What does it mean when an insurance company reimburses Scott & White their “reasonable and customary” rate?

Reasonable and customary (or Usual and customary) – Commonly charged fees for health services in a certain area. The use of fee screens to determine the lowest value of provider reimbursement based on:

  1. The provider’s usual charge for a given procedure
  2. The amount customarily charged for the service by other providers in the area
  3. The reasonable cost of services for a given patient after medical review of the case

Most health plans provide reimbursement for reasonable and customary charges, although no universal formula has been established for these rates.