Nov. 6—Hospitals should not help their patients pay for health insurance sold on the new marketplaces—counter to recent indications from federal officials—according to new guidance from the Centers for Medicare & Medicaid Services (CMS).

CMS issued guidance this week that raised concerns over the possibility that hospitals or other healthcare entities could help their patients pay premiums or cost-sharing components of insurance sold through the new public insurance marketplaces, also known as exchanges, created by the Affordable Care Act. The agency stopped short of saying the practice was illegal, but discouraged this practice and urged insurers to reject it as well.

“[The U.S. Department of Health and Human Services] has significant concerns with this practice because it could skew the insurance risk pool and create an unlevel field in the marketplaces,” the guidance stated.

Additionally, CMS said it would monitor whether any provider cost-sharing occurs and “take appropriate action, if necessary.” 

The guidance followed a recent communication that appeared to clear a legal obstacle to hospitals covering the insurance costs of their disadvantaged patients.

U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius stated in a letter to Rep.  Jim McDermott (D-Wash.) that the federal anti-kickback statute barring assistance to patients covered by federal health programs did not apply to those with coverage from private plans sold under the marketplaces. 

McDermott had asked HHS about the issue due to concerns that the federal anti-kickback statute could bar those plans from “offering assistance with premiums to persons who are unable to afford their premiums on the exchanges,” according to a statement from his office. 

Hospital advocates saw the opinion as potentially allowing those providers to give financial assistance to patients struggling to afford marketplace insurance premiums or cost-sharing. The tactic to help more patients obtain coverage was a potentially significant one for hospitals with large uncompensated care populations who are unable to afford the coverage.

Publication Date: Wednesday, November 06, 2013