by Wyn Staheli, Director of Research
July 12th, 2018
It is important to keep in mind that Medicaid is run at a state level so there can be some differences when it comes to coverage. However, the rules regarding balance billing of covered services is set at the federal level. The law states (emphasis added):
A state plan must provide that the Medicaid agency must limit participation in the Medicaid program to providers who accept, as payment in full, the amounts paid by the agency plus any deductible, coinsurance or copayment required by the plan to be paid by the individual. - 42 CFR § 447.15 Acceptance of State payment as payment in full
According to this law (above), the only amounts you could collect from the patient for covered services, are the Medicare allowed deductible, coinsurance, and/or copayment. However, according to Medi-Cal’s Provider guidelines, you cannot do that. It states “Providers must not bill the recipient for private insurance cost-sharing amounts such as deductibles, coinsurance or copayments…” Bottom line: you must carefully review your state law. Balance billing covered charges is always illegal.
Another important thing to check is whether or not the patient is enrolled in the Qualified Medicare Beneficiary (QMB) program. This is critical because if they are, it is illegal to bill them for any cost sharing (i.e., co-pays, deductibles, or co-insurance) on covered charges. You may bill Medicaid for these costs, but coverage is determined at the state level. Even if you are not enrolled as a Medicaid provider, you cannot bill the patient for these amounts. CMS recently released a MLN Matters (SE1128) on this subject because it is such a problem. CLICK HERE to learn more about the QMB program.
So the next question is, what do you do about noncovered charges?
When services are not covered by Medicaid (e.g., they exceed frequency limitations, considered experimental), a healthcare provider is allowed to enter into a written agreement with the patient where the patient agrees to pay out-of-pocket for the services. This written agreement is like the ABN for Medicare noncovered services. It must be completed on a Medicaid-approved form (click here to see Montana’s form), and be signed and dated by both the provider and patient BEFORE services are provided. Utah’s agreement is called “AGREEMENT OF FINANCIAL RESPONSIBILITY- MEDICAID” and Montana’s is called “CUSTOM AGREEMENT FOR MEDICAID NON-COVERED SERVICES.” Just do an internet search on “medicaid non covered services waiver form” and include your state and you should be able to find yours.
Be aware that states can have additional requirements regarding noncovered services. For example, according to the Utah Medicaid Provider Manual, you may bill the patient for noncovered services only when all of the following limited circumstances are met:
- The provider has an established policy for billing all patients for services not covered by a third party. (The charge cannot be billed only to Medicaid patients.)
- The patient is advised prior to receiving a non-covered service that Medicaid will not pay for the service.
- The patient agrees to be personally responsible for the payment.
- The agreement is made in writing between the provider and the patient, which details the service and the amount to be paid by the patient.
Regardless of the state in which you reside, healthcare providers are required to let their patients know when a service is not covered by Medicaid BEFORE providing that service. Look up “non-covered services” in your state Medicaid provider manual to make sure you have all your bases covered.