Most employers take group health insurance coverage for their employees. These plans do not cover the full cost of the treatment. Insurance companies place a reasonable limit on the maximum amount of money the policyholder can receive for a treatment. Understanding this limit before obtaining any group insurance plan or visiting a health practitioner for healthcare services is important. Learn why you should get group benefits for your business.
Most employers opt for this insurance coverage to maintain the well-being of their employees. Doing so enhances their reputation among the current and prospective employees. It also helps them comply with the employment laws. Moreover these laws require Employers to provide certain benefits to their permanent employees. Health insurance group benefits for the employees cover different types of illnesses and health issues. Some of these plans also cover the family of the employee. A group benefit is a cheaper way to ensure proper health insurance coverage for all employees. Check more information about how the group benefits work.
What are Reasonable and Customary Limits?
Unfortunately, a health insurance plan does not mean the policyholder will get all treatment expenses reimbursed by the insurance company. This plan comes with a reasonable limit on the amount of money the recipient will receive for the treatment. The person has to pay the remaining amount out of pocket. You can still go for a treatment plan that costs more than the typical market rate but the insurance company will pay you only up to the agreed limit.
These limits apply for paramedical treatments offered by the health practitioners like massage therapist, physiotherapist, chiropractor and some others. This limit changes by the region and over time so keep checking the latest fee data even after obtaining your health insurance coverage.
The following example will help you understand this limit. Suppose the chiropractor you plan to consult charges $200 for the initial consultation. The insurance company may have determined $180 R&C limit for this service in your region. It means it will reimburse you only up to $180 while the remaining $20 must be paid by you.
The Importance of Reasonable and Customary Limits
Reasonable and Customary limits prevent excessive claims and keeps the fees and charges of the healthcare practitioners within reasonable limits. It reduces the costs of group benefit plans for the employers and employees. Moreover, these limits ensure that any insurance fraud or abuse cases are avoided. Most importantly, it means a sustainable and healthy health insurance industry for all the stakeholders. Learn how group benefits help motivate your employees.
Insurance providers do not decide these limits arbitrarily. Associations of health practitioners themselves issue fee guides for their members. These guides are updated regularly based on the inflation and other changes. This information is available in the public domain. Insurance companies use these guides to determine the reasonable reimbursement limit for a particular treatment or extended health care cost.
Are you planning to visit a health practitioner and expect to get reimbursed by your insurance company under the group benefit health insurance plan? Make sure the practitioner charges according to the standard fee guide. This way you will avoid paying a big amount of the treatment cost from your own pocket. Learn more about reasonable and customary limits here.