As a Medical Biller, the better you understand the health insurance payment process, the better you can care for your patients. Your understanding of what a patient will owe and what will be covered can help them navigate the confusing world of medical insurance.

One of the most confusing terms is Contracted Carve-Out.

A contracted carveout is a special clause in the contract that stipulates a different payment rate from the normal.

Traditionally, “Carve-Outs” are health care services such as: Mental Health, Pharmacy, Dental, Optical and some services such as Transplant Services, burn unit services, etc. But there are some instances in medical offices that are also not available for reimbursement.

For the insurer, these carve outs typically increase profitability. For the patient, they can cause confusion and frustration. For this reason, it is important you know the most common, and how they can affect the payment owed by the patient.

On top of this some patients may choose to pay extra for a carve-out plan. The carve-out plan is provided by a third-party vendor, and is a supplement to a person’s standard health insurance plan. It covers specialized care or products, such as prescription medications and treatment for chronic illnesses.

A carve-out insurance plan can provide for highly managed care to participants who struggle with chronic diseases, behavioral health issues and specialty pharmacy needs. In this way, a carve-out insurance plan can provide products and care that might be deemed too expensive under a traditional group insurance plan at a lower premium cost.