Upfront Payment Legislation Approved By MPs
Last night [Mar.19] legislation banning upfront payment for healthcare service providers was passed in the House of Assembly.
Health Minister Zane DeSilva said, “The regulations abolishing upfront payments come into operation on the 1st of August this year. The legislation encourages the health system to move to electronic submission of claims, which secures quick payment and prevents the need to charge upfront.
“I also want to note that while insurers and many healthcare providers support the abolition of upfront payments, the change is not without detractors. There is a sub-set of healthcare professionals who vehemently oppose this reform and object to legislation banning upfront charges.
“Nevertheless, the majority of stakeholders understand the reasons for this change, want to ensure patients’ needs are protected, and agree that, unfortunately, some professionals will not stop charging upfront without legislation.”
The information brief below was provided by Government:
Louise Jackson, Opposition spokesman for Health in the House of Assembly, said: “The OBA agrees with the intent of ending upfront payments for medical patients. These payments put a particular burden on many patients, particularly those who are severely ill and those with limited financial means.
“But the proposed Government legislation to do this is flawed. Its compliance deadlines are driven more by the Government’s political agenda than the critical need to put a system in place that actually works for all concerned – patients, health care providers and insurers.
“We have an opportunity here to avoid problems down the road if we just take a step back rather than forcing this legislation through in its current form. This is a question of measuring twice and cutting once.
“The OBA would like to see the legislation reconsidered to enable insurers and health care providers to actually get their electronic billing and claims systems further advanced before proceeding. We need realistic deadlines, not political deadlines. We also need health service provider buy-in to make this work properly for patients.
“We understand the deadlines recommendation made by the Health Ministry committee to implement the legislation were completely rejected by the Government,” continued Mrs Jackson.
“Failure to get this right may end up confusing patients and costing them more. In addition, some health care providers may shy from seeing patients on government-run insurance programmes such as GEHI, FutureCare and HIP. Why? Because the programmes have historically taken a long time to make claim payments, sometimes up to a year after the fact. It’s one of the reasons doctors started asking patients for payment at the time of service.
“This is one of the ironies of this particular legislation – the failure of government-run insurance schemes to pay on time creating payment problems for patients and health care providers that the Government is now trying to fix with this legislation.
“Instead of fixing its own insurance programmes that gave rise to the problem, it is imposing new rules on the industry leaving the original problem still in place. To compound the situation, it has adopted unrealistic deadlines that are driven by its political needs and not by what will work.
“Let’s make sure we get this working right for the people most affected. The proposed August 1st deadline will not achieve that. The system has to work. Surely that should be the point,” concluded Mrs Jackson.
The Minister’s full statement follows below:
Mr. Speaker and Honourable Members, I rise today to introduce the Health Insurance Amendment Act 2012 and the Health Insurance (Health Service Providers and Insurers) (Claims) Regulations 2012.
The purpose of the Health Insurance Amendment Act 2012 is to update the process to license health insurers and approved schemes. And the purpose of the Health Insurance (Health Service Providers and Insurers) (Claims) Regulations 2012 is to eliminate the practice of charging insured patients the full cost of a health bill at the time of the service – or “upfront payments” as it is commonly known.
Mr. Speaker, this Honourable House will recall that on the 9th of December 2011, I introduced this bill and regulations as a Communications to the House. Since that time, with assistance of the Bermuda Health Council, we have undertaken extensive consultation and developed an implementation framework in collaboration with relevant stakeholders.
The Health Insurance Amendment Act 2012 was developed after consulting with health insurers on proposed changes to the annual licensing process. These changes will:
- Clarify some inconsistencies in the legislation, including transferring responsibility for licensing health insurers and schemes from the Minister of Finance to the Bermuda Health Council, as currently stipulated in the Bermuda Health Council Act 2004;
- Increase the financial reporting requirements for annual re-licensing;
- Change the licensing timeline to be better aligned with returns in respect of the Bermuda Monetary Authority and the Standard Premium Rate;
- Increase annual licensing fee, and the penalties for making false declarations about health insurance claims.
Mr Speaker, I want to highlight that health insurers have cooperated with the Health Council since 2010 on the financial reporting requirements and have, in fact, submitted the additional information for three years now. They understand the need for this data, and cooperated voluntarily as a matter of policy, anticipating that the legislative changes would take longer.
The Health Council is grateful to health insurers’ for their ongoing collaboration, as it has enabled improvements in the oversight of health insurers, and the production of key information about Bermuda’s health system, such as the National Health Accounts.
In addition, Mr Speaker, the Health Insurance Amendment Act 2012 provides for the introduction of the Health Insurance (Health Service Providers and Insurers) (Claims) Regulations 2012.
These new Regulations were developed after significant stakeholder consultation and with input of an implementation committee that included representatives from each insurer and most health professions.
