Author Topic: Offering cash discounts on self-pay being gamed by patient  (Read 4107 times)

trw

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Offering cash discounts on self-pay being gamed by patient
« on: August 12, 2009, 06:00:00 PM »
Our company offers a courtesy / cash discount on self pay balances if paid at the time of service.  The discount is offered to reduce billing costs and in consideration of the time value of money.

One of our patients is paying their bill, receiving the discount and apparently billing their insurance themselves and collecting more than they ultimately paid us.  The physicians at the site think this is ok.  Can anyone give me something I can use to support my position that this is not ok?   

Let me extend the question:  is it legal to offer a cash discount on deductible/co-pay/non covered balances to patients with insurance as opposed purely to patients that are solely self pay?

Thanks. 


PMRNC

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #1 on: August 12, 2009, 06:20:46 PM »

 Ok, first of all there is no balance if the patient pays at time of service  ???

Second.. I am ASSUMING you don't participate with the carrier? And also that you are not submitting the claim to the carrier at all?

Third.. IF they are paying cash, are you giving them a receipt for the full fee? You have to be if they are sending it to their carrier!  Yes it's fraud , but it's on your end if it's your superbill/billing statement they are submitting.

« Last Edit: August 12, 2009, 06:24:50 PM by PMRNC »
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Pay_My_Claims

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #2 on: August 12, 2009, 06:32:08 PM »
Our company offers a courtesy / cash discount on self pay balances if paid at the time of service.  The discount is offered to reduce billing costs and in consideration of the time value of money.

One of our patients is paying their bill, receiving the discount and apparently billing their insurance themselves and collecting more than they ultimately paid us.  The physicians at the site think this is ok.  Can anyone give me something I can use to support my position that this is not ok?   

Let me extend the question:  is it legal to offer a cash discount on deductible/co-pay/non covered balances to patients with insurance as opposed purely to patients that are solely self pay?

Thanks. 

I"m confused.....

1. if it is self pay then how are they filing insurance???
2. Are you having them pay up front because you are non-par? If so you should be billing non-assigned and having the patient recieve the payment.
3. Is this the copay deductible then yes if you are a participating provider, you have a legal contract that states that you are in network and must collect the patients coinsurance. This looks like a "kick back".




trw

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #3 on: August 12, 2009, 07:17:13 PM »
Clarifications:

* Let's say it is a self pay patient and the bill for today's visit is $100.  We would provide a cash / prompt pay discount of 10% if they paid at the time of service. 
*  What if it is an insured patient who owes $100 for their co-pay and non covered services?  Can the same 10% discount be applied as a collection tool to get cash upfront and avoid collection costs?  I am not talking about waiving the co-pay just discounting it for immediate payment.
* We do not participate with the carrier in question and we are not submitting a claim to the carrier.
* It is my understanding that the patient is using claim forms the office is providing to the patient. 
* When I refer to self pay I am referring to self pay balances whether they be from non-insured patients or balances owed from patients with insurance.
* Are we able to discount the co-pay as a means to collect the balance at the time of service eliminating the need to bill the patient and make collection calls?  This is a discount not a waiver of the co-pay.  I read several sources saying the OIG has ok'd discounting as a means to avoid collection costs.
* In an internet search I found a number of hospitals / offices that post their policies on-line.  it seemed a split as some specifically referring to discounts for the uninsured and others just referring to discounts on cash payments. 

Steve Verno CMBS, CEMCS

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #4 on: August 12, 2009, 07:29:20 PM »
Not being a lawyer, but this sounds like your patient is comitting insurance fraud.  I say this because they are sending a claim for more than what the service cost them. 

Discounts should NOT be given to insured patients.  They have contracted copays, deductibles and coinsurance they are contracted to pay.  To give a discount could b a possible violation of the Stark Act, the antikickback statute, and the false claims act. 

