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Q  Is there a difference between price, cost and payment?
A Yes.

Price
Similar to retail price, when used in healthcare, “price” refers to the amount a provider sets for a service. Price is often used interchangeably with “charge” and serves as the starting point from which payment is negotiated. Most patients do not pay the full price for healthcare services.

Cost
"Cost" refer to the amount spent by the provider delivering services and include all of the expenses involved in keeping their doors open, from supplies to utilities to labor.

Payment
"Payment" simply refers to the dollar amount which is paid from insurance companies – public or private – to providers. Many times this rate represents a negotiation between two entities, which is why variation in the payment for healthcare services sometimes exists. Payment also includes the amount received from patients directly for the deductible, coinsurance or co-pays as well as charges for services not covered by the insurance policy.


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