How to become an out-of-network provider
Practice growth is hitting a wall, competition is draining opportunities and margins are razor-thin—sound familiar? Some cliched, albeit valuable, advice may be to think outside the box.
But what about thinking outside the network? While operating in-network can be advantageous, it undeniably carries some drawbacks. This is true for care providers of all kinds: eye care professionals, physical therapists, substance abuse clinics, chiropractors. Everyone deals with the struggles inherent in payers' networks.
Thinking outside the network may be the solution for providers who feel outside forces squeezing practice growth. Is it time for your practice to start thinking outside the network?
What is an out-of-network provider?
Network participation has benefits: It’s easy for people to find your practice, you have a fee schedule to work off of and prospects may be more likely to convert into patients.
However, care providers have to weigh those advantages against the drawbacks. We'll delve into those below. However, if you'd like to learn more about your specific practice discipline check out these posts:
- How to be an out-of-network vision provider
- The case for starting a cash-based physical therapy practice
Why leave your network in the first place?
Think about the time your staff invests in claims. Even in-network claims take some time and effort from your staff and can face rejection. And then consider the consistency with which your practice isn't adequately reimbursed by the payer.
Is it all worth it?
Research indicates doctors spend about 3 hours per week on billing-related activities. For each doctor, medical support staff spend an additional 19 hours per week on such tasks.
Furthermore, close to half of physicians report spending more than $40,000 per physician per year to observe insurers’ criteria, according to a survey from the Medical Group Management Association.
Ultimately these factors can negatively affect both practice revenue and patient outcomes. Much of that can be attributed to simply dealing with the demands of various insurers. In fact, 80% of the time spent on billing-related activities can be traced to the complexities of insurers' requirements for billing and collecting payment, according to one study.
You, your associates, your technicians and the rest of your staff have less time to care for patients due to hours spent on insurance administration. All the while those same hours are burning into your revenue—as if you’re trying to fill a leaky bucket.
And that's just the beginning. There are myriad reasons beyond the heaps of time invested for little payoff. For example, has an insurers' preferred treatment plan ever conflicted with your preferred course? Providers can sometimes feel at odds with the insurers they're in-network with, which ultimately affects patient care in addition to practice revenue.
Does OON offer more potential for success?
So it’s better to practice out-of-network?
Remaining in-network or leaving altogether is totally up to you. Do what works best for your practice!
However, there are certainly benefits to leaving managed care. Some trace back to misconceptions: Such as the idea that the only way patients will find you is through their insurance portals.
But there are other advantages. If you list the perks flexibility would rank near the top. Out-of-network care means your practice is no longer confined to strict rules and network rates. The world is yours!
You run things your way. Physical therapists and chiropractors can focus on the best course of care rather than a cost-efficient churn of appointments. Optometrists have the flexibility to ensure they're properly paid for eye exams and other care.
All of this adds up to better outcomes for the people trusting you with their health. But better care isn’t the only way that an OON practice helps you improve the services you offer.
How does out-of-network coverage work?
If you’re reading this article chances are you’re on insurers’ panels. When you go out-of-network your patients will still enjoy benefits from their insurers. The difference is how claims are filed. You have several options:
- Have patients them handle everything themselves.
- Ask patients to manage the claim themselves but offer hands-on guidance for each step.
- Use a web-based application like Anagram to file claims electronically.
Essentially, leaving a network means giving up the contractual relationship between your practice and the insurer. Your patients will still enjoy cost-sharing benefits, albeit not as substantial—that’s something you can workaround. You’ll still be able to work with people on the plans active in your area. The only thing that changes? The added freedom you'll get to run your practice the way you want.
Getting ready to go out of network
Going out-of-network is more than a flip of the switch. In fact, you should know your practice front-and-back, as it stands as an in-network practice, before you consider going out of network.
If you don’t know where your practice stands today, how do you know where it could be tomorrow?
- Can you break down by insurer the number of prospective patients who contact your practice? Which are the most and least popular carriers?
- Can you provide the same breakdown for your existing patients?
- Are there insurers operating in your region that you’re not in-network with? Do you currently have patients on those plans?
- Do patients not currently in-network with your practice offer significant opportunities for you to capture new revenue?
- Do you know how much uncaptured revenue there is to be had outside the networks you're currently operating within?
- Are you going to have patients manage claims or will you do that for them?
- If you’ll handle claims, what tools will you use to help?
- What sort of training will your office staff require to be able to effectively follow new workflows?
- Do you know what you’ll charge for the services or hardware you offer?
- Are your local competitors also cash pay?
- Do you have new scripts for staff to effectively communicate your new status as an ONN or Open Access practice?
The answers to these questions will help you identify the right path forward for your practice.
What is Open Access?
Out-of-network doesn’t describe the sort of practice you can build when you drop managed care. That’s why we use the term Open Access.
What does this mean? It means that your practice isn’t contracted with any one plan and is able to work out-of-network with any insurer in your area. Your practice is open to provide care for members of any plan.
