
"Uh-oh." That's the sound being uttered in doctors' offices and
hospitals across the country as medical providers realize they're
getting stuck with another bottomless Obamacare bill. While the White
House desperately tries to pivot from the havoc wrought by the
"Affordable Care Act," its hidden regulatory bombs keep exploding.
I heard about the latest problem this week from an eye doctor friend
who received a letter from a Colorado-based insurer informing her that
she's essentially on the hook for Obamacare's payment grace period for
debtors. The optometrist is bracing for a flood of similar letters from
other insurers.
Like countless other independent providers, she's
extremely concerned about the potential liability, uncertainty and fraud
the rule imposes on her business.
Here's the raw deal: The Affordable Care Act created a 90-day grace
period before insurers can drop patients who fall behind on premiums.
So, delinquents who obtain tax-subsidized health insurance through an
Obamacare health insurance exchange have three months to settle up their
bills prior to their policy being canceled. As written, the law puts
insurers on the hook for the grace period.
But the bureaucrats at the Centers for Medicare and Medicaid Services
decided to issue a rule in March making insurers responsible only for
paying claims during the first 30 days of the debtors' grace period.
Who's on the hook for the other two months? Well, customers are
entrusted to foot the bills for additional services. But if they blow
off the payments, it's up to physicians and hospitals to collect.
In real-world practice, this means providers will be eating untold
costs. Several large hospital associations raised red flags over the
issue this summer. In August, the Missouri Hospital Association noted
that the regulatory shift "unduly burdens physicians, hospitals and
other health care providers" by making them directly collect payments
from patients, which "puts them at an unfair and significant risk for
providing uncompensated care to patients."
Emillie J DiChristina of Practicefirst Medical Management Solutions
spelled out the financial risks for clients on the company's blog: "This
leaves providers in a potentially bad place as they have a high
potential for accruing bad debt on services provided between 31 and 90
days of the allowed grace period." Can you spell f-r-a-u-d? People could
"go on and off" insurance plans, Tampa Bay health care lawyer Bruce
Lamb told me, and game the system by bailing on payments and exploiting
Obamacare protections against denial of coverage.
Or as MHA officials put it: "We also are very concerned that some
disreputable individuals will learn they can manipulate the system and
win a full year's insurance coverage on only nine months of premiums.
Knowing they are entitled to three months of grace period coverage,
dishonest persons could stop paying premiums on the ninth month, enjoy
free coverage during the 90-day grace period, have their coverage
terminated, and then re-enter the exchange market where the Affordable
Care Act's guaranteed issue mandate would prohibit another plan from
denying them coverage."
Think such nefarious behavior won't occur? Then you haven't been
paying attention to the data manipulators and con artists in the
Obamacare navigator program. As I reported earlier this year, the seedy
nonprofit Seedco secured multimillion-dollar navigator contracts in
Georgia, Maryland, Tennessee and New York to recruit Obamacare
recipients into the government-run exchanges -- despite settling a civil
fraud lawsuit for faking at least 1,400 of 6,500 job placements under a
$22.2 million federally funded contract with New York City a year ago.
Additionally, investigative journalist James O'Keefe and his Project
Veritas team have caught Obamacare navigators on tape advising health
insurance exchange customers to under-report their income and lie about
their health status in order to cheat the system.
CMS has made no effort to repeal its cost-shifting rule or to do
anything to address the concerns of providers who will be left holding
the bag. As one hospital rep told me: "It's potentially catastrophic."
Private practices are already being hit hard with slashed
reimbursements, the electronic medical records mandate, ICD-10 medical
diagnostic code changes, and increasing federal intrusions on how they
provide care. In yet another entry on the laundry list of Obamacare's
unintended consequences, this regulation will hurt patients by
dissuading doctors from participating in exchange plans.
In short: less choice, higher prices, increased potential for fraud,
more bureaucratic headaches and more disincentives to enter or stay in
the medical profession. When the government grants "grace," everyone
must watch their wallets. It's always easy to afford compassion when
someone else is paying for it.