Obamacare Provision Allows Treatment Without Payment

Thursday, 24 Apr 2014 01:31 PM

By Melissa Clyne

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Doctors and hospitals, not patients, will be on the hook for people who don’t pay their Obamacare insurance premiums, Fox News reported.

Obamacare allows for a 90-day grace period for subsidized health exchange plans, but the insurance companies are only obligated to cover the first 30 days. Patients can get two more months of medical care without paying for it.

"The insurance company doesn't pay, you don't pay, who pays? said John Goodman of the National Center for Policy Analysis, according to Fox News. "Well, the doctors and the hospitals have to eat it. That's a very strange feature of this new health reform."

The American Medical Association addresses the conundrum on its website, recommending doctors "take steps to minimize any potential non-payments from health insurers that are due to cancellation of coverage at the end of the grace period."

The AMA has sent doctors a sample letter notifying patients of their financial obligation in the event they lose their coverage for non-payment of a premium.

The loophole could cripple doctors and hospitals, who are already cutting fees to participate in Obamacare plans, Scott Gottlieb of the American Enterprise Institute told Fox.

"They're used to absorbing a certain amount of bad debt, but for a lot of individual doctors – they're not going to be able to absorb these costs so they're going to be really stuck," he said.

Some experts have voiced concern that doctors who know they may not get paid could withhold treatment or demand payment upfront, according to Kaiser Health News. The latter is a breach of doctors’ contracts with insurers.

Brian Haile, a senior vice president for health policy at Jackson Hewitt Tax Service, told Kaiser that while doctors are business people who should be paid, "nine times out of ten the doctor is not going to provide the services – no matter what their network contract says.

Physician groups are seeking clarification from the Obama administration about when insurers must notify them about patients falling behind on premiums.

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