Here are some reasons why:
1. Insurance Fraud: Waiving deductibles and copays can be seen as a form of insurance fraud. Insurance companies view this as a misrepresentation of the actual cost of the service being rendered. If a provider is willing to give a patient a discount then that discounted rate is what should be billed to the insurance. By giving the discount after the service has been billed, it leads to improper reimbursement. While it may be easy to think that the insurance company will never find out, all it takes is one patient saying something.
2.Violation of Contracts: Health insurance contracts typically include provisions that outline the responsibilities of both the insured individual and the healthcare provider. These contracts specify the cost-sharing arrangements, including deductibles and copays. Waiving these cost-sharing amounts would be a breach of contract from both the insured and the healthcare provider.
3. Equal Treatment: Insurance companies negotiate specific rates with healthcare providers. Waiving deductibles and copays for some patients while charging others may be considered discriminatory or unfair. It can lead to different individuals receiving different treatment for the same services, based on their insurance coverage or ability to pay. If the patient is struggling financially, and the healthcare provider wishes to give a discount, its best to agree upon a rate with the patient and not bill their insurance.
4. Inflated Billing: Some providers may use the practice of waiving cost-sharing amounts as a way to overinflate the overall billing for services rendered. As in, they will bill at a higher rate just so the insurance pays more since they know that the patient's responsibility will not be collected. This is one thing that contributes to the rising healthcare costs overall.
5. Compliance with Regulations: Health insurance is highly regulated, and insurance providers must adhere to various laws and regulations. Waiving deductibles and copays can potentially violate these regulations, leading to legal repercussions for the provider.
It's essential to maintain a fair and transparent healthcare system, where costs are accurately represented, and patients are treated equally. If you have questions about your specific health insurance policy or a provider's practices, it's best to contact the insurance company or seek legal advice for clarification. Its up to the healthcare provider to know and understand their contracts with various insurance companies.
At Priority Medical Billing, we are always here to answer questions like this from our providers, or direct them to somewhere for further explanation.
For additional resources regarding this topic, see below.