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Provider-Based Facility Billing

Oaklawn Medical Group is an outpatient department of Oaklawn. Medicare refers to this type of hospital-owned clinic as a “provider-based facility.” This designation impacts the way bills and copays are calculated under Medicare, which could also affect your out-of-pocket costs. The purpose of this brochure is to explain our billing practices and help you anticipate your costs.

How We Bill Medicare Patients
Medicare requires us to bill the hospital fee to Part A and the professional fee to Part B. Depending on your plan, this may result in additional copays and/or deductibles, which could increase your out-of-pocket costs. Our Central Billing Office can help you estimate your cost. You may reach them at (269) 789-7181. 

If you have secondary or supplemental insurance, we will continue to submit any balance that is not covered by Medicare to that additional insurance plan. If your secondary insurance does not cover the balance, or if you do not have secondary or supplemental insurance, we will bill you for the balance.

Why do I need to complete a Medicare Secondary Payor (MSP) Questionnaire?
As a participating Medicare provider, we are required to ask questions that determine whether Medicare or another payer should be the primary payer for each visit.

What is a Provider-Based Facility?
Medicare recognized the benefit of an integrated system where the hospital and your doctor’s office work together to provide the care and services you need. Hospital-owned clinics also have to meet additional quality standards. “Provider-based facility” is a special Medicare designation that rewards this collaboration and compliance by reimbursing both the hospital and the doctor’s office for your visit. Capturing this additional reimbursement helps us minimize the impact of Medicare reimbursement shortfalls so that we can continue to provide you with high-quality care.

How does this affect my bill?
All care and services at our office will be provided as a service of Oaklawn. Your bill will come from Oaklawn, and you will make your payments to Oaklawn. The charge for each service will be divided into two parts – A facility fee for the hospital and a professional fee for the doctor or medical professional. This is similar to the way billing is done in other hospital departments, such as Radiology or Emergency. These charges will appear together in the same bill. You may receive two Medicare Summary Notices or explanations of benefits for the same visit.

What does “provider-based” mean?
“Provider-based” refers to the billing process for services rendered and means that the clinic is an outpatient department of the hospital. This is the national model of practice for integrated delivery systems where the hospital operates space and employs support personnel involved in patient care.

What are the provider-based locations at Oaklawn Hospital?
The following Oaklawn Medical Group (OMG) locations are considered outpatient departments of Oaklawn Hospital and are provider-based:

• OMG Albion Family Medicine
• OMG Beadle Lake
• Oaklawn After Hours Express
• OMG Olivet Internal & Family Medicine
• OMG Pulmonology
• OMG Tekonsha Family Medicine
• OMG Marshall Internal & Family Medicine
• OMG Marshall Specialty Clinic
• OMG Marshall Primary Care
• OMG Family Practice/OB Suite
• OMG Ear, Nose & Throat
• OMG Heart & Vascular Institute
• OMG Gastroenterology
• OMG General Surgical Associates

Why did Oaklawn Hospital convert to this billing model for its physician office locations?
The Medicare-approved provider-based model ensures Oaklawn is receiving appropriate reimbursement for services provided. The hospital has leased, owned & maintained the space that its employed providers and support staff work out of without additional reimbursement for many years. Declining base reimbursement and increased cost of maintaining facilities are both factors in this decision.

How will this affect my next visit?
Provider-based billing only affects patients with Medicare insurance. Provider-based billing will not change which services are covered, but it may affect your coinsurance liability and deductible for those services. This means that it is possible patients may pay more for certain outpatient services and procedures at the provider-based/hospital outpatient locations. The amount of the deductible depends on the care provided and is determined by the Medicare program through CMS – Centers for Medicare and Medicaid Services. It is recommended that patients review their insurance benefits or contact their insurance provider to determine what their policy will pay and what out-of-pocket expenses they may incur. Medicare patients will now receive one bill with two separate fees, a “professional fee” and a “facility fee”.

Professional Fee: the charge generated is for services provided by the physician, physician assistant, or nurse practitioner.

Facility Fee: the charge generated for use of the office facility: room charge, x-rays, procedures, supplies, and laboratory work.

Who can I contact with questions about my bill?
Oaklawn understands that this change may be confusing for some patients and we are committed to providing any details or explanations that may be helpful. If you have any questions about your bill or your Medicare explanation of benefits (EOB) for your service, please don’t hesitate to contact the billing office at (269) 789-7181.

Out-of-Pocket Costs
The average co-insurance amounts for our most frequently billed services will range from $27.74-$44.52 for established patients. Your actual out-of-pocket costs may differ, depending on your plan and whether you have met your Part A or Part B deductible for the year. If you have secondary or supplemental insurance, it may also cover some of these costs.

Questions or Concerns?
We understand that bills and insurance can be confusing. That’s why our Central Billing Office is here to help.

If you have questions, please call us today at (269) 789-7181.