At one time in America, there was no such thing as "health insurance." Patients negotiated directly with hospitals and doctors, and paid what they could, often on a sliding scale, according to ability. Eventually, health insurance entered the market, easing the burden of healthcare costs.
It didn't take long to realize the ordinary rules of supply and demand would not apply, if the insurance company, not the patient, was responsible for the bill. Copayments, deductibles, and coinsurance developed as a check against overutilization. If the patient had some "skin" in the game, this would provide some disincentive, though not absolute, but some hedge against over-use. This protective requirement, though necessary, is at times at odds with AMA Code of Ethics Opinion 8.03, which holds: "The primary objective of the medical profession is to render service to humanity; reward or financial gain is a subordinate consideration.
"In the current economy, as available dollars are becoming scarce, insurance carriers have begun checking up on the collection of copayments, deductibles, and coinsurance. With greater regularity, physicians and hospitals are receiving letters requesting proof, in perhaps five randomly selected cases, that the provider has collected, or sufficiently attempted to collect the portion of fees which is the patient's responsibility. This comes as a shock to many providers, who in keeping with Opinion 8.03, and the historical tradition of sliding scales, based upon ability to pay, have subordinated financial ability to pay in favor of the higher duty to care for the patient's need.
It is important to understand, however, forgiveness of copayments could land you in hot water. Therefore, doctors must understand the rules regarding waiver of copayments. AMA Opinion 6.12 addresses the ethical considerations:
Opinion 6.12 - Forgiveness or Waiver of Insurance Copayments
Under the terms of many health insurance policies or programs, patients are made more conscious of the cost of their medical care through copayments. By imposing copayments for office visits and other medical services, insurers hope to discourage unnecessary healthcare. In some cases, financial hardship may deter patients from seeking necessary care if they would be responsible for a copayment for the care. Physicians commonly forgive or waive copayments to facilitate patient access to needed medical care. When a copayment is a barrier to needed care because of financial hardship, physicians should forgive or waive the copayment.
A number of clinics have advertised their willingness to provide detailed medical evaluations and accept the insurer's payment but waive the copayment for all patients.
Physicians should be aware that forgiveness or waiver of copayments may violate the policies of some insurers, both public and private; other insurers may permit forgiveness or waiver if they are aware of the reasons for the forgiveness or waiver. Routine forgiveness or waiver of copayments may constitute fraud under state and federal law. Physicians should ensure that their policies on copayments are consistent with applicable law and with the requirements of their agreements with insurers.
Where the insurance contract requires a doctor to make reasonable attempts to collect the patient's portion, an open question surrounds the definition of "reasonable attempts to collect the debt." Historically, doctors could satisfy the requirement by sending at least three letters attempting to collect the debt. However, the Office of Inspector General (OIG) has taken the position that the routine waiver of copayments could constitute a criminal kickback in Medicare cases.
This has emboldened private insurers, who are relying upon this contractual provision as a basis for a post-payment recoupment audit. If a provider cannot demonstrate efforts to collect from the patient, the carrier may demand a refund for any benefits paid across a large patient population.
Providers should be aware of this new emphasis upon patient responsibility. My advice would be to proactively get ahead of the problem. Contact your insurance representative to find out what is expected of you and document the response. By all means, if you are a physician and you receive a letter from an insurance carrier requesting proof of attempts to collect, do not ignore it. A failure to cooperate could constitute grounds for termination of the contract with the payer.
Because this emphasis upon collection of copayments is a fairly recent phenomenon, even if you have been deficient in the past, you may be able to satisfy the carrier by demonstrating a corrective plan of action going forward.
Courtesy of Physicians Practice, By Martin Merritt http://www.physicianspractice.com/blog/forgiving-patient-copays-can-lead-unforgiving-consequences?GUID=2E8F906E-CDE7-43B7-AC93-7066F83372C7&rememberme=1&ts=17122013
Showing posts with label deductible. Show all posts
Showing posts with label deductible. Show all posts
Monday, January 13, 2014
Friday, November 22, 2013
Medical Practices: Think Twice Before Waiving Copays
Historically, family practices and many other physicians groups have routinely waived insurance copays as a gesture of goodwill to patients in a tight economy. After all, who wants to hound sick patients for their portion of the charges?
There was a time when insurance companies turned a blind eye to these routine waivers of copays. Not anymore.
The AMA's Code of Medical Ethics Opinion 6.12 explains why routine waivers are unethical, particularly when a clinic advertises a willingness to waive copayments.
Further, the Office of Inspector General (OIG) has long taken the position that routine waiver of copayments constitutes an illegal kickback, which is a felony.
The routine waiver of copayments also constitutes a violation of the terms of private insurance company plans. This contractual violation serves as a basis for a recoupment audit, during which insurance companies request proof of collection of copayments for five randomly selected patients. If the clinic cannot prove it collected, or at least exhausted all reasonable means of collection, then the carrier may demand a refund for any benefits paid across a large patient population.
