Now that even the extended deadline of the first open enrollment period for coverage through the Health Insurance Marketplace has passed, there is a window of opportunity to evaluate successes and failures of the first period and to prepare for the next. Given the rising cost of healthcare, those lacking insurance will be risking heavy expenses if they need medical treatment before the opening of the next enrollment period.
They could also end up paying penalties on their tax returns, which will progressively increase with each insurance-less year. The lack of insurance generally results in limited preventative care or proactive screening, which puts the uninsured at risk for more serious health conditions that go untreated for lengthy periods of time resulting in higher costs to treat once identified, poorer prognoses and even premature death.
The impact of the uninsured does not only impact the uninsured individual; the cost of health services to the uninsured effects the entire health system as a whole. Hospitals, in particular, absorb the majority of the cost of uncompensated care as generally the uninsured seek treatment in emergency rooms and efforts to fund the health system often result in cuts in hospital reimbursement.
The success of hospitals will be drastically impacted by how well they address this segment of their patient population. The introduction of the Affordable Care Act has brought change that can both benefit and impede hospitals’ revenue cycle strategies and goals. In several states there are now additional options available for hospitals and their self-pay patients. The key is understanding the changing landscape of healthcare and proactively taking advantage of opportunities as presented. It is very important that during this tumultuous time, hospitals have a partner that has the insight and capability to navigate the changing landscape.
What should hospitals do to prepare for the next open enrollment period?
• Reevaluate Financial Assistance Policy - Most hospitals have a financial assistance program in place with set criteria for providing charity care at no cost or reduced cost to patients that meet certain financial eligibility criteria. However, not all Financial Assistance policies are created equal. Some states actually subsidize charity care while in other states the patient balances are simply written off. Some hospitals offer such generous charity programs that patients are not encouraged to seek coverage options as required by the individual mandate of the ACA. Below are a few recommended features as a result of the ACA to include in a financial assistance policy:
1. Require cooperation with screening and application (if potentially eligible) for medical assistance
• Screening should include traditional coverage options such as Medicaid, Medicare, Disability, Crime Victims’ Compensation, and COBRA, as well as eligibility for health insurance marketplace subsidies such as the Advance Premium Tax Credit and Cost Sharing Reduction.
• Individuals who do not qualify for Medical Assistance or meet exemption criteria through the marketplace are good candidates to evaluate financially for financial assistance.
2. Limit spans of coverage for charity care to currently evaluated dates of service
• Coverage spans for 6 months to a year can guarantee free coverage to patients regardless of changes in their financial circumstances or changes in eligibility for other coverage options.
• Patients receive a false sense of security with extended charity care and may not see the need to avail themselves of options available as a result of the ACA.
3. Extend charity care to cover hospital pharmacy and clinics for 30 days
• Coverage of these areas reduces risk of readmission within 30 days
4. Leverage manufacturer and private programs for pharmaceutical replacement, discounts, and coverage.
5. Evaluate subsequent admissions for charity care patients as self-pay
• Charity care should not be viewed as an insurance coverage upon readmission. Each new admission should be screened for eligibility for Medical Assistance Programs
• Expand areas covered by Medical Assistance Eligibility Programs - Hospitals generally ensure coverage of inpatient admissions with medical assistance eligibility programs but the ACA has created opportunity to covert new populations that were not previous eligible. With CHIP and Medicaid available for year round enrollment, hospitals can rely on the assistance of Medical Assistance Eligibility experts to provide a full service program or to augment a hospital program. The ultimate goal is to maximize conversion and reimbursement as expeditiously as possible. Below are a few recommended areas to consider for expansion of a medical assistance program:
1. Emergency Department (ED) Services (not admitted)
• In states that have adopted Medicaid Expansion a much higher percentage of the uninsured ED patients are eligible for Medicaid
2. Outpatient and Clinic
• Converting patients to assistance programs while in clinic or outpatient settings can drastically reduce future costs and subsequent admissions would be covered.
• In as much as marketplace qualified health plans do not provide retroactive coverage it is beneficial to conduct screenings of particularly high cost services in advance of the services being provided.
• Elective procedures that may otherwise not be provided to uninsured patients could obtain coverage in advance.
4. Existing Charity Patients
• Given the changes in eligibility for medical assistance programs as a result of the ACA many patients that have previously been qualified for Charity are actually eligible for Medicaid or qualified health plans.
• Provide Education and Outreach - During the enrollment period, the effectiveness of onsite marketing for patients had a dramatic effect on patients that were already in facilities. Scheduling outreach and enrollment events through the hospitals for their patients in advance, being able to explain and educate consumers on these process, are ways of leveraging the hospital-patient relationships for maximum benefit.
Hospitals are now able to provide presumptive eligibility when online systems are not available to individuals who appear to meet the financial and categorical eligibility requirements for Medicaid. Most states are not proponents of this addition since presumptive eligibility is a federal requirement that is fully funded by the state. States don’t get the federal matching funds that they usually would for Medicaid, until the full Medicaid application and determination has been made.
If a hospital goes through a presumptive eligibility process, they must follow up with a full formal application for Medicaid. There is a misconception that this process makes it easier on hospitals. Hospitals presume the individual is eligible, therefore billing the claim, thinking it will get them reimbursed immediately. However, this prolongs the reimbursement process for hospitals.
The state looks at what percentage of individuals a hospital actually places in these applications for presumptive eligibility, then they look at what percentage of those individuals actually get benefits. If a certain percentage of patients do not meet certain requirements, which in some states are very rigid, the hospital may lose its capability to take advantage of presumptive eligibility.
What presumptive eligibility actually does is speed up the initial process of obtaining the Medicaid determination, but hospitals don’t really see the impact because of the rigorous process. This is more effective on an as needed basis, or in certain emergency cases, and should not be a standard practice.
Ultimately, presumptive eligibility has an adverse impact to the state because they want to get the federal matching funds they are used to receiving. In states where they don’t have Medicaid expansion, presumptive eligibility only applies to medical categories that are already expedited, i.e. children, pregnancies, etc. Presumptive eligibility services benefit patients who are undergoing surgery or taking advantage of other specialized hospital services.
How can hospitals be more prepared to help patients during the next enrollment period?
Getting that material in front of the hospital’s patients on site allows you to take advantage of a more captive audience. There is value in the convenience of presenting this information to uninsured patients in the hospital rooms by having representatives on site that can assist with these processes.
DECO has the capability to allow a more even-flow for these rigorous processes and can help hospitals maximize their efforts for self-pay patients that have missed the enrollment period. Find out more about the services we offer and how DECO can assist your facility in managing these specialized processes.