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Update: Can Hospitals Pay Patient Health Insurance Premiums?

A new legal advisory from the American Hospital Association takes the position that there is currently no federal authority to prevent hospitals from paying for patient insurance premiums on the health insurance exchanges. Nevertheless, the Centers for Medicare & Medicaid Services has expressed its concern about the practice, because it could skew the risk pool. CMS also is encouraging insurers to reject third-party payments.

Some hospitals may opt to provide patients with premium support through a hospital foundation or by donating to charitable organizations. The University of Wisconsin Hospital and Clinics, for example, announced a donation to United Way to assist low-income people purchase health plans on the state’s health exchange.

Not-for-profit hospitals are already  required to have a written policy establishing criteria for charitable assistance to patients. Criteria for premium subsidies could be incorporated into those plans.

Sources:

Legal advisory: HHS encourages insurers to reject hospital subsidies for patients in need. American Hospital Association, Nov. 13, 2013. http://www.aha.org/hospital-members/advocacy-issues/tools-resources/advisory/2013/131113-legislative-adv.pdf [AHA members only]

Clark C. AHA: hospitals can pay patients’ HIX premiums. HealthLeaders Media, Nov. 18, 2013. http://www.healthleadersmedia.com/print/HEP-298440/AHA-Hospitals-Can-Pay-Patients-HIX-Premiums

Third party payments of premiums for qualified health plans in the marketplaces. Centers for Medicare & Medicaid Services, Center for Consumer Information & Insurance Oversight, Nov. 4, 2013. http://www.cms.gov/CCIIO/Resources/Fact-Sheets-and-FAQs/Downloads/third-party-qa-11-04-2013.pdf

Sebelius K, Secretary of Health and Human Resources letter to J McDermott, US House of Representatives re: qualified health plans are not federal health care programs subject to federal anti-kickback law, Oct. 30, 2013. http://mcdermott.house.gov/images/The%20Honorable%20Jim%20McDermott.pdf

Kirchgaessner S. US hospitals look to provide insurance for poor patients. Financial Times, Nov. 18, 2013. http://www.ft.com/intl/cms/s/0/11ee6fba-4fd8-11e3-b06e-00144feabdc0.html [subscription or free registration required to view]

Earlier post: Can hospitals pay patients health insurance premiums?

Posted by AHA Resource Center (312) 422-2050, rc@aha.org

One Response

  1. […] what’s new since the last update on whether or not a hospital can pay the health insurance premium for a […]

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