Out-of-Network Positioning: Building a Premium Practice Outside Insurance Panels

Operating outside insurance networks feels risky. You're walking away from the patient volume that insurance panels provide. You're asking patients to pay more out-of-pocket or submit their own claims. You're competing against in-network providers who appear more affordable.

But for the right practice in the right market with the right positioning, going out-of-network (OON) creates a sustainable, profitable business model that's impossible to achieve while accepting insurance panel rates and restrictions.

OON practices typically enjoy higher reimbursement, less administrative burden, better patient relationships, and more control over clinical decisions. The tradeoff is a smaller patient base that values and can afford premium care.

The key is knowing whether OON positioning makes sense for your situation, and if so, how to position, price, communicate, and operate successfully outside traditional insurance panels.

The Out-of-Network Opportunity

Insurance participation creates a paradox. It provides patient access and payment certainty, but it also caps your reimbursement, increases administrative costs, and gives payers significant control over your practice.

Going OON means:

  • Setting your own fees rather than accepting contracted rates
  • Eliminating or dramatically reducing claims processing
  • Avoiding prior authorizations and medical necessity determinations
  • Building relationships with patients who choose you specifically
  • Creating a sustainable margin structure

The patients you attract tend to be different. OON patients:

  • Value quality and provider choice over cost minimization
  • Have financial capacity to pay more for better care
  • Often have PPO insurance with out-of-network benefits
  • Appreciate personalized attention and relationship continuity
  • Are willing to handle their own insurance claims

This isn't for every practice or every specialty. But where it works, it creates a fundamentally different—and often better—way to practice medicine.

Strategic Assessment

Before going OON, evaluate whether it's viable for your situation.

Practice readiness evaluation considers:

  • How strong is your reputation and differentiation?
  • Do you have an established patient base that might stay with you?
  • Can you clearly articulate value beyond insurance network status?
  • Are you prepared for lower initial patient volume?
  • Do you have financial reserves to manage the transition?

New practices rarely succeed going OON from the start. You need established reputation, proven clinical excellence, and demonstrable value that justifies premium positioning.

Market demand analysis based on AMA healthcare economics data examines:

  • What percentage of your market has PPO insurance with OON benefits?
  • What's the income distribution in your area?
  • Are there underserved patient segments willing to pay for better access or service?
  • How many competitors are already OON in your specialty?
  • What's the general attitude toward healthcare spending?

Wealthy suburban markets with high PPO penetration support OON practices better than lower-income areas dominated by HMO and Medicaid coverage.

Competitive positioning requires differentiation:

  • What makes you different enough to justify higher costs?
  • Can you deliver meaningfully better outcomes, experience, or access?
  • Are there unmet needs in your market that insurance-based practices can't address?
  • Do you have unique expertise, credentials, or capabilities?

If you're offering the same services with the same quality and the same experience as in-network competitors, patients have no reason to choose you at higher costs.

Financial modeling tests viability:

  • What patient volume do you need at OON rates to match current revenue?
  • What's realistic patient retention if you go OON?
  • How long can you sustain lower volume during transition?
  • What's your break-even point?

Most practices going OON see initial volume drops of 30-50% before rebuilding with ideal patients. Model whether you can sustain that. Understanding your patient acquisition economics becomes even more critical in OON models where volume is typically lower but value per patient must be higher.

Your approach to insurance panel strategy may evolve toward selective or complete OON positioning over time.

Value Proposition Development

OON success requires compelling value that justifies premium pricing.

Differentiation factors separate you from in-network alternatives:

  • Clinical outcomes demonstrably better than peers
  • Specialized expertise or advanced training
  • Unique treatment approaches or technologies
  • Research contributions or thought leadership
  • Published work or professional recognition

You need evidence that you're not just different, but better in ways that matter to patients.

Patient experience premium often matters more than clinical differences:

  • Longer appointment times (no rushing through visits)
  • Same-day or next-day appointment availability
  • Direct provider communication (cell phone, email)
  • Minimal wait times
  • Unhurried, personalized attention
  • Comprehensive care coordination

Many patients will pay significantly more for an experience that respects their time and treats them as individuals rather than claim numbers.

Access and availability become competitive advantages:

  • Appointment availability within 24-48 hours
  • After-hours or weekend access when needed
  • Direct provider contact for questions
  • Minimal wait times at appointments
  • Flexible scheduling to accommodate patient needs

Insurance-based practices often can't offer this level of access due to volume requirements. You can.

