they feel you will need more than conservative care to manage the pain (ex: it's a fracture or significant tear that requires surgery).
In Georgia, where Age Fit is based, we have 21 days or 8 visits (whichever comes first) to see you without a referral. If at this time, we feel your care will extend past this, we will discuss this with you to help you get the referral you need.
*This does not apply to wellness or performance issues such as generally being healthier, improving your mechanics for weightlifting, or helping you improve your mobility and strength for running or pickleball. We can help anyone be healthier at any time :) *
The downside, is that your insurance may mandate you seek a referral first before you see your PT. This is specific to your individual insurance plan as well as whether they will require Prior Authorization (PA). Your insurance may require a PA even before your first visit and usually again after the evaluation where they determine how many visits they are willing to pay for your issue.
Here's the problem with PAs. Many of these are determined by a computer algorithm. They usually don't account for the actual person and are based on collected data. For example, it your referral states you have "Pain in right knee," you may only get approved for 4 visits because that's the lowest number of visits you'll need based on the algorithm's data. What it doesn't account for are whether your knee pain is actually due to a knee issue. It doesn't account for any comorbidities you have that may complicate your rehab and healing timelines. It doesn't account for your lifestyle and daily and recreational activities, or the goals you hope to achieve from therapy.
It's also a pain in the butt for your therapist who has to constantly submit more and more paperwork to get you more visits and figure out how to make your insurance realize there's more to you than just your right knee to consider. Especially if your pain is actually coming from your hip or ankle, because then they question why we're working on something other than your knee, despite the extensive evaluation we submitted explaining what the actual origin of the pain is.
The final thing to consider with insurance is that they have their own definitions of "medically necessary" and what is covered under this definition. This is another limiting factor in how close you can get to achieving your actual goals. In the minds of most insurances and their algorithms, it only matters if you can walk 300ft, do basic daily activities, get off the toilet, and keep your balance enough to stay off the floor. So what happens to the people who want to return to playing golf? Prevent a comorbidity or disease from progressing to maintain a healthy life? Run around the yard playing with the grandkids pain free? Denied. Too recreational. Not medically necessary.
You wanna use your insurance? Make sure you're in pain, injured, or declining medically. Unless you're really lucky and have some amazing wellness benefits from work!
I'm sure there's tone more we could say about insurance, but this is a good start. Know your numbers and know what you need to get to your healthcare practitioner.