By: Jon Jablon, Esq.
You asked whether your clients can decide to not utilize their wrap network for a given claim, right? Oh, you didn’t? Well, why didn’t you?
We get it. Wrap networks are very simple to use and they guarantee against balance-billing. Those are great things. But despite the ease of use, do wrap networks offer the best bang for your buck?
Research shows that the average wrap network discount ranges from 18% to 25%. There may be outliers, though; if you’ve got a 65% discount, it’s often worth it to take it with no questions asked. But if you’ve got a 20% discount on a very large claim, it will probably be beneficial to explore other options. In many cases, individualized negotiations can yield far better results than wrap discounts, since wrap discounts are pre-determined and predicated on arbitrary percentages off arbitrary billed charges. When negotiating a claim on an individual basis, though, there’s an opportunity to use benchmarks (such as Medicare), examine the specifics of the bill, and actually discuss the claim and its merits with a human being. More often than not, individualized negotiations yield better savings than pre-negotiated wrap discounts.
In a recent poll of many of The Phia Group’s clients, 75% of those who responded indicated that they weren’t aware that they were able to forego utilization of the wrap network on a case-by-case basis. It’ll depend on the contract, but in just about every case, a health plan does have that right.
Plus, if a negotiation outside the wrap isn’t successful, the health plan will still have the wrap discount to fall back on!
If you need a contract reviewed, The Phia Group can do just that – and if a benefit plan incurs a large claim that should have a better rate than what the wrap will offer, let us know as soon as possible, because we can help.