Perhaps most frighteningly, routine copay waivers constitute ordinary financial fraud. If a patient is charged $100 and the insurance carrier is billed $80, the patient is supposed to pay $20. If you never attempt to collect the $20, this means the actual charge is $80, not $100. Therefore, the insurance company should only pay $64 (80 percent of the $80
Fraud or dishonesty is a primary way to get in trouble with state medical boards.
There are provisions for waiving copayments in cases of financial hardship. At a minimum, you should document the financial hardship, and obtain a release from the patient to turn the financial document over to the insurance company, if requested.
The OIG states the following criteria for waiver on the basis of financial hardship:
• The waiver must be based on a good faith determination of the patient’s financial need. In other words, waivers must not be applied routinely. The government does not specify the financial status that would justify a waiver, so you should develop your own approach, apply it consistently, and document your efforts. For example, if your efforts to collect on a patient’s bill fail, or if it’s obvious that a patient is struggling to pay the amount owed, ask the beneficiary to fill out a form noting their employment status and average household income and expenses. Then make your determination based on the information provided.
• The waiver must not be based on the amount of the charges. Your decision about whether to waive what a patient owes should be based on the patient’s ability to pay without regard to what Medicare may have paid or the total charges for the service.
• The waiver must not be offered as part of an advertisement or solicitation.
State laws vary regarding waivers. Therefore, seek the advice of an experienced health lawyer in your state if you have questions about your practices.
Article By Martin Merritt from Physicians Practice
http://www.physicianspractice.com/blog/medical-practices-think-twice-before-waiving-copays?GUID=2E8F906E-CDE7-43B7-AC93-7066F83372C7&rememberme=1&ts=19112013
There was a time when insurance companies turned a blind eye to these routine waivers of copays. Not anymore.
The AMA's Code of Medical Ethics Opinion 6.12 explains why routine waivers are unethical, particularly when a clinic advertises a willingness to waive copayments.
Further, the Office of Inspector General (OIG) has long taken the position that routine waiver of copayments constitutes an illegal kickback, which is a felony.
The routine waiver of copayments also constitutes a violation of the terms of private insurance company plans. This contractual violation serves as a basis for a recoupment audit, during which insurance companies request proof of collection of copayments for five randomly selected patients. If the clinic cannot prove it collected, or at least exhausted all reasonable means of collection, then the carrier may demand a refund for any benefits paid across a large patient population.
Perhaps most frighteningly, routine copay waivers constitute ordinary financial fraud. If a patient is charged $100 and the insurance carrier is billed $80, the patient is supposed to pay $20. If you never attempt to collect the $20, this means the actual charge is $80, not $100. Therefore, the insurance company should only pay $64 (80 percent of the $80
Fraud or dishonesty is a primary way to get in trouble with state medical boards.
There are provisions for waiving copayments in cases of financial hardship. At a minimum, you should document the financial hardship, and obtain a release from the patient to turn the financial document over to the insurance company, if requested.
The OIG states the following criteria for waiver on the basis of financial hardship:
• The waiver must be based on a good faith determination of the patient’s financial need. In other words, waivers must not be applied routinely. The government does not specify the financial status that would justify a waiver, so you should develop your own approach, apply it consistently, and document your efforts. For example, if your efforts to collect on a patient’s bill fail, or if it’s obvious that a patient is struggling to pay the amount owed, ask the beneficiary to fill out a form noting their employment status and average household income and expenses. Then make your determination based on the information provided.
• The waiver must not be based on the amount of the charges. Your decision about whether to waive what a patient owes should be based on the patient’s ability to pay without regard to what Medicare may have paid or the total charges for the service.
• The waiver must not be offered as part of an advertisement or solicitation.
State laws vary regarding waivers. Therefore, seek the advice of an experienced health lawyer in your state if you have questions about your practices.
Article By Martin Merritt from Physicians Practice
http://www.physicianspractice.com/blog/medical-practices-think-twice-before-waiving-copays?GUID=2E8F906E-CDE7-43B7-AC93-7066F83372C7&rememberme=1&ts=19112013
Wednesday, November 20, 2013
Update to Medicare Deductible, Coinsurance, and Premium Rates for 2014
MLN Matters® Number: MM8527
Related Change Request (CR) #: CR 8527
Related CR Release Date: November 15, 2013
Related CR Transmittal #: R82GI
Effective Date: January 1, 2014
Implementation Date: January 6, 2014
Provider Types AffectedThis MLN Matters® Article is intended for physicians, other providers, and suppliers submitting claims to Medicare contractors (Fiscal Intermediaries (FIs), carriers, Regional Home Health Intermediaries (RHHIs), Durable Medical Equipment/ Medicare Administrative Contractors (DME/MACs) and A/B Medicare Administrative Contractors (A/B MACs)) for services to Medicare beneficiaries.
Provider Action NeededThis article is based on Change Request (CR) 8527 which details the new Calendar Year (CY) 2014 Medicare premium, coinsurance, and deductible amounts. Make sure that your billing staffs are aware of these changes.
