Exchange health insurance plan grace period: how to avoid working for free

Answering the following question:

Have a patient who had exchange (Obamacare) BCBS from marketplace.  Was seeing and treating this patient and paid by insurance.  Now have a letter from insurance company asking for their payment back because the patient didn’t pay his monthly fees.  They say we need to refund their money and seek payment from the patient.  

1. Is this legit?  Do I have to pay them back?

2. If I pay them back, do I have to charge patient the negotiated rate or can I charge my self-pay rate?

And here’s my response:

This is in my employee protocol book:  if someone has a exchange plan (your staff should know which plans off top of their head), before the surgery we verify via phone or through our PM system/ insurance company website that their premiums are paid up to date for that month, otherwise they pay the deductible and we refund later. 

Yes this is legit and was part of Obamacare laws. The politicians and insurance lobbyists screwed us. In the event you get a clawback that they didn’t pay their premiums, they had no insurance. So you can charge your regular cash pay rate since they were uninsured. 

I’m not familiar if the rules were modified, but patients gamed the system by getting health care when needed and then dropping their plan. 

So this was asked: is this type of thing particular to exchange plans? (where they don’t pay their premium for the month)

Do we have to worry about this type of thing for other plans?

For employer based plans, the grace period depends on state law and if it even exists is usually only until the end of the month or the next month.

Fortunately only about 5% of the population is in exchange plans but this may vary depending on your practice.

Only exchange plans for which a federal subsidy has been given is eligible for the 90 day grace period. This means that even if the patient doesn’t pay, the insurance will show eligibility as active, claims will pay for first 30 days, but be clawed back after 90 days. This is codified as 45 CFR (code of federal regulations) §156.270:

Other plans simply won’t pay with the EOB as not eligible. 

Here’s a fact sheet from the AAFP with highlights similar to my opinions:

How does the 90-day grace period work?

If an enrollee’s premium is due on May first, the 90-day grace period begins. If he or she pays their full share of the premium, the 90 day grace period is not needed. If he or she fails to pay their required amount, the 90-day period begins. The insurer MUST pay a claim incurred during the first 30 days of the period (1st through 30th day). Claims during the unpaid 31st through the 90th day may be pended. If the enrollee never pays his or her share, the claim is not payable by the insurer.

What does it mean for family physicians?

Trust but verify. Make any appropriate changes to your current procedure to verify eligibility for every visit, especially for those patients who have coverage through an exchange plan. If your EHR accommodates electronic transactions under HIPAA, you may be able to check a patient’s eligibility on the date of the appointment, but this may require a change in your standard front office check-in procedures.  (Added:  I don’t phone for office visits but will definitely make sure premiums are up to date for surgeries)

Am I required to provide care if the insurance plan is suspended?

If the patient’s eligibility verification states that coverage is suspended, the physician may choose to treat the situation as it would any other patient who has had a lapse in health insurance coverage. For non-emergency services, patients would have the option to either pay cash or not be seen.

And then the following was asked: I feel stupid that I had no idea about this 90 day grace period prior to 30 seconds ago.

Do the insurance companies verify that the premium was paid for a month, or does the patient have to provide this info themselves?

Better to learn the hard way once, rather than hire a billing company who you think will take care of this, but doesn’t chase after the zero payments nor notify you. This is EXACTLY why everyone needs to supervise their own billing- knowledge is money.

Some insurance companies might have it on their website; they aren’t in our PM system.  In AZ Ambetter does. But Bright Health doesn’t on Avality so we phone in. We always phone in before surgery to verify, and we have postponed surgeries and office visits as a result. The ACA isn’t going to mandate that I work for free. 

And how did this idiotic rule become law? Because the insurance companies and Kaiser donated more to the politicians and lobbied them more than we did. If all MDs donated $2000 each to ophthpac or the other specialty PAC equivalents, perhaps we could have hospital administrators and insurance company executives working for free, rather than us. 

Finally here’s a great article how patients can game the system:

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