Discount Dangers is a DaisyBill series on the ways discount contracts unscrupulously lower work comp providers’ reimbursements. With this series, we shine a light on the worst practices and help providers fight back.

Eligibility and active encouragement: These two principles uphold the equitability of discount contracts. Providers have the right to know who’s applying a given discount to which bills, and to have patients steered to their office in exchange for those discounts.

Over and over, Labor Code Section 4609 mandates adherence to these dual precepts. The next two Provider’s Rights in this series further clarify exactly how eligibility and active encouragement are supported by law.

So far in this series, we’ve detailed the following provider rights:

1. The right to know which payors are eligible for the discount
2. The right to have employees steered to their office by the employer
3. The right to know if discounts can be extended to unspecified payors later
4. The right to know how employees will be steered to their office
5. The right to ensure provider contact information is shared with employees

§ 4609 is the law that protects providers from unscrupulous payor discounts. Accordingly, we declare the following provider rights to be indisputable:

6. Providers have the right to be updated, at their request, of exactly which insurers and employers are eligible to apply discount contract rates at any point during the terms of said contracts.

7. Providers have the right to decline inclusion on any list of providers offering discount contract rates to which patients are not actively steered.

Let’s take a look at the basis for these rights, as described in the code.

Mandated Contract Updates

§ 4609 (b)(4) requires the discount contracting agent to:

Disclose, upon the initial signing of a contract, and within 15 business days of receipt of a written request from a provider or provider panel, a payor summary of all payors currently eligible to claim a provider’s contracted rate due to the provider’s and payor’s respective written agreements with any contracting agent.

Put plainly, providers can demand a list of every payor eligible to apply contract discounts.

Providers can do so any time they like, and contracting agents must furnish that list within 15 days of the request. This safeguard is intended to discourage the sale, lease, or other extensions of contract discounts to random payors at the expense of providers.

Right to Refuse

§ 4609 (b)(5) requires contracting agents to:

Allow providers, upon the initial signing, renewal, or amendment of a provider contract, to decline to be included in any list of contracted providers that is sold, leased, transferred, or conveyed to payors that do not actively encourage the employees to use the list of contracted providers when obtaining medical care…

Any payor that wants access to discount rates had better be prepared to steer patients to the providers offering those rates. Providers are free to withdraw their name from consideration by any payor who does not meet that standard.

It’s a matter of fair exchange: discounted reimbursement rates for “active encouragement” as defined by law.

Check back or subscribe for the final entry in our Provider’s Bill of Rights, coming soon.

DaisyBill has providers’ backs in the fight for proper reimbursement. We offer tools to help determine exactly what providers are owed, bill quickly and compliantly, and prevail when disputes arise. Schedule a free demonstration, and see what DaisyBill can do for your office.

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