Now, here's a scenario your doctors may not like.  The patient belongs to an HMO.  The patient pays at the time of service, gets a discount. They submit the bill for reimbursement.  The HMO files a complaint that their HMO member is paying out of pocket fo healthcare. The regulatory starts to investigate your providers for possible loss of licensure for a possible State Law violation.  They order you to reimburse the patient.  You submit the claim. The HMO denies for timely filing and you are directed that there is no balance billing. YOU lose and the patient wins and gets free healthcare at your expense.  This happened to one of my providers.  The OIG has stated it is permissable to give uninsured patients a discount.
http://www.healthlawyers.org/News/Advisory%20Opinions/Documents/2009/AO0905.pdf

However if you have a patient with insurance, you need a financial plan, as part of your compliance plan to provide guidance on patient payment issues such as uninsured discounts, financial hardship, cost of collecting vs cost of amount to pay and use of a collection agency for delinquent debts.

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PMRNC

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #5 on: August 12, 2009, 08:41:47 PM »
Quote
* Let's say it is a self pay patient and the bill for today's visit is $100.  We would provide a cash / prompt pay discount of 10% if they paid at the time of service.

That's fine as long as your non-par and the statement/receipt you give the patient reflects this discount.

Quote
*  What if it is an insured patient who owes $100 for their co-pay and non covered services?  Can the same 10% discount be applied as a collection tool to get cash upfront and avoid collection costs?  I am not talking about waiving the co-pay just discounting it for immediate payment.

No. If it's "A" patient in a financial hardship situation, refer to the office policy/financial policy and follow protocol. If your office policy allows for hardship arrangements, document the file, and have the patient complete a financial hardship agreement. ROUTINELY waiving OOP is illegal/Fraud


Quote
* We do not participate with the carrier in question and we are not submitting a claim to the carrier.

Right but if your office is providing the patient with a "false" statement there's a problem on your end.



Quote
* It is my understanding that the patient is using claim forms the office is providing to the patient.

That's vague.. do you mean a blank claim form?  I think it's really important that you find out EXACTLY what the office was giving the patient before going any further with this.

Quote
* When I refer to self pay I am referring to self pay balances whether they be from non-insured patients or balances owed from patients with insurance.

Right but you said "self pay balances if paid at the time of service"  There is a difference. If you are offering a patient a discount as an incentive to pay AT the time of service then it would never be a balance because they wouldn't owe any money unless you are giving them the discount even if they don't pay at the time of service.. what's point?  Again, though .. IF the patient has insurance and you are discounting, the insurance carrier must be billed the same fee. You can't bill the insurance company $100, collect $80 from the patient and turn around and give them a statement for $100. Likewise, if you bill the insurance company (you have to if your participating) you would have to bill them the same discounted fee.


Quote
* Are we able to discount the co-pay as a means to collect the balance at the time of service eliminating the need to bill the patient and make collection calls?  This is a discount not a waiver of the co-pay.  I read several sources saying the OIG has ok'd discounting as a means to avoid collection costs.

No you must have read it wrong, you cannot routinely waive copayments, coinsurance or any out of pocket expenses. you must make an attempt to collect.   If the patient has a carrier that you do NOT participate with they would still be in violation of the cost-sharing portion of their policy. Now if you want to give them a discount that's fine but you must bill the insurance company the same rate (discounted) OR show the discount on it's own line of the claim.

Quote
* In an internet search I found a number of hospitals / offices that post their policies on-line.  it seemed a split as some specifically referring to discounts for the uninsured and others just referring to discounts on cash payments.

Never use the old "Everyone else is doing it.."    The law is the law.  It sounds like the office does NOT have an office and financial policy and that's a problem. I hate to ask this but do they have a compliance plan.. if you plan to report this what's your protocol to do so? Hopefully there is a compliance plan at the very least in which case you might want to grab a hold of real quick. 
Linda Walker
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Steve Verno CMBS, CEMCS

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #6 on: August 12, 2009, 09:31:44 PM »
I was doing some research on another guidebook I am writing. I found the following under Texas Law:

Sec. 1204.055.  CONTRACTUAL RESPONSIBILITY FOR DEDUCTIBLES AND COPAYMENTS.  (a)  The payment of benefits under an assignment does not relieve a covered person of a contractual obligation to pay a deductible or copayment.

