Welcome to the Ethics Forum! The optometric profession has long recognized its ethical responsibilities to patients, colleagues, other health care professionals and the public. This forum provides an opportunity to review a hypothetical case study containing potential ethical challenges and includes suggestions on how one might handle the situation based upon the American Optometric Association Standards of Professional Conduct and Code of Ethics.

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Ethical dilemma:  Must copays be collected?

By Douglas L. Totten, O.D.   

Case Study #9

Sue has been seen twice in the last week after developing a dense corneal infiltrate due to over wearing her contact lenses. The eye is quieting after aggressive topical pharmaceutical treatment. She is in for this third visit but is still having some discomfort and feels the eye is, "75 percent better." You determine she needs to continue one of the medications you have prescribed for the inflammation to resolve and tell her you need to see her in one week to determine when she might be able to restart her contact lens wear (of course, with firm instructions as to the proper care and wear of her lenses).     

At the close of the encounter, she asks if there is a charge for the visit and if there will be another charge next week. She discloses that her major medical insurance coverage includes a $50 specialist copay for every office visit.   

You answer that there is a charge for the visit today and there will be one for any subsequent encounters. You know that her husband lost his job last year and can surmise that the family is having some financial trouble.  

She asks, point-blank, "Can you waive my copay for today and next week and just take what the insurance pays?"  

Discussion:

Out-of-pocket health care costs have been rising for patients. This is a growing concern as major medical health insurance plans continue to shift more of the cost burden to subscribers through deductible, co-insurance and copay amounts.1 Insurers are offering plans with greater cost-sharing with the goal, in part, to help reduce costs, including those associated with the overconsumption of services.2  

Patients are becoming more and more cost-sensitive about out-of-pocket costs for medical services; this has led to an era of broader price transparency for clinics and hospitals.3  

Sue's doctor of optometry has several acceptable options to appease the patient, but also follow the agreement that she signed when she became a participating provider for the health insurance plan involved in the case.  

1.       She can tell the patient, "No," and state that examinations require charging a fee, as the condition is not resolved and further care is necessary. The copays will apply for every visit when charges are billed to her insurance.  

This option is a straight-forward decision, as the doctor of optometry should be reimbursed for services rendered and the patient agreed to the terms of the insurance plan, including the copay amounts, when enrolling. The patient should be billed for the copays due and a payment plan could be arranged if Sue is unable to pay the balance. This option avoids any legal problems associated with waiving co-pays.  

2.        The doctor of optometry could waive the fees for the visit today and any necessary follow up.  

The copays could be a hardship for the patient and family. Both the Beneficence or "do good" section of our AOA Standards of Professional Conduct, along with the Code of Ethics, contain language directing that doctors of optometry should strive to ensure that all persons have access to eye, vision, and general health care, and this might include considering a patient's ability to pay for necessary care.  

Waiving the subsequent examination fees could be an appropriate response and satisfy the patient and participating provider agreement. Yet, should the doctor provide free services? This situation is sight-threatening and requires skillful care. The provider should be compensated for the level of care being provided. In addition, if Sue is covered by Medicare, the provision of free care could be viewed as a form of "kickback" to induce her to return later for services for which Medicare will be charged (see below for more information about Medicare anti-kickback rules). Referring Sue to a clinic that provides free care or that does not charge a copayment may be another solution.4  

3.       The doctor of optometry might schedule a phone call update with the patient, versus scheduling a follow up visit when the condition is very likely to have resolved.   

Although not an ideal option, a charge would not need to apply and the optometrist might be able to make a fairly well-informed decision from the conversation to determine any next steps.   

