How are health insurance "negotiated rates" negotiated?

Asked January 24, 2014, 2:17 AM EST

Are "negotiated rates" negotiated on an insurer-by-insurer basis or a plan-by-plan basis? In other words, will two plans from the same insurer always pay the same negotiated rate for a given procedure at a given provider?

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1 Response

Your question seems to have stumped the first couple of Educators who have taken a look at it, so please first accept an apology for a delay in answering.

While I am not an insurance underwriter and I am guessing that there may be some opening for interpretation in some states or plans, most of the commentary I can find indicates that the answer is YES that most likely two plans from the same insurer do pay the same negotiated rate for a given procedure at a given provider. The "negotiated rate" is the acceptable rate of reimbursement to that provider (and usually other providers in the same geographic area and at the same type of facility) for that procedure.

The National Association of Insurance Commissioners is charged by law with establishing and enforcing regulations that ensure fairness and consistency in pricing and benefits of all types of insurance across the states and markets. You may find some resources to research further at their website
and below are some links to helpful articles on the subject.
http://blog.pricinghealthcare.com/
http://guides.wsj.com/health/health-costs/how-to-research-health-care-prices/