Insurers Say Hospitals Not Playing Fair When It Comes to Paying for Obamacare Premiums

CMS is considering new rules for third-party payment plans after the lobbying association for insurers argued that such programs place an unfair burden on health plans. In a letter sent to acting CMS Administrator Andy Slavitt on September 22, America’s Health Insurance Plans (AHIP) used kidney dialysis as an example, saying that one health plan saw its cost for those patients rise from $1.7 million in 2013 to $36.8 million in 2015. The number of patients who needed the procedure rose from 26 to 186.

“Similarly, for other plans, enrollment of individuals with ESRD [end-stage renal disease] has increased by 200-500% over a period of only one to three years,” states the letter, which was signed by Matthew Eyles, AHIP’s executive vice president for policy and regulatory affairs and Julie Miller, AHIP’s general counsel.

Hospitals are prohibited by law from offering premium assistance to patients, but that doesn’t apply to premium assistance programs funded directly or indirectly by hospitals and other providers. 

While recognizing the important roles played by organizations such as the Ryan White HIV/AIDS Program, AHIP says that the system is being abused. It points to “specific and widespread abuse of third-party payments by certain providers, institutions, and non-profit entities that are steering patients eligible for or receiving Medicare and/or Medicaid benefits into individual market plans (both on-and-off the Marketplace) for the primary purpose of obtaining higher reimbursement….”

Source: AHIP letter to CMS