A biller tells a facility owner that Cigna pays $2,400 a week for residential. The owner remembers that number for every Cigna admission after. Then a claim comes back at $1,100 for the exact same level of care, same state, same week — because the $2,400 was never really a fact, just an average with the context stripped out.
Kyle McHenry, founder of Revenue Logic and the team behind PayerLenz’s reimbursement benchmarking, has a line for this: asking what a payer pays is like asking what the weather’s like in Chicago without saying which season. The question sounds answerable. It isn’t, not with one number.
- “Cigna pays $X” isn’t a fact — it’s an average with the plan type, sub-policy, and time period stripped out, and those three variables are most of what determines the real number.
- Cigna alone runs multiple distinct sub-policy types, including MRC1 and MRC2, that can reimburse the same level of care very differently under the same carrier name.
- BCBS resolves further still — by alpha prefix and home plan, not just “Blue Cross.” Two BCBS patients can be on effectively different payers.
- A blended number that ignores recency is stale by construction. A rate from three years ago isn’t the rate a payer allows today.
What “Cigna Pays $X” Actually Leaves Out
A single blended rate collapses at least three variables into one number: which sub-policy the patient is actually on, what reimbursement method that sub-policy uses, and how recently that rate was observed. Drop any one of those and the number stops describing anything real. That same imprecision is what makes underpayment against the contracted rate so hard to spot on a remittance.
Cigna is the clearest example. It isn’t one reimbursement schedule — it runs multiple sub-policy types, including MRC1 and MRC2, plus separate distinctions like negotiated-and-published rates versus usual-and-customary. Two patients both described as “Cigna, out-of-network” can be on entirely different sub-policies with different expected payouts.
- One number for the whole carrier
- No sub-policy or plan-type distinction
- No indication of how current the figure is
- Specific to the sub-policy — MRC1 vs. MRC2, negotiated vs. usual-and-customary
- Resolved to alpha prefix and home plan for BCBS
- Weighted toward recent claims, not a stale multi-year average
BCBS makes the same point a different way. “Blue Cross Blue Shield” isn’t a single payer — it’s dozens of independently operating plans, each identifiable by the alpha prefix on the member ID and resolved to a home plan. A number that says “BCBS pays $X” without that resolution is guessing at which BCBS it means.
Asking what a payer pays, without saying which sub-policy, is like asking what the weather’s like in Chicago without saying which season.Kyle McHenry, Founder, Revenue Logic
Why the Lazy Version Persists Anyway
A single number is fast to produce and easy to repeat, which is exactly why it survives inside billing operations that don’t have claims data to check it against. It isn’t malicious. It’s just the version that doesn’t require the harder work underneath it.
An active benefit isn’t a rate covers the same gap from a different angle — a VOB confirms coverage, not the sub-policy-specific rate. A blended reimbursement figure has the identical blind spot: it answers a simpler question than the one that was actually asked.
This isn’t unique to behavioral health. Research on hospital reimbursement has found wide reimbursement variation by insurer depending on plan and contract structure, not just which carrier is listed on the card. CAQH CORE, the body HHS names as author of the federally adopted operating rules for these transactions, exists specifically because claims and eligibility data don’t standardize cleanly across payers and plans on their own.
What a Resolved Rate Actually Requires
Getting past the blended number means resolving three things on every claim: the specific sub-policy, the reimbursement method it uses, and how recently that rate was actually paid. None of that is optional if the number is going to mean anything. Resolving all three is what sub-policy level rate detail is for, since a plan-level average collapses exactly the distinctions that decide the number.
A real verification of benefits confirms the plan is active. It was never built to resolve sub-policy-level reimbursement, and most billing operations don’t have the claims volume to do it even if they wanted to.
If a billing company or a competitor’s tool gives you a single reimbursement number for a payer with no plan type, no sub-policy, and no date attached, ask where it came from. If they can’t answer, it’s a guess wearing a decimal point.
This is also why comparing behavioral health RCM vendors on reimbursement claims is harder than it looks — a vendor citing one blended number per payer is telling you they haven’t done the resolution work, whether or not they say so directly.
Is a blended payer rate ever useful?
As a rough starting point, sometimes. As a number to admit or forecast against, no — it hides exactly the variance that determines whether a specific admission makes money.
Why does BCBS need to be resolved to an alpha prefix?
“Blue Cross Blue Shield” covers dozens of independently operating plans identified by the alpha prefix on the member ID. Two BCBS patients can effectively be on different payers with different reimbursement behavior.
If you want to see your own payer mix resolved this way instead of averaged, reach out to Revenue Logic and we’ll walk through what the data actually shows.
- BCBS resolved to alpha prefix and home plan
- Weighted toward recent claims, not stale averages
