Healthcare Law Blog

UPS Denies Insurance Coverage of Spouses and Cites ACA as Reason

The United Parcel Service (“UPS”) recently made a big statement when they decided to drop 15,000 working spouses eligible for health coverage through their own employers from the UPS plan in 2014. The shipping conglomerate explained the change in a memo to its workers and repeatedly cited the Affordable Care Act (“ACA”) as the reason for the new policy. Rising medical costs “combined with the costs associated with the Affordable Care Act, have made it increasingly difficult to continue providing the same level of health care benefits to our employees at an affordable cost,” the memo stated. The new policy will not affect union workers, as their health benefits are already spelled out in labor contracts, but will apply to about a quarter of the UPS U.S. workforce. More >

The ACA Loophole Of Which Providers Should Be Aware, Part II

Earlier this week, we discussed the three-month grace period afforded to enrollees of qualified health plans (“QHPs”). To recap that article, the ACA requires that QHPs pay claims for the first thirty days of the grace period during which premium payment remains unpaid, but issuers may pend claims for the final sixty days of the grace period. If the balance remains unpaid, the issuer may deny any claims submitted within the final sixty days. More >

The ACA Loophole Of Which Providers Should Be Aware

Providers contracting with state health insurance exchanges may find themselves shortchanged for services provided due to a little-known loophole in the Affordable Care Act (“ACA”).

Under the ACA, an individual who fails to pay his or her insurance premiums has a three-month grace period before the policy is cancelled. Insurers, however, are only responsible for paying claims during the first month of that grace period. The ACA will allow exchange plan, also known as “qualified health plan” (“QHP”), issuers to pend claims submitted by providers during the last two months of a federally subsidized patient’s three-month grace period for premium payment delinquency. If the patient is terminated at the end of the three months, the QHP is free to deny all claims submitted for that patient within the final two months.

Here’s what providers can expect during the three-month grace period:

First month of delinquency:

• Claims are paid normally. The QHP treats this month as paid even if the enrollee is eventually terminated for non-payment.
• Providers are not notified of the patient’s delinquency.

Second and third months of delinquency:

• The QHP has the option to pend claims for services performed until the enrollee pays his or her outstanding premium balance.
• Providers submitting claims during these two months are notified of the potential that claims submitted for services performed for the enrollee may be denied.
• If the enrollee pays off the premium balance, providers’ claims are paid at that time.

Terminated after three months of delinquency:

• The QHP has the option to deny all claims for services performed in the second and third months of delinquency.

Note that the timing of an enrollee’s grace period is based upon the date when a service was rendered, not the date of claim submission. In fact, a patient may enroll in a different QHP during the next open enrollment period regardless of whether they have paid off an outstanding premium balance with their previous insurer.

Providers have the option to seek payment from the patient for denied claims, but a patient who is unable to pay their insurance premium is also unlikely able to pay a provider’s bill. Further, the legal action necessary to recover payment is a costly endeavor for any provider. Check back on Thursday for more information on this topic.

Services may be performed by others.

This article does not constitute legal advice.

Clarifying the “Two-Midnight Rule” and Part A Payments, cont.

Earlier this week, I discussed CMS’ final rule on the prospective payment for acute care and long-term care hospital inpatient services for fiscal year 2014. The final rule provides guidance to physicians on how to designate a patient as inpatient or outpatient and the impact of the designation on Medicare Part A or Part B coverage. This blog will discuss the two midnight rule. More >

Clarifying the “Two-Midnight Rule” and Part A Payments

In August, the Centers for Medicare and Medicaid Services (“CMS”) announced a final rule regarding the prospective payment for acute care and long-term care hospital inpatient services for fiscal year 2014. This rule becomes effective on October 1, 2013. More >

New IRS Guidance for Charitable Hospitals

The Patient Protection and Affordable Care Act added section 501(r) to the Internal Revenue Code, which imposes new requirements on 501(c)(3) organizations (nonprofit hospitals) that operate one or more hospital facilities. Under section 501(r), each hospital facility operated by a 501(c)(3) organization must meet four general requirements on a facility-by-facility basis in order for the nonprofit hospital to maintain its tax exempt status: More >

Nearly Two-Thirds of CAHs’ Status in Jeopardy

On August 15, 2013, the Office of the Inspector General of the Department of Health and Human Services (“OIG”) released a report entitled “Most Critical Access Hospitals Would Not Meet the Location Requirements if Required to Re-enroll in Medicare” (“Report”). If the recommendations in the Report are fully executed, it would cause a detrimental blow to rural hospitals. There are approximately 1,300 critical access hospitals (“CAHs”) currently in operation. More >