While one of my primary concerns here at The Strategic Chiropractor is helping you get paid for the work that you do, a frequent question we get at our seminars and via email is in regards to giving away care. Frequently, chiropractors want to know how if or how they can give services away for free AND keep compliant.
While the rules regarding your chiropractic fees and what you give away for free seldom shift, there is a rare change issued by Medicare that is effective January 6, 2017 that affects this very topic of how much care chiropractors can give away.
As with many things in the healthcare marketplace, Medicare has something to say about what you can and cannot give away in regards to your chiropractic services. Essentially Medicare’s “anti-kickback” rules largely prevent you from trying to persuade new patients from coming to your office by enticing the with free or deeply discounted care.
The situation is basically the same with regular insurance payers as well. If you are contracted with a payer, your contract requires you to charge for all services rendered. And most, if not all, states have laws which prohibited “inflated” fees which charge one fee to your “regular” self-paying or cash patients and another to those with insurance coverage.
Yet, despite these rules across the board, there are times where exceptions are permitted.
When Fees Can Be Discounted
Generally speaking, the one exception to the fee discounting rules that is universally permitted is in terms of a “financial hardship.” Even most insurance payers have a clause in their provider contract that permits reducing or waiving co-pays, co-insurance and patient portions in the cases of a financial hardship.
That said, financial hardship is not something that you get to arbitrarily define and your criteria for determining a hardship must be solid or follow set guidelines. For example, you would not be able to state that a co-pay is a financial hardship for every patient as that’s a condition of your provider agreement (and a statement that is difficult to prove true). On the other hand, a financial hardship policy that uses Federal Poverty guidelines as part of the criteria for establishing financial hardship may be considered legitimate.
Creating a Solid Financial Hardship Policy
Although there is no universally accepted definition of what constitutes a financial hardship, here are three criteria that appear in most payer policies and regulatory publications regarding what can be used to establish hardship:
1. Defined Hardship – the first component is that your hardship policy needs to reference existing guidelines that define hardship (such as state or federal poverty guidelines) or some similar publicly acknowledged tool that establishes a set of criteria for what represents a case of hardship.
2. Written Criteria – the second element a good hardship policy has is that it is in writing. The very act of putting your hardship policy in writing will help you from randomly offering it to whomever you please at the time, which will certainly spell trouble.
3. Temporary Time Limit – the third important ingredient is that all hardship policies should be established for a temporary period of time. Remember the purpose of the hardship agreement is to enable a patient to access your care, despite a time of financial need where they cannot afford your normal fees. For example, a person who starts care and loses their employment, may make a good candidate for hardship criteria. But obviously, you would want to define this for a limited time period so that when they get a job in the future, you don’t have them on an endless hardship agreement for which they may no longer meet the criteria.
4. Defined Benefits – the final element of a solid hardship agreement is that you define exactly what the benefits of the agreement are. For example, if your hardship criteria is to provide a waiver of co-pays or co-insurance amounts, then state that. If it’s a 50% reduction in your fees, then state that.
Medicare’s New FREE Fee Rule
When it comes to giving care away for free, the best policy is to tread carefully. Every payer (and your state board) certainly frowns on you billing insurance for an exam or other services that you routinely give away to “cash” patients.
And though Medicare is no exception to opposing giving away free care or free stuff, they actually have a written policy regulating exactly how much you can give away and under what circumstances.
In fact, it took nearly two years for the Office of Inspector General (OIG), which is essentially Medicare’s auditing arm, to make amendments updating their “anti-kickback” rules. Put simply: the anti-kickback statutes are the specific Medicare guidelines that prevent or make difficult the giving away of services for free or at a deep discount. But healthcare has changed so much in the wake of the Affordable Health Care Act, technology and a billion other ways, that the OIG has been hard at work trying to update their policies to reflect the current environment.
The resulting final rule created a few changes to the Anti-Kickback Statute (AKS) regulatory safe harbors and adds protections for certain payment practices and business arrangements under the beneficiary inducement provisions of the Civil Monetary Penalty Law (CMP). Clocking in at nearly 90,000 pages long (no joke!), here’s a VERY brief summary of the relevant rules application to chiropractors.
How to Give Away Care for FREE to Medicare Patients AND Stay Compliant
In short, there’s no easy route to giving away your services and steering clear of trouble with Medicare beneficiaries. The feds are quite picky about anything that may “induce” or “entice” patients to utilize your care, particularly new patients.
Apparently, every healthcare entity has thought of creative ways of trying to discount their services, some of which are considered lower risk or higher risk than others. As published in the latest Federal Rule, the OIG weighed in on ideas such as providing free transportation for patients, how far you can transport a patient, if and when you can give away movie tickets, prizes, fee discounts for both new and established patients – pretty much everything you can imagine and quite a few scenarios which are highly unlikely to ever occur in a chiropractic setting.
Attempting to creatively navigate these waters so you can give a bunch of care away is a feat few lawyers could probably achieve and one that I would recommend for even fewer chiropractors. But there was one single, clear paragraph that stood out amongst the 90,000 pages of fee nonsense that could easily be obeyed by all of us in chiropractic. Here it is:
Items of Nominal Value That Chiropractors CAN Give Away
The OIG provided one succinct statement regarding what you can give away:
“Items of nominal value do not require an exception”
In other words, in a sea of attempts to clarify what procedures may qualify for an exception to the anti-kickback statutes (and be given away without a compliance violation) and what items don’t, Medicare cut to the chase and stated that certain items (of nominal value) don’t even require an exception. Yes, these items can be given away!
Now, before you get too excited, the OIG even defined these items and gave them limits. (But the good news is that they raise the limits from the previous ruling dating back to 2002). Here’s what they said:
The NEW Rule Going into Effect January 6, 2017
In the 2002 Special Advisory Bulletin, inexpensive gifts (other than cash or cash equivalents) of no more than $10 in value individually or $50 in value in the aggregate annually per patient were permitted.
“Concurrently with the issuance of this final rule, we are announcing an increase in these limits, based on inflation, to $15 for an individual gift and $75 in value in the aggregate annually per patient.”
Essentially what this means is that you can give away “inexpensive” gifts of $15 or less to a patient. And you can do that no more than 5x per year ($75 annually). That’s it. For those who want to read the rule for yourself, you can see it here and you will want to head to page 88,394 (unfortunately, not kidding!).
Unfortunately, this ruling pretty much rains on the parade of many discounted services that doctors may wish to offer. If your free exams, free consults or free adjustments are worth more than $15 (what you would normally charge) then, it’s obviously exceeds these limits. The “senior discounts” you give on services or products you render bear the same potential for trouble.
But it’s clear that Medicare is absolutely against most variations of the free and discounted theme.
What to Do Next
When you see how narrowly defined the rules are for giving away services and reducing fees, it’s essential to create solid policies for keeping your office compliant.
There’s a tiny bit of wiggle room for what you can give away ($15 per incident, $75 per year, per patient to be exact) and for how you can discount fees (for a legitimate hardship), but not much more than that.
So, the best defense here is a non-creative offense. Document your hardship policy and keep within the boundaries of giving away services.
That’s the rules (new and old). Hope this helps you play by them. It’s the smarter thing to do!
How to Make Progress in the Wake of New Policies!
One final consideration. While all these new Medicare rules, payer policies and other obstacles that form against our business probably negate the idea of a “perfect” practice environment, the good news is that progress (not perfection) is possible! That’s what our latest ChiroProgress SEMINAR is all about — tuning your practice for more progress – which means BETTER Medicare, BETTER Insurance and BETTER Business! Because our last date sold out, we’ve added another, click the links for more details and register now!