American Academy of Professional Coders (AAPC) Practice Exam

What are Participating Providers required to accept?

1. The full billed amount from patients

2. The allowed payment amount determined by the insurance carrier

3. Any amount the patient is willing to pay

4. Any payment received from government sources

The correct answer is: The allowed payment amount determined by the insurance carrier

Participating Providers, often referred to as in-network providers, engage in agreements with insurance carriers that dictate the terms of payment for services rendered. These agreements typically specify that Participating Providers are required to accept the allowed payment amount determined by the insurance carrier as reimbursement for their services. This allowed amount is the maximum that the insurance company will pay for a particular service, and it is typically less than the provider's full billed charges. By accepting this amount, Participating Providers agree to adhere to the pricing structures established by the insurance company, which helps keep costs predictable for patients and insurers alike. Choosing any of the other responses would misrepresent the obligations of Participating Providers. For instance, accepting the full billed amount would contradict the purpose of being a Participating Provider, as they have already agreed to a negotiated rate with the insurance carrier. Additionally, accepting any amount a patient is willing to pay or payments from government sources, without adhering to the established allowed amounts, would not align with the agreed contractual terms with the insurance company.