Maximum Allowable Amount (MAA) Mailings

Oregon/Washington Brokers

Health Net Health Plan of Oregon, Inc. – Washington Group Contract Update

Health Net will be issuing a mailing to Washington group policyholders to inform them of updates to the Maximum Allowable Amount definition for Out-of-Network covered services. The revisions are fully described in the attached “Contract Update Endorsement” documents but are summarized here for your reference. There are two versions of the updates, one for 2015 contracts and one for 2016 contracts. The changes are effective July 15, 2016.



Current Definition

Maximum Allowable Amount (MAA) is the amount on which Health Net bases its reimbursement for covered Services and Supplies provided by an Out-of-Network Provider, which may be less than the amount billed for those services and supplies. Health Net calculates MAA as the lesser of the amount billed by the Out-of-Network Provider or the amount determined as set forth herein. MAA is not the amount that Health Net pays for a Covered Service; the actual payment will be reduced by applicable Coinsurance, Copayments, Deductibles and other applicable amounts set forth in this Evidence of Coverage.


Revised Definition

The definition of “Maximum Allowable Amount (MAA)” has been revised to update how MAA is determined and paid and will now read as follows:

“Maximum Allowable Amount (MAA)” is the amount that we use to calculate what we pay for covered Medical Services and supplies provided by a Nonparticipating Provider. MAA is a percentage of what Medicare would pay (known as the Medicare Allowable Amount). Medicare pays 100% of the Medicare Allowable Amount. The percentage of Medicare at which we pay Out-of-Network claims is 160% as determined by the Subscriber Group. In the event there is no Medicare allowable amount for a professional service, MAA is determined by applying a designated percentile from the database of Physician charges from the FAIR Health RV Benchmarks or a similar type of database of Physician charges. In the event there is no Medicare allowable amount for a facility service, MAA is calculated using a method developed by Data iSight, a data service that applies a profit margin factor to the estimated costs of the services rendered by the Out-of-Network Provider, or similar type of valuation service. In the event that MAA cannot be determined using the methodologies described above, MAA shall be deemed to be seventy five percent (75%) of the amount normally charged by the provider for the same services or supplies. If the billed charges for a claim are less than MAA, we will pay the billed charges.

Additional updates are provided in the attached “Contract Update Endorsement” documents.

Click here to view a sample of the Cover Letter which will be mailed to the impacted Washington group policyholders.

Click here to view a sample of the Oregon Contract Update Endorsement WA Group Plan Contract Agreement.

Click here to view a sample of the Oregon/Washington Contract Amendment Endorsement Group Plan Agreement


Please contact your Health Net Sales Representative.

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Susan Peters