Advanced Institute for Diabetes & Endocrinology

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Insurance: Do I Have to Play by Their Rules?

There are few things in life that patients are more dedicated to than obeying their insurer’s “mandates.”

In my subspecialty, we frequently use medications that are not common, require a very specific approval process or are just not covered at all. 

So we have to have a strong game in place to combat these things. 

Insurance Plans

Now, when you sign up for an insurance policy–or you start your new job that signed up for your policy–you are agreeing to participate in their networks in order to optimize your benefits. But the key phrase here is “optimize benefits.” 

They create these networks to rein in costs, and all entities contained in the network agree to certain price restrictions, and to not “balance bill” the patient for the difference between the contracted price and their usual fee schedule. 

What Are the Rules?

The rules they stipulate are designed to reduce utilization of benefits. That’s how these companies are able to continually profit year over year. 

Sometimes, there is legislation that will favor the patients’ rights, such as Senate Bill 680 in Texas that went into effect several years ago. These kinds of rules can eliminate the problem of “step therapy” in order to get a medication covered. They can also ensure continuity of coverage if the patient is stable on a medication, but then changes insurance.

Otherwise, if you want that MRI for your torn ACL, you’ll have to start with an X-ray, even though it’ll be useless, and then maybe a CT or ultrasound, because those are cheaper than the MRI. Then, if it’s still recommended, they will pay for that MRI. 

Pharmacies

Pharmacies are an excellent example of this problem. Remember the “good old days” of just being able to tell your doctor who your favorite pharmacy was and take the script with you? 

It’s true that independent pharmacies hands-down do a better job of attending to patients’ needs, managing prior authorizations, making recommendations for alternatives if the primary agent is not covered, and generally troubleshooting problems than any chain or mail order pharmacy. 

However, when United Healthcare owns Optum, the Pharmacy Benefit Manager, and Optum owns the pharmacy, then United might “require” that all prescriptions be filled by those pharmacies. It’s not exactly illegal, but they can rig it to price the patient and the competing pharmacy out of the picture. 

Why wouldn’t every pharmacy just want to be In Network? Well, because the contracted prices they get from the insurer usually are so low that they can’t cover the overhead. 

The End Result

So, in short, when you’re contracted with an insurance policy, you DO have to play by their rules, whether they are evidence based or not. 

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