[Fredslist] health insurance deductible question

[IrisWolinsky at aol.com]

Hello Along the Network,
 
   Some information from my health ins. co, GHI or Emblem  Health, doesn't 
seem to make sense.  Where else would I go to verify this  but Gotham's own 
industry specialists??  
 
   I understand there is a contract rate providers agree to  accept for 
their services from an insurer.  For starters, is the term  allowable rate 
interchangeable with contract rate?  If not, what's the  difference?  
 
  When I  explored this product the independent broker said the  subscriber 
pays a contracted rate previously agreed to between the ins co and  the 
provider for whatever the service is.  Of course, his example was of  the 
provider's normal rate being $1200 but the contract rate being $400 or 600,  
which is what the patient would pay till deductible was satisfied, and  what the 
ins co. would pay thereafter.      
 
   The question is, if a provider sends a bill for a  service, and the 
insurance co's 'allowable' rate is higher* - as in  2-1/2 times higher than the 
billed amount - is the insurer obligated to process  the claim for payment 
of the much higher allowable rate when the  patient's deductible has not yet 
been met?  Sounds crazy to me- the  patient, or even the ins. co., paying 
way more than the billed  amount (which was plenty to begin with).  
 
   It also makes me wonder how later providers fare -  once my deductible 
has been satisfied, what rate applies for  what the ins co pays to those 
providing services  thereafter?  It just seems like the deductible gets sucked 
up this way  by one or two early providers, by reverting to what--- market 
rates -- as  if I had no insurance at all? - and leaving less for other  
providers.  Is the ins co allowed to subject the insured to such  a market rate, 
esp where it was never billed?     
 
   Also, could the patient try to negotiate with such a  provider, given 
the disparity?  
 
   * How can the allowable rate be higher, by the way?   Isn't insurance to 
protect consumers from paying market rates, among other  things?  
 
   This is all quite counterintuitive to me.  What am I  missing, or not 
understanding?  
 
   Thanks for any info and explanations!
 
   Iris

Iris  Wolinsky
Attorney Arbitrator Mediator
227 Riverside Drive
New York, NY  10025
(212) 865-0505 Tel & Fax
(917) 716-7690  Cell
iriswolinsky at aol.com
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