When you get health insurance, you might see a policy notation that outlays In-network and Out-of-network costs. You may even notice that the in-network costs are cheaper than the out-of-network costs.
What is an insurance network? How does it affect pricing? What can you do to make sure you're always getting service within your network?
Insurance companies often negotiate special rates with certain physicians, hospitals or other providers. These special rates mean doctors agree to accept discounted payments from their patients — which means those patients will have to pay less for services. A physician accepting the negotiated rates can be considered in-network.
Out-of-network providers have not negotiated special rates with the insurance company. As a result, these providers usually will not accept the patient's insurance at all. And even if an out-of-network provider does accept a patient's insurance, that patient still will likely pay a much higher percentage for care than if they stayed in-network.
Remember, a provider network is not the same thing as covered expenses. Your physician may be in- network, but your policy still might not cover every service offered by that doctor.
In-network vs. Out-of-Network Math
Let's say your total cost of care is $300, and your insurance company will pay $200 for the costs. An in-network provider might agree to a discounted rate of $50.
This discounted rate leaves you with $250 in total costs. If your insurance agrees to pay $200 for the cost of care, that leaves you with $50 for the costs of treatment. You will save $50 on the total cost of care.
However, let's say that you see an out-of-network provider who has not accepted the rate discount. You would not have the $50 rate available from an in-network doctor. Your total cost would remain $300, and you'd only qualify for $200 in insurance coverage. This would make your personal costs $100.
In this scenario, the cost for in-network care would be $50, while out-of-network care costs would be $100. You would save money by staying in-network.
How to Stay In-Network
Staying in-network means going to a doctor or facility that accepts your insurance. Most insurance providers will help policyholders find a physician in their insurance network. Often times, a physician's office can also verify whether they are in-network for your coverage.
We've got you covered. Call Simpson Financial Group, Inc. at (978) 222-3939 for a free health insurance quote.