What Are Usual, Customary and Reasonable (UCR) Fees?
Let me explain what Usual, Customary and Reasonable (UCR) fees are—they're the out-of-pocket costs you, as a health insurance policyholder, have to pay for services. These fees depend on the specific services you receive and the part of the country where you're getting them.
Understanding Usual, Customary and Reasonable Fees
You need to know that a fee qualifies as usual, customary, and reasonable if it's what a doctor typically charges for that service, it fits within the price range other doctors in your area charge, and it's for a service that's necessary given the situation.
Your insurance company keeps an eye on these UCR fees to see if they align with what local doctors are charging. If your doctor bills more than what the insurer deems UCR, you're on the hook for the difference between the charged amount and what the insurance covers.
The actual UCR fees for services vary based on several factors, and your policy spells out when they apply. For instance, many health insurance plans divide providers into 'network' and 'out-of-network' categories. Stick with an in-network provider, and you might avoid UCR fees altogether, but go out-of-network, and you could end up paying some or all of the costs yourself.
I've seen how many policyholders only consider service costs after the fact, getting surprised by uncovered expenses. To avoid a hefty bill, you should confirm if a doctor is in your insurer's network, discuss costs with the doctor beforehand, and ask your insurer exactly how much they'll cover.
Usual, Customary and Reasonable Fees and Medicare
When it comes to Medicare, UCR charges aren't regulated by state or federal agencies, but Medicare does release its own UCR fee schedule, often called 'Medicare Allowable' charges. Providers who participate in Medicare agree to take this allowable charge as full payment, though you're still responsible for your co-insurance and deductible.
Medicare providers might opt not to bill you for anything over the allowable fee. Make sure to check if a provider 'Accepts Medicare Assignment' or is a 'Medicare Provider' to steer clear of unexpected and possibly large out-of-pocket bills.
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