Matters in Healthcare: What is the difference: co-pay and upfront pay?

FRIDAY, FEB. 24:

Question: What is the difference between a co-payment and being asked to pay “upfront” at a healthcare visit?

Answer: There is a very important distinction. Essentially, the difference is about whether a patient pays for the majority of the bill at the time of the office visit. A ‘co-payment’ is just part of the full bill.

Simply explained:

A co-payment is a portion of the full cost of a health visit. This is charged to an insured patient, while the remainder of the bill is sent to his or her insurer. Co-pays are intended to ensure a patient’s investment in their treatment. They can help to lower insurance costs, and prevent potential over-use of some services.

“Upfront Payment” is a shorthand term to refer to charging insured patients the full fee at the time of the visit. The patient then has to submit a claim to his or her insurer to recover the insured portion.

Example: If at your last doctor’s visit you had to pay $40; this was most likely a co-payment. Your doctor would have sent a separate bill to your insurer for about $60 to cover the full cost of your visit ($100 in this example). However, if your visit cost you $100, this was likely the full cost. Healthcare offices generally give you a receipt and encourage you to send it to your insurer, who will reimburse you the $60 insured portion.

Question: Am I required to pay either of these bills?

Answer: Yes, but there are changes coming. Currently, a healthcare provider can charge you either way, and about 47 per cent charge upfront sometimes or always.

BHeC was first asked to investigate the practice in 2008 by the Ministry of Health. Three years later, while reimbursement has improved and guidelines were published, the upfront payment practice has not stopped. While a complex issue, according to the World Health Organization (WHO), it should be curtailed to ensure access to healthcare without undue financial hardship to patients. Bermuda’s health professionals and insurers have the patient’s interest at heart and many are currently working with BHeC and the Ministry of Health as changes are introduced to improve patient access.

For now, however, as the patient your healthcare provider can charge you either way, but you can take steps to prepare yourself.

Call your healthcare provider ahead of your visit. Make sure you ask these questions before your visit:

Will I have to pay in full or just a co-pay?

If you charge upfront, how much will the visit cost?

If not, how much will the co-pay be for my visit?

If you are concerned about upfront payments and are unable to afford to pay out of pocket for the insured portion, you can discuss this with your health provider, or consider going to another professional who doesn’t charge upfront. If you have questions or concerns, you can contact BHeC for more information.