To help out their patients burdened by healthcare costs, providers may on occasion consider not collecting copayments and deductibles. The patient may claim financial distress. Or the amount may not seem worth pursuing, although $20 or more per patient quickly adds up over the course of a year. Routinely waiving copays, however, makes you vulnerable to charges under the federal False Claims Act, as well as the federal antikickback law and similar state laws. And you risk fines of up to $25,000 and possible exclusion from federal insurance programs for violating the federal antikickback law alone.
Except in limited circumstances, Medicare and Medicaid don’t allow such waivers and demand that providers collect those amounts from patients. Routinely waiving them can be interpreted as program abuse. Why? Because a claim to government programs for patients in which a copayment or deductible was waived is misrepresenting the true charge for service. And there’s more. Rather than being perceived as the kindhearted person that you are, not collecting these payments can make it appear as if you are trying to attract patients by offering something of value, and consequently generating Medicaid or Medicare payments – a violation of the antikickback law.
If the patient has private insurance, you could be giving the patient’s insurer an opening to escape paying its share of your bill. For example, assume there is a $100 total charge where the patient has an 80/20 plan. If the provider waives the patient’s obligation to pay 20%, then, again arguably, the commercial plan owes only 80% of $80.
Be especially wary of copays. The rules of managed care are federally mandated and clearly state that the patient cannot see the doctor until they make their copayment. Many providers will recognize this clause in their contracts with insurance companies. Health insurance (including commerical) is also governed by a set of federal laws that fall under ERISA (The Employee Retirement Income Security Act). Commercial insurers can claim that the doctor interfered with their contracts with employers/individuals and some insurance companies have been aggressively fighting back on this front, including using the courts. Therefore, the safest course is simply to avoid granting copay waivers. If a patient has a true well-defined financial hardship, document the situation and in isolated, worthy cases, there is the option of reducing a deductible.
Ultimately, regardless of how onerous or convoluted insurance plans are, the responsibility for these payments rests with the patient as conceptually, they have entered into a ‘cost sharing’ arrangement with the company or organization that is providing their healthcare coverage.
Failure to collect copayments or deductibles for a specific group of Medicare patients
AAFP: Anti-kickback & Stark Compliance
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