Silent PPO --> RE: Re: Multiplan - Pay you less quicker

[Guest guest]

As an education for us all -- here is what a Silent PPO is...

This article is the most in depth...

http://findarticles.com/p/articles/mi_m3257/is_7_57/ai_105501126/

Tactics for thwarting silent PPO activity - Managed Care - a discussion of silent PPO payer arrangements for the health care industry

=======================

http://managedhealthcareexecutive.modernmedicine.com/mhe/article/articleDetail.jsp?id=329908

A silent PPO often is described as an organization that functions as a network of providers, but the discounts it takes with respect to medical claims may be without the knowledge or contractual consent of some of the network providers. Thus, the availability of the discount with respect to a particular medical claim depends on the legitimacy of the relationship between payer and provider and whether the payer has appropriate access to the discounts.

snip/snip

http://en.wikipedia.org/wiki/Silent_PPO

A Silent PPO is an organization that accesses a discounted rate for services from a physician, hospital or other health care provider without direct authorization from the provider to do so.

Generally, insuring entities may negotiate contracts with the healthcare provider, with a defined set of reimbursement values for the work performed by the provider. These rates may entail a significant discount from the amount the provider would charge an uninsured patient. For a given provider, the amount of discount varies between different insuring entities, and a separate contract is negotiated with each entity.

Silent PPOs create agreements with insuring entities, allowing buyers into the Silent PPO to access the terms of the lowest discounted rate available. Patients (and other insuring entities who are members of the Silent PPO) may then access the lowest discounted rate of the healthcare provider, even though the patient is not directly a member of the plan contracted to the healthcare provider.

The members of the Silent PPO might be insurance companies, self insured employer health plans or another Silent PPO. The Silent PPO could also be a middle man and resell their created network of healthcare providers.

There are medical organizations which disagree with or dislike the concept of Silent PPOs. [1] The problem as advocated is that when the physician negotiated the discount, they intended to give it only in exchange for referrals from members of the insurer - where a patient is given some advance incentive to choose them. Silent PPOs typically do not make referrals, but provide access to the discount after the service was rendered. Additionally, providers argue that had the patient not entered via a back-door arrangement, they would not have been given the discount applied to the contract. Thus, the provider loses money from the amount that would have been charged.

[edit]External links

Article in Healthcare Financial Management

Article by B. reproduced in in FindLaw

Article in June, 2006 issue of Managed Healthcare Executive

http://www.texmed.org/Template.aspx?id=5495

Silent PPOs/Rental Networks

When a physician contracts to join a health plan network, he or she agrees to accept a discounted rate in return for the plan steering patients into his or her practice through a listing in the health plan’s directory.

However, this discounted rate has been highjacked through a deceptive market practice called a “silent PPO” or “rental network.” A silent PPO/rental network is neither insurance nor a health care payment plan offered by a health plan to its clients. Silent PPO/rental networks are not regulated and create a huge obstacle to heath care transparency.

A silent PPO/rental network generally takes no financial risk. The network “shops” around to find the lowest rates a physician has agreed to with any insurer, then “rents” that discounted rate to another entity without the physician’s knowledge or permission. Fourteen states have laws to prohibit these arrangements.

Patients also may suffer financially when the discount applied to their medical treatment is based inappropriately on the lowest contracted rate of a silent PPO/rental network. The patient may have to pay more toward the unpaid balance and incur higher coinsurance.

Silent PPO/rental networks provide no benefit to physician practices or their patients. Physicians may become wary of granting discounts under their existing contracts or are forced to increase their existing contracted rates to offset losses from these unethical manipulations.

Medicine’s Agenda

Support legislation to regulate how a physician’s contract rate is sold, leased, or shared among health plans.

Support legislation that will ensure the physician’s right of action against anyone who improperly accesses their price discount.

Continue to encourage the Texas Department of Insurance to enforce current state insurance laws to alleviate this deceptive trade practice.

Last Published: 1/23/2008

Locke, MD