Making 'Cents' of Out-of-Network Physical Therapy

The 2016 year has begun and, if you are anything like me and my family, it has started with a sprint.  After the holiday “fog” wears off we are met with the need to begin the next semester of school, sign up for winter sports, and update the kid’s wardrobe.  We begin to compile all of our paperwork from 2015 in preparation for the dreaded tax day in April.  Although the year starts with a sprint, it is a sprint filled with hope and promise.  Over the New Year we set our goals to improve our minds, bodies, families, and financial health.  We start the sprint with the notion that we will achieve all that we have planned and with steady resolve they will be accomplished and celebrated.

One of the items on your list for the New Year may be to finally have that nagging lower back ache checked out or to find someone that can help you run without the annoying and ever present knee pain.  You decide to pursue a solution to the pain that has been keeping you from doing the activities that you love.  After consulting with you primary care physician or orthopedist you are referred to outpatient physical therapy.

As you consider where to attend physical therapy, you remember going to a physical therapist for your plantar fasciitis 3 years ago.  Just as you are about to make the call you remember that your friend recently told you about another physical therapist in the area that was excellent.  Your friend strongly recommended this other PT and states “you just have to see this guy, it is worth it”.  So, you trust your friend’s opinion and you check out the website for the new physical therapist. 

After reading the therapist bio, and seeing pictures of the clinic, and reading about the services offered you recognize a section that states that this therapist is “out-of-network” for all insurances.  Immediately your reaction is to call your previous therapist’s office as you feel you can’t afford to see this concierge physical therapist.   This may sound familiar to some of you and likely this scenario has played out just like it has in the narration above.  The inherent assumption is that “if I can’t use my insurance it must be more expensive.”  I hope through the coming examples to describe how this assumption is not always the case and to detail how out-of-network care can save you time and money.

How Does Insurance Work for Physical Therapy Services 

Over the last few years it has become mandatory for everyone in the United States to have health insurance.  This means that everyone now is on an insurance plan that has certain coverages for health services.  Now, not every plan is the same and coverages for services do vary widely.  Most plans; however, do offer coverage for physical therapy services. In order to use your health insurance benefits you need to attend physical therapy by someone who is a “participating provider” for that insurance. 

In laymen’s terms this means that the physical therapist has negotiated a set contracted rate or payments to treat patients who carry that particular insurance. 

For instance, if you have Blue Cross health insurance and a local physical therapist states they are “in-network” for Blue Cross then you can attend therapy there and use your benefits.  Depending on your insurance plan, you may need to pay a “co-payment” for each visit.  This payment can be between 0-50 dollars in some cases.  After each visit your physical therapist will send a bill to your insurance company as you have directed them by using your insurance.  The insurance company will then in turn provide “reimbursement” to the physical therapy office based on their contracted rate.

Deductible

Most all insurance plans come with a deductible that has to be met before the insurance company will cover the cost of services.  Starting January 1st of each year (sometimes different but rare) you will need to start paying towards your deductible for physical therapy services.  Deductibles can range between 0-5,500 dollars so be sure to check out your plan. 

Your insurance paperwork will read something like this, “physical therapy services are covered at 100% after you meet your yearly deductible.”  So in the case of a deductible that is 1,000 dollars, you will need to pay 1,000 dollars out of pocket before the insurance company will pay anything towards physical therapy treatment.

https://www.univerahealthcare.com/wps/portal/uv/mbr/hpn/high-deductible-for-individuals/

What is “Out-of-Network”

If a provider has stated that they are “out-of-network” will all insurances then they have not negotiated any rates or payments with any insurance company.  This type of arrangement changes the relationship between patient and provider.  In this case the patient and the provider will agree on a set payment for services instead of the physical therapist and the insurance company agreeing on a payment structure. 

Attending an “out-of-network” physical therapy clinic means that you will be paying for services out of pocket.  In most cases this payment amount is LESS than what an “in-network” clinic would charge your insurance company.   After services are provided by an out-of-network physical therapist, they will provide you will a detailed bill, called a "superbill", that you can submit to your insurance company.  This bill will tell the insurance company that you have paid for and received physical therapy care.  Your specific insurance plan may have what is called “out-of-network benefits” in which case YOU may be reimbursed some or all of the monies paid.  Check your insurance plan to find out if you have these benefits.

Deductible

Just like with an “in-network” provider, you still are required to meet your yearly deductible before your insurance company will pay for services.  Your insurance may have different deductible amounts for in-network and out-of-network care.  Once you have met your deductible for out-of-network therapy your insurance company will reimburse YOU based on the set rate.

Running the Numbers: High Deductible Plans

Many insurance plans now carry a high yearly deductible.  As stated above, this number can run as high as 5,000 dollars.  If you are in need of physical therapy services, and you have not had any other medical care in the current year, you will have to pay out of pocket for services until you meet your deductible.  Each visit you attend at physical therapy will be paid for at the full rate until the deductible is met.  Typical charges at an “in-network” physical therapy center run between 150-225 dollars when paying the full amount.  Certain carriers have specified out of pocket amounts that each client should pay and these usually run 75-100 dollars.

On the other hand, most “out-of-network” PT practices charge between 100-150 dollars per session.  This is how the numbers stack up when comparing the two scenarios.

In-Network Clinic

30 min one-on-one time with PT per session

2 sessions per week

75-180 payment per session

1 hour total time with PT 150-360 total in payments

Out-of-Network Clinic

60 min one-on-one with PT per session

1 session per week

100-150 payment per treatment

1 hour total with PT

100-150 total in payments

Average savings for out-of-network care

1-week average savings=130
2-week average savings=260
3-week average savings=390
4-week average savings=520

From the above example you can see that for the same amount of one-on-one treatment time with your physical therapist there is a 130-dollar savings per month with out-of-network physical therapy.

Know Your Costs Upfront

As we all know from past experience, the insurance run around can be confusing and challenging.  After paying a co-payment, then getting an explanation of benefits, then getting a bill we are left wondering, “What am I actually paying here?”  This unfortunately is how the system is run. 

One of the intangible benefits of paying for physical therapy services upfront is that you will know your exact costs.  At an out-of-network practice there are no hidden fees or bills that will be sent after treatment is provided.  What you pay at the time of service is all there is.  In fact, you might even get money back from your insurance company if you submit the superbill from each visit.  Wouldn’t it be nice to have your insurance company pay you for a change!

Conclusion

From the above examples you can see that for those with high deductible plans or higher co-payments for physical therapy, seeing an out-of-network therapist may save you time and money.  Health insurance can be confusing and frustrating to manage but your physical therapy team can help you navigate the process.  Every insurance situation is different and the above examples are by no means comprehensive.  Please consult your provider to determine your exact benefits for physical therapy.  

If you have questions about out-of-network physical therapy you can contact us by phone at 408-784-7167 or through email kevin@compedgept.com

Written by:
Kevin Vandi DPT, OCS, CSCS
Physical Therapist in San Jose-Los Gatos-Campbell-Almaden