The Only Thing A PPO Can Guarantee Is No Balance Billing

The Phia Group, LLC
March 22, 2011

Balance Billing… it happens. With health care reform in effect and costs of providing benefits soaring, our industry has become increasingly careful with their claims dollars. Plan Administrators, seeking to cut costs and enforce their plan documents, are combating provider overcharges with a new vigor.

For years, benefit plans and their administrators relied upon traditional PPO arrangements to receive discounts on their hospital bills. To be “in-network” was once a privilege for which hospitals were willing to offer great discounts. As time has passed, and networks have expanded, incentives for providers to offer deep discounts have disappeared and a discount is truly not what it used to be. In other words, these days everyone is “in-network” and it has consequently resulted in increasingly small discounts for the payor.

To read more about this interesting topic please see an article from Bloomberg Businessweek posted on Adam Russo’s blog.

Many plans have sought to leave this traditional PPO arrangement – seeking new ways to prudently manage plan assets and ensure payment of only eligible, reasonable, and appropriate amounts. Unfortunately, one of the great benefits of a network arrangement remains; most networks protect plan participants from balance billing.

A plan administrator must enforce the terms of the plan as written, and prudently manage plan assets. Benefit plans which seek to do so by paying what they, in their discretion, feel are the reasonable and appropriate amounts face the threat of providers balance billing the plan participants. If they pay in accordance with their PPO network, they stand a better chance of avoiding balance billing, but will likely be paying excessive rates. What can a plan administrator do?!?! Know your rights.

If this conundrum strikes a chord, please call The Phia Group for assistance. We have years of experience dealing with providers who balance bill patients. We have developed a best practices approach to dealing with these matters and have enjoyed great success removing the patient from the conflict, enforcing the terms of the plan document, and achieving resolution.

Please contact me at 781-535-5636 or email at  if you would like to inquire about this service.

Andrew Milesky
The Phia Group, LLC
Editor’s Note: Our clients who have moved away from the PPO world are achieveing significant savings.