What Is RBP, or Reference-Based Pricing?

What is reference-based pricing?

Reference-based pricing (RBP) is an alternative to traditional pricing systems that generally stabilizes or reduces the cost of claims. Traditionally, the pricing and coverage under a health plan is based on network rates. That is great if your provider is in-network with PHCS. If your provider is out-of-network, your preventive services could be excluded, or you may have a higher copay, all leading to a higher overall out of pocket cost.

RBP is useful for these out-of-network claims that might otherwise not receive a discount from the provider—resulting in either a full denial of the claim or a lack of savings passed on to the patient. When a provider accepts RBP rates, it helps out-of-network claims be accepted and results in savings for the patient. Planstin health plans with RBP use a combination of Medicare rates and usual, customary, and reasonable (UCR) rates to determine pricing for out-of-network claims that cannot be re-priced through the PHCS network. 

Planstin pays 150% of the Medicare rate, using the National Payment Amount. When services do not have Medicare rates, we will pay a usual, customary, and reasonable (UCR) rate, or a rate equal to the 75th percentile of charges billed by providers in your geographical area.

Where does Planstin obtain RBP rates?

We retrieve Medicare pricing directly from the Centers for Medicare and Medicaid Services (CMS), using the current physician fee schedule, the clinical laboratory fee schedules, and other fee schedules offered directly from CMS. In the absence of a Medicare rate, Planstin determines pricing using UCR rates, which are based on the geographical area where the service took place. Planstin uses CPT codes, modifiers, revenue codes, and other “claim codes” on standardized claim forms to know how to obtain these rates.

As a consumer, you have resources that allow you to look up fair rates for certain services, like the Fair Health Consumer or the ASP Pricing File (the average selling price/payment allowance limits for certain drugs). The CDC website also publishes a current vaccine contract price list that can be very helpful in determining the maximum allowable amounts for out of network vaccines, under an RBP plan.

Why use reference-based pricing?

Planstin has no control over what a provider decides to bill for a specific service. Depending on where a patient goes, the billed amounts can vary widely. Outpatient hospital clinics are going to be more expensive than a freestanding clinic not associated with a hospital. These differences in price can be very important when the patient is not getting a network or contract discounted rate, as a provider has no obligation to accept an RBP rate and could balance bill the patient for the difference.

You may wish to check with your provider before receiving services to ensure they will accept reference-based pricing or check to see if their rates already fall within RBP amounts.

More states are starting to implement laws that require providers to be more transparent in their rates and to make pricing information more easily accessible to patients. To find pricing for services in your area, you could contact the billing office of your provider; or you may be able to find rates available on their websites.

Have questions about Planstin, or questions about how we implement RBP features in our plans? Click here or call us at 888-920-PLAN