4.       The insurance could be billed and the copays adjusted or waived as Sue requested.   

This is an option with some commercial and governmental carriers and should be considered only in rare and extenuating circumstances, with close attention paid to documenting those circumstances in case the waiver is ever questioned. Read your participating provider agreements to know how each carrier handles this situation.  Medicare and Medicaid for example strictly prohibit offering any beneficiary remuneration that the person knows or should know is likely to influence the beneficiary's selection of a particular provider, practitioner, or supplier of governmental programs. However, an U.S. Department of Health and Human Services (HHS) Office of Inspector General bulletin states that there can be rare exceptions to the definition of remuneration, which may not implicate Anti-Kickback Statutes. It states, "Non-routine, unadvertised waivers of copayments or deductible amounts based on individualized determinations of financial need or exhaustion of reasonable collection efforts can be allowed."5  

Another HHS publication Avoiding Medicare and Medicaid Fraud and Abuse reinforces this position noting, "You are free to waive a copayment if you make an individual determination that the patient cannot afford to pay or if your reasonable collection efforts fail.  It is also legal to provide free or discounted services to uninsured people."6 However, there is no "safe harbor" method of waiving co-pays in Medicare, so every waiver will be viewed as a potentially illegal kickback. A provider must be prepared to demonstrate that it was not a kickback, or risk losing the ability to treat Medicare patients and be at risk for other penalties.  This makes the "individual determinations of financial need" required by HHS extremely important. It means asking about-and documenting-the patient's financial situation to make sure the waiver is justified and to generate reliable documentation to satisfy any future audit requests from HHS. For an example of how to do this correctly, review the patient application forms for a charity care referral program such as Vision USA http://www.aoafoundation.org/vision-usa/ (see Vision USA Application Worksheet). Becoming a participating provider for a charity care referral agency and referring patients to the agency for vetting and documentation of financial hardship may be a good option for providers (though note that Vision USA is intended for patients without insurance, so would not be able to provide a referral in this particular instance).  

Attorney Marc Cohen of the law firm Baker Donelson summarizes the concept clearly in a published article, "So, providers can, under certain circumstances waive or discount patient co-payments. But remember, from a legal standpoint, routinely offering discounts to patients is a risky venture. It can implicate various state and federal laws, and can attract the scrutiny of government investigators. Mr. Cohen goes on to say that, "(W)hen in doubt, consult with your attorney to be sure that your arrangements comply with all applicable state and federal laws."7  

Conclusion

The doctor of optometry in this case should consider the financial implications for the patient, but also the administrative burden and risk to the provider associated with the waiver of copays. It is appropriate for the provider and patient to have a discussion about potential fees and give consideration to the patient's ability to pay. Providers should explicitly ask about financial concerns. Doing so allows the physician to take into account the ramifications for the individual, while considering alternative approaches to patient treatment.4 The delivery and type of care, or the method of billing, may possibly be adjusted to help work around any financial challenges for the patient.    

References

1. "2015 Employer Health Benefits Survey," The Henry J. Kaiser Family Foundation. Retrieved January 22, 2016 from http://kff.org/health-costs/report/2015-employer-health-benefits-survey  

2. Baicker, K. & Goldman, D. (2011). "Patient Cost-Sharing and Healthcare Spending Growth." Journal of Economic Perspectives, 25(2): 47-68.  

3. Infographic. September 26, 2014. Retrieved January 16, 2016 from https://www.advisory.com/research/financial-leadership-ouncil/resources/posters/recognizing-the-risk-of-price-sensitivity  

4. Brooks, C. Enforcing Patient Copays. MDVirtual Mentor. August 2011, Volume 13, Number 8: 534-538.

5. http://oig.hhs.gov/fraud/docs/alertsandbulletins/SABGiftsandInducements.pdf. August, 2002. Retrieved January 28, 2016.  

6. https://oig.hhs.gov/compliance/physician-education/index.asp. Retrieved February 10, 2017.  

7. Cohen, M. Health Care Providers May Waive Patients' Copayment Obligations, But.... Health Law Alert Newsletter. 2014: Issue 1. Retrieved January 28, 2016.  

About the author:  

Doug Totten is in private practice in Norton Shores, Michigan.