patient-responsibility-estimator

# Patient Responsibility Estimator

## Overview

Estimate patient out-of-pocket costs based on available benefit information. Unlike coverage verification (deterministic), cost estimation involves uncertainty—this skill provides calculation logic AND appropriate confidence levels based on data completeness.

## The Estimation Problem

### What You Know vs. Reality

| Data Point | What Eligibility Returns | Reality |
|------------|-------------------------|---------|
| Deductible | Plan deductible amount | ✓ Accurate |
| Deductible Met | Amount applied (as of last claim) | May be stale by days/weeks |
| Copay | Plan copay amount | May vary by service type |
| Coinsurance | Plan coinsurance % | ✓ Usually accurate |
| OOP Max | Plan out-of-pocket maximum | ✓ Accurate |
| OOP Met | Amount applied to OOP | May be stale |
| Allowed Amount | Unknown | You're estimating |

**Key insight:** You're estimating with incomplete, potentially stale data. Communicate this appropriately.

## Estimation Workflow

```
┌─────────────────────────────────────────────────────────────────┐
│               PATIENT RESPONSIBILITY ESTIMATION                  │
├─────────────────────────────────────────────────────────────────┤
│                                                                 │
│  INPUT:                                                         │
│  - Service codes (CPT/HCPCS)                                   │
│  - Benefit data (deductible, copay, coinsurance, accumulators)  │
│  - Fee schedule / expected allowed amount                       │
│                                                                 │
│  STEP 1: Assess Data Completeness → Confidence Level           │
│  STEP 2: Determine Cost-Share Structure                         │
│  STEP 3: Calculate Estimate                                     │
│  STEP 4: Apply Caveats                                         │
│  STEP 5: Format for Patient Communication                       │
│                                                                 │
│  OUTPUT: Estimate + Confidence + Caveats                        │
│                                                                 │
└─────────────────────────────────────────────────────────────────┘
```

## Step 1: Assess Data Completeness

### Confidence Levels

| Level | Data Available | Estimate Reliability |
|-------|----------------|---------------------|
| **HIGH** | Real-time accumulators + contracted rates | ±10% |
| **MEDIUM** | Benefit structure + recent accumulators | ±25% |
| **LOW** | Benefit structure only, no accumulators | ±50% |
| **NONE** | Minimal/no benefit data returned | Cannot estimate reliably |

### Confidence Scoring

```
START: confidence = 0

ADD +30 if: Have current deductible accumulator (≤7 days old)
ADD +20 if: Have current OOP accumulator (≤7 days old)
ADD +25 if: Have contracted/allowed amount (not estimate)
ADD +15 if: Have specific copay for service type
ADD +10 if: Coinsurance clearly defined

CONFIDENCE LEVEL:
  ≥80: HIGH
  50-79: MEDIUM
  25-49: LOW
  <25: NONE (provide range or decline to estimate)
```

## Step 2: Determine Cost-Share Structure

### Common Plan Structures

#### Copay-Based (HMO/POS Typical)

```
Patient pays: Copay (flat fee)
- May vary by service type
- Usually no deductible for office visits
- May have separate copays for:
  - PCP visit
  - Specialist visit
  - Urgent care
  - ER
```

#### Deductible + Coinsurance (PPO/HDHP Typical)

```
Patient pays: Deductible first, then coinsurance
- All costs apply to deductible until met
- After deductible: patient pays X% (coinsurance)
- After OOP max: patient pays $0
```

#### Hybrid (Common)

```
Patient pays: Copay OR Deductible + Coinsurance
- Copay for office visits
- Deductible + coinsurance for procedures, imaging, etc.
- Must know which applies to service type
```

### Service Type to Cost-Share Mapping

| Service Type | Typical Cost-Share | Benefit Category |
|--------------|-------------------|------------------|
| Office visit (PCP) | Copay | 30 - Health Benefit Plan Coverage |
| Office visit (Specialist) | Copay (often higher) | 30 |
| Preventive | $0 (ACA mandate) | 35 - Preventive |
| Diagnostic imaging | Deductible + coinsurance | 30 |
| Advanced imaging (MRI/CT) | Deductible + coinsurance | 30 |
| Lab work | Deductible + coinsurance OR $0 | 30 or 35 |
| Surgery (outpatient) | Deductible + coinsurance | 30 |
| ER visit | Copay + deductible + coinsurance | 30 |
| DME | Deductible + coinsurance | 30 |

## Step 3: Calculate Estimate

### Copay Calculation

```
IF service_type has copay:
  patient_responsibility = copay_amount
  
EXAMPLE:
  Service: Office visit (specialist)
  Copay: $50
  Patient responsibility: $50
```

### Deductible + Coinsurance Calculation

```
INPUT:
  allowed_amount = expected payment from payer
  deductible = plan deductible
  deductible_met = amount already applied
  coinsurance = patient percentage (e.g., 20%)
  oop_max = out-of-pocket maximum
  oop_met = amount already applied to OOP

CALCULATE:
  deductible_remaining = deductible - deductible_met
  oop_remaining = oop_max - oop_met
  
  IF allowed_amount <= deductible_remaining:
    # Service fully applies to deductible
    patient_responsibility = allowed_amount
  ELSE:
    # Part to deductible, part to coinsurance
    deductible_portion = deductible_remaining
    coinsurance_portion = (allowed_amount - deductible_remaining) * coinsurance
    patient_responsibility = deductible_portion + coinsurance_portion
  
  # Apply OOP max cap
  IF patient_responsibility > oop_remaining:
    patient_responsibility = oop_remaining

RETURN patient_responsibility
```

