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They sure do. The doctor accepts the reduced amount because they want the medicare customers. Volume discount, I guess you can call it.
One of my son's specialists doesn't take insurance at all. I have to pay all of it out of pocket then file my own and take whatever they "allow." Usually it is only a third of the amount I paid.
Yes, your insurance company has a pre-negotiated rate with the service provider. In this case the provider agrees to accept only $35.67 if it's the insurance company paying the bill. A good example of the power of being a major insuracnce company who can negotiate such great rates compared to what a person off the street would have to pay.
It is called a DRG. It is a set amount of money for specific diagnoses and procedures.
The hospital/doctor agrees to accept the amount of money that the insurance company has set up for the particular diagnosis or procedure, the balance is then written off by the hospital/doctor and cannot be passed back to the patient.
When a doctor becomes part of a HMO network, or a PPO next work, they agree to accept as full payment a specific amount, for example my wife had surgary at a major hospital in Nashville last Jan, the billed amount was slightly over 10,000 but on he EOB the insurance discount ( basicly lowing it to the agreed price, was nearly 6500 dollars, leaving about 3500 as the billable amount, since this was a PPO not a HMO there was a deductable and co pay, but the hospital had an agreement in pricing. this is an important factor in these types of policies, having the ageed to pricing.
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