All About allowed amounts

Allowed amounts are a cap that insurance puts on a service. The policy does not cover any amount over that cap. For example, you pay $5000 for global maternity, and we bill your insurance $5000, but the allowed amount is $3000. Insurance will ignore $2000 of the bill and only apply coverage to $3000. You will be responsible for paying anything over the allowed amount in cash without insurance help, especially if you have a signed agreement with your provider acknowledging their fee.

Knowing the allowed amounts can help you determine how much your insurance will pay for a particular service. The Affordable Care Act made it a law that insurance companies must be transparent about the allowed amounts for clients seeing out-of-network providers. 

Start in your insurance portal. If your plan offers a cost estimator or out-of-network estimate tool, use it to search the procedure codes listed below. Some plans show the allowed amount (or the amount they base benefits on) directly in the estimate.

Call the number on your insurance card and say:

“I’m seeing an out-of-network provider and I’m trying to estimate my total financial responsibility, including any balance billing. I need the out-of-network allowed amount (or the amount you use to calculate benefits) for these codes.”
 

Under federal Transparency in Coverage rules, many health plans are required to publicly disclose out-of-network allowed amounts and billed charges for covered services, which means the plan should have access to this information. 

Ask:

“For out-of-network care, is my coinsurance a percentage of the billed amount or the allowed amount?”
 

• If they say it’s based on the allowed amount, then say:
   “Great — please tell me the allowed amount for each code.”
  
   

Diagnosis code: O80 (Maternity)

Ask for the allowed amounts for these CPT codes:

• 59400 (Global maternity)
   
• 59426 (Prenatal care)
   
• 59430 (Postpartum care)
   
• 99215 (Office visit)
   

The allowed amount is typically a dollar amount (or a plan-defined amount used to calculate benefits). If the rep only gives a percentage, a range, or says “it depends,” respond with:

“I understand it may vary — I’m asking for the plan’s out-of-network allowed amount or historical allowed amount used to calculate benefits for these CPT codes.”
 

If the rep cannot provide any allowed amount or estimate:

• Ask for a supervisor or escalation team.
   
• Repeat:
   “I’m requesting the plan’s out-of-network allowed amount (or the amount used to calculate benefits) so I can estimate my responsibility before receiving care.”
  
   

If they tell you “the provider should know,” you can say:

“The provider is out-of-network and does not have access to your plan’s allowed amounts — only the plan does.”
 

If your plan will not provide an allowed amount or doesn’t provide a way to access it, you can:

• File a complaint with the U.S. Department of Health and Human Services (HHS), and/or
   
• Contact your State Insurance Department / Insurance Commissioner

We submitted a question to HHS.gov about allowed amounts for our clients working with out of network Midwives and this is the response we received:

COPY OF EMAIL FROM Federal Health & Human Services:

"This is an update on your Health Plan Price Transparency inquiry. Please find our response below.
PT Case Number: 83702282011195
Status: Answer communicated to submitter

Health Plan Price Transparency case summary:  "We are an out of network provider. Is the insurance company supposed to tell their members the allowed amounts for out of network providers?
Having this information can make a big difference to the patient, since they  can calculate what may be balance billed and what will be covered.
Many  of our patients contact their insurance companies asking for the  allowed amounts, using the correct codes, but the insurance company does  not supply them. The client is not able to know what coverage to  expect, due to the nature of balance billing.
Thanks!"

Response:  The Transparency in Coverage final rules apply to group health plans  and health insurance issuers in the individual and group markets.  Providers are not required comply with the Transparency in Coverage  rules. 
Group health plans and issuers of group or  individual health insurance are required to disclose pricing information  to the public in two ways.
First, a set of machine-readable files containing the following sets of costs for items and services

• In-Network Rate File: rates for all covered items and services between the plan or issuer and in-network providers.
• Allowed Amount File: allowed amounts for, and billed charges from, out-of-network providers.

Second,  an internet-based price comparison tool (also available by phone, or in  paper form, upon request) allowing an individual to receive an estimate  of their cost-sharing responsibility for a specific item or service  from a specific provider or providers, for all items and services. This  includes the out-of-network allowed amount or any other rate that  provides a more accurate estimate of an amount a group health plan or  health insurance issuer will pay for the requested covered item or  service, reflected as a dollar amount, if the request for cost-sharing  information is for a covered item or service furnished by an  out-of-network provider; provided, however, that in circumstances in  which a plan or issuer reimburses an out-of-network provider a  percentage of the billed charge for a covered item or service, the  out-of-network allowed amount will be that percentage. We  recommend your clients log in to their member portals on their plan's  website and use the internet-based cost-comparison tool to find  personalized cost-sharing estimates. If your clients experience any difficulties with this, they can submit a complaint at https://www.cms.gov/healthplan-price-transparency/contact-us. 

Resources:
For additional questions, contact: PriceTransparencyInCoverage@CMS.hhs.gov.

Additional information is available at:
• Transparency in Coverage: https://www.cms.gov/CCIIO/Resources/Regulations-and-Guidance#Transparency
• CMS Transparency in Coverage website: https://www.cms.gov/healthplan-price-transparency

Thank you,

Transparency in Coverage Support Team
Center for Consumer Information & Insurance Oversight
Centers for Medicare & Medicaid Services
U.S. Department of Health & Human Services"