Many treatment centers in California treatment have gotten the disturbing notification that Health Net will suspend payment to them until while they investigate fraudulent practices. These practices center around a few different areas but notably:
- unethical payments for referrals
- not charging co-pay amounts to patients and
- paying the insurance premiums for the patient (or setting up the insurance policy itself for the patient)
The Affordable Care Act
The Affordable Care Act has not been without its bumps and hurdles, has undoubtedly helped millions of Americans afford health coverage. There’s no doubt that more people are insured today than ever before. However, with more paperwork and more participants than ever before, insurers see the market as ripe for fraud. While they can usually stop fraud in its tracks outside the federal exchanges by using identity verification measures and only accepting paper applications, other fraud has been more stealthily developed. Insurers have increasingly found that the fraud and abuse is originating with memberships that are obtained via Healthcare.gov.
Special Enrollment Periods (SEPs)
In fact, it’s Special Enrollment Periods (SEPs) that seem to attract consumers looking for a loophole for insurance. The SEPs allow individuals and families to obtain coverage outside of open enrollment, if they have experienced a qualifying event such as a marriage or divorce, or an out-of-state move for a new job or schooling. Insurers say 900,000 people were allowed to use an SEP to get healthcare coverage in 2015; and many of them did not qualify. The guidelines have been so broad that nearly anyone could qualify to skip open enrollment and join whenever they like.
People who abuse the system, insurers say, sign up for insurance when they realize they’re sick using SEP and then quit paying when their illness is cured, sticking insurance companies with a stack of unpaid bills and a much smaller premium pool to cover other health plan members.
Drug Treatment Centers
To collect lucrative insurance payments, drug treatment centers are highly motivated to help patients obtain coverage. Insurers are concerned about third-party payment of premiums and copay charges. Since many people with addictions cannot afford to pay for treatment on their own, it would be naïve to believe that special fraud protections are not needed to verify the payments.
The Obama administration has announced it will eliminate or rework the language addressing SEPs to prevent people from taking advantage of SEP.
Insurers are also battling other forms of fraud and abuse, many of them revolving around residency and identity concerns. Because of this, several California insurers, such as Health Net, Anthem Blue Cross, and Blue Shield of California are now only accepting paper applications for SEP qualifying events, and may require paper documentation to follow such requests for special enrollments.