ie a pharmacy will take insurance A but not insurance B, forcing someone with insurance B to look at other pharmacies or pay a greater amount of money out of pocket.
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Because each entity has to enter an agreement with each available Insurance entity or payment won’t be issued.
Pharmacy A might have an agreement with Humana which Pharmacy B does not have. Likewise my doctor might have an agreement with Anthem that your doctor doesn’t have. Usually it involves the write-off amounts affecting the reimbursements to the charging entity.
In short, Capitalism.
Service providers should receive fair and reasonable reimbursements.
It’s the insurance company or, moreover, their third party billing network for that insurance company that is the problem. Slow pay and short pay providers get booted.
Whether a pharmacy or doctor will “take” an insurance just depends on whether they are willing to deal with the insurance to bill them for you. Each insurance has its own rules for billing, coverage, and preauthorization, and many doctors and pharmacies don’t want to have to deal with all of the difference processes and each of their timelines. You can always pay the bill upfront then ask your insurance to reimburse you and you **should** end up in the same situation as if the doctor bills them for you (though they will probably be “out of network”).
There is also the very important “in network” aspect, which is whether the doctor or pharmacy has a contract with a specific insurance. These contracts will include terms such as how much the insurance will pay for a given procedure or medication, and will almost always prohibiting “balance billing”. Balance billing is where the doctor or pharmacy can bill the patient for any difference between what their charge and their insurance agrees the procedure costs, which is often not the same as what the insurance will pay – namely, deductibles and copays make that final difference.
Any doctor or pharmacy that is “in network” will “take” the insurance, but many that are “out of network” will also “take” the insurance, though you will typically pay more for the same procedure.
unfortunately health insurance isn’t simply intercepting your medical bill and paying for it. All the healthcare providers and insurers all have special pricing deals with one another so everyone gets a cut of the cash. So if a service provider and insurer don’t have an agreement in place already, they may decide they don’t want to do business with each other, and leave you to pay some or all of the bill. It’s more about everyone getting their cut, than it is about protecting people from medical emergencies.
Pro-tip, for doctor visits or incidents that may cost you out-of-pocket with insurance, you can opt to self-pay, instead of using insurance. Sometimes the self-pay bill total is vastly cheaper than the total they would calculate with insurance. Some urgent cares are cheaper to self-pay than your insurance co-pay is. Every situation is different.
They have a contract with certain insurance companies. They don’t have contracts with other companies. It’s just a business arrangement.
I can’t expect every health care providers in the country to negotiate rates with every insurance company.
As a tiny example, I once had my primary care physician resign from my HMO because he felt they were intruding on his ability to practice medicine as he saw fit.
Because they can… you wanted freedom, no regulations, no checkes and balances… This is the price…
Now companies are free to exploit customers and employees.
“Regulations are harming the free market, they are communist” – Now we can see which is the biggest harm… Whale CEOs losing their money or you selling a kidney for an x-ray or an ambulance ride
So you’ve already got responses that explain that there’s a CONTRACT between each facility and each insurer. One hospital, takes five plans, that’s five different contracts. All are independent of each other. Right?
Now imagine:
There’s a hospital in Miami. It’s a big hospital. They take insurance from 15 different companies.
And there’s a small insurance company located in little old Fresno, California. It’s not a national company, it’s really meant to insure residents of Fresno. Maybe they’ll grow nationwide, but for right now, they’re local to Fresno.
Why would the Miami hospital bother getting into a contract with the Fresno insurer? The likelihood of someone from Fresno walking into the Miami hospital is low.
**Distance** is just ONE reason why a hospital or insurer may not want to enter into a contract. Maybe the hospital doesn’t like the insurer’s terms, maybe the insurer thinks the hospital is poorly managed. Or maybe they’re just too far apart.
Maybe the hospital made a contract with XYZ-Insurance, and that contract says that the hospital will not do business with ABC-Insurance, because they’re a competitor.
I’m sure if you rack your brain thinking of other scenarios, you can find many reasons why two entities may wish to not do business with each other.
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