Retail: A Separate Legal Entity

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For many reasons, providers are focusing on retail cash sales of products, including Medicare-covered items and non-covered items. As margins tighten, providers should look for ways to reduce their dependency on insurance reimbursement. What opportunity is out there? An estimated 268,600 new cases of invasive breast cancer will be diagnosed in 2019. There were 3,788,235 births in the U.S. in 2018. Baby boomers are retiring at the rate of 10,000 per day. These individuals need products you can provide that can help them through their stage of life.

Many commercial insurance contracts require that the supplier accept assignment for covered items/services provided and prohibit the supplier from billing the patient instead of the payor. If the cash sale business is a “division” of an entity with commercial insurance contracts, it will not have the ability to engage in cash sales for covered items or services with individuals covered by such third-party insurance plans. On the other hand, if the cash sale business is a separate legal entity that is not contracted with any insurance payors, it will not have such limitations.

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