This consumer information guide is the result of Senate Bill 1731, 80th Legislature, Regular Session (2007), with the idea to reduce costs for consumers with cost transparency. The law requires the Texas Department of Insurance (TDI) to collect data from health plans to determine how much they pay doctors and hospitals for specific medical services. It also requires TDI to combine all responses and present summary information by geographical regions in Texas. TDI updates this information annually.
There are lots of ways this guide might help you make decisions about medical procedures and insurance.
An uninsured consumer may be able to get an idea of the cost of services before having a procedure done, and may even decide to have it in a different region, depending on the difference in costs.
An uninsured person may use the average amounts as a baseline to shop among providers.
An uninsured consumer may also be able to get an idea of how far down the providers come from the billed amount by looking at the difference between the billed and contracted amounts. They may then be able to negotiate a lower amount to pay the provider, similar to how insurance companies negotiate lower rates.
A patient with insurance may be able to estimate a coinsurance amount, depending on whether the patient is in or out of network.
While there are thousands of different medical procedures, this consumer guide has data for the most common inpatient and outpatient procedures, labs, and imaging. To view a list of the procedures available, visit the Medical Procedures link above, and to download a list of the medical codes visit the For Researchers link above. If a procedure isn't listed, TDI does not have reimbursement data for it. FAIR Health Consumer is a nonprofit organization that has medical cost data that can be researched by the current procedural terminology code. If you are unable to find data for a specific procedure, billing data can be looked up on the FAIR Health Consumer website, located at http://fairhealthconsumer.org/
Provider availability is probably the most significant factor that determines the cost of services in a region. The cost of living and amount of uncompensated care are other factors.
The allowed amount is how much a health plan will pay a doctor or provider for a service. When an in-network doctor or provider provides a service, the allowed amount is usually a fixed dollar amount that is agreed to by the health plan and provider through a contract. When a patient visits an in-network provider, the cost is usually shared by the patient and the health plan, with the combined payments equaling the allowed amount. In this situation, the provider has agreed to accept this amount as payment in full and will not bill the patient for more than the agreed amount.
When an out-of-network doctor or provider provides a service, there is no contract between the health plan and the doctor or provider. In this case, the allowed amount is the amount that the health plan is willing to pay to reimburse the out-of-network doctor or provider for a service. However, unlike an in-network provider, the out-of-network provider will usually bill the patient for an additional amount that the out-of-network provider believes is due. This is known as “balance billing.” So while the allowed amount for an out-of-network provider is usually lower than that of an in-network provider, the patient can be stuck paying the out-of-network provider an additional amount that is not shared by the health plan.
TDI must collect a certain amount of data before it can post reliable cost amounts for each procedure. In cases where there are too few claims to produce a reliable number, "no data" will be shown. This happens most frequently with expensive surgical procedures that are not emergencies. Since expensive surgeries like knee replacement, ACL repair, C-Section, and hip replacement are typically planned, the surgeon usually selects facilities such as surgical centers from the patient's insurance network. Because most expensive surgical procedures will take place in a surgical center in the patient's insurance network, there's not much data for these procedures when they take place out-of-network.
TDI has classified medical services based on the type of doctor or the location where they provide service. This guide includes medical procedures for the following six medical categories:
Inpatient Procedures - care in a medical facility that requires admission as an inpatient and usually requires an overnight stay;
Outpatient Procedures - care in a medical facility that usually doesn't require an overnight stay;
Imaging Services - medical services to diagnose or detect illness or injury, including CT scans, MRIs, mammograms, and X-rays;
Pathology Services - medical services to detect or diagnose a disease, including blood tests, urinalysis, tissue analysis, and other screenings;
Office Visits - a meeting between a patient and a physician to get health advice or treatment for a symptom or condition; and
Emergency Services - health care services provided in a hospital emergency facility or comparable facility to evaluate and stabilize sudden and severe medical conditions.
Health care services performed by physicians or hospitals that have agreed to provide medical care for members of a health plan at a negotiated rate. This term includes physicians or providers that are members of a Health Maintenance Organization (HMO) delivery network or a Preferred Provider Organization (PPO) preferred provider network.
Health care services performed by physicians or hospitals that have not agreed to provide medical care for members of a health plan at a negotiated rate. An HMO plan usually only pays for care received from within its network, and a PPO plan requires members to pay more to receive out-of-network services.
The dollar amount physicians or hospitals bill to health plans for medical care.
The allowed amount is the maximum dollar amount that health plans will pay to providers for a specific procedure or service, including cost-sharing amounts that the patient may be responsible for.
Additional helpful information for consumers is available on the TDI website as follows:
How Texas protects consumers from surprise medical bills - provides information about balance billing and tips for consumers: www.tdi.texas.gov/takefive/texas-protects-consumers-from-surprise-medical-bills.html;
Texas Health Options - provides assistance for consumers shopping for health insurance coverage: www.texashealthoptions.com;
Your Health Care Coverage - TDI publication that provides information about types of health insurance, dependent coverage, pre-existing conditions, health plan costs and benefits, and related information: www.tdi.texas.gov/pubs/consumer/cb005.html.