Catching Tariff Leakage: Under-Billing Against TPA and Insurer Contracts
Find where your hospital bills below agreed TPA and insurer tariffs, and put a check in place that stops it at billing.
A hospital renegotiates rates with an insurer, signs the new agreement, and files it with the management team. Months later, an audit shows billing is still using the old tariff for several procedures. Every claim in between went out at the lower rate, and the insurer paid exactly what was asked.
Leakage also hides in package rules. A procedure billed as a package when it should be itemised, an implant left out, or a room upgrade not charged per contract. Because the claim is paid without complaint, nobody notices. Unlike a rejection, under-billing never generates a letter that tells you something went wrong.
Can we recover money for past under-billing?
Sometimes, but it depends on your contract terms and how long ago the claim settled. Many payers will not reopen settled claims. Treat recovery as a case-by-case discussion and focus effort on stopping future leakage.
How is tariff leakage different from claim deductions?
Deductions are amounts the payer disallows from what you billed. Leakage is money you never billed in the first place. Deductions show up on settlement letters, while leakage stays invisible unless you audit bills against contracts.
Who should own the tariff master?
Usually someone in revenue cycle or insurance management who sees contracts as they are signed. What matters most is that one named person updates it, and that billing cannot edit rates without approval.