Reasonable cost basis

Calculation to determine the reasonable cost incurred by individual providers when furnishing covered services to beneficiaries. Reasonable cost is based on the actual cost of providing such services including direct and indirect costs of providers, excluding any costs that are unnecessary in the efficient delivery of services covered by a health insurance program.

Reasonable cost methodology

System used by Medicare fiscal intermediaries under established guidelines from the Centers for Medicare and Medicaid Services (CMS) to find the reasonable cost incurred by the provider when rendering services to a Medicare patient. These guidelines try to exclude unnecessary medical costs.

Reasonable fee

Amount on which payment is based for participating physicians in the Medicare program; a charge is considered reasonable if it is deemed acceptable after peer review even though it does not meet the customary or prevailing criteria. This would include unusual circumstances or complications requiring additional time, skill, or experience in connection with a particular service or procedure.

Rebating

See: antirebate law .
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Generally illegal practice, by an Insurer’s representative, or returning to an insured a portion of a commission or any other valuable inducement to buy Insurance from that representative. In India every proposal form for general Insurance business contains the following text: “Prohibition of rebating Your attention is respectfully invited to Sec. 41 of the Insurance Act 1938 which reads as follows: 01. No person shall allow or offer to allow, either Directly or indirectly as an inducement to any person to take out or renew or continue an Insurance in respect of any kind of risk relating to lives or property in India, any rebate of the premium shown on the Policy, nor shall any person taking out or renewing or continuing a Policy accept any rebate, except such rebate as may be allowed in accordance with the published prospectuses or tables of the Company. 02. Any person making default in complying with the provision of this section shall be punishable with a fine which may extend to five hundred rupees.: