In Network vs Out –

Contracting Strategies and Avoiding OON Discounts

Network Status

Although there are exceptions, a psychiatrist or mental health nurse practitioner in private practice is either In Network (INN) or Out of Network (OON) with an insurance company. We refer to this as the network status. There are pros and cons to either status.

Generally, the terms like “in network with,” “contracted with,” “on the panel with,” and “paneled with” an insurance are interchangeable. Sometimes mental health providers say “credentialed with” to mean contracted with, but credentialing and contracting are actually different.

In Network

Being INN means a psychiatrist or mental health nurse practitioner has a signed contract with the insurance company and among other things, agrees to a contract rate for each CPT code. That contract amount is all the mental health provider will get paid per code. The contract amount varies per code and differs by payer and is different across geographic regions. 

When submitting claims, submit the same rate per code to each payer, regardless of their reimbursement amount. The difference between your rate and the contract amount is a contractual write off. You don’t get to collect that from the patient. Being held to the contract rate is the main downside of INN status. 

The upside to being contracted, is that the patient’s out of pocket expenses are often lower than if they see an ONN provider, so seeing someone INN often makes better financial sense for a patient. Also, contracted providers are often listed in an online directory, making it easy for potential clients to find them; this can cut down on the need for psychiatrists or mental health nurse practitioners to engage in much marketing or networking.

Out of Network

OON providers don’t have the benefit of the network referrals from an online provider directory, so psychiatrists and mental health nurse practitioners may find they need to do some marketing or networking to bring on clients. And patients generally end up paying more out of pocket to go ONN. Some plans don’t provide any ONN benefits at all. These are downsides of being Out of Network.

But there are several advantages to being ONN.

While INN “contract amount” is used to refer to the reimbursement for each CPT code, ONN “allowed amount” is the more common term. Just like INN you would bill your full rate for each code regardless of the allowed amount. However, ONN providers are usually allowed to collect the difference between their rate and the reimbursement rate; they are not bound by the allowed amount. When done, it’s called balance billing. 

Being OON with some or all payers may also fit into the bigger picture strategy for your private practice.

Network Strategy

Though some psychiatrists and mental health nurse practitioners new to private practice think they need to contract with every insurance company they can in order to fill up their practice with clients, at MindEase we advocate for a more strategic approach.

Providers with a generalized practice may want more contracts while someone with a very specific niche can get away with less. 

If your practice is near some large employers, you may want to consider contracting with the payers that provide benefits to the employees.

There are national companies as well as regional ones and you may want a combination of both. Looking at market share for your region can help you determine what kind of blend fits for your practice. This ties into the phase of your practice. A provider with a new practice that needs to fill up quickly may want companies that have greater market share and can refer more clients (even if reimbursements are lower). While a mature practice may be able to add diversity with a company with smaller market share. 

Insurance Company vs. Network

Although most people use the term “insurance company” and “network” interchangeably, it is important to understand there is a difference.  The insurance company is typically the party that collects the premiums and pays the benefits. The network refers to the pool of health care providers that the insurance company pulls from. 

Most of the nationally recognized companies like Blue Cross Blue Shield (BCBS), United Behavioral Health (UBH), Cigna, and Aetna are both an insurance company and their own network. A therapist can contract directly with them. 

Other insurance companies may be too small to manage their own network, so they “rent” other networks. Cigna and Aetna networks are often used by tiny, obscure insurance companies. 

OON Discounters

One of the most common conversations on local listservs is what to do when you get a communication from MultiPlan asking you to accept a discount to get paid faster. We refer to these companies as “out of network discounters.” Below is our advice to avoid giving an unintended discount to a payer.

Network Shopping

Most payers want to pay as little as they can for benefits, so when a claim comes in, they do a little network shopping. First, they search to see if you’re contracted directly with them. If so, they (should) process claims INN saving some OON costs. If you’re not contracted with them directly, they’ll see if you have a contract with some other network they partner with or “rent” a network from. If they don’t find you on one of those contracts, they reach out to OON discounter like MultiPlan.

Aggressive Encouragement

Aetna and Cigna often use OON discounters; if you’re OON with them keep this in mind. They could hire MultiPlan (renamed Claritev in February 2025) or another similar company to see if you would like to take a pay cut. They aggressively “encourage” psychiatrists and mental health nurse practitioners to be treated as In Network with very low reimbursement rates.

The OON discounter will fax you a negotiation. Then another. And another. Then they might call and/or email. The gist of the communication is that if the provider agrees to the discount, they will get paid “right away.” 

Avoid the Discount

The payer is obligated to process clean claims in a timely fashion which is generally 30 business days in most states. If a claim cannot be processed within this timeframe either because there’s a backup at the company or information is missing from the claim, you are supposed to receive communication directly from the payer about this. Usually this is sent in writing; they don’t normally call and they don’t contact you aggressively or pressure you with “right away” payment tactics.

Our advice is to ignore the OON discounter communications. Shred the faxes. Delete the messages.

However, if you do end up on the phone with one of these discounter reps, do not give them any information. One give-away that you’re talking to such a representative is that they are unlikely to be able to tell you who the patient or the insurance company is. If you are asked for a TIN or patient ID#, you can say “all the information the insurance company needs to process the claim is already on the claim form.” Or “I’m fine waiting until the actual insurance company processes the claim.”

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