Already an Open Access provider? Let your patients know with the #OpenAccess hashtag!
Differentiating your out-of-network practice
So you know what OON entails, you’ve studied how it will affect your practice and you're confident that being Open Access is right for you and your patients: What next?
You’re essentially starting a new business. So before you leave managed care you should identify what your brand differentiator is: Why should people in your community choose your practice?
Some competitors will have an automatic advantage via the in-network benefits patients can access. However, it's easy to overcome that edge through effective differentiation.
What is the specific value you offer prospective patients? What services do you specialize in and who’s best served by visiting your practice? Are you going to start offering telehealth services?
Answering these questions is the first step toward differentiation. Ultimately, you’ll want to identify your specialty, your target patient and the personality of your practice. All of these factors will contribute to your larger brand and how it stands apart from others.
Once you’ve established your unique brand and value provided you can begin pushing it through your website, email campaigns, local marketing and more!
How do you actually leave the networks?
Ending the relationship
So the time has come: Are you ready to break it off? If so, the following tips will help you carefully extricate yourself from networks.
Dropping out of plans in your region
When you’ve dug into every last dollar of practice performance; thoroughly understand the plans in your region and how they’re uniquely affecting your revenue; and have a documented brand and differentiation strategy; you’ll finally be ready to begin.
You’ve already sifted through the data. You know which plans are treating you best and which are worse for your practice. With that foundation you can start listing carriers starting with the worst one. That’ll be the plan you drop first.
You may have some cancellations - even if they’re short term. Ultimately, you’ll recover from that. But to mitigate potential pain in the near future, it’s best to drop plans one-by-one.
The break up: How to leave the network
When your list is ready it’s time to start breaking off relationships. You may have to jump through some hoops—depending on the plan you’re leaving it may be necessary.
The first thing you should do is call the insurer to identify the correct letter of termination address. The appropriate recipient varies depending on the carrier.
After you’ve sent your letter of termination you should regularly follow up. It will be on you to ensure you get a clear answer that the letter was received by the appropriate individual.
After the letter’s receipt, things can go a couple of ways. The insurer may drop you immediately or it may take some time for you to go off-panel. This window varies from 30 to 90 days typically. More often than not you’ll wait the full 90 days.
It’s time to start dialing the insurer again. This time to confirm that you’re officially off their panel. Occasionally the carrier will follow up with a date of termination, but typically it’s on the provider to find that date.
Type up notification letters or emails to patients and employers.
Notifying your patients
Some practitioners will say it’s best not to notify patients. They recommend informing them as they reach out to set up appointments.
However, for most practices, better patient relationships will be a big component of their brand differentiation. Failing to notify them that you’re OON moving forward may not be the best way to start those relationships.
Honesty is probably the best policy in this case. Type up a letter or email for your existing patients explaining:
- You’ll be outside their insurance networks moving forward but that they can continue to take advantage of benefits from their insurers.
- Your mission statement moving forward. Focus on the unique value you’ll be able to bring your patients.
- How you’re willing to assist them with out-of-network claims.
- Who they should contact with any questions.
You don’t have to send these letters or emails to all of your patients at once. You can do it in batches by insurer if you’re going off-panel one-by-one.
Notifying local employers
You should also let employers know that you’re leaving their contracted networks. You can negotiate case-by-case deals with employers in your area to ensure their staffs’ healthcare needs are met. You might be able to strike an agreement that works better for your practice, the employer and the employees.
Your independent new practice
Finally: Your practice is running by your rules. So what exactly does that look like going forward?
What are you going to charge?
You’re no longer subject to a fee schedule, so what are you going to charge for services? Here' a trick we picked up from a great Eyetrepreneur webinar:
Start by identifying your most frequently used procedure codes. Once you have those rounded up head to the Centers for Medicare and Medicaid website and navigate to the Physician Fee Schedule Search page. This tool will help you set some baseline prices.
After all, CMS has already put the time into determining what each covered service is worth—why should you? It’s easy enough to plug in codes and build in whatever additional fees you may charge from there.
Take a look using a common code such as 99213.
Enter the procedure code, your locality and select "All Modifiers." Once you’ve submitted your search look for the non-facility limiting charge.
That will be the baseline cost for each service you look up—the amount Medicare, and most carriers, are willing to reimburse for each provided code.
What about non-covered services?
The non-covered services you offer probably lie well within your niche. These are the foundation for your brand differentiation. For that reason, it makes sense that you put additional time into them.
If a rushed, in-network appointment takes 15 minutes then maybe yours will last half an hour. If that’s the case, take the standard rate and double it to account for the extra time invested and to ensure the best care possible.
That feeling when you have a new patient.
Selling patients on out-of-network benefits
Going OON means speaking to your patients about their insurance benefits differently. Many don’t know they have out-of-network benefits! Simply getting on the same page as prospective patients regarding their out-of-network benefits will require a new approach.
