The Texas Department of Insurance (TDI) has updated its FAQs for Health Carriers to include information about the federal 90-day grace period granted to patients with subsidized Affordable Care Act health insurance marketplace coverage and about prompt payment of claims.
ACA marketplace regulations give patients with subsidized health insurance coverage three months to pay their premiums. They also allow health plans to deny or later recoup payments from doctors for services provided to patients who are 31 to 90 days delinquent. The patients must at least have paid their first month's premium to be eligible for that 90-day grace period.
A marketplace patient's failure to make a premium payment triggers the so-called "90-day grace period." Health plans must give the patient 90 days to catch up. Insurers must pay physicians for services provided in the first 30 days of the grace period.
Federal rules, however, allow health plans to pay, hold, deny, or later recoup claims payments for services incurred in the second or third month of that window if patients remain delinquent on premium payments. TMA officials say health plans must comply with Texas' prompt pay law for claims submitted at any point in the grace period.
TDI's FAQs on prompt payment state that "Texas’ requirements (TIC Chapter 1301, Subchapter C) related to the prompt payment of claims do not allow issuers to 'pend' claims as suggested under federal rules. Thus, issuers will generally be expected to pay claims received during months 2 and 3 of the grace period in a timely manner."
TDI goes on to explain that "if the grace period expires, an issuer may recoup claims paid during months 2 and 3 as an overpayment under §1301.132 of the Insurance Code. Issuers may also pay claims during months 2 and 3 subject to audit, consistent with §1301.105 of the Code, which requires the issuer to clearly note that the claim is being paid subject to audit."
Federal regulations require exchange plans to notify affected physicians "as soon as is practicable when an enrollee enters the grace period, since the risk and burden are greatest on the provider." Notification includes where the enrollee is in the grace period and the names of everyone covered by the policy. The notice must tell doctors the health plan may ultimately deny payment.
In TDI's FAQs, the department clarifies that while "Texas law does not reference the federal grace period, … TDI anticipates that, if an issuer receives an eligibility inquiry during months 2 and 3 of the grace period, the issuer will provide the federally required notice to the requesting provider as part of its eligibility response."
The Centers for Medicare & Medicaid Services says federal rules don't specify when or how insurers have to send the notification. TMA officials caution that health plans' practices will vary.
For more on the ACA health insurance marketplace and the 90-day grace period, read “The ACA Marketplace” in the April 2014 issue of Texas Medicine. Also, check out TMA's ACA Exchange Plans Questions and Answers for Texas Physicians (for TMA members only).
Action, Sept. 15, 2014