Subject: Grace period bill / SB 5340

Hi all,

Hope this finds everyone well. Wanted to draw your attention to this year’s grace period bill – SB 5340, again by Sen. Rivers – which will appear on tonight’s Senate intro sheet. I know I’ve discussed the bill with most of you, but the two main components are laid out below. And attached is our one-pager on the bill. I’ll let you all know when a hearing is scheduled.

· 2015 grace period legislation – Medicaid look-back and QHP criteria

o Builds off of the grace period legislation adopted in 2014 in two ways:

§ Medicaid retroactive coverage or “look-back”

· To date, over 8,600 Exchange enrollees have had their coverage terminated due to non-payment of premiums.

o We can assume that at least a portion of that population stopped making payments due to a “qualifying event” that may make them eligible for Medicaid (i.e. divorce, job loss).

· When an individual enrolls in Medicaid, he or she is asked if they have outstanding medical bills.

o If the individual indicates that they do, Medicaid grants them a three month retroactive coverage or “look-back” period.

o This allows the individual to work with Medicaid to reconcile claims incurred over the last three months by having providers re-bill them through Medicaid.

· SB 5340 requires the Exchange to conduct specific outreach to enrollees with the goal of making sure they are aware that they may be eligible for Medicaid (or an increased subsidy level in the Exchange).

o By maximizing utilization of the existing Medicaid look-back policy, we can ensure that for those patients who are Medicaid-eligible:

1. Physicians will receive reimbursement (albeit at Medicaid rates – rather than Exchange); and

2. Patients will be protected from being billed directly for claims incurred during the grace period.

· *We are aware that due to the fact that the Exchange will not be aggregating premiums, this requirement may more appropriately be made of QHPs in the future. We received mixed messages on that question, so elected to keep it a requirement of the Exchange for the time being.

§ QHP selection criteria

· Physicians have a moral, legal and ethical obligation to provide treatment to patients in Exchange grace periods. Insurance carriers are currently allowed to abdicate on their responsibility to provide reimbursement for those services provided in the last 60 days of the grace period, despite the fact that the patient has insurance coverage during that time.

· The federal rules surrounding the grace period set a floor for the standards of this consumer protection provision. Washington state can – and should – strengthen the provision by ensuring carriers are required to honor the duration of their contract with a patient – including the full 90-day grace period.

· SB 5340 requires that for a health plan to be offered inside the Exchange, it would have to provide reimbursement for all claims incurred throughout the duration of the contract with a patient.

Thanks and please feel free to let me know if you have questions, or if there is additional information I can provide.

Sean Graham
Associate Director of Policy and Political Affairs
Washington State Medical Association (WSMA)
Cell: (360) 259-4184

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