Your ABA Agency Has Billing Rates. But Do You Have a UCR?

Most ABA agencies bill every week or every day. Submitting claims to Medicaid. Billing commercial payers. Processing payments. The billing function runs.

But there's a difference between having billing rates and having a usual and customary rate (UCR), and most ABA agencies only have the first one.

That distinction matters more than most leaders realize.

What is a usual and customary rate (UCR) in ABA billing?

A usual and customary rate (also called a chargemaster rate or standard fee schedule) is the amount a provider bills to all payers for a given service, before any contractual adjustment applies. Every payer gets the same billed charge. Each one then applies its own contracted rate to decide what it actually pays. The gap between the billed charge and the allowed amount is the contractual write-off.

Every payer gets the same bill: Medicaid, Blue Cross, UnitedHealthcare, self-pay. The billed amount stays identical across the board. Each payer then applies its own contracted rate or fee schedule, which determines what it actually pays.

This model, billing a single standard charge to all payers, is the industry standard for healthcare providers. And for ABA agencies billing under CPT codes 97151 through 97158, it isn't optional.

What Most ABA Agencies Actually Have

When we ask ABA agency leaders what their billing rates are, the answers usually sound something like this:

• "We bill whatever our payers pay us."
• "Our billing company set our rates when we opened."
• "We have rates in the system, but I couldn't tell you how they were determined."
• "We just charge $X per unit across the board."

None of these describes a usual and customary rate. And none of them holds up as compliant.

What these agencies have are contracted rates, amounts negotiated with or accepted from individual payers. They may have default entries in a practice management system that someone typed in years ago. What they don't have is a documented, benchmarked, defensible standard charge that was deliberately set and can be justified if someone asks.

Why It Matters

This isn't a theoretical concern. Operating without a properly documented UCR creates several distinct risks for ABA agencies.

State Medicaid compliance exposure

Most state Medicaid programs, whether fee-for-service or managed care, set requirements around consistent and appropriate billing. Many states require providers to bill their standard charge, and some explicitly require that the billed amount not fall below what the provider charges other payers for the same service.

The specifics vary by state. But if your state Medicaid program or MCO ever audits your billing practices and asks to see your standard fee schedule and the method behind it, you'll need to produce one. "We bill what the MCO pays us" isn't a compliant answer in most states, and it isn't a defensible one anywhere.

Commercial payer contractual risk and the MFN problem

Many commercial payer contracts contain something called a Most Favored Nation (MFN) clause. In plain English, an MFN clause requires you to charge that payer at least as little as you charge your lowest-paying payer. It's the insurance company's way of making sure you aren't giving a better deal to anyone else.

Here's where things get serious for ABA agencies that haven't set a consistent UCR.

Imagine you're billing your state Medicaid program at a rate that reflects what Medicaid actually reimburses, say $12 per unit for CPT 97153. You haven't thought much about it, because that's just what Medicaid pays. Meanwhile, your commercial payer contract says Blue Cross will pay you $15 per unit for the same code.

If Blue Cross has an MFN clause in your contract and discovers that you've billed Medicaid at $12 while billing them at $15, they may argue that under the MFN clause your "lowest rate" is $12, and therefore that's all they owe you too. Retroactively. For every claim you've submitted.

That's not a hypothetical. That's a real contractual mechanism, and it can result in:

• Demand letters requiring you to refund the difference between what you were paid and the "corrected" lower rate
• Withholds against future payments while the payer conducts a review
• Contract termination
• Exclusion from the payer's network

A documented, consistently applied UCR, set above all payer reimbursements and applied uniformly, protects you from this scenario. It shows that your standard charge stays the same regardless of who's paying, and that Medicaid's lower reimbursement reflects their contracted allowance, not a discounted billed rate. Billing the same service under different charges to different payers also invites the kind of coding-integrity questions we cover in Downcoding Isn't the Safe Choice.

Chronic underbilling

If your billed rate sits at or below what a payer would have allowed, you can never recover that difference. The claim closes, and the lost revenue is permanent. No system alert fires when a rate is set too low. Over hundreds or thousands of claims, the financial impact adds up fast.

Rate compression over time

UCR benchmarks move and change over time. FAIR Health updates its percentile data annually. TRICARE maximum allowed amounts adjust each May. Medicaid fee schedules change. An agency that set its rates in 2019 and never revisited them almost certainly bills below current market benchmarks, and falls further behind every year.

Audit vulnerability

When an auditor, whether Medicaid, commercial, or otherwise, requests your standard fee schedule and the documentation behind it, "That's just what we've always billed" doesn't protect your agency. A documented chargemaster with a clear benchmarking method does. Knowing which of your practices would actually survive that request is its own discipline, one we walk through in How to Know What to Audit.

