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Reminder: Exchange patients, eligibility and the 90-day grace period



February 01, 2018
Area(s) of Interest: Health Care Reform Practice Management 

Practices are reminded that under the Affordable Care Act, exchange enrollees who receive federal premium subsidies (approximately 90 percent of enrollees) to help pay their premiums are entitled to keep their insurance for three months after they have stopped paying their premiums. In the first month of the grace period, federal law and California regulations require plans to pay for services incurred even if the patient fails to pay the premiums due by day 90 (CCR §1300.65.2(b)(1)(A)). But in months two and three of the grace period, plans can “suspend” coverage and pend or deny claims if the patient doesn’t true up on his or her premiums by day 90.


In 2014, CMA was successful in advocating that plans be required to clearly communicate to practices through their real-time eligibility and verification systems if an enrollee’s coverage is suspended during the second and third months of the grace period. Further, the regulation requires plans to reflect “suspended” coverage on day one of the second month of the grace period, and requires plans to use one of three eligibility status indicators to reflect suspended coverage – “coverage pending,” “coverage suspended” or “inactive pending investigation” (CCR §1300.65.2(b)(C)).


If a plan fails to reflect suspended coverage using one of the above indicators on day one of the second month of the grace period, and a physician provides services to a subsidized enrollee, the plan is financially responsible for the claims incurred (CCR §1300.65.2(d)(5)). However, practices must be able to prove that the plan did not comply with the regulation.


For this reason, it is extremely important that practices verify eligibility on all exchange patients, ideally on the date of service, or as near the time of service as possible, and that the practices retain a printout of the eligibility verification and includes it as part of the patient’s chart. If a patient's eligibility verification comes back indicating his or her coverage is suspended, the practice can treat the situation as it would any other patient who has had a lapse in coverage. For non-emergency services, patients may be given the option to either pay cash at the time of service or reschedule to a later date. 


Further, California regulations require the plan to notify any provider with an outstanding prior authorization if the patient is in months two or three of the grace period (28 CCR §1300.65.2 (d)(2)).


If the plan fails to comply with the notice requirement and the services are provided in good faith, pursuant to the authorization, the plan is responsible for paying the authorized claim(s) (28 CCR §1300.65.2 (d)(5)).


For more information, visit CMA's Exchange Resource Center. In the resource center, you can download CMA's Surviving Covered California tip sheets as well as a number of other CMA exchange resources. CMA members and their staff also have FREE access to our reimbursement helpline at (888) 401-5911 or economicservices@cmadocs.org.

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