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Medicare rules on blg pts for copays/ded

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ECPMS:
I am looking for a written summary by Medicare on their guidelines for writing off patient copays and deductibles.  I found your article but know the doctor is going to want it right out of the Medicare guide.  I looked through a couple of websites but cannot find the documentation I am looking for.  Any ideas where I find it?

PMRNC:
It SOOO irritates me when a doctor says "show me". THEY know dang well they cannot ROUTINELY waive out of pocket expenses. PERIOD. I don't go into debates with my clients. I tell them the way it is, and if they want to question it further I have them go to their attorney. As a Third Party Billing Company and as part of my compliance, I won't do anything illegal and all I can do is advise them not to as well. The office should have it's own compliance plan, office policy and financial policy ON file and ready to look at for such questions.  But if he insists. send him this link and tell him to read it.  Just cover your butt, document and don't do anything illegal and your golden. If the doctor wants to waive out of pocket on a case by case basis, he can as long as he adheres to his own office/financial policy and has the patient complete a financial hardship agreement.

http://oig.hhs.gov/fraud/docs/alertsandbulletins/121994.html

In Our subscriber area we have several articles and documentation about this very subject.

Michele:
I think what they were looking for was not routinely writing them off, but when you are going to what do you have to do to document it to be in compliance with Medicare.  The article they are referring to explains how it is illegal to not bill the patient, unless there is a provable hardship and then it must be documented.  Linda, do you know if Medicare has documentation on when it is ok to write off a patient balance and what you must do to document it?

Michele

PMRNC:
No, because their (Medicare) position is that a "reasonable" attempt at collections must be made for any out of pocket and that the "routine" waiver of copay's and OOP is illegal. That is why offices have to establish their own financial policies. For example, if Dr. Smith's office has a financial policy it will be based on the criteria he sets, then when a patient is in need of or qualifies for true financial hardship they can complete a financial hardship agreement with the provider and that would then serve as the documentation. That's why you will not find verbiage saying that you can "never" do it, it doesn't exist, the Grey area is the reasonable attempt vs. NOT collecting it at all. In other words. Dr. Smith cannot just tell Mrs. Doe "Not to worry about their copay". Doctors who do want to see this DO want to see this so they can just arbitrarily choose accounts, choose patients to which they don't collect on or attempt to collect on and while they think it's the noble thing to do it's not right and doctors DO know this. If a provider genuinely has a case or two that would qualify for financial hardship based on their office/financial policy they then need to have the patient complete the financial hardship agreement, and place it in the patient's record/file.

PMRNC:
From that previous link I posted below the exact wording. I bolded and highlighted some areas. This SHOULD put to rest the "prove it" for the doc.

# The Medicare ``deductible'' is the amount that must be paid by a Medicare beneficiary before Medicare will pay for any items or services for that individual. Currently, the Medicare Part B deductible is $100 per year. ``Copayment'' (``coinsurance'') is the portion of the cost of an item or service which the Medicare beneficiary must pay. Currently, the Medicare Part B coinsurance is generally 20 percent of the reasonable charge for the item or service. Typically, if the Medicare reasonable charge for a Part B item or service is $100, the Medicare beneficiary (who has met his [or her] deductible) must pay $20 of the physician's bill, and Medicare will pay $80.

Why Is it Illegal for ``Charged-Based'' Providers, Practitioners and Suppliers to Routinely Waive Medicare Copayment and Deductibles?

Routine waiver of deductibles and copayments by charge-based providers, practitioners or suppliers is unlawful because it results in (1) false claims, (2) violations of the anti-kickback statute, and (3) excessive utilization of items and services paid for by Medicare. A ``charge-based'' provider, practitioner or supplier is one who is paid by Medicare on the basis of the ``reasonable charge'' for the item or service provided. 42 U.S.C. 1395u(b)(3); 42 CFR 405.501. Medicare typically pays 80 percent of the reasonable charge. 42 U.S.C. 1395l(a)(1). The criteria for determining what charges are reasonable are contained in regulations, and include an examination of (1) the actual charge for the item or service, (2) the customary charge for the item or service, (3) the prevailing charge in the same locality for similar items or services. The Medicare reasonable charge cannot exceed the actual charge for the item or service, and may generally not exceed the customary charge or the highest prevailing charge for the item or service. In some cases, the provider, practitioner or supplier will be paid the lesser of his [or her] actual charge or an amount established by a fee schedule. A provider, practitioner or supplier who routinely waives Medicare copayments or deductibles is misstating its actual charge.
For example, if a supplier claims that its charge for a piece of equipment is $100, but routinely waives the copayment, the actual charge is $80. Medicare should be paying 80 percent of $80 (or $64), rather than 80 percent of $100 (or $80). As a result of the supplier's misrepresentation, the Medicare program is paying $16 more than it should for this item. In certain cases, a provider, practitioner or supplier who routinely waives Medicare copayments or deductibles also could be held liable under the Medicare and Medicaid anti-kickback statute. 42 U.S.C. 1320a-7b(b). The statute makes it illegal to offer, pay, solicit or receive anything of value as an inducement to generate business payable by Medicare or Medicaid. When providers, practitioners or suppliers forgive financial obligations for reasons other than genuine financial hardship of the particular patient, they may be unlawfully inducing that patient to purchase items or services from them.