Quality indicators provide objective validation:

  • Board certifications and specialized credentials
  • Patient satisfaction scores
  • Clinical outcomes data
  • Professional awards or recognition
  • Research publications or speaking engagements
  • Peer referrals from other respected providers

Don't be shy about showcasing credentials and achievements. Patients choosing premium options want validation that you're worth it.

The relationship to models like concierge medicine and direct primary care is clear—these are specific OON approaches with defined structures.

Pricing Strategy

Setting fees outside insurance contracts requires thoughtful strategy.

Fee schedule development starts with understanding your costs:

  • What does it actually cost you to deliver each service?
  • What margin do you need for sustainability and growth?
  • What allows appropriate provider compensation?
  • What supports staff salaries and practice overhead?

Then consider market factors:

  • What do in-network providers receive for similar services?
  • What's a reasonable premium for OON positioning (typically 1.5x-3x)?
  • What can your target market afford?
  • What do OON competitors charge?

Market rate research provides context:

  • Survey what other OON providers charge in your area
  • Understand typical insurance reimbursement for reference
  • Research what patients pay out-of-pocket for similar services
  • Examine what the market will bear for premium services

Price too low and you undermine premium positioning while leaving money on the table. Price too high and you limit your market to the very wealthy.

Transparency approaches build trust:

  • Publish your fee schedule or price ranges
  • Provide clear cost estimates before services
  • Explain what's included in fees
  • Offer package pricing when appropriate

Transparency reduces patient anxiety and builds confidence that you're not exploiting OON status to overcharge.

Package options can improve perceived value:

  • Annual wellness packages
  • Treatment bundles for related services
  • Membership programs with included services
  • Prepayment discounts

Packages that deliver clear value encourage commitment while smoothing your revenue.

Patient Communication

How you explain and justify OON status determines patient acceptance.

OON benefits explanation reframes the conversation:

Instead of: "We don't take your insurance" Say: "We're out-of-network, which allows us to spend 45 minutes with each patient instead of the 15 minutes insurance-based practices are limited to"

Instead of: "You'll have to pay more" Say: "Many of our patients find their out-of-network benefits cover 60-80% of costs, and the personalized care and immediate access are worth the difference"

Focus on what patients gain, not what they lose.

Cost expectation setting prevents surprises:

  • Provide detailed cost estimates upfront
  • Explain typical insurance reimbursement so patients can calculate their net cost
  • Offer to verify their OON benefits
  • Discuss payment options and timing

Never let patients be surprised by costs. Transparency and clear expectations are essential.

Insurance submission assistance eases the burden:

  • Provide detailed superbills with all required information
  • Explain exactly how to submit claims to insurance
  • Offer to answer questions about the process
  • Provide template letters if insurance requests additional information

The easier you make insurance reimbursement, the lower the perceived barrier.

Value justification articulates why you're worth premium pricing:

  • Share specific examples of how your approach delivers better outcomes
  • Explain what's possible when you're not constrained by insurance restrictions
  • Testimonials from patients who've experienced the difference
  • Concrete examples of superior access, attention, or results

Don't assume patients understand your value. Make it explicit and specific.

Your financial policy communication becomes even more critical in OON positioning where patients have more direct financial involvement.

Operational Considerations

Running an OON practice requires different operations than insurance-based practices.

Billing and collections simplify in some ways, complicate in others:

  • No insurance claims processing (or minimal if you submit courtesy claims)
  • Direct payment from patients at time of service
  • Higher collection rates but smaller patient base
  • Need for clear payment policies and enforcement

Collect payment when services are delivered. Your leverage disappears once patients leave without paying.

Good faith estimates are required under No Surprises Act federal law:

  • Provide written estimates for services over $400 for uninsured/self-pay patients
  • Include expected charges for the service and associated costs
  • Deliver estimates at least 3 business days before scheduled services (or upon request)
  • Maintain documentation of provided estimates

Compliance with good faith estimate requirements protects you and manages patient expectations.

No Surprises Act compliance applies even to OON providers:

  • Provide notice of OON status and good faith estimates
  • Obtain patient consent for OON care at in-network facilities
  • Follow dispute resolution processes when applicable
  • Maintain required documentation

Familiarize yourself with No Surprises Act requirements. Non-compliance creates significant risk.

Insurance claim submission varies by approach:

  • Some OON providers submit claims as courtesy to patients
  • Others provide superbills and let patients submit
  • Some offer claim submission as a premium service
  • A few avoid insurance entirely and work only with self-pay

Decide your approach based on your market and target patients. High-income self-pay is simpler but limits market size. Insurance reimbursement support expands your potential patient base.

