Common use of Liability Calculation Method Per Claim Clause in Contracts

Liability Calculation Method Per Claim. The calculation of the Participant liability on claims for Covered Services processed through the BlueCard® Program will be based on the lower of the participating healthcare provider's billed covered charges or the negotiated price made available to Service Provider by the Host Plan. The calculation of the Department’s liability on claims for Covered Services processed through the BlueCard® Program will be based on the negotiated price made available to Service Provider by the Host Plan. This negotiated price may be greater than what would be the healthcare provider(s)’ billed charges in those instances where the Host Plan has negotiated with its participating healthcare provider(s) an inclusive allowance for specific healthcare services (e.g., DRG or per case or per day amount payment methodologies). Each Host Plan’s determination of an applicable negotiated price will be consistent with the terms of each Host Plan’s applicable healthcare provider contract. The negotiated price made available to Service Provider by the Host Plan which will be passed through to the Department under this Contract is one of the following: (i) an actual price. An actual price is a negotiated payment without any other increases or decreases, or (ii) an estimated price. An estimated price is a negotiated payment reduced or increased by a percentage to take into account certain payments negotiated with the provider and other claim- and non-claim-related transactions. Such transactions may include, but are not limited to, anti-fraud and abuse recoveries, provider refunds not applied on a claim-specific basis, retrospective settlements, and performance-related bonuses or incentives, or (iii) an average price. An average price is a percentage of billed covered charges representing the aggregate payments negotiated by the Host Plan with all of its healthcare providers or a similar classification of its providers and other claim- and non-claim-related transactions. Such transactions may include the examples noted above for an estimated price. Host Plans using either an estimated price or an average price may, in accordance with BlueCard® policies, prospectively increase or reduce such prices to correct for over- or underestimation of past prices (i.e., prospective adjustments may mean that a current price reflects additional amounts or credits for claims already paid to providers or anticipated to be paid to or received from providers). However, the amount paid by the Participant and the Department is a final price for the limited purpose of pricing an applicable claim and no future price adjustment will result in increases or decreases to the pricing of past claims. The BlueCard® Program specifically requires that the price submitted by a Host Plan to Service Provider is a final price under this Contract for the limited purpose of pricing an applicable claim and irrespective of any future adjustments based on the use of estimated or average pricing. Recovery of overpayments from a Host Plan or its participating healthcare providers will in any event be applied for the benefit of the Department independent of this limited pricing rule and consistent with terms of this Contract. If a Host Plan uses either an estimated price or an average price on a claim, it may also hold some portion of the amount paid by a Home Plan in a variance account, pending settlement with its participating healthcare providers. This includes amounts paid by Service Provider as a Home Plan which are passed through to the Department under this Contract. Because all such amounts paid are final for the limited purpose of pricing an applicable claim, neither variance account funds held to be paid, nor the funds expected to be received, are due to or from the Department. Such payable or receivable funds would be eventually exhausted by healthcare provider settlements and/or through prospective adjustment to the negotiated prices. In such instances some Host Plans may retain interest earned, if any, on funds held in variance accounts. In some instances federal law or the laws of a small number of states may require Host Plans either (i) to use a basis for determining Participant liability for Covered Services that does not reflect the entire savings realized, or expected to be realized, on a particular claim or (ii) to add a surcharge. Should either federal law or the law of the state in which healthcare services are accessed mandate liability calculation methods that differ from the negotiated price methodology or require a surcharge, an applicable Host Plan would then calculate both Participant liability and Service Provider liability for Covered Services which are passed through to the Department under this Contract in accordance with such applicable law.