At first glance, it may appear that routine waiver of copayments and deductibles helps Medicare beneficiaries. By waiving Medicare copayments and deductibles, the provider of services may claim that the beneficiary incurs no costs. In fact, this is not true. Studies have shown that if patients are required to pay even a small portion of their care, they will be better health care consumers, and select items or services because they are medically needed, rather than simply because they are free. Ultimately, if Medicare pays more for an item or service than it should, or if it pays for unnecessary items or services, there are less Medicare funds available to pay for truly needed services. One important exception to the prohibition against waiving copayments and deductibles is that providers, practitioners or suppliers may forgive the copayment in consideration of a particular patient's financial hardship. This hardship exception, however, must not be used routinely; it should be used occasionally to address the special financial needs of a particular patient. Except in such special cases, a good faith effort to collect deductibles and copayments must be made. Otherwise, claims submitted to Medicare may violate the statutes discussed above and other provisions of the law.

What Penalties Can Someone Be Subject to for Routinely Waiving Medicare Copayments or Deductibles?

Whoever submits a false claim to the Medicare program (for example, a claim misrepresents an actual charge) may be subject to criminal, civil or administrative liability for making false statements and/or submitting false claims to the Government. 18 U.S.C. 287 and 1001; 31 U.S.C. 3729; 42 CFR 1320a-7a). Penalties can include imprisonment, criminal fines, civil damages and forfeitures, civil monetary penalties and exclusion from Medicare and the State health care programs. In addition, anyone who routinely waives copayments or deductibles can be criminally prosecuted under 42 U.S.C. 1320a-7b(b), and excluded from participating in Medicare and the State health care programs under the anti-kickback statute. 42 U.S.C. 1320a-7(b)(7). Finally, anyone who furnishes items or services to patient substantially in excess of the needs of such patients can be excluded from Medicare and the State health care programs. 42 U.S.C. 1320a- 7(b)(6)(B).

Indications of Improper Waiver of Deductibles and Copayments To help you identify charge-based providers, practitioners or suppliers who routinely waive Medicare deductibles and copayments, listed below are some suspect marketing practices. Please note that this list is not intended to be exhaustive but, rather, to highlight some indicators of potentially unlawful activity.

# Advertisements which state: ``Medicare Accepted As Payment in Full,'' ``Insurance Accepted As Payment in Full,'' or ``No Out-Of- Pocket Expense.''

# Advertisements which promise that ``discounts'' will be given to Medicare beneficiaries.

# Routine use of ``Financial hardship'' forms which state that the beneficiary is unable to pay the coinsurance/deductible (i.e., there is no good faith attempt to determine the beneficiary's actual financial condition).

# Collection of copayments and deductibles only where the beneficiary has Medicare supplemental insurance (``Medigap'') coverage (i.e., the items or services are ``free'' to the beneficiary).

# Charges to Medicare beneficiaries which are higher than those made to other persons for similar services and items (the higher charges offset the waiver of coinsurance.)

# Failure to collect copayments or deductibles for a specific group of Medicare patients for reasons unrelated to indigency (e.g., a supplier waives coinsurance or deductible for all patients from a particular hospital, in order to get referrals).

# ``Insurance programs'' which cover copayments or deductibles only for items or services provided by the entity offering the insurance. The ``insurance premium'' paid by the beneficiary is insignificant and can be as low as $1 a month or even $1 a year. These premiums are not based upon actuarial risks, but instead are a sham used to disguise the routine waiver of copayments and deductibles. D. Special Fraud Alert: Hospital Incentives to Physicians (Issued May 1992)

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