Out-of-network providers: 6 things to know before you go

What happens if you need an out-of-network provider for medical care?

If you're like most people, your first thought is probably, “This is going to be expensive.”

It’s true. Out-of-network care can cost more, but how much more, and why, isn't always obvious. 

• Maybe you need to see a specialistspecialistA physician specialist focuses on a specific area of medicine or a group of patients.
  Read more » who isn’t in your plan’s network.
• Maybe you have established relationships with providers outside your network.
• Maybe it's simply more convenient, like if you're in the process of moving, your health plan recently changed, or you're on vacation when you need care and an out-of-network provider is your only option

Whatever the reason you might need to see an out-of-network provider, here are 6 things to know about the costs before you go.

1. Know the difference between in-network and out-of-network providers

The term "network" doesn't just refer to your office computers. Your insurance company has a network too:¹

• A network is a group of healthcare providers it contracts to provide you service.
• In-network providers (which include doctors, nurses, labs, specialistsspecialistsA physician specialist focuses on a specific area of medicine or a group of patients.
  Read more », hospitals, and pharmacies)  agree to charge rates set by your insurance company.
• When you use in-network providers, you pay a set part of the total bill: your copaymentcopaymentFixed amount you pay for a covered health care service.
  Read more » or coinsurance.

Out-of-network providers are a different story:

• They haven't agreed to a contract with your insurance company and may charge higher rates for the same services.
• That doesn't mean your insurance company will pay those higher rates.
• If your plan covers out-of-network care at all, it may only pay what it would for an in-network service. As a result, you could owe a larger share of the bill in the form of higher copayments and coinsurance.

2. Understand copays: in-network vs. out-of-network

Let's look at examples of a copay for in-network care vs. out-of-network care.

The in-network copay

Say your in-network doctor has contracted with your insurance company:

• They agree to charge $200 for a simple office visit.
• Your insurance company has agreed to pay $170 for that office visit.
• Your copayment will be the remaining $30.

Nationally, the average copay for a primary care visit is $27, and the average copay for a specialist visit is $45.²

The out-of-network copay

Out-of-network care doesn't always work on a flat copay system the way in-network care often does.

More commonly, your plan applies coinsurance instead, a percentage of the bill, or requires you to pay the full amount upfront.

But it's still useful to see the cost side by side using the same copay structure. Say an out-of-network doctor hasn't made this contract with your insurer:

• This doctor charges $300 for the same office visit.
• Your insurance company still pays $170.
• This means you would pay the difference: $130.

In this example, you could pay an estimated $130 more for the exact same care from out-of-network providers.

3. Get clear on coinsurance costs: in-network vs. out-of-network

What you pay for care sometimes depends on your plan's coinsurance agreement, and that agreement differs for out-of-network providers.

The in-network coinsurance cost

Say you pay 19% coinsurance on in-network doctor visits, the current national average.²

• An in-network doctor has agreed to charge $200 for a visit.
• 19% of $200 leaves you paying about $38.
• Your insurance company pays the remaining 81%, or about $162.

The out-of-network coinsurance cost

Now say an out-of-network doctor hasn't agreed to lower their prices for your insurer:

• They charge $300 for the same visit.
• Your insurer might apply a higher coinsurance percentage for out-of-network care (for example, 30% rather than 19%).
• You may also be responsible for the difference between the in-network and out-of-network allowed amounts.

Combined, out-of-network coinsurance and balance billing can add up to a meaningfully higher bill for the exact same visit.

4. Watch for out-of-network services that aren't covered

Can you just go to an out-of-network provider and expect your plan to pay part of the bill?

You could, but you could also be surprised when the bill arrives. In some cases, your plan may not pay for out-of-network care at all.

Health Maintenance Organizations (HMOs) often work this way. If you need an out-of-network specialist, you may be able to appeal to your insurance company for an exception, but there's no guarantee it will be granted.

No Surprises Act protections

If you have to see an out-of-network provider and you're worried about cost, don't avoid getting care you need.

Your health is important. Since January 1, 2022, the No Surprises Act has protected people covered by most types of health insurance from unexpected out-of-network bills for:³

• Emergency room visits
• Certain non-emergency care connected to an in-network facility
• Air ambulance services

5. Compare out-of-network costs carefully

It's possible to shop around and compare prices among out-of-network providers. But it helps to know what's actually changed here recently.

One recent study looked at what happened after the No Surprises Act took effect. In states that newly gained its protections, out-of-pocket spending for privately insured adults dropped by about 16.5%. That's a bigger drop than in states that already had similar protections in place.⁴

That said, the law's protections are narrow. They cover:

• Emergency care
• Air ambulance services
• Certain non-emergency care tied to an in-network facility

They don't cover routine visits to an out-of-network provider you've chosen yourself. For those situations, staying in-network for non-emergency care generally keeps costs more predictable.

6. Plan ahead when you can

Navigating in-network vs. out-of-network care isn't always simple. A few things you can do:

• Use in-network providers for non-emergency care when you can.
• Compare prices between different out-of-network providers if you need one. Even in-network providers can charge different rates for the same service.
• Find out if your plan posts price information online.
• Check your benefits package for copay, coinsurance, and out-of-network details.
• Call your insurance provider with questions.
• Remember you have the right to choose the doctor who serves your needs best.

Build in a cost cushion with supplemental insurance

After weighing your in-network options, what if you still need out-of-network care?

Supplemental health insurance is one way to make those out-of-pocket costs more manageable.

• Supplemental insurance plans can help with costs from events like major accidents or serious diagnoses, including deductibles and other out-of-pocket expenses.
• These plans typically can't provide coverage after you've already encountered a critical illness or injury. So you need to purchase supplemental coverage in advance.

To find out more about your supplemental health insurance options, give us a call at (855) 217-0749 to speak with a licensed health insurance agent.