Our goal at Telasleep is to offer superior sleep medicine care at a very affordable price. While we will “work” with any insurance, at this point we don’t enter into long-term contracts with them. That means that you get care from a doctor that isn’t dictated by your insurance company. We provide patients with a receipt that they can submit to their insurance plans. It is then up to their insurers to reimburse them. Some insurances like ones that cover out of network services may cover our nominal fee. Other may not. But even if the insurance company doesn’t reimburse many patients will find out that they pay less for our services than going to another physician who accepts their insurance. That is because many insurances have high deductibles and co-pays that cost more than we charge for our services. How and why do we work this way? The short answer is it makes sense for us and for many patients. We can provide quality care at lower cost than other doctors. The alternative is a bit, well, complicated.
When starting medical school many years ago, I had great dreams of treating the ill and making them better. Like many doctors, I didn’t know much about the “business of medicine.” I wanted to care for patients–not care about insurance companies. But at the end of 4 years of pre-med at college, 4 years of medical school and another 5 years of residency and fellowship training, I was forced to understand a thing or two about the business side of medicine. I love the doctors (many of them). I love the patients. The business of medicine, not so much.
Have you ever received a statement from your health insurance and noticed that a doctor or hospital billed a massive amount of money? Like $100 for one Tylenol, $1000 for an office visit or $5,000 for a short procedure? I have. I’ve seen it as a patient. As a provider, I have been asked about it. Even when my insurance company was paying the bill, it just didn’t seem right. If you ask a doctor, they will usually respond “We never get paid that amount.” Then why do they bill that amount?
Imagine the following. Veronica calls the store with an order of groceries. She is told that the regular price is $100 but it’s on sale for $25. She agrees and sends Archie to get the groceries. He pays $25 but the receipt says that the original price is $100, which he gives back to Veronica. Veronica is happy because she received 75% off of the retail price. Now if Veronica finds out that in reality the price is always $50 then she gets mad because she was duped into believing she received 75% off when, in fact, she only received 50% off. That makes sense. The grocer was engaging in false advertising, deliberately deceiving the consumer into believing they were getting a “deal” when in fact they were not. In retail this practice is actually illegal. The FTC prohibits ‘unfair and deceptive acts or practices’ and companies have had to pay millions in fines for violating these rules.
Now what if Veronica knew beforehand that the retail price was only $50 and she refused to pay the store unless the store gave her a discount. If the store sent her a bill for $100.00 should she be upset? Of course not. But lets take this a step further. What if Veronica, who forced the store to give her a discount, then receives a bill for $75 for something she forced a store owner to sell for $25. Should this make a difference in the final price? Guess what, Veronica insists that it does. If she gets a receipt for $75 instead of $100, she forces the store to accept $20 the next time. After all Veronica is a great customer and she threatens to take her business somewhere else if the grocer doesn’t agree. So the local store owner acquiesces. Does this sound crazy to you? This is basically what happens between insurance companies and doctors. Large insurance companies negotiate very low rates with doctors. In return they promise to provide the doctors with a large volume of patients. Small doctors have no leverage to negotiate so they usually acquiesce to low prices or risk losing patients–patients who they care about.
Just like in the example above, if a doctors office bills an insurance company for $75 instead of $100, then next time the negotiated rate is lower. That’s all legal. But does that make any sense? Even though the insurance company paid $25, if the doctors bill says it costed $50 then they will get paid less the next time around. So is the doctor wrong for providing a receipt that lists $100 as the cost? But if it did cost that much how could they afford to provide the service for $25?
This is just one example of how the “system” works. Getting into all the details is beyond my scope of knowledge. The healthcare business is very complex. However, decisions regarding reimbursement can have life and death consequences. It seems that the system is often played like a game. To me, that’s unfortunate.
A famous politician was once asked about a scandal that took place during his time in office. He remarked that what he regretted the most is that he did it because he “could.” Sometimes insurance companies operate one way because they “can”. From what I have seen, doctors often are not responsible for billing, when they are responsible it seems they are forced into playing a billing game with insurers. That is usually their only choice if they want to be able to offer care to patients and earn a living. The practice may be legal. But often it just doesn’t make sense.
At Telasleep.com we believe in doing the right thing. Sure we are a business. But we offer the best care available. By working with the insurance companies but not entering into long-term contracts we hope to continue giving the best care, to more people and keep pricing low, fair and honest.