Liability Calculation Method Per Claim. The calculation of the Participant Member liability on claims for Covered Services covered healthcare services processed through the BlueCard® Program BlueCard Program, if not a flat dollar Copayment, will be based on the lower of of: the participating healthcare provider's ’s billed covered charges for covered services; or the negotiated price made available to Service Provider the Plan by the Host PlanBlue. The calculation of the Department’s liability on claims for Covered Services processed through the BlueCard® Program will be based on the Host Blues may use various methods to determine a negotiated price made available to Service Provider by the Host Plan. This negotiated price may be greater than what would be the healthcare provider(s)’ billed charges in those instances where the Host Plan has negotiated with its participating healthcare provider(s) an inclusive allowance for specific healthcare services (e.g.price, DRG or per case or per day amount payment methodologies). Each Host Plan’s determination of an applicable negotiated price will be consistent with depending upon the terms of each Host PlanBlue’s applicable healthcare provider contractcontracts. The negotiated price made available to Service Provider the Plan by the Host Plan which will be passed through to the Department under this Contract Blue may represent a payment negotiated by a Host Blue with a healthcare provider that is one of the following: (i) : • an actual price. An actual price is a negotiated payment without any other increases or decreases, or (ii) ; or • an estimated price. An estimated price is a negotiated payment reduced or increased by a percentage to take into account certain payments negotiated with the provider and other claim- and non-claimnonclaim-related transactions. Such transactions may include, but are not limited to, anti-fraud and abuse recoveries, provider refunds not applied on a claim-specific basis, retrospective settlements, and performance-related bonuses or incentives, or (iii) ; or • an average price. An average price is a percentage of billed covered charges representing the aggregate payments negotiated by the Host Plan Blue with all of its healthcare providers or a similar classification of its providers and other claim- and non-claim-related transactions. Such transactions may include the examples same ones as noted above for an estimated price. Host Plans Blues using either an estimated price or an average price may, in accordance with BlueCard® Inter-Plan Programs policies, prospectively increase or reduce such prices to correct for over- or underestimation of past prices (i.e., prospective adjustments may mean that a current price reflects additional amounts or credits for claims already paid to providers or anticipated to be paid to or received from providers). However, the amount paid by the Participant and the Department Member is a final price for the limited purpose of pricing an applicable claim and price; no future price adjustment will result in increases or decreases to the pricing of past claims. The BlueCard® BlueCard Program specifically requires that the price submitted by a Host Blue to the Plan to Service Provider is a final price under this Contract for the limited purpose of pricing an applicable claim and irrespective of any future adjustments based on the use of estimated or average pricing. Recovery of overpayments from a Host Plan or its participating healthcare providers will in any event be applied for the benefit of the Department independent of this limited pricing rule and consistent with terms of this Contract. If a Host Plan uses either an estimated price or an average price on a claim, it may also hold some portion of the amount paid by a Home Plan in a variance account, pending settlement with its participating healthcare providers. This includes amounts paid by Service Provider as a Home Plan which are passed through to the Department under this Contract. Because all such amounts paid are final for the limited purpose of pricing an applicable claim, neither variance account funds held to be paid, nor the funds expected to be received, are due to or from the Department. Such payable or receivable funds would be eventually exhausted by healthcare provider settlements and/or through prospective adjustment to the negotiated prices. In such instances some Host Plans may retain interest earned, if any, on funds held in variance accounts. In some instances federal law or the laws of a A small number of states may require a Host Plans Blue either (i) : to use a basis for determining Participant Member liability for Covered Services covered healthcare services that does not reflect the entire savings realized, or expected to be realized, on a particular claim claim; or (ii) to add a surcharge. Should either federal law or the law of the state in which healthcare services are accessed mandate liability calculation methods that differ from the negotiated price methodology or require a surcharge, an applicable Host the Plan would then calculate both Participant Member liability and Service Provider liability for Covered Services which are passed through to the Department under this Contract in accordance with such applicable law.

