Reference Based Pricing

If your employer offers both a reference-based pricing (RBP) plan and a traditional plan (often called a PPO or "choice" plan) at open enrollment, you're looking at two genuinely different approaches to healthcare. This article walks through what each one means for the decisions and moments that actually affect you — not just how they work on paper.

The short version

Traditional / PPO plan: You pay more in premiums, but you get a defined network of doctors and predictable out-of-pocket costs. Surprises are rare.

RBP plan: You typically pay less in premiums and can see almost any provider, but there's a small chance of a "balance bill" that you may need help resolving.

Neither is universally better. The right choice depends on your doctors, your health, and how much price predictability matters to you.

Can I keep my doctor?

Traditional plan: Only if your doctor is in the plan's network. If they're not, you'll pay much more out-of-pocket — or everything, depending on the plan type. Check the network directory before enrolling.

RBP plan: Almost always yes. Most RBP plans don't use a traditional network, so you can see any licensed provider. A small number of providers may be unfamiliar with RBP and ask questions at the front desk, but this is usually resolved with a quick call to the plan administrator (the phone number on the back of your ID card).

If keeping a specific doctor is a top priority, look up whether they're in the traditional plan's network and, if possible, ask their billing office whether they've worked with RBP plans before.

What will I actually pay?

Both plans have a premium (taken from your paycheck) plus out-of-pocket costs when you use care (deductible, copays, coinsurance, out-of-pocket maximum). Your plan summary will show all of these.

Traditional plan: Generally higher premium. Out-of-pocket costs are predictable as long as you stay in-network.

RBP plan: Generally lower premium — sometimes significantly so. Out-of-pocket costs at the point of care are also defined in your plan documents and work the same way (you pay your copay or coinsurance, the plan pays its share).

If your household is on a tight monthly budget, the premium savings on an RBP plan can be meaningful. If you'd rather pay more each month for fewer surprises, the traditional plan may feel safer.

What's a "balance bill" and should I worry about it?

This is the main trade-off with RBP, so it's worth understanding clearly.

In a traditional plan, your insurer has pre-negotiated rates with in-network providers, so the provider accepts the plan's payment as payment in full (minus your share).

In an RBP plan, the plan pays a fair amount based on a transparent benchmark — but the provider didn't sign a contract agreeing to that exact amount. Most providers accept the RBP payment without issue. Occasionally, a provider will send the patient a bill for the difference between what they charged and what the plan paid. That's a balance bill.

What to know:

Balance bills are not common, but they're possible.
If you get one, don't pay it right away. Call your plan administrator first — they have processes (and often dedicated advocates) to negotiate with the provider on your behalf. Most balance bills get resolved without the member paying the disputed amount.
A No Surprises Act passed in 2022 already protects you from balance billing in many emergency and out-of-network situations, regardless of plan type.

If the idea of any unexpected bill — even one that's likely to be resolved — causes you significant stress, the traditional plan may suit you better. If you're comfortable making a phone call to get something sorted out in exchange for lower premiums, RBP is designed to work for you.

What if I have an emergency?

Both plan types cover emergencies. You won't be turned away or asked about your plan in an emergency room. Federal law (the No Surprises Act) protects you from surprise billing for emergency care in both plan types.

What if I have ongoing or specialized care needs?

A few situations worth thinking through:

You're pregnant or planning to be: Check whether your OB/GYN and preferred hospital work with each plan. Maternity care involves many providers (OB, anesthesiologist, hospital, pediatrician), so network breadth matters in a traditional plan, and provider familiarity matters in an RBP plan.

You have a chronic condition or see specialists regularly: Confirm your current providers accept your chosen plan. With RBP, ask whether they've accepted RBP payments before. With a traditional plan, confirm they're in-network.

You take expensive prescriptions: Prescription drug coverage is usually handled separately from RBP. Check the formulary (drug list) for each plan to see how your medications are covered.

You travel often or live in multiple states: RBP's lack of a network can be a real advantage here — you're not stuck looking for in-network providers in unfamiliar places.

How much hassle should I expect?

Traditional plan: Familiar to most providers. Front desk staff know how to handle your card. Bills generally arrive in expected amounts.

RBP plan: Most visits go smoothly. Occasionally, a provider may have questions about how RBP works, which usually means a quick call from the front desk to your plan administrator. If a balance bill arrives, expect to spend some time on the phone to get it resolved (your plan administrator does most of the work).

Quick decision guide

An RBP plan is often a strong fit if:

Lower monthly premiums matter to your household budget
You don't have a strict attachment to a specific in-network provider
You're comfortable making a phone call to resolve an occasional billing issue
You value the flexibility to see almost any provider

A traditional plan is often a strong fit if:

Predictable, no-surprises bills matter more than premium savings
You have specific in-network doctors you don't want to risk losing
You'd rather not deal with a billing dispute, even an uncommon one
You have complex ongoing care needs that involve many coordinated providers

Questions?

Talk to your HR team or contact All Atlantic Benefits — we're happy to help you think through which plan fits your situation.