When to Apply for a Gap Exception for Your Patients

A network gap exception is a mechanism used by health insurance companies to address gaps in their network of contracted healthcare providers. When your patients health insurer grants them a network gap exception, it enables them to receive healthcare services from an out-of-network provider while paying the lower in-network cost-sharing fees.

In this blog, we will discuss the process of obtaining a network gap exception, how it functions, and the expected out-of-pocket costs if the exception is granted.

A network gap exception may be referred to by various names, such as a clinical gap exception, out-of-network exception, network insufficiency exception, or gap waiver.

The Function of a Network Gap Exception

When a patient receives medical care from an out-of-network provider without a network gap exception, they will typically face higher out-of-pocket costs compared to using an in-network provider.

If the patient has an HMO or an EPO, they may not receive coverage for any costs associated with non-emergency out-of-network care, unless you obtain a network gap exception. This is because these types of plans typically do not cover out-of-network care.

For PPO or POS plans, using out-of-network providers can result in higher out-of-pocket costs compared to in-network providers. While these plans may offer some coverage for out-of-network care, the deductible, coinsurance, and copayments are typically much higher. This means that even if your patients plan covers out-of-network care, they may still be responsible for the entire bill due to a high out-of-network deductible.

To request a network gap exception, you are essentially asking the health insurance to cover the cost of care received from an out-of-network provider at the same rate as if it were in-network. Each request is evaluated on a case-by-case basis by the insurer. If the exception is granted, the patient will only be responsible for paying the lower in-network deductible, copay, or coinsurance for the specific out-of-network care.

Benefits of Obtaining a Network Gap Exception

It's important to keep in mind that obtaining a network gap exception from the health plan may not be an easy process. Health plans may be hesitant to grant exceptions due to the additional administrative work and potential costs involved.

However, if the health plan lacks an in-network provider in your area or cannot provide the healthcare service the patient needs, it may be unjust to require the patient to pay higher cost-sharing fees. In such cases, the health insurer can grant a network gap exception to enable the patient to receive the necessary care from an out-of-network provider without incurring excessive costs.

Networks offered by insurance plans can vary greatly from one policy to another. Certain insurers may provide comprehensive networks with a PPO structure that permits members to seek care from providers outside the network, while others may offer plans with narrower networks and an HMO or EPO structure that mandates members to seek in-network providers (or request a network gap exception).

Health insurance plans offered through employers tend to have more robust networks, while plans purchased by individuals or families on the individual/family market (whether on-exchange or off-exchange) tend to have more limited networks.

As of 2018, the enforcement of network adequacy rules was transferred from the federal government to the states. However, starting in 2023, the federal government will resume the enforcement of these rules. Additionally, as of 2024, the network adequacy standards will be strengthened to include maximum wait times for appointments.

Costs with a Network Gap Exception

If the health plan grants a network gap exception, it implies that they will consider the specific service from the provider as if it's in-network. This means that the patient will be responsible for the in-network deductible, copays, and coinsurance for that service, instead of the plan's out-of-network cost-sharing. For plans that do not cover out-of-network care at all, a network gap exception will provide coverage for the service in question instead of no coverage at all.

Even if a network gap exception is granted and the health plan agrees to treat the service as in-network, it does not guarantee that the provider will accept the health plan's reasonable and customary rate as full payment. This will depend on the specific agreement between the provider and health plan, and may vary by state and health plan. As a result, you may still balance bill the patient the portion of their charges that exceed the health plan's reasonable and customary amount.

When setting up a network gap exception for a specific service, it's important to discuss the financial details with the patient. Advise whether you will accept the health plan's rate as full payment in case the exception is approved. If you're not, try to provide an estimate of how much extra the patient may have to pay after meeting their health plan's regular cost-sharing requirements.

