Usual and Customary Cost?! UHC

I am so pissed off right now. How can United Healthcare think that $3003 is the usual and customary cost of Lap Band surgery? That is the dumbest thing I've ever heard!

Melanie: I am sorry that you are upset about what is happening with UnitedHealthcare. I did want to offer some insight into usual and customary charges that guide many PPO plans. Insurance companies do not make up usual and customary charges. In the background, there is a quirky algorithm that most use to come up with the figure. But, that data that is fed into the algorithm comes from data collected from the geographical area of your provider. The point of the formula is to come up with a mean amount that providers in particular areas charge for a certain procedure. It is that amount that you will be quoted if you contact your insurance company's member support department. I am sure you are well aware that anything over usual and customary (U&C) will be your financial responsibility, and the provider will typically require that payment in advance. That can definitely put a damper on anyone's parade. Ultimately, the issue lies with the provider of your choosing, the amount that he or she charges, and the fact that he or she is out of network. You have a few options. Since you most likely have a PPO product, there should be an HMO tier to your benefits. If you access the HMO (in-network) portion of your benefits, you would not subject to the same limitations. All in-network services are payed based on a contract, which means that you cannot be billed the difference of what the provider charges and what the insurance company pays. A limitation with the HMO level though is that there are greater restrictions on how you can access care. In essence, you allow the insurance company and your provider to manage your care (typically meaning more paperwork and longer wait times). Another option is considering changing to a different insurance plan, one that will provide you with the flexibility that you clearly seek. The limitation to this option though is that most companies have one open-enrollment period per calendar/contract year. The only way that you will be able to change is if there is a qualifying event--a marriage ,death, birth, etc. I hope this information assists you in effectively pursuing the surgery. Please feel free to contact me if you have any other insurance questions.

The above post is not accurate on one subject.  If you have a PPO plan you have a ppo plan, there is no HMO associated with this.  You can call your insurance company and ask.  I work for an insurance questions and my california providers will say what is the hmo portion of this plan and we say there is no hmo, it's strictly ppo, so makes me wonder if that is true of some insurancies.  I can tell you for most it's not.  Usual and Customary applies to out of network providers, find an in network prov and your out of pocket will be significantly less. Good Luck.

You're right.  Most insurance companies do not look at benefits the way that I described above.  One company that I know who does is Health Net (mainly because I used to work with the company).  Their PPO products don't act like the traditional PPO plans that you are referring to (I was actually surprised by that when I was working there as well, so I very much understand what you are saying).  I learned PPO plans the way that you understand them, too. For example, for a patient who elects a PPO product through Health Net and is capitated to UC Davis Medical Group, the only difference between this patient and a patient who chooses a strictly HMO plan is that the first patient can visit a specialist provider for consultation purposes only.  If the specialist wanted to render services under this patient's plan, the service would be denied as not authorized by the primary doctor.  All services would have to go through the primary care doctor for the PPO patient.  In that sense, their PPO plan is basically an HMO with the option of visiting a specialist with no referral. Health Net's POS plans act more like the PPO plans that you and I are familiar with, with the exception that on the non-par level of their plan, the out-of-pocket costs tend to be very high. It was hard for me to understand when I worked with Health Net, but it is the way that they set up a lot of their plans for their medical groups.