Usual, Customary And Reasonable

What Does Usual, Customary And Reasonable Mean?

Usual, customary, and reasonable (UCR) is a term used to describe fees related to healthcare costs that health insurance companies cover. A fee is considered UCR if it is similar to what other healthcare providers in the area charge for the same service and if the service is deemed necessary based on the current circumstances.

Insuranceopedia Explains Usual, Customary And Reasonable

Sometimes, a healthcare provider in an area may charge more for a service than other providers. For example, a dermatologist might charge 20 percent more for mole removals than most other dermatologists in the area. In such cases, insurance companies may not consider the cost as usual, customary, and reasonable (UCR), meaning the policyholder would likely need to cover the difference between the UCR fee and the actual expense.

Additionally, insurance companies often categorize doctors as “in-network” or “out-of-network” based on the fees they charge. Visiting an out-of-network doctor can result in higher service costs and greater out-of-pocket expenses for the policyholder.