How high copays impact your practice

August 24, 2017
Physicians sometimes struggle with how to collect the appropriate payment amount from the patient.

Ask the Coding Experts, by Doug Morrow, O.D., Harvey Richman, O.D., Rebecca Wartman, O.D. Excerpted from page 44 of the July/August 2017 edition of AOA Focus.

As doctors, we know that the health care insurance landscape has been changing for some time, and in many cases patients are paying increasingly more out of pocket for health care costs. The Kaiser Family Foundation found that the average deductible for people with employer-provided health coverage rose from $303 to $1,077 between 2006 and 2015.

In addition to patient deductibles, patients also are responsible for their copayments at each visit, and nearly 68% of patients with employer-sponsored health insurance have a copayment requirement.

Copayment levels can widely vary. For plans sold on the marketplace, copayments can range from $30-$60. Some patients may have even higher copayment requirements.

For patients with very high copayments, doctors may experience occasions when the fees for the services provided to the patient are actually less than the copayment amount. For example, if a patient returns for follow-up care and monitoring and you perform an OCT (CPT 92134), the fee for this service in some areas of the country may be as low as $39.89, according to the Medicare Physician Fee Schedule.

In these situations, many physicians struggle with how to collect the appropriate payment amount from the patient. Typically, insurance companies will require that the copayment be collected in full regardless of the fees associated with the services provided. However, you may verify with the patient's insurance company to determine your contractual obligation to collect the full copayment amount, if concerned.

For your Medicare patients, it is even more critical that copayments be collected for every patient. The Office of the Inspector General (OIG) issued guidance several years ago on the routine waiver of copayments and found that this practice raises significant concerns. The OIG indicated that waiving Medicare copayments could be interpreted as the physician misrepresenting his or her charges for services. If a physician indicates that his or her charge for a service is $100, but the physician waives the Medicare copayment, the actual charge is $80. If the true charge of the service is $80, the OIG has indicated that Medicare should actually be reimbursing 80% of that amount, rather than 80% of $100.

The OIG also cautioned against waiving copayments because that action could be construed as a violation of the Medicare and Medicaid anti-kickback statute [42 U.S.C. 1320a-7b(b)]. If a physician waives a copayment for a patient, the physician may be inducing that patient to purchase items or services from the doctor. It would be allowable to waive a copayment in cases in which the patient has true financial hardship, but this should not be routine; doctors should have specific policies in place for waiving copayments due to financial hardship, and the reasons for a copayment waiver should be appropriately documented in the case of an audit or inquiry.

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