Negotiating the world of billing for physical therapists can be confusing and arduous. When physical therapists usually think about billing they think about CPT codes and modifiers. However, PT’s should also need to take into consideration their status as in or out of network providers. Knowing the difference between being in-network and out of network with patients insurance companies is essential in determining the billing process for each patient. 

In this article we review how physical therapists can be successful when performing out of network billing. 

Healthie’s practice management software is perfect for physical therapy practices of any size. Our new free Starter Plan can help you with program creation, scheduling, telehealth, and provide a client portal all for $0. Click here to start your free account today.

Out-of-network billing vs in-network

When a provider is considered “in-network” it means that they have a contract with an insurance company that ensures that the insurance company will cover services offered to patients with that specific type of insurance. The provider is a member of that specific insurance company's health care network. Fees for patients tend to be lower when they choose to receive care from providers that are in-network with their insurance company.

“Out-of-network” physical therapy providers do not belong to the insurance company’s network, and no contract exists between provider and insurance company. Providers do not necessarily have to abide and partake in the in-network guidelines for billing set by the insurance company for a patient that they treat when they are out of network. However, fee’s tend to be higher for out of network care, and different types of plans like HMOs do not always cover any out of network services unless a medical emergency takes place.

Most physical therapists will encounter both situations of being in- and out-of-network. There are pros and cons to both types of billing so it is important for providers to understand their status with the patient’s insurance and how to bill appropriately for each situation. Successful  out of network billing for physical therapists can lead to decreases in claim denials, increased reimbursement and ultimately improved financial stability. 

How to bill if you are an out-of-network provider

Prior to treating a patient it is important for providers to be knowledgeable of the type of health care plan that their patients have. Being that some insurance companies will not cover out of network physical therapists, it is important for providers who accept to treat patients who are out of network to communicate their out of network status and address how it may affect them. 

Once a provider has become aware of a patient's insurance information and the patient understands the providers out of network status, physical therapists have to decide how they will bill for their services. 

If you’re struggling to navigate this system on your own, look to Healthie to streamline payment processing and billing.

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Out-of-network physical therapists have a couple routes that they can take when billing insurance: ‍

✔Accept Assignment

‍By accepting assignment the physical therapist will continue to treat the patient and will be paid by the insurance company and potentially the patient. If a physical therapist accepts assignment, they have two options. The first is the physical therapist can bill the patient when the service is provided and bill the insurance company. If the insurance company reimburses more than was expected and this results in overpayment from the patient and the physical therapist is then required to reimburse the patient for their over payment directly. 

The physical therapist can also bill the insurance company on the behalf of the patient prior to billing the patient directly. Once the insurance company has covered the amount they have decided,  the patient is then billed the remaining cost. This is also called balance billing.  When balance billing occurs, the patient pays the difference between the amount charged by the provider and what was covered by the insurance company. Providers that are in-network can not do balance billing. Laws and regulations restrict providers from using balance billing with patients who have Medicare or Medicaid. Providers should refer to their state laws prior to this type of billing. By utilizing balance billing, the provider has the potential to receive the full amount that they bill for by having the patient reimburse what was not covered by the insurance company. The con for balance billing is that the patient may be confused and frustrated when receiving the remaining bill. It is important to communicate with the patient upfront to avoid shocking them with a bill they did not expect.

✔Decline Assignment‍

By declining assignment the physical therapist is deciding to continue to treat the patient but will not be paid by the insurance company at all and will receive full payment from the patient. If a physical therapist declines assignment they also have two options for billing. The first is to submit a Superbill.  A Superbill is a receipt of your services that clients can submit to the insurance company in hopes of reimbursement. Healthie’s new free Starter plan can handle all of your superbill needs, sign up for a free account today. The key to using Superbills in practice is to identify who is financially responsible; it’s best practice to collect payment from your client at the time of service. Providers either submit the Superbill on behalf of their client, or send it to their client for them to submit. Utilizing Superbills can be a positive for a provider, because they will get paid in full, at the time of service and do not have to worry about reimbursement denial from insurance companies. 

Alternatively, the physical therapist can bill the patient when the service is provided and also bill the insurance company on the behalf of the patient and have the insurance company then reimburse the patient directly.  

When physical therapists bill in-network, insurance companies take into account the payment rates for CPT codes. However, out of network physical therapy providers can determine how much they are going to charge for their services. When out of network providers are determining their fees, it is important for them to consider UCR’s. A UCR stands for Usual, Customary and Reasonable and is defined by HealthCare.gov as “The amount paid for a medical service in a geographic area based on what providers in the area usually charge for the same or similar medical service. The UCR amount sometimes is used to determine the allowed/appropriate amount.” If providers have concerns or questions it is important to reach out to the insurance company prior to billing. 

Communicating with patients and staying up to date with billing terminology, insurance guidelines, laws and regulations should help lay the groundwork for success when billing out of network as a physical therapist. Changes are constantly occurring in the billing and insurance world and it is important for physical therapists to take that into consideration along with their state laws and regulations. 

Healthie‍

Healthie offers a cloud-based EHR and telehealth platform that is quick to implement while supporting compliance with HIPAA regulations — while being customizable to meet your business needs. In addition, the Healthie platform integrates with insurance billing tools, so that you can quickly create Superbills and CMS 1500 claims, send invoices, and collect payments for out-of-pocket services. All of these features are available on our free starter plan. Click here to sign up today!

• Superbills: Have clients that have coverage with companies you are not in network with? Generate a Superbill for them to submit, or submit it to the payer on behalf of your client in hopes of receiving reimbursement.
• Favorite ICD-10 & CPT Codes: PTs can designate physical therapy-specific billing codes as “favorites” within Healthie, allowing for quick access when filling out both CMS-1500s and Superbills
• Anatomical Charting: With our new Anatomical Charting feature, PTs can chart more accurately, therefore saving thm time when creating and submitting Superbills
• Packages: Healthie’s packages feature allows providers to build custom packages based on their service offerings.  You can also create unique promotional codes if offering a discount for patients.
• Payments: From the payments page, you can keep track of when, how, and for what patients have paid.  You can create invoices and receipts for your services, so patients can easily see what they owe.  

We have seen physical therapists and occupational therapists that use Healthie find success with reimbursement for out-of-network services. Whether you’re a solo practitioner or part of a multi-provider group or organization, our flexible membership plans adapt to meet your business needs. Let us help you launch your practice.