BackgroundBeneficiaries who use covered Part A services may be subject to deductible and coinsurance requirements. A beneficiary is responsible for an inpatient hospital deductible amount, which is deducted from the amount payable by the Medicare program to the hospital, for inpatient hospital services furnished in a spell of illness. When a beneficiary receives such services for more than 60 days during a spell of illness, he or she is responsible for a coinsurance amount equal to one-fourth of the inpatient hospital deductible per-day for the 61st-90th day spent in the hospital. An individual has 60 lifetime reserve days of coverage, which they may elect to use after the 90th day in a spell of illness. The coinsurance amount for these days is equal to one-half of the inpatient hospital deductible. A beneficiary is responsible for a coinsurance amount equal to one-eighth of the inpatient hospital deductible per day for the 21st through the 100th day of Skilled Nursing Facility (SNF) services furnished during a spell of illness.
Most individuals age 65 and older, and many disabled individuals under age 65, are insured for Health Insurance (HI) benefits without a premium payment. The Social Security Act provides that certain aged and disabled persons who are not insured may voluntarily enroll, but are subject to the payment of a monthly premium. Since 1994, voluntary enrollees may qualify for a reduced premium if they have 30-39 quarters of covered employment. When voluntary enrollment takes place more than 12 months after a person's initial enrollment period, a 10 percent penalty is assessed for 2 years for every year they could have enrolled and failed to enroll in Part A.
Under Part B of the Supplementary Medical Insurance (SMI) program, all enrollees are subject to a monthly premium. Most SMI services are subject to an annual deductible and coinsurance (percent of costs that the enrollee must pay), which are set by statute. When Part B enrollment takes place more than 12 months after a person's initial enrollment period, there is a permanent 10 percent increase in the premium for each year the beneficiary could have enrolled and failed to enroll.
The updated rates are as follows:
2014 PART A - HOSPITAL INSURANCE (HI) RATES
Deductible
Standard Premium
on the CMS website.
If you have any questions, please contact your MAC at their toll-free number, which may be found at http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/provider-compliance-interactive-map/index.html on the CMS website.
Related Change Request (CR) #: CR 8527
Related CR Release Date: November 15, 2013
Related CR Transmittal #: R82GI
Effective Date: January 1, 2014
Implementation Date: January 6, 2014
Provider Types AffectedThis MLN Matters® Article is intended for physicians, other providers, and suppliers submitting claims to Medicare contractors (Fiscal Intermediaries (FIs), carriers, Regional Home Health Intermediaries (RHHIs), Durable Medical Equipment/ Medicare Administrative Contractors (DME/MACs) and A/B Medicare Administrative Contractors (A/B MACs)) for services to Medicare beneficiaries.
Provider Action NeededThis article is based on Change Request (CR) 8527 which details the new Calendar Year (CY) 2014 Medicare premium, coinsurance, and deductible amounts. Make sure that your billing staffs are aware of these changes.
BackgroundBeneficiaries who use covered Part A services may be subject to deductible and coinsurance requirements. A beneficiary is responsible for an inpatient hospital deductible amount, which is deducted from the amount payable by the Medicare program to the hospital, for inpatient hospital services furnished in a spell of illness. When a beneficiary receives such services for more than 60 days during a spell of illness, he or she is responsible for a coinsurance amount equal to one-fourth of the inpatient hospital deductible per-day for the 61st-90th day spent in the hospital. An individual has 60 lifetime reserve days of coverage, which they may elect to use after the 90th day in a spell of illness. The coinsurance amount for these days is equal to one-half of the inpatient hospital deductible. A beneficiary is responsible for a coinsurance amount equal to one-eighth of the inpatient hospital deductible per day for the 21st through the 100th day of Skilled Nursing Facility (SNF) services furnished during a spell of illness.
Most individuals age 65 and older, and many disabled individuals under age 65, are insured for Health Insurance (HI) benefits without a premium payment. The Social Security Act provides that certain aged and disabled persons who are not insured may voluntarily enroll, but are subject to the payment of a monthly premium. Since 1994, voluntary enrollees may qualify for a reduced premium if they have 30-39 quarters of covered employment. When voluntary enrollment takes place more than 12 months after a person's initial enrollment period, a 10 percent penalty is assessed for 2 years for every year they could have enrolled and failed to enroll in Part A.
Under Part B of the Supplementary Medical Insurance (SMI) program, all enrollees are subject to a monthly premium. Most SMI services are subject to an annual deductible and coinsurance (percent of costs that the enrollee must pay), which are set by statute. When Part B enrollment takes place more than 12 months after a person's initial enrollment period, there is a permanent 10 percent increase in the premium for each year the beneficiary could have enrolled and failed to enroll.
The updated rates are as follows:
2014 PART A - HOSPITAL INSURANCE (HI) RATES
Deductible
- $1,216.00
- $304.00 a day for 61st-90th day
- $608.00 a day for 91st-150th day (lifetime reserve days)
- $152.00 a day for 21st-100th day (Skilled Nursing Facility coinsurance)
- $426.00 a month
- $468.60 a month
- $234.00 a month (for those who have 30-39 quarters of coverage)
- $257.40 a month
Standard Premium
- $104.90 a month
- $147.00 a year
- $114.99 1st month
- $32.01 2nd month
- 20 percent
If you have any questions, please contact your MAC at their toll-free number, which may be found at http://www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/provider-compliance-interactive-map/index.html
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