Financial Assistance / Patient Discounts Policy / Patient Discounts Policy Definitions

Patient Discounts Policy Definitions

Amounts Generally Billed (AGB): IRS Section 501(r) requires hospitals to limit the amounts charged for emergency and other medically necessary care provided to individuals eligible for financial assistance to no more than the amounts generally billed (AGB) to insured individuals. The AGB calculation is updated annually. 

Appropriate VUMC Representative: Those individuals serving in those positions identified in the Approval Requirements section below and relating to the corresponding Discount set forth below.

Contracted Payer:  Third party payers, including health plans, self-insured employers, and indemnity plans, which have entered into a written managed care or pricing agreement with VUMC with respect to the health care services in question. Contracted Payers include managed care agreements with Medicare Advantage Plans and/or contracts with any other Governmental Payers.

Eligible Health Care Services: Services which are emergent and other medically necessary care. Eligible Health Care Services exclude:

  • Non-Covered Services;
  • Any contractual allowances;
  • Cosmetic services or elective services that are not medically necessary;
  • Vanderbilt Health On-Call services;
  • Market Sensitive services where Alternative Pricing has been developed and deployed;
  • Write-offs of amount due from third party payers;
  • Shortfall between reimbursement from government programs and the cost of services provided;
  • Write-offs of patients' balances when there is not an indication that the patient is unable to pay;
  • Experimental Services;
  • Transplant Services;  
  • CAR-T Therapy and related services;
  • Retail Health Clinic Services; and
  • Retail and Specialty Pharmacy items

Financial Assistance or Financial Assistance Discounts: Discounts or elimination of payment for health care services provided to eligible patients with documented and verified financial need.

  • Financial Assistance: Discounts provided to patients for medical bills based on income guidelines; and
  • Catastrophic Financial Assistance: Discounts or write offs of medical bills based on family medical debt; patients are often referred to as medically indigent

Financial Counseling:  Information and assistance provided to patients regarding their out-of-pocket liability including those patients without sufficient insurance coverage, or who are unable to pay their estimated/actual liability prior to the treatment, or who have large past due balances.

International Individual: International Individual: Any person receiving medical services who meets one of the following criteria:

  • A non-U.S. citizen with non-U.S. insurance not living in the U.S. or U.S. territory for less than a continuous 12-month period
  • A non-U.S. citizen with U.S. insurance not living in the U.S. or U.S. territory
  • A non-U.S. citizen with no insurance not living in the U.S. or U.S. territory
  • A U.S. citizen with non-U.S. insurance living in the U.S. or U.S. territory for a period greater than 12 months
  • A U.S. citizen with U.S. insurance not living in the U.S. or U.S. territory for a 12-month period
  • Embassy sponsored patients

Letter of Agreement (LOA): The written agreement stipulating the financial terms and conditions for providing healthcare services to a patient.

Look-Back Method:  The methodology specified by IRS Code Section 501(r) and selected by VUMC to determine AGB. A hospital facility determining AGB under the Look-Back method may use claims for all medical care allowed during a prior 12-month period for the calculation of AGB.

Non-Contracted Payer:  Third party payers, including health plans, self-insured employers, plans, which have not entered into a formal managed care or pricing agreement with VUMC.

Non-Covered Services:  Service not covered by insurance provided to individuals with contracted payer coverage.

Private Pay: Patient identified as having no insurance coverage, including disease specific or defined benefit plans which are not considered health insurance benefit plans  or who elects to opt out of their insurance coverage for specific services/events.

Transplant Services:  Medical services provided to patients for either solid organ or stem cell transplantation.

Underinsured: Insured patients who receive Eligible Health Care Services that are determined to be noncovered services or have limited benefit coverage by the insurance provider. This includes patients with health care sharing ministries as defined in the Affordable Care Act. This does not apply to disease specific or defined benefit plans as these are not considered health care insurance coverage plans. 

Uninsured:  Patients identified as having no insurance coverage. This does not include those patients with faith-based plans as identified by the Affordable Care Act

Uninsured Discount: A discount on charges for medical services for patients identified as uninsured.  The Uninsured Discount is determined annually based upon the Look-Back Method by determining the average discount provided by VUMC hospitals to Medicare fee-for-service and private health insurers. 

U.S. Insurance Plan: Insurance plan underwritten by a U.S. based insurance company and liable for the payment of the health care service provided to a patient. Registered and in good standing with the Insurance Commissioner’s office of the state in which they are based.

Vanderbilt University Medical Center (VUMC) or Vanderbilt Health: Vanderbilt University Hospital, Monroe Carell Jr. Children’s Hospital at Vanderbilt, Vanderbilt Psychiatric Hospital, Vanderbilt Medical Group, Vanderbilt Academic and Research Enterprise, Medical Center Administration, Vanderbilt Wilson County Hospital, or other similar consolidated health care entity.