What a Defensible UCR Actually Requires

Setting a compliant, defensible UCR isn't a matter of picking a number and entering it into your billing system. It requires a documented benchmarking process that weighs multiple reference points.

At minimum, a defensible UCR for an ABA agency should be benchmarked against:

• Your state Medicaid fee schedule (the regulatory floor; your chargemaster must exceed it)
• Medicaid rates from other states, for regional context
• Commercial payer market ranges for your geography
• FAIR Health usual and customary percentile data for your market area

The resulting chargemaster rate should exceed all known payer reimbursements in your market and land within the 75th to 80th percentile of FAIR Health charge data. That combination is what makes a rate both financially sound and defensible under scrutiny.

And it needs an annual review. A UCR analysis isn't a one-time document. It requires regular updates as Medicaid rates change, commercial market rates shift, and FAIR Health data refreshes.

The Documentation Piece That Most Agencies Miss

Even agencies that have thought carefully about their rates often skip the documentation step. That's where compliance actually lives.

A compliant chargemaster rate isn't just a number in a spreadsheet. It's a documented report that includes:

• The rates themselves, broken out by CPT code and provider tier
• The benchmarking method used to derive them
• The data sources consulted, with dates
• The effective date of the fee schedule
• A review and update date

This document is what you produce in an audit. It shows that your billing rates were deliberately set, methodologically sound, and consistently applied. Without it, even a reasonable rate becomes hard to defend.

This Isn't Just a Billing Department Issue

ABA agency leaders often treat billing as a function handled by someone else. The billing company sets the rates. The front office manages the claims. Someone else handles the payer relationships.

But when an audit lands, it lands on the organization. Whether your rates were set appropriately, documented properly, and applied consistently is a compliance question, not just a billing question. And it belongs in the compliance program. If you're not sure where a question like this fits in a broader compliance effort, we lay out how to prioritize in What To Do When You Don't Know Where to Start.

If you don't know what your standard fee schedule says, how your rates were set, or whether your agency could produce a defensible chargemaster document on short notice, that's worth knowing now, not when someone asks for it.

Frequently Asked Questions

What is a usual and customary rate (UCR) in ABA?
A UCR, also called a chargemaster rate or standard fee schedule, is the single amount an ABA provider bills to all payers for a given service before any contractual adjustment. Every payer receives the same billed charge, then applies its own contracted rate to determine actual payment. It's the healthcare industry standard, and for ABA agencies billing CPT 97151 through 97158, it isn't optional.

What's the difference between a UCR and a contracted rate?
A contracted rate is what an individual payer has agreed to pay you. A UCR is your own standard billed charge, applied uniformly to every payer regardless of what each one reimburses. Most ABA agencies have contracted rates entered in their system but no deliberately set, documented UCR behind them.

Why does an ABA agency need a documented UCR?
Three reasons. State Medicaid programs may require you to bill a consistent standard charge and produce the method behind it on audit. Commercial contracts with Most Favored Nation clauses can claw back payments retroactively if your billed rates aren't uniform. And a rate set too low means permanent, unrecoverable underbilling across every claim.

What is a Most Favored Nation (MFN) clause?
An MFN clause in a payer contract requires you to charge that payer at least as little as you charge your lowest-paying payer. If you bill Medicaid $12 per unit and a commercial payer $15 for the same code, an MFN clause can let the commercial payer reduce its rate to $12 retroactively, across every claim you've submitted. A uniform UCR is what prevents this.

How should an ABA agency set its UCR?
Benchmark against your state Medicaid fee schedule (the floor your rate must exceed), Medicaid rates in other states, commercial market ranges for your area, and FAIR Health percentile data. Aim to exceed all known payer reimbursements and land in the 75th to 80th percentile of FAIR Health charges. Document the rates, the method, the data sources with dates, and an annual review date.

Want to go deeper on this topic?

Michael Fabrizio presented The Rate Nobody Set: What ABA Leaders Don't Know About Their Own Billing on BehaviorLive, a session covering what UCRs are, what's at stake when you don't have one, and what a properly benchmarked chargemaster actually looks like. Watch the recording here.

If you'd like to evaluate your agency's current practices, the free UCR Readiness Self-Assessment is a 14-item checklist that shows you exactly where your agency stands. Download it here.

And if you're looking for ongoing compliance support, including AI-assisted tools to help you build your own UCR chargemaster report, the ABA Compliance Collective is where that work happens. Learn more at abacompliance.com/collective.