Top up (or GAP) invoices – asking the patient to agree to pay the difference between a consultant’s fee and the fee an insurance company is prepared to pay.
The discussion concerning them seems to take place more in whispers than anything and sometimes they are even deemed to be almost a taboo subject because they don’t exist. But they do.
So, and for the record:
I don’t like top up invoices.
I don’t think they are the way forward.
That said, I do use them and have no problem issuing them on behalf of my clients. Why and when?
Consider the case of a real consultant surgeon who’s patient is quite happy to pay, for example, £852 for a surgical episode.
But the patient is insured with XYZ Insurance. XYZ will only pay a “customary and reasonable fee” of £639. The fee was £852 but due to “market conditions” XYZ have reduced it by 25%.
Thus the consultant may now as part of his recognition protocol only charge £639
Most consultants actually perform the same procedure throughout the month. Empirical evidence using MHM clients confirms they all perform, in their own specialism obviously, the same code(s) on average 5 times a month.
If that code happens to be the one reduced by £213 each time, the reduction in revenue is over £1,000 each month.
Returning to the original scenario though, the patient has chosen to see that particular consultant. His/her decision has zero to do with fees; that is the consultant the patient has chosen. If the patient is advised the fee for their procedure is £852 but their insurance company will only pay £639 towards it and then, if they – the patient – is asked beforehand to pay the difference and agrees, where is the problem?
Ah no, say the insurance company, you can’t do that for that is above our customary and reasonable fees and anyway you are risking your recognition with us.
This article is not about if they are right to potentially withdraw recognition if fees are not adhered to. Neither is it about whether XYZ Insurance are right to reduce the fee.
This article is about what do XYZ Insurance expect, in the real word, the consultant surgeon provider to do when faced with such a drop in income.
The first thing consultants will all do is be deeply unhappy about the reduction. The second thing they will do is attempt to mitigate the loss somehow or another.
And the second point is the more relevant one.
Many times I hear from insurance companies the market is contracting and cost has to be taken out to make the private medical insurance offering more attractive. No argument from me on that BUT why is the cost reduction, or so it appears, being continually directed at the consultants?
Yes, I am aware that certain fees have gone up but overall fees have come down. I’m equally opposed to those consultants who insist on ignoring insurance companies fee structures for every single procedure and/or episode.
I’m also very focused on taking cost out of any business – you want to make more, then spend less so I can see where the insurance companies are coming from.
But not at the expense of continually reducing a consultant’s fee and thereby reducing his profit continually AND the patient’s right to a choice.
Top Up or Gap invoices are a reaction to consultants continually seeing their fees being eroded. I haven’t said I completely agree with them for they should be unnecessary.
What I am saying is that I understand why I’m being asked to produce them and when.
Consider an actual quote to me recently from a very well established consultant surgeon. An orthopod who has been in private practice for over 10 years:
“It feels like insurance companies have decided the surgeon is at the bottom of the food chain”
That, perhaps, sums up precisely why some MHM clients are asking me to produce Top Up or GAP invoices.