Liability Calculation Method Per Claim. The calculation of the Participant Member liability on claims for Covered Services processed through the BlueCard® BlueCard Program will be based on the lower of the participating healthcare providerProvider's billed covered charges or the negotiated price made available to Service Provider Us by the Host PlanBlue. The calculation of the Department’s liability Host Blues may use various methods to determine a negotiated price, depending on claims for Covered Services processed through the BlueCard® Program will be based on the negotiated price made available to Service Provider by the Host Plan. This negotiated price may be greater than what would be the healthcare provider(s)’ billed charges in those instances where the Host Plan has negotiated with its participating healthcare provider(s) an inclusive allowance for specific healthcare services (e.g., DRG or per case or per day amount payment methodologies). Each Host Plan’s determination of an applicable negotiated price will be consistent with the terms of each Host PlanBlue’s applicable healthcare provider contracthealth care Provider contracts. The negotiated price made available to Service Provider Us by the Host Plan which will be passed through to the Department under this Contract Blue may represent a payment negotiated by a Host Blue with a health care Provider that is one of the following: (i) an : An actual price. An actual price is a negotiated payment without any other increases or decreases, or (ii) an or An estimated price. An estimated price is a negotiated payment reduced or increased by a percentage to take into account certain payments negotiated with the provider Provider and other claim- and non-claim-related transactions. Such transactions may include, but are not limited to, anti-fraud and abuse recoveries, provider Provider refunds not applied on a claim-specific basis, retrospective settlements, and performance-related bonuses or incentives, or (iii) an ; or An average price. An average price is a percentage of billed covered charges representing the aggregate payments negotiated by the Host Plan Blue with all of its healthcare providers health care Providers or a similar classification of its providers Providers and other claim- and non-claim-related transactions. Such transactions may include the examples same ones as noted above for an estimated price. Host Plans Blues using either an estimated price or an average price may, in accordance with BlueCard® Inter- Plan Programs policies, prospectively increase or reduce such prices to correct for over- or underestimation of past prices (i.e., prospective adjustments may mean that a current price reflects additional amounts or credits for claims already paid to providers Providers or anticipated to be paid to or received from providersProviders). However, the amount paid by the Participant and the Department Member is a final price for the limited purpose of pricing an applicable claim and price; no future price adjustment will result in increases or decreases to the pricing of past claims. The BlueCard® BlueCard Program specifically requires that the price submitted by a Host Plan Blue to Service Provider Us is a final price under this Contract for the limited purpose of pricing an applicable claim and irrespective of any future adjustments based on the use of estimated or average pricing. Recovery of overpayments from a Host Plan or its participating healthcare providers will in any event be applied for the benefit of the Department independent of this limited pricing rule and consistent with terms of this Contract. If a Host Plan uses either an estimated price or an average price on a claim, it may also hold some portion of the amount paid by a Home Plan in a variance account, pending settlement with its participating healthcare providers. This includes amounts paid by Service Provider as a Home Plan which are passed through to the Department under this Contract. Because all such amounts paid are final for the limited purpose of pricing an applicable claim, neither variance account funds held to be paid, nor the funds expected to be received, are due to or from the Department. Such payable or receivable funds would be eventually exhausted by healthcare provider settlements and/or through prospective adjustment to the negotiated prices. In such instances some Host Plans may retain interest earned, if any, on funds held in variance accounts. In some instances federal law or the laws of a A small number of states may require a Host Plans either Blue either (i) to use a basis for determining Participant Member liability for Covered Services that does not reflect the entire savings realized, or expected to be realized, on a particular claim or (ii) to add a surcharge. Should either federal law or the law of the state in which healthcare health care services are accessed mandate liability calculation methods that differ from the negotiated price methodology or require a surcharge, an applicable Host Plan We would then calculate both Participant Member liability in accordance with applicable law. Under the BlueCard Program, recoveries from a Host Blue or its participating Providers can arise in several ways, including, but not limited to, anti-fraud and Service Provider liability abuse recoveries, health care Provider/Hospital audits, credit balance audits, utilization review refunds, and unsolicited refunds. In some cases, the Host Blue will engage a third party to assist in identification or collection of recovery amounts. The fees of such a third party may be netted against the recovery. Recovery amounts determined in this way will be applied in accordance with applicable Inter-Plan Programs policies, which generally require correction on a claim-by-claim or prospective basis. As an alternative to the BlueCard Program, the Member’s claim for Covered Services which are passed may be processed through a negotiated national account arrangement with a Host Blue. If We have arranged for (a) Host Blue(s) to make available (a) custom health care Provider network(s) in connection with this Contract, then the terms and conditions set forth in Our negotiated national account arrangements with such Host Blue(s) shall apply. Member liability calculation will be based on the lower of either billed covered charges or negotiated price (refer to the Department under this Contract in accordance with such applicable lawdescription of negotiated price above) made available to Us by the Host Blue that allows Members access to negotiated participation agreement networks of specified Participating Providers outside of Our service area.