Reasons Why Your Patient May Qualify for a Network Gap Exception

A network gap exception is generally only granted if the following conditions are met:

1. The patient is only likely to be granted a network gap exception if the care you are requesting is a covered benefit and is deemed medically necessary.

2. A network gap exception may be granted if the care the patient needs is a covered benefit, medically necessary, and there is no in-network provider within a reasonable distance or wait time (as defined by network adequacy standards, including maximum wait times for appointments starting in 2024).

If the patient meets the requirements mentioned above and have found an out-of-network provider that can provide the necessary care, you can request a network gap exception from the health insurance company. This request can either be submitted by the out-of-network provider or by the patient, depending on the situation.

To avoid having the patient to pay more, it's important to request a network gap exception before rendering services. If you wait until after providing the care, the health plan will process the claim as out-of-network and the patient will likely have to pay more. Not to mention that you might not get a payment out of the services that were rendered.

A network gap exception is a temporary exception that only covers a specific service from an out-of-network provider.

When an insurer approves a network gap exception, it typically only covers a specific service provided by a particular out-of-network provider within a limited timeframe. In other words, it doesn't give the patient unlimited access to out-of-network providers for any service they want.

Information Needed for Requesting a Network Gap Exception

When requesting a network gap exception, you will need to have the following information available:

1. You will need to have the CPT or HCPCS code that corresponds to the healthcare service or procedure you require when making a request for a network gap exception.

2. You will need the ICD-10 code that corresponds to the patient diagnosis when requesting a network gap exception.

3. The contact information for the out-of-network provider.

4. One piece of information you'll need for your network gap exception request is the expected date range for the service you're requesting, such as from July 1, 2022, to October 1, 2022.

5. You will need to provide the names of any in-network providers of the same specialty within the patients geographic area and explain why those providers are not able to perform the services the patient needs.

Patient recommendation:

To ensure that the network gap exception covers the services you require, obtain the CPT codes, HCPCS codes, and ICD-10 codes from your out-of-network provider. If this is not possible because you haven't had an appointment with that provider yet, the physician who referred you may be able to provide you with the necessary medical codes.

Depending on the situation, either the out-of-network provider or the patient may be responsible for submitting the network gap exception request. However, the patient is ultimately responsible for any charges that are not covered by health insurance, regardless of who submits the request.

Providing an explanation for why the in-network provider is unable to perform the required service.

If there are any in-network providers who offer the same service as the out-of-network provider for which you're requesting a network gap exception, you will have to provide a justification to the patients health insurance company explaining why they cannot use the in-network provider.

For instance, suppose the patient requires ear surgery and are seeking a network gap exception for an out-of-network otolaryngologist to perform the surgery, but there is an in-network otolaryngologist available within the patients area.

If there is an in-network otolaryngologist available in your patients geographic area but is unable to perform the surgery the patient requires due to age or a medical condition such as a hand tremor, it is important to provide this information to the health plan when requesting a network gap exception. Failing to do so may result in a denial of your request.

Patient recommendation:

Seeking the out-of-network provider's assistance can be helpful in providing a detailed explanation of why the in-network providers will not be able to meet your needs, so it is a good idea to involve them in the process.

What actions to take if your request is not approved.

If your request for a network gap exception is denied, don't lose hope. Instead, contact the health insurance company to understand the reason for the denial. It's possible that the denial was due to a simple issue, such as:

1. The health insurance company was not able to reach the office of the out-of-network provider.

2. The insurance company believes there are in-network providers who can perform the same service.

3. The health insurance company may have denied the request because they have incorrect information such as the patients address, which may have led them to believe the patient lives closer to in-network providers than they actually do.

Understanding the reason why your request was denied can help you either appeal the decision or submit a new request with additional information to support your case.

Summary

A network gap exception is a case-by-case decision made by a health plan to treat a specific medical service as if it were in-network, even if it is performed by an out-of-network provider. These exceptions are granted when there are no in-network providers who can provide the necessary care within a reasonable distance or time frame.

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