February 2014

the Affordable Care Act marketplace doesn’t pay his or her premiums? A. Yes, possibly. Here is what the govern- ment said in the March 27, 2012, Federal Register, when adopting the regulation:

We note that QHP [qualified health plan] issuers may still decide to pay claims for services rendered during that time period in accordance with company policy or state laws, but the option to pend claims exists. If the individual settles all outstanding premium payments by the end of the grace period, then the pended claims would be paid as appropriate. If not, the claims for the second and third months could be denied. The grace period under this final rule repre- sents an extended time for enrollees to catch up on premium payments be- fore coverage is terminated.

Here are examples the government

provided to explain its regulation. Assumptions for a monthly premium:

• Premium: $500 • Advance premium tax credit share of premium: $450

• Enrollee share of premium: $50 • First month of grace period: March • Patient pays enrollee share of premi- um for January and February cover- age.

Example No. 1: The patient misses $50 payment due Feb. 28 for March cover- age. Patient realizes the mistake and pays $100 on March 31 for March and April coverage, satisfying all obligations for premium payments through March.

• The insurer adjudicates claims for March consistent with normal prac- tices (that is, for nongrace periods).

• The patient will have full coverage for March and April.

Example No. 2: The patient misses $50 payment due Feb. 28 for March cover- age and misses $50 payment due March 31 for April coverage. Patient pays $150 on April 30 for March, April, and May coverage.

8 TEXAS MEDICINE February 2014

• The insurer adjudicates claims for March.

• Coverage continues for April and May (second and third months of the grace period), but:

• The insurer notifies physician of the potential for a denied claim.

• The insurer pends claims for services performed in April and May until the patient pays outstanding premiums.

Example No. 3: The patient misses $50 payment due Feb. 28 for March coverage, misses $50 payment due March 31 for April coverage, and misses $50 payment due April 30 for May coverage.

• Coverage is terminated retroactively to March 31.

• The insurer can deny claims for ser- vices rendered during April and May. The physician could then seek pay- ment directly from the patient for any services provided during that time.

As you can see, coverage is available

for the first 30 days of the grace period, and the insurer may not recoup. Termi- nation of coverage begins on the 31st day. After that time (day 31 forward), the insurer can retroactively terminate coverage and recoup payments to the physician. Remember that state law applies to

exchange plans. Texas prompt pay law says insurers must pay you within 30 days following receipt of a clean claim. Thus, you may receive some payments within the grace period. For insurance companies, Texas

prompt pay law permits recovery of overpayments and audits with the ability to recover paid amounts (up to 180 days after payment). A retroactive termina- tion may cause an overpayment or audit recovery by the insurance company.

Q: Will physicians know if an insured patient is delinquent in paying the premium? A: Practices will be able to discover which patients are in the nonpayment grace period. Federal regulation requires insurers to give notice to treating physi- cians of individuals who are in the grace period. Different insurers will meet the

obligation in different ways. Some may tell physicians when the medical office calls to verify coverage. Practices often call insurers the day

before scheduled visits of current pa- tients to verify the insurance coverage on file with the practice. Other offices may verify coverage when the patient checks in. At verification of coverage is when physicians will likely be notified. Some insurers will provide this informa- tion electronically.

Q: Can I withhold services from or directly bill for services for a patient who has not paid the premium? Can I refuse to see any exchange plan patients? A: The obligations to withhold from col- lections and accept certain people as pa- tients generally stem from the contract between the insurer and physician. The grace period regulation is a limitation on cancellation of insurance coverage. It is not a regulation of physician business practices generally. Absent an agreement, there is no limitation on how a physi- cian interacts with his or her patients as it may regard collections. Also, if you have no contract in place,

you are free to choose the patients you serve, except in emergencies. This is in line with American Medical Association ethics opinions, which say:

Opinion 9.06 — Free Choice Free choice of physicians is the right of every individual. One may select and change at will one’s physicians, or one may choose a medical care plan such as that provided by a closed panel or group practice or health maintenance or service organization. The individual’s freedom to select a preferred system of health care and free competition among physicians and alternative systems of care are prerequisites of ethical practice and optimal patient care.

In choosing to subscribe to a health maintenance or service orga- nization or in choosing or accepting treatment in a particular hospital, the patient is thereby accepting limi- tations upon free choice of medical services.

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