For most practices this will start with your front desk staff. They’re often the first to engage with new patients. And when existing patients call to set an appointment it will be up to your front-desk staff to explain new processes. It’s crucial to educate these employees on the new language and scripts, as well as benefits for patients.
For example, rather than having your front desk staff say “we’re out-of-network with VSP,” you could ask them to explain that “yes, we work with all types of insurance on an Open Access basis.”
By having your staff answer in the affirmative you’re ensuring that prospective patients don’t feel turned away before they’ve even had a chance to discuss care. Whether the individual sets an appointment or not your practice comes off as more friendly and helpful than it would have with another answer.
It’s at this point that your employees can explain what many potential patients don’t know: Their insurance plans likely include out-of-network benefits in addition to their in-network benefits. With the right script your staff will be able to overcome objections and sell the merits of your Open Access practice.
What about out-of-network costs
You may have to address your rates as well. OON rates may be higher than in-network prices. This can be viewed either as a barrier or as an appropriate value for more transparent, flexible care. How your practice sells itself will make all the difference.
What many providers find is that oftentimes when patients realize the quality of care and the level of custom treatment they can receive out-of-network they're sold. People are willing to pay for better products. How do you think Apple continues to sell its products, after all?
What can you do to differentiate your practice to improve perceived value and justify the cost of OON care? Carve out your niche and follow the selling strategies below:
Selling strategies for Open Access practices:
Here are a few options for selling your open network practice to prospective patients:
We’re a concierge practice
If you’re willing to provide the requisite level of service you could self-describe as a concierge practice. What does this mean? That your patients will get concierge-level service from the moment they step into your building—better yet the moment they set an appointment!
Acknowledge that filing claims can be a headache and offer to assist with the insurance submission process to help convince prospective patients any additional cost is worth it.
Patient and practice are partners
You could also explain that you’re all in this (that aforementioned headache) together. Essentially: You’re not partnered with anyone but your patients. On paper that sounds good but what does it really mean? Your practice isn’t restrained by third-party rules anymore. You can pick who you want to work with to ensure the highest quality services and materials are available in your community.
The out-of-network value-added
Ultimately the value you provide as an Open Access provider is transparency and flexibility. You’re able to choose pricing and provide it to patients upfront and you’re not limited in the services and materials you may offer.
If patients aren’t willing to pay extra for that then they will leave. But you will also open your practice up to new, OON sources of revenue and individuals who are OK with paying a little more for better service from their care providers.
How to bill out-of-network
When you’re done treating patients someone will still have to file a claim. Billing as a cash-pay practice offers you more options than you had before. You can choose whichever route works best for your patients and aligns with your practice mission.
Filing an out-of-network claim
One nice part about billing out-of-network is that you no longer have to take care of claims for your patients. However, if you’re selling your practice as one that offers concierge-level service then you may want to make an effort to continue assisting with claims.
Since you’ll no longer be able to submit claims through insurer’s portals you’ll likely have to do so by mailing in paper forms. Unfortunately, this can get messy.
Claim was denied: Sound familiar?
Filing and submitting claims forms manually is a process primed for mistakes. To err is human, but, in this case, forgiveness isn’t coming your way. Instead, an error on a claim form will almost certainly result in an insurance claim denial.
No one ever said claims were divine, anyway. But you’ll certainly find yourself praying as you push through the claim denial appeal process. However, when you go out-of-network you have options to make everything about claims easier.
Out-of-network provider claims and reimbursement made easier
One workaround is to get Anagram. Anagram removes paperwork from the claims process so you no longer have to take the time to fill out and mail forms. Nor do you carry the risk of human error like you would with paper claims.
This way you can help patients unlock access to the OON benefits they never knew they had. It will also help your practice build better a better billing cycle and accounts receivable.
Another benefit of this service is for some plan members you get to choose who receives the reimbursement:
- If you don’t want your patients to have to deal with claim submission at all, you can charge them a discounted rate and send the reimbursement to your practice.
- Or you can have your patients pay in full upfront and send the reimbursement directly to them. Think of it as a rebate program of sorts.
The freedom to run your practice your way
What does everything above add up to? The freedom to run your practice the way you see fit. You set appointment times however you want and control patient flow. You choose whichever rates work best for you. You have the flexibility to offer patients care that results in truly better outcomes.
If this is how you see your practice then maybe it’s time to start exploring outside the network thinking. And if you need any help along the way tools like Anagram can make the transition easier.
Rearrange out-of-network care with Anagram
With Anagram the hope is that your practice is able to make paying for care easier by removing surprise bills and the restraints imposed by third parties. For care providers considering going out of network that means an easier claims submission and reimbursement process. Claims submitted through Anagram are filed electronically and have a nearly 0% denial rate.
If spending more time managing patients’ claims was an obstacle to going out of network, then look no further: This web-based application eliminates that concern. If you’re interested in learning more about Anagram request a demo!