As if physicians didn't have enough financial concerns these days, now it seems they could be left holding the bag for patients' unpaid health insurance premiums.
As if physicians didn’t have enough financial concerns these days, now it seems they could be left holding the bag for patients’ unpaid health insurance premiums.
“That’s the way I interpret it,” says Bruce Lamb, head of the health care practice group at Gunster law firm in Tampa Bay, referencing a CMS rule in the Affordable Care Act that gives consumers a 90-day grace period for paying health care premiums. “There’s heightened exposure. It’s a big concern for providers on all levels.”
Which means physicians need to be on heightened alert.
The potential exposure
The CMS rule provides consumers with a 90-day grace period before their insurer can drop them for non-payment of premiums. Upon reading the statute, it would be easy to assume that the insurer would be at risk for the entire 90 days, but Lamb says that’s not the case.
“What CMS did is they shifted the risk and they said that the insurer is only responsible for 30 days,” Lamb says. “That leaves a gap and that gap is from 61 to 90 days that puts the provider at risk for the non-payment.”
Lamb explains that there has always been some type of a lag in all kinds of insurance where the provider might not know, and the insurance carrier might not even know that there was a non-payment issue. Most people wouldn’t try to take advantage of that because they had their insurance carrier they were dealing with and they didn’t want to shop around. That has changed, however, with the mobility that’s been created by the insurance exchanges. And the problem is magnified because of the elimination of the pre-existing condition issue that previously led a lot of people to manipulate things because they’d be afraid that they couldn’t get insurance if they had a pre-existing condition.
“With the exchanges and this enhanced competition, so to speak, there’s a fear that certain people in the populous will just do this as almost a scam,” Lamb says. “They won’t pay, they’ll get their free health care for 90 days, and then sign up again. So, there’s heightened exposure.”
Lamb believes that the manner in which medical practices protect themselves against non-payment could drive a wedge between the doctor and the patient. He explains that the steps a practice might take, such as having patients sign forms acknowledging that their insurance payments are current, or that they authorize the practice to charge their credit card if the insurer doesn’t pay, are very disruptive to a good relationship.
“But they’re the only things that we’ve been able to really think about and suggest that the practices consider, except trying to work with the carrier to get better (patient and payment) information,” Lamb explains. “And whether the carriers will cooperate on that is yet to be seen because the exchanges have not yet been implemented in a functional fashion.”
Lamb explains that medical practices historically have relied on strong, assertive practice managers to take care of the practice while the physician is taking care of the patients. But with diagnostic and billing code systems become more complex, and third-party payers being much more aggressive in trying to minimize reimbursements, a great deal of pressure is falling on smaller medical practices.
“A lot of the exchanges are forcing a lot of physicians to consider leaving independent private practices and go into bigger groups where the risk is not on them so directly,” Lamb says. “They’ll become salaried employees, and let the group worry about these things — the complexity of the changing reimbursement system and other factors are driving that.”
More changes to come?
Lamb is cautiously optimistic that there will be some additional rulemaking with regard to the potential increase in exposure physicians face. The insurance industry, he says, lobbied for this shifting of the financial burden. Now the pendulum swings a little bit, and there’s a lot of pressure from organized medicine and organized health care to level off what they think is an unfair burden.
“Many times that will result in some additional rule making,” he says. “For example, it might be that insurance carriers have an obligation to notify when there’s been a non-payment of insurance premiums within a certain time period, or that they have an obligation to have a mechanism for practitioners and facilities to make inquiries as to that. I don’t think that they’ll change the 30-day period, but I think that there may be some progress made that would allow the practitioner and facility to at least have better knowledge of what they’re dealing with. If something is done at all, it will be a compromise along those lines.”