AMA Issues Grace-period Guide to Assist Physicians
CHICAGO — The American Medical Assoc. (AMA) has announced new resources to guide physicians on navigating a little-known rule in the Affordable Care Act (ACA) that could pose a significant financial risk for medical practices. The rule, published by the Centers for Medicare & Medicaid Services (CMS), provides individuals who purchase subsidized coverage through the state insurance exchanges a 90-day grace period before their coverage is cancelled for non-payment.
Under the CMS rule, insurers in health exchanges are required to pay any claims incurred during the first 30 days of the grace period, but insurers are not required to pay claims incurred during the last 60 days for any patient whose coverage is terminated. Patients are considered to be covered for care during the entire grace period, but insurers are allowed to place all the claims during the last two-thirds of the period in a pending status and retroactively deny them when coverage is terminated at the end of the grace period.
“The grace-period rule imposes a risk for uncompensated care on physicians, so the AMA has created resources to help medical practices navigate the key aspects of the rule to minimize its potential negative impact,” said AMA President Dr. Ardis Dee Hoven. “Managing risk is typically a role for insurers, but the grace-period rule transfers two-thirds of that risk from the insurers to physicians and healthcare providers. The AMA is helping physicians take proactive steps to minimize these risks.”
Resources for navigating this change are available to physicians at www.ama-assn.org/go/
A key issue for physicians is having accurate information from health insurers regarding patients’ grace-period status. The AMA recently delivered a letter urging CMS to amend the grace-period rule to require insurers to notify physicians as soon as a patient falls behind on their premiums, rather than the current notification requirement that provides insurers with discretion as to when and how to notify physicians during the 90-day grace period.
