CMS leader testifies to DOI: Clarify notification during the 90-day grace period

Wednesday, May 07, 2014 03:36 PM

With the large number of Coloradans newly insured through the Affordable Care Act comes a risk for payment issues to physician practices due to the 90-day grace period. CMS Immediate Past President Jan Kief, MD, testified at a hearing of the Colorado Division of Insurance on Thursday, May 1, about a proposed state rule to clarify the 90-day grace period.

Per federal rule, patients who receive federal subsidies to purchase plans through the state health insurance exchange have a 90-day grace period for non-payment of premiums. During the first 30 days the health insurer must pay for claims as if the patient were eligible, but in the last 60 days they can suspend claims. If the patient’s coverage is cancelled after 90 days because of non-payment of premiums, the insurer may deny all suspended claims for services furnished during the 31-90 day time period.

Physician practices could therefore be in a position of providing services for up to 60 days, only to be stuck with the prospect of either having to absorb the costs as bad debt or attempting to collect arrears from patients who may not have the means to pay these bills given that they couldn’t pay for their premiums.

The ACA requires that the carrier notify the enrollee’s physician and other health care providers when a patient enters into the second and third month of the grace period, but the notification requirement is vague and does not indicate when such notification must be made.

“We strongly support the division’s efforts to add clarity to the 90-day grace period for policyholders receiving advance tax payments under the Affordable Care Act,” Kief said. “The division has the unique opportunity to not only address the consumer and health plan issues related to grace periods but also the concerns of those actually delivering the care to the policyholder.”

She stated that the proposed regulation – 4-2-48 – should include language that will ensure providers receive eligibility information in a timely manner, and in a manner detailed enough so that they can anticipate any potential problems. “These proactive measures will give our health care professionals the assurance they need to continue providing access to care for the Coloradans receiving advance tax payments through the purchase of exchange products.”

Kief testified on behalf of the Colorado Medical Society, the Colorado Hospital Association, the Colorado Medical Group Management Association, the Colorado Academy of Family Physicians, the Denver Medical Society, University Physicians, the Colorado Society of Anesthesiologists, the Colorado Orthopaedic Society, the Colorado Chapter of the American College of Physicians, and Pikes Peak Professional Association of Health Care Office Management.

Click here to read her testimony.