When patient doesn’t pay health exchange premium, you may be left holding the bag
September 3rd, 2014 - Scott KraftOne of the issues surrounding implementation of the Affordable Care Act (ACA) that impacts physician billing and payment and hasn’t gotten a lot of attention is what happens when a patient buys an insurance plan under the exchange, but then stops paying the premium.
The answer may end up leaving more than a few physician practices fuming over providing free care with little or no recourse.
First, patients have a 90-day grace period to get caught up on their premiums when they are receiving advance tax credits to help pay the premiums. A large number of exchange enrollees will be getting at least some premium assistance.
As a result, patients in this grace period will appear to still have coverage, because they will still have coverage. The final rule published in the Federal Register by CMS on March 27, 2012, establishing the rules and regulations governing the exchanges interprets the ACA to provide the grace period.
During the first 30 days of the grace period, the patient’s chosen insurance company is on the hook for paying any claims incurred by the patient. For the next 60 days, it is the service provider who will either have those payments suspended until the patient gets caught up, or have those payments recouped once the patient’s policy is canceled for the 90-day delinquency.
The objection from health providers is the same one you’re probably having – the lack of information about the patient’s insurance status could result in your practice providing costly services during the 60-day grace period and ultimately not being paid for the work.
The best way for you to figure out if a patient is in the grace period and at risk of having his or her policy canceled is to pay close attention to the claims remittance advice you get for unpaid claims during 2014, though in doing so at least one service will be potentially unpaid.
Insurers are allowed – but not required – to pend payments during the second and third months of the grace period to avoid the liability for patients whose policies are ultimately canceled.
Look for Claim Adjustment Reason Code 257, created on Nov. 1, 2013. The code descriptor is “The disposition of the claim/service is pending during the premium payment grace period, per Health Insurance Exchange requirements.”
Seeing that code is a sure sign that you’re at risk of losing money for that patient, and should consider seeing that patient only on an emergency basis until the premium is caught up or the policy is canceled.
It wouldn’t be advisable to tell the patient you know that he or she is delinquent on premium payments, but you can ask the patient to check with the insurance company to verify the status of his or her coverage prior to being seen.
It’s a small measure, but it’s the best one you may have to guard against providing a large volume of care and getting stuck with the bill. You are allowed to back bill the patients directly when policies are canceled for non-payment, though your chances of getting paid are probably remote.
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