Here are definitions for some of the terms used.
Balance billing is when a provider of a medical service bills the patient for the difference between the provider’s actual charges and the amount the provider is reimbursed from the patients insurance benefit plan. This commonly occurs when a patient seeks services from an out-of-network provider, but has been prohibited by the contracts governing the relationship of in-network providers.
In-network providers negotiate a contract with an insurance network that specifies what they will be reimbursed for providing services to patients that are members of that network. They agree to accept the agreed upon reimbursement amount as payment in full for their services.
Out-of-network providers - Out-of-network services are those provided by physicians or other health care providers that have not entered into a contract with the health insurer to accept discounted rates.
Durable Medical Equipment (DME) is a medical item that can be used repeatedly and would not generally be useful to an individual in the absence of an illness or injury e.g., crutches and wheel chairs.
Deductible – The amount a member must pay out-of-pocket for services before the insurer will start making payments for covered services. A deductible is typically set on an annual basis.
Usual, Customary and Reasonable (UCR) - Before managed care became common, medical service providers typically charged insurers a retail, non-discounted rate for services. The concept of usual, customary and reasonable rates was developed to protect against providers engaging in fee gouging. Health insurers generally calculate coverage for out-of-network benefits based on a percentage of UCR rates.
The American Medical Association (AMA) defines Usual, Customary and Reasonable (UCR) as:
"Usual": the fee an individual physician usually charges his or her private patient for a given service (i.e., his or her own usual fee);
"Customary": a fee that is within the range of usual fees physicians of similar training and experience currently charge for the same service within the same specific and limited geographical area; and
"Reasonable": a fee that meets the above two criteria and is justifiable, considering the special circumstances of the particular case in question without regard to payments that governmental or private plans have discounted.As I mentioned previously, this is the only example I know of where providers are permitted to balance bill in-network. In all other instances, they are reimbursed at the rate they negotiated in their contracts with the insurers. It's particularly difficult to communicate and difficult for people to understand since it's so outside the norm.
Originally posted on Inside Workplace Wellness -- http://www.insideworkplacewellness.com/2012/11/insurance-coverage-for-hearing-aids.html