Medicare Claims Repricing Based on Medicare Rates
Physicians and hospitals that accept Medicare reimbursement agree to fixed prices for the services and treatments they provide to Medicare patients. These prices are established by CMS (the Centers for Medicare and Medicaid Services). Prices for those services are typically a fraction of what insurance companies or privately insured patients pay, and they increase by more than three times the rate of inflation every year.
Payers (self-funded employers, health plans, etc.) of all sizes will benefit from Medicare Reference-Based Pricing, reducing their short-term as well as long-term costs.
Several payers use our Medicare Reference-Based approach for all of their Medicare-covered claims, while others use it for their out-of-network claims, for hospital or physician claims only, or for specific services such as dialysis.
Here is how it works. CMSPricer, a SaaS-based Medicare repricing system, is perfect for payers to determine the number of Medicare rates they’ll pay, which is usually between 1.2 and 2.0 times the Medicare rate. CMSPricer reprices Medicare claims based on the multiples set by the payer when a plan member receives care and the provider submits a bill to the payer.
Regardless of your clients’ circumstances, there may be a better option for them if they self-insure their health benefits, particularly if they benchmark claims against the Medicare rates. Additionally, you can earn a handsome income just by virtue of your expertise in the topic.
What can you do? Your clients will likely turn toward self-insurance with or without your lead as their headcounts rise. You can look like a hero if you advise them wisely, though you have a great deal of influence on how they prepare for the transition.
Understanding Self-Funded Health Benefits
An employer who self-funds assumes the financial burden of paying the employees’ medical claims. TPAs design a plan that meets the employers’ needs, including determining how employee and employer costs will be split. Copayments, deductibles, and payroll deductions are often included in fully-insured plans. TPAs contract with provider networks and administer claims.
As a precaution against catastrophic costs associated with a major medical expense or a high number of claims, employers opt for the reference-based pricing model, often called Medicare-plus model.
An employer may choose to use the Medicare-plus approach for all claims, only hospital claims (and pay contracted rates for physician services via a PPO), or for specific services such as dialysis.
Here’s How Reference-based Pricing Works
TPAs are billed after employees access care. TPAs work with organizations such as ours to reduce the cost of medical claims. The bill is re-priced using the Medicare rate. Next, the TPA pays a reduced amount.
In other words, RBP limits the amount of reimbursement a health plan will pay to providers. Facilities such as hospitals, surgery centers, radiology centers, etc, can be modeled using the RBP model. RBP models have also been developed for physicians’ services in recent years, aiming to save money in every aspect of medical care.
RBP model claims repricing process leads to more-predictable claim costs and because it reduces employers’ spending. Simply put, it’s an alternative to shifting costs to employees.
CMSPricer: How Can It Help TPAs and Self-Funded Employers?
Providers must communicate with payer representatives about their payment processes since Medicare claim repricing differs between payers. By using CMSPricer, you will spend less time analyzing remittance advice since all services will be paid correctly.
With CMSPricer, TPAs and self-funded employers can manage claims more effectively by using an easy-to-use SaaS-based Medicaid & Medicare repricing system. Using this platform, payers, PPOs, TPAs, BPOs, self-funded employers, and auditing firms can streamline their processes and get paid faster.
For more information on how our Medicare claims repricing system can help you save on Medicaid and Medicare claims, please contact us.