In the previous post, we talked about the extra lengths healthcare providers should go to educate patients who purchased insurance through Affordable Care Act exchanges about their financial obligations.
Managing and tracking patients should also be considered. Providers should consider setting up ACA-insured patient accounts in their respective practice management financial systems under its own classification. As the old business maxim states, “if you can’t measure it you can’t manage it.” In many respects ACA-insured patients represent uncharted financial waters for healthcare providers, who shoulder all the financial risk and therefore must do everything possible to minimize it.
Many providers already have configured their financial management systems to identify ACA-insured patients as a unique financial class, distinct even from insurer. For example, patients who receive insurance from their employer are tracked separate from patients who purchased insurance from the same company through an ACA exchange.
At the same time the provider should establish metrics for tracking patients with ACA-exchange insurance. Some areas that should be looked at include:
- Contracted payment rate. Is the payor paying at the contracted rate? Also, is the ACA plan contracted rate different from non-ACA plans?
- Slowness/average payment. Are the ACA plans pay slower to accommodate the 90-day window given to patients to play premiums?
- Denials as a result of non-payment. At what rate are payors denying claims as a result of non-payment of premiums by patients?
Patients with ACA insurance represent uncharted waters for healthcare providers, so it is urgent that over the coming months there should be an effort to identify any financial trends with this particular patient class. Based on those trends, the education process should be adjusted to better help the patient understand and meet their respective financial obligations.
As stated in the previous post, while these patients are tracked as a separate class within the provider’s financial management system, it should go without saying that they are not treated differently on the clinical side.
The Elephant in the Room
By carefully tracking patients with ACA-exchange insurance, one trend that may present itself is that a substantial number of patients who obtain insurance may fail to pay their respective premiums.
One of the biggest controversies since the launch of the ACA exchanges last October has been over hospitals and other healthcare providers paying patient premiums. Shortly before the exchanges launched, the question about the legality and appropriateness of that practice was asked at a Q&A session with representatives from the Centers for Medicare and Medicaid Services. Shortly after that, then-Health and Human Services Secretary Kathleen Sebelius issued a letter discouraging the practice.
That was all the incentive many insurers needed to deny payments from third parties. However, this created a new issue in that charitable organizations such as the Ryan White HIV/AIDS Program suddenly had their payments denied, thereby blocking care to those unable to pay the premiums. CMS earlier this year published a new rule providing an exception to the Ryan White organization and American Indian tribes, among others.
Last month, shortly before her resignation, Sebelius issued yet another clarification of the policy of third-party payments, which said, in part, that such payments could be made provided:
(a) They come from Indian tribes, tribal organizations, urban Indian organizations, state and federal government programs or grantees (such as the Ryan White HIV/AIDS Program); or
(b) The payments are made by private, not-for-profit foundations on behalf of QHP enrollees who satisfy defined criteria that are based on financial status and do not consider enrollees’ health status. In this situation, CMS would expect that premium and any cost-sharing payments cover the entire policy year.
Based on this, one could assume that not-for-profit healthcare providers would be permitted to make third-party payments of premiums. One word of warning, however, is that we have heard from clients that some payors are insisting upon including language in their contracts with providers prohibiting the practice.
Roberta Schultz is Director of Operations at ProSource Billing, Inc., a part of the Array Services Group family of companies. Roberta has over 23 years of healthcare Revenue Cycle and A/R management experience which includes managing various revenue cycle projects for multiple healthcare facilities including physician, hospital, and healthcare organizations.