DO YOU NEED A FINANCIAL HARDSHIP POLICY IN YOUR FEE SYSTEM?
Kathy Mills Chang
MCS-P, CCPC, CCCA
Anyone who hasn’t been living under a rock has noticed the quantum shift occurring in the healthcare industry over the last several years. As the economy struggles, we have seen deductibles creep higher, covered services become more limited, and the sheer number of uninsured patients has grown by leaps and bounds.
A quickly growing number of cash-paying patients now visit chiropractic offices throughout the country on a daily basis. I hear many practitioners sing the praises of being able to avoid insurance work with a greater number of cash-paying patients. However, 100 percent of the practices paying cash are the very small majority of chiropractic offices. For some doctors who have been used to living in the insurance world, this increase in uninsured or underinsured patients has created a financial crisis.
One of the major issues being addressed relates to discounting fees for these uninsured and underinsured patients without running afoul of
“The lack of insurance or the lack of a desire to pay the practice’s fee is not financial hardship. ”
the law. Some doctors think that the easy way to do this is to simply have these patients sign a hardship agreement. After all, if they don't have insurance, they must have a financial hardship, right? This is absolutely not the case. Specific rules and regulations have been set forth for legal ways to identify financial hardship. A certain percentage of your patients will absolutely meet these guidelines and should receive relief in your office if you choose to offer financial hardships. However, many providers are tempted to discount or entirely waive the patient due portion of copayments and deductibles. Without a clear understanding of the rules and regulations, you could torpedo your practice. Let's review what must be in place in order to offer legal, financial
hardship agreements in your practice.
What Is True Financial Hardship?
The lack of insurance or the lack of a desire to pay the practice’s fee is not financial hardship. Great news is, you get to decide what is hardship in your office, based on the way you set up your policy. You may determine what qualifies, within reason, for your office. Your policy reflects what you deem hardship and how you will verify that hardship. Some provider contracts may allow for financial hardship. Don’t offer a discount on copayments or deductibles without verification from the carrier or by your contract that it’s allowed. If you’re not sure, contact them for the policy. Then, immediately document this in your Compliance Policy and Procedure manual as your policy, and stick to it!
Setting Up Your Office Guidel ries
When deciding if a sliding fee schedule or hardship agreement is appropriate for your practice, you should take into consideration the following details:
• Your policy must be in writing and nondiscriminatory.
• Post signage to ensure that patients are aware of availability of discounted/sliding fee.
• Patients must request hardship consideration and it should be for a finite period.
• Document fees in your accounting software just like you would with any fees. Show the actual fee, then the write off reflecting the discount.
• Use the Federal Poverty Guidelines or your state guidelines as your gauge. Patients at or below poverty can be charged a nominal fee or not charged at all. But you must set the scale and stick to it.
• Providers may establish any number of incremental percentages (discount pay classes) as they find appropriate between 100-200 percent of poverty.
• Some guidelines indicate that patients above 200 percent of poverty may be charged the full fee for the service(s). We recommend
that the high end of your sliding scale correspond with your Discount Medical Plan Organization (DMPO) fee schedule. Use a program like ChiroHealthUSA, and then your discounted fee schedule can be the top end of your hardship sliding scale.
Verify Eligibility
You must verify eligibility and not just assume that someone who is uninsured or underinsured will qualify for your sliding fee schedule or hardship agreement. If a patient indicates a need for hardship consideration, verify the eligibility according to the guidelines. You are allowed to accept the patient’s word at the time the request is made. But, on future visits, it is appropriate to require some form of verification. Verification doesn’t have to resemble a colonoscopy. But it is required to verify that the patient qualifies for your policy.
Certification and Attestation
The last step in this process is to have a certification form and application for the patient to sign. This is important as it will document the patient’s need, and show where they fall in your sliding scale. This will allow them to attest to the fact that they need the assistance to pay for the care, while keeping your office compliant.
Don’t sully the waters of your compliant fee schedule system with a non-compliant hardship agreement. If your office is armed with your prevailing fee schedule, insurance contracted fee schedules you’ve agreed to, your legally discounted fee schedule using a network like ChiroHealthUSA, and a hardship or sliding fee schedule, you’re ready to take on any patient who comes in the door!
Kathy Mills Chang is a Certified Medical Compliance Specialist (MCS-P). Certified Chiropractic Professional Coder (CCPC), anc^ Certified Clinical Chiropractic Assistant (CCCA). Since 1983, she has been providing chiropractors with reimbursement and compliance training, advice, and tools to improve the financial performance of their practices. Kathy leads a team of 30 at KMC University and is known as one of our profession’s foremost experts on Medicare, documentation and CA development. She or any of her team members can be reached at (855) 832-6562 or [email protected]