### Calculation Example

```
SCENARIO:
  Service: MRI Brain
  Allowed amount: $800
  
  Plan benefits:
    Deductible: $1,500
    Deductible met: $1,200
    Coinsurance: 20%
    OOP Max: $6,000
    OOP Met: $1,400

CALCULATION:
  Deductible remaining: $1,500 - $1,200 = $300
  OOP remaining: $6,000 - $1,400 = $4,600
  
  Step 1: Apply $300 to deductible (exhausts it)
  Step 2: Remaining $500 × 20% = $100 coinsurance
  Step 3: Total = $300 + $100 = $400
  Step 4: $400 < $4,600 OOP remaining, no cap applied
  
RESULT: Patient responsibility = $400
```

### In-Network vs. Out-of-Network

```
IF provider is out_of_network:
  USE oon_deductible, oon_coinsurance, oon_oop_max
  ALSO CONSIDER:
    - Balance billing (provider may bill above allowed)
    - Separate OON accumulators
    - Higher cost-share percentages
    
WARNING: OON estimates are less reliable due to:
  - Unknown allowed amount
  - Potential balance billing
  - UCR (usual, customary, reasonable) variations
```

## Step 4: Apply Caveats

### Standard Caveats by Confidence Level

**HIGH Confidence:**
```
"This estimate is based on your current benefits and accumulators. 
Actual costs may vary slightly based on services rendered."
```

**MEDIUM Confidence:**
```
"This is an estimate based on available benefit information. 
Your actual cost may vary based on:
- Claims processed since your last accumulator update
- Specific services rendered
- Any applicable plan limitations"
```

**LOW Confidence:**
```
"This is a rough estimate only. We have limited information about 
your current deductible and out-of-pocket status. Your actual 
responsibility may be significantly different. We recommend 
contacting your insurance for more accurate information."
```

**NONE (Cannot Estimate):**
```
"We are unable to provide a reliable estimate based on available 
information. Please contact your insurance company directly for 
cost information, or we can collect a deposit and reconcile 
after claim processing."
```

### Situation-Specific Caveats

| Situation | Caveat |
|-----------|--------|
| Accumulator data >7 days old | "Deductible status may have changed" |
| Multiple procedures | "Costs may vary based on procedure order" |
| Out-of-network | "Provider may bill amounts above estimate" |
| HDHP with HSA | "You may use HSA funds for this expense" |
| Near year-end | "Accumulators reset on [date]" |
| New policy | "As new coverage, full deductible may apply" |

## Step 5: Patient Communication

### Estimate Output Format

```
───────────────────────────────────────────
PATIENT COST ESTIMATE
───────────────────────────────────────────

Patient: {name}
Service: {description} ({cpt})
Provider: {provider_name}
Date: {dos}

YOUR BENEFITS:
  Deductible: ${deductible} (${deductible_met} met)
  Coinsurance: {coinsurance}% after deductible
  Out-of-pocket max: ${oop_max} (${oop_met} met)

ESTIMATED COST:
  Service charge: ${charge}
  Insurance payment: ${insurance_pays}
  ─────────────────
  YOUR ESTIMATED COST: ${patient_responsibility}

Confidence: {HIGH/MEDIUM/LOW}
{caveat_text}

This is an estimate only. Actual costs will be determined 
after claim processing.

───────────────────────────────────────────
```

### Range Estimates (When Confidence is Low)

```
YOUR ESTIMATED COST: $300 - $500

Why a range?
We have limited information about your current deductible 
status. The lower estimate assumes recent claims have been 
applied. The higher estimate assumes no recent changes.
```

## Special Scenarios

### Multiple Services Same Visit

```
CALCULATE in order of processing (typically by charge amount desc):

Service 1: $500 → Patient pays $300 (exhausts deductible)
Service 2: $300 → Patient pays $60 (20% coinsurance)
Service 3: $200 → Patient pays $40 (20% coinsurance)
───────────
Total: $400

NOTE: Claim processing order may vary
```

### Family Deductible

```
IF family_deductible applies:
  CHECK individual_deductible_met
  CHECK family_deductible_met
  
  Patient deductible satisfied when EITHER:
    - Individual deductible met, OR
    - Family deductible met
```

### Preventive vs. Diagnostic

```
IF service is preventive:
  Patient responsibility = $0 (ACA mandate)
  
BUT IF service is diagnostic:
  Normal cost-share applies
  
COMMON CONFUSION:
  - Annual physical = preventive ($0)
  - Problem-focused visit during physical = diagnostic (cost-share)
  - Screening colonoscopy = preventive ($0)
  - Colonoscopy with findings/biopsy = may become diagnostic
```

## Resources

### references/
- **plan-types.md** — Cost-share structures by plan type
- **calculation-examples.md** — Worked examples for various scenarios
- **patient-scripts.md** — Scripts for explaining estimates to patients

### scripts/
- **estimate-calculator.py** — Calculates patient responsibility
- **confidence-scorer.py** — Scores data completeness

### assets/
- **estimate-template.docx** — Patient estimate letter template
- **good-faith-estimate.docx** — No Surprises Act compliant estimate