Marketing OON Services

Attracting patients to OON practice requires deliberate marketing.

Targeting ideal patients focuses efforts:

  • Demographics: Income, insurance type, age, health needs
  • Psychographics: Values, priorities, healthcare attitudes
  • Behaviors: Healthcare utilization patterns, spending habits

Don't market broadly. Target the specific segments most likely to value and afford OON care.

Messaging strategies emphasize unique value:

  • Premium access and availability
  • Personalized, unhurried care
  • Clinical excellence and expertise
  • Freedom from insurance restrictions
  • Comprehensive, coordinated care

Website copy, marketing materials, and patient communications should consistently reinforce why OON positioning serves patients better.

Reputation building creates demand:

  • Outstanding patient experiences that generate word-of-mouth
  • Online reviews highlighting differentiating factors
  • Professional visibility through speaking, writing, media
  • Community engagement and relationship building

OON practices live or die on reputation. Invest heavily in delivering experiences worth talking about. Excellence in online reviews management becomes mission-critical when your practice depends on reputation over network status.

Referral development from other providers:

  • Build relationships with primary care physicians
  • Educate other specialists about your capabilities
  • Make referrals easy with responsive communication
  • Provide exceptional care that makes referring physicians look good

Professional referrals validate quality and overcome price objections. Your physician referral network becomes even more valuable when insurance network isn't driving patient flow.

Connection to billing transparency is essential—OON practices must be exemplary in clear, upfront communication about costs.

Transition Planning

Moving from in-network to OON requires careful planning.

Phase 1: Preparation (6-12 months before)

  • Analyze current payer mix and patient demographics
  • Model financial impact of OON transition
  • Develop value proposition and messaging
  • Build financial reserves for transition period

Phase 2: Communication (3-6 months before)

  • Announce planned changes to current patients
  • Explain reasons and benefits
  • Provide timeline and options
  • Answer questions and address concerns

Phase 3: Transition (notice period)

  • Honor insurance contracts through notice period
  • Continue care for patients during transition
  • Implement new billing and operational systems
  • Train staff on new processes

Phase 4: Post-Transition (first 12 months)

  • Monitor patient retention and new patient acquisition
  • Adjust pricing and positioning as needed
  • Refine operational processes
  • Market to attract ideal patients

Most successful transitions take 12-24 months to stabilize at new patient volumes with improved margins.

Measuring Success

Track whether OON positioning is achieving goals.

Key metrics:

  • Average revenue per patient visit
  • Patient retention rate
  • New patient acquisition rate
  • Net margin per patient
  • Provider and staff satisfaction
  • Patient satisfaction scores

Financial performance:

  • Total revenue trends
  • Revenue per clinical hour
  • Collection rates
  • Operating expenses as percentage of revenue
  • Provider compensation

Patient quality metrics:

  • Demographic alignment with target patients
  • Referral source quality
  • Patient lifetime value
  • Retention rates

Compare performance before and after transition. OON success means higher margins and better patient relationships, not necessarily higher total revenue.

When OON Makes Sense

OON positioning works best for:

  • Established practices with strong reputations
  • Specialists with unique expertise
  • Markets with high PPO penetration
  • Practices that can deliver demonstrably superior experience
  • Providers willing to accept lower volume for better margins

Consider whether models like concierge medicine or direct primary care provide structured approaches to OON practice.

It works less well for:

  • New practices building patient bases
  • Common specialties in competitive markets
  • Areas dominated by HMO and Medicaid
  • Providers without clear differentiation
  • Those needing high volume to cover fixed costs

Building Your OON Practice

Going out-of-network isn't for everyone. It requires market conditions that support premium positioning, clinical excellence that justifies premium pricing, and operational discipline to deliver exceptional experiences.

But for practices that can execute well, OON positioning offers:

  • 50-100% higher effective reimbursement rates
  • 60-80% reduction in administrative burden
  • Stronger patient relationships and loyalty
  • Greater clinical autonomy
  • More sustainable business model

The key is thorough assessment before transitioning, compelling value proposition, transparent pricing and communication, and exceptional delivery that justifies premium positioning.

If you're frustrated by insurance reimbursement, administrative complexity, and lack of time with patients, OON positioning may offer the solution—if you're willing to build the reputation, differentiation, and operational excellence required to succeed outside traditional insurance panels.

Done right, you'll serve fewer patients but serve them better, earn more per patient while spending less on administration, and build a practice that's both professionally satisfying and financially sustainable.