When most people purchase insurance, they concentrate on what the insurance will cover, not how they’ll make the payments. When you sign an assignment of benefits agreement, you bypass dealing with an insurance company’s claims department and allow the benefits to be paid directly to the provider.
For example, the assignment of benefits medical definition is when you sign a form that requires your health insurance provider to pay the hospital or physician directly.
When you visit an in-network doctor in a contract with your insurance company, the assignment of benefits (AOB) happens automatically. That hospital receives payment right from the insurance company, and the provider handles everything related to billing.
But if your doctor is out-of-network, you might have to sign an AOB agreement that’s included in the paperwork when you check in. In this instance, the hospital will receive a portion of the payment from the insurance company and bill you for the rest.
Some wonder, what is the purpose of an assignment of benefits form? The answer is simple. This form gives the insurance company written authorization to release information that the hospital requires for reimbursement purposes. It also allows medical billing and collection companies to use that information for their billing purposes. When you sign this form, you agree to appoint anyone from the hospital to seek payment from the insurance payer on your behalf. After you sign the AOB form, you won’t have to deal with the insurance company directly unless you are explicitly asked.
Make a note of the fact that the insurance company is not required to accept or honor the AOB. Whether or not they do will depend on your benefits contract and the state law.
To follow are services that use AOB:
● Clinical diagnostic laboratory services.
● Home dialysis equipment and supplies.
● Physician services for patients who hold Medicare and Medicaid plans
● Services other than a primary physician, including clinical psychologists, clinical social workers, nurse midwives, etc.
● Simplified billing roster for vaccines.
Having an AOB in place speeds up the process because it takes away the need to contact the patient directly. It can also increase the chance of reimbursement.
At Montiel Hodge, we can help you navigate your AOB form and understand the language and terms of the contract. Get in touch with us before you sign - reach out to our team today.
