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Reasonable and Customary Charges

When care is rendered In-Network, the charges are always considered reasonable and customary by the Plan. This is true because the Claims Administrator has negotiated the charges which will be rendered to the Plan by the providers. The network providers have agreed that the only charges which may be rendered to the Members are those specifically provided by the Plan. Your portion of those charges would include the deductible, the copay or the specific percentage of the negotiated fee specified in the Plan.

When you go to an Out-of-Network provider, you are responsible for any amounts which exceed the reasonable and customary charge for a covered service or supply. The reasonable and customary charge is the lower of the provider’s usual charge or what the Claims Administrator determines is the prevailing charge in the geographic area where this service or supply is furnished.

In determining the reasonable and customary charge for a service or supply that is unusual, not often provided in the area or provided by only a small number of providers in the area, the Claims Administrator may take into account factors such as:

  • The complexity of the service;
  • The degree of skill needed;
  • The provider’s specialty; and
  • The range of services or supplies provided by a facility and the prevailing charge in other areas.

Cigna and Cigna Behavioral Health determine the reasonable and customary charge for Out-of-Network charges from a large database of actual charges that have been submitted by many carriers and adjusted periodically (usually, every six months) to add current data and to remove statistically aberrant examples. In contrast, Aetna, CVS Caremark and EyeMed determine the reasonable and customary charge for Out-of-Network charges from the charge each vendor is contracted to pay its network provider for the same service or supply.