Practice Management Alert

If you don-t, your practice could face litigation and payer problems No doubt some of your patients are going to fall upon hard financial times, but before you waive a copayment or offer a discount make sure you aren't setting your practice up for major legal problems. The problem: Routinely waiving deductibles and copayments can violate several federal laws and regulations, including the federal False Claims Act, anti-kickback statutes and compliance guidelines for individual and small group physician practices. It may also violate payer contracts and could result in your removal from a health plan's provider panel. Good news: If you can prove -- or more accurately, if the patient can prove to you -- that he is suffering financial hardship, you may be able to offer him some payment assistance. Don't Just Take the Patient's Word When it comes to financial hardship and making fee concessions, you cannot rely solely on the patient's statement that he is having financial problems. You need to get proof. Here's how: In assessing whether a patient qualifies for a financial hardship discount, you should ask the patient for proof of the following, says Barbara Colburn, president and CEO of Total Health Care Solutions in Ocala, Fla.: - Gross monthly household income, including salary and wages and any court-ordered payments; - Other income, including dividends, interest, payments from property rental, support from family members, pensions, Social Security benefits, veteran benefits, unemployment compensation, trusts and gifts; - Assets, including cash, all bank accounts, stocks, bonds, real estate equity and equity in personal property, such as cars and boats; and - Essential monthly household expenditures, such as mortgage/rent, utilities, insurance and food. - Number of dependents in the household (include the patient). Request copies of the patient's income-tax returns and W-2 and 1099 forms as proof of income to determine whether the patient's earnings meet state and federal poverty guidelines, Colburn adds. Caution: Just because the patient has a lot of credit card and loan debts does not mean he qualifies for financial hardship discounts. You should not count non-essential or "luxury" items when determining financial hardship. Simply look at the amount the patient earns and subtract the amount he needs to live, and then you can determine whether the patient can afford to pay your bill. "Basically, we look at how much the patient makes, how much their debt is, then compare that with the poverty guidelines, and if they have much (a subjective number) left over, then we bill them up to half of what they owe," explains Robin Yazell, CPC, billing supervisor at Cardiology, P.C. in Syracuse, NY. "If they are at or below the poverty level, we will usually write the balance [...]