In this post, I’m going to talk about straight Medicare only. None of this discussion applies to Medicare Advantage plans. You can read more about Medicare Advantage on Narrow network plans and verifying patient insurance coverage. Some of the topics covered will be a bit redundant to Medicare deductible and holding Medicare claims for dual eligibles, or Medicaid as secondary as well.
The Qualified Medicare Beneficiary (QMB) program pays for Medicare beneficiaries who also have Medicaid the following:
- Medicare Part A premiums (inpatient services)
- Medicare Part B premiums (outpatient and professional services)
- Medicare deductibles ($183 for 2018)
- Medicare coinsurance (20% after deductible is met)
- Medicare Part D prescription drug plan premiums (depending on the chosen plan)
- a portion of Medicare drug co-pays
Pretty much, almost anyone who qualifies for his or her state’s Medicaid will be a QMB. To qualify for Medicaid (Medi-Cal) in California in 2018, you need to earn less than $1,200 a month as an individual or $1,600 a month as a couple. You must also have in the bank less than $2,000 as an individual or $3,000 as a couple. A primary home, one vehicle, household items, personal belongings (including jewelry), burial plots, and life insurance polices and retirement accounts are excluded.
However, there is one exception to Medicaid equaling QMB. Some people are just above the income limit to be eligible for Medicaid. These folks have a conditional form Medicaid with a “spend down.” For example, if you make $2,000 a month as a couple, your Medicaid benefits will only kick in after you spend at least $400 a month in medical expense. Hence, bringing your monthly income down the $1,600. Despite having a Medicaid card, these people actually are not considered QMBs. At least this is how it works in California. I’m sure there will be subtle rule variations with each state.
With Medicare only, you have to pay monthly part B premiums of $134 or higher, depending on your income. If you pay Medicare taxes for at least 10 years, then your part A coverage will be free. Otherwise, it will cost $232 to $422 a month, depending on how long you’ve been working. In addition to the annual deductible and all co-insurances, both part A and part B premiums are also fully covered for QMBs.
Now, “paid for” and “covered” is such a misleading and subjective term for CMS (Center for Medicare Services). At least for California, this “covered” benefit usually translates to us getting paid 30 cents on the dollar for the $183 deductible, and being forced to write off the 20% co-insurance entirely. Of course, in the eyes of the QMB, the government is gracious enough to “pay” for all their care.
If you are a participating provider with both Medicare and Medicaid, things are pretty straight forward. You can NEVER charge a single penny to a QMB. Period. Things get a bit more confusing if you are either a nonparticipating Medicare provider or if you don’t accept Medicaid. Many Medicare providers think that they can bill a QMB for the co-insurance or deductible if they don’t accept Medicaid. Unfortunately, that is not true. If you choose to see a QMB, you are not allowed to send a bill even if you have never been credentialed with Medicaid. Same goes for nonparticipating Medicare providers. The only way you can collect money from a QMB is if you completely opt-out of both Medicare and Medicaid, and become a straight cash practice. Obviously, there aren’t a lot of practices in this category.
At least in California, if you choose to see a QMB, you pretty much do so with the expectation that you are going to get paid at 80% Medicare rates for all office visits, most diagnostic tests, and a good number of procedures. Other state Medicaid programs pay better, so you would have to check with your locality. As for deductibles, they’re even worse. Medi-Cal pays about $20 to $50 for most office visits. (ie. 99214 pays around $33). So, if you submit an annual exam for a QMB in January, all of your charges will be applied toward the $183 deductible, and Medi-Cal will pay you $33 for it a month or two later. Of course, you would have to write off the remaining balance. Diagnostic tests pay around 40-60% of Medicare rates, and procedures and drugs pay 80-95%. So, even if you don’t decide to hold your claims, you should adjust the sequence of your claims submissions, favoring procedures and drugs over diagnostics over office visits. For example, let’s say that you see a patient whose OCT reveals new CNV (wet macular degeneration), and you give an intravitreal Avastin injection on the same day. Then you would bill for:
- 92004 Comprehensive New Patient Eye Exam (with modifier 25)
- 92134 OCT macula
- 67028 Intravitreal injection
- J7999 Avastin
Assuming that you have to write off all 20% co-insurances, if you submit the claim in order #1, you would get paid:
- 92004 $0 from Medicare ($185 applied to deductible), $35 from Medi-Cal
- 92134 $45 from Medicare, $0 from Medi-Cal
- 67028 $100 from Medicare, $0 from Medi-Cal
- J9990 $40 from Medicare, $20 from Medi-Cal
If you submit the claim in order #2, you would get paid:
- J9999 $0 from Medicare ($60 to deductible), $60 from Medi-Cal
- 67028 $0 from Medicare ($125 to deductible), $100 from Medi-Cal
- 92134 $45 from Medicare, $0 from Medi-Cal
- 92004 $148 from Medicare, $0 from Medi-Cal
Big difference huh? And none of this is illegal. Every Medicare provider has 365 days from the date of service to submit a claim. There is no rule that requires you to submit your claims in chronological order or all at once. Your goal is to avoid letting any office visit go toward the deductible. So, if you perform an X-ray on one visit and an EKG on another visit 3 months later, then you should submit the claim for the X-ray and EKG first, and then both office visits a few days later. I usually wait at least 24 hours before submitting the office visit claim.
If you happen to have nothing but office visits for the entire year, then your best bet is to hold your claim until someone else eats the deductible. Most solo and small practice doctors know this game all too well, and it can sometimes even take the full year before the deductible goes away. You’re main hope is that a hospital, lab, surgery center, or mega group practice takes the deductible some time during the year. You see, these larger systems have billing departments that are either unaware, indifferent, or ill equipped to hold claims or keep track of them.
Up until late 2017, you were able to track a QMB’s remaining deductible through your practice management system or your Medicare contractor’s eligibility web portal. Unfortunately, that all changed in October after this Medicare QMB Announcement. With this new policy change, you will no longer be able to keep track of remaining deductibles for QMBs. If you look up eligibility, deductibles will always be listed as $0. That doesn’t mean that the $183 deductible has gone away. It just means that you will never be able to find if a QMB’s deductible has been met or not. I guess it makes sense. After all, why would it matter knowing how much deductible is left for a QMB, when no one is allowed to collect any of it in the first place. In addition, the eligibility portal will let you know in bold writing when a patient is a QMB.
It seems that the main reason for zeroing out all QMB deductibles is to make sure that providers can easily identify QMB’s, thus discouraging them from balance billing patients for deductibles and co-insurances. Believe me, there are plenty of doctors who knowingly or unknowingly collect payment from QMBs, which is pretty messed up in itself. To demand $20 from someone who makes less than $1,200 a month is a bit rough. It just happens that us claim holders end up being collateral damage.
So here’s how I will adjust my strategy. I plan to submit claims for most procedures and diagnostics tests promptly, but hold all office visits until I know for certain that a QMB’s deductible has been met. That most likely means that I will be holding the majority of office visits for close to an entire year. Thankfully, my low overhead and healthy cashflow from other payors will allow me to hold the line.