(b)  A physician or other health care provider may not waive a deductible or copayment by the acceptance of an assignment.

and

Any advertisement, solicitation, or marketing material of a discount health care program may not use the term "health plan," "coverage," "copay," "copayments," "deductible," "preexisting conditions," "guaranteed issue," "premium," "PPO," or "preferred provider organization," or another similar term, in a manner that could reasonably mislead an individual into believing that the discount health care program is health insurance or provides similar coverage.


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You got your peanut butter on my milk chocolate.
Dont cut the blue wire! 
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Qualls14

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #7 on: May 21, 2010, 11:20:02 AM »
At our office we have one particular insurance company that we know does not pay for routine office visits.  Thus, we discount the visit to our spp fee of $60 when we bill the insurance - thus the patient will not be responsible for more than $60.  It is my understanding that as long as you are billing the same amount to insurance as you would provide a patient statement for (whether it is the full $60 or discounted by insurance) that it is legal.
However, I also thought it was legal to write off old account balances that have not been paid as a means to eliminate collection costs for the practice.
Anyone that has any feedback on this please . . . fill us in.
Thanks!

Qualls14

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #8 on: May 21, 2010, 11:24:27 AM »
Also . .  what do you do in the scenario where a patient realizes that they have an extremely high deductible and it would be cheaper to pay the self pay patient rate, rather than to bill their insurance.  Can you allow them to choose to pay self pay and NOT file the insurance? 
My original thought would be no you can't do this, however what do you do for the patients that present and lie stating that they do not have any insurance - just so they can get the cheaper rate?
Anyone got any ideas? ???

PMRNC

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #9 on: May 22, 2010, 10:52:14 AM »
Quote
At our office we have one particular insurance company that we know does not pay for routine office visits.  Thus, we discount the visit to our spp fee of $60 when we bill the insurance - thus the patient will not be responsible for more than $60.  It is my understanding that as long as you are billing the same amount to insurance as you would provide a patient statement for (whether it is the full $60 or discounted by insurance) that it is legal.

That would be ok, because the carrier does not pay for routine office visits, so there is no '' cost sharing obligation"

Quote
However, I also thought it was legal to write off old account balances that have not been paid as a means to eliminate collection costs for the practice.

It is legal as long as the office has a policy in place to "attempt" collections. This should be in the office policies and procedures, a time frame in which to write off "bad debt" and when to pursue additional collection methods. That's why it's always a good idea that the biller or billing company have and read/understand the practice policies and procedures.
 
Linda Walker
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PMRNC

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Re: Offering cash discounts on self-pay being gamed by patient
« Reply #10 on: May 22, 2010, 10:55:41 AM »
Quote
Also . .  what do you do in the scenario where a patient realizes that they have an extremely high deductible and it would be cheaper to pay the self pay patient rate, rather than to bill their insurance.  Can you allow them to choose to pay self pay and NOT file the insurance?

Why would the patient choose NOT to have the claims at least filed and applied to their deductible? I would say no that would not be legal unless the patient signs a waiver that insurance will NOT be filed.. that means ever. There is liability there once you know the patient has insurance, it could cause a lot of problems later when the patient decides they do want to use their insurance.

Quote
however what do you do for the patients that present and lie stating that they do not have any insurance - just so they can get the cheaper rate?
Anyone got any ideas? Huh

If they don't inform you of the insurance, then obviously you don't know they are doing anything wrong <g> but they will be creating their own headache later, eventually they have to absorb the cost-sharing provisions of their policy in order to have charges that would be considered and paid :)
Linda Walker
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