Medical groups fear ACA grace period will lead to unpaid claims

Washington Physicians are calling for real-time patient information regarding insurance coverage eligibility status from health plans purchased on new exchange marketplaces, citing a potential loophole that could leave doctors holding the bill.

Doctors, practice administrators and hospitals have continued to express concerns to the Centers for Medicare & Medicaid Services about claims for services going unpaid when patients stop paying premiums but still retain insurance coverage. Beneficiaries delinquent on their premiums are given a 90-day grace period before their coverage is dropped. During the final two months of that grace period, health plans are instructed to designate claims submitted for physician services as pending, but the services ultimately could go unpaid.

“Physicians, hospitals and other health care providers cannot reasonably be expected to know or predict if an enrollee’s premiums are paid or will be paid before the end of the grace period,” officials from the Missouri State Medical Assn. and the Missouri Hospital Assn. stated in an Aug. 12 letter to CMS. “And they cannot reasonably be expected to bear the concomitant burden of uncertainty and a potentially significant financial loss.”

The Missouri physicians’ and hospitals’ letter was one of the latest on the subject. CMS rules require health plans on exchanges to notify all affected providers “as soon as practicable” once a beneficiary falls behind on payments and enters the grace period. CMS, which will oversee the exchanges, has acknowledged the risk and burden to physicians and hospitals, but it gives health plans leeway to determine when and how to inform the professionals treating the patients.

“Permitting this latitude is unacceptable, especially considering that the insurers have ready access to the information that an enrollee has not paid his or her premium,” MGMA-ACMPE President and CEO Susan Turney, MD, wrote in a July 3 letter. “We are very concerned that issuers’ interpretation of ‘as soon as practicable’ will be too late for physicians to engage patients and make informed decisions prior to furnishing potentially uncovered services.”

Who pays the bill?

The health plan would be responsible for paying claims during the first 30 days after a patient enters the nonpayment grace period. If the enrollee continues to be delinquent in paying premiums, practices and hospitals would be left to collect payment directly from the patient when claims during the final 60 days of the grace period are rejected.

The Obama administration has heard concerns about this problem and is working with organizations on a solution, officials said. MGMA-ACMPE, an organization for medical practice managers, has urged CMS to pay claims during the entire grace period. CMS also should require a real-time notification process that is consistent with electronic standards of the Health Insurance Portability and Accountability Act, which mandate that insurers respond electronically to health plan verification checks within 20 seconds, the organization said.

“It is essential for practices to have this grace period eligibility information in the same timely manner,” Dr. Turney stated. “Additionally, if a practice calls the insurer or uses an insurer’s online portal to verify eligibility, insurers should be required to provide the grace period information in these instances the same way they would be required to during eligibility verification transactions.”