The new Regulations:
- Prohibit charging insured patients the insured portion of a bill at the time of the healthcare visit;
- Mandate reimbursement of clean claims within 30 calendar days;
- Mandate a process for how and when a claim is to be submitted;
- Prescribe the data elements to be presented on all health claims;
- Require insurers to provide information about insurance coverage at the point of service;
- Require providers to submit claims directly to insurers on behalf of insured patients, and prohibits charging the insured portion upfront;
- Establish means to grant exemptions to insurers and healthcare providers in exceptional circumstances;
- Impose penalties for non-compliance.
Mr Speaker, the regulations abolishing upfront payments come into operation on the 1st of August this year. The legislation encourages the health system to move to electronic submission of claims, which secures quick payment and prevents the need to charge upfront.
Mr Speaker, I also want to note that while insurers and many healthcare providers support the abolition of upfront payments, the change is not without detractors. There is a sub-set of healthcare professionals who vehemently oppose this reform and object to legislation banning upfront charges.
Nevertheless, the majority of stakeholders understand the reasons for this change, want to ensure patients’ needs are protected, and agree that, unfortunately, some professionals will not stop charging upfront without legislation.
Mr Speaker, I want to pause to remind us all that the reason for this change is to protect patient’s access to healthcare. The Ministry of Health, the Bermuda Health Council and the Department of Consumer Affairs all receive ongoing complaints from patients about the problems they face when they have to pay the full cost of a health visit upfront, to be reimbursed later by their insurer.
Let us not forget that for many people a $200 bill is enough to cause them to avoid the visit altogether. And we know that when timely care is not received, the condition can worsen and become even more expensive.
Mr Speaker and Honourable Members, I know most healthcare providers are primarily concerned about the well being of their patients. I hope the minority who resist change will appreciate that the regulations have made every effort to address their concerns regarding insurance reimbursement, which will negate the need to charge any insured patient upfront.
I hope they will also appreciate that this has been a problem for a number of years, and that numerous attempts were made to bring about change on a voluntary basis.
However, after two years of attempting to bring providers onboard voluntarily, and the situation simply not improving despite most insurers reimbursing in 30 days, it has become necessary to resort to a legislative change.
This was not the first choice, Mr Speaker. But it became the only option after a significant cohort of healthcare providers refused to comply with the voluntary guidelines.
Mr Speaker, this reform is being brought for the benefit of the people of Bermuda. In particular for the benefit of those who are sick and with limited financial means.
I understand the concerns that have been expressed, and have carefully weighed the pros and cons of legislation. In the end, Mr Speaker, the patients have to come first. And this legislation will ensure that.
Thank you Mr. Speaker.
CLAUSE BY CLAUSE
HEALTH INSURANCE AMENDMENT ACT 2012
Clause 1 – Sets out the title of these Regulations.
Clause 2 – Clarifies definitions for “approved scheme” (licensed by the Council), “health insurance” (coverage for hospital and non-hospital services), “insured”, and “licensed insurer”. And adds a definition for “health service provider” (the business, as opposed to the professional).
Clause 3 – Amends references to standard hospital benefit to clarify language and insurance coverage requirements.
Clause 4 – Enables the Mutual Reinsurance Fund to cover expenses of the Health Insurance Committee in carrying out its functions in respect of the fund. This is to support the administration of the Mutual Reinsurance Fund, FutureCare, HIP and Government Subsidies.
Clause 5 – Transfers responsibility for licensing insurers and approved schemes from the Minister of Finance to the Bermuda Health Council, as per the Bermuda Health Council Act 2004. The Ministry of Finance supports this. The reason for this change now is simply that it appears that it was an oversight at the time the Health Council Act 2004 came into effect, as the two acts were not aligned.
Clauses 6 to 8 – Clarify terminology and amend provisions to suspend or revoke health insurers’ licenses, in light of the new Health Insurance (Health Insurance Providers and Insurers) (Claims) Regulations 2012.
Clause 9 – Increases the penalty for making false declarations about health insurance claims from $250 to $2,000 to deter fraudulent claims submissions.
Clause 10 – Provides for the issuance of “penalties” in addition to “fines” for non-compliance. And provides for the creation of regulations to: prohibit health service providers from requiring insured persons to pay the insured portion at the time of service (upfront charges); prescribe information requirements between insurers and health service providers to enable disclosure of coverage at the time of service and the submission of complete claim information; prescribe the manner and time within which a claim must be submitted and paid; and to provide exemptions in prescribed circumstances.
Clauses 11 to 13 – Amend the Health Insurance (Licensing of Insurers) Regulations 1971 to change the date of expiry of health insurance and approved scheme licenses from 31st March to 31st December. Clause 12 increases insurers licensing fee from $550 to $1,000, and approved schemes licensing fee from $400 to $1,000. Clause 12 also increases the licensing and annual renewal submissions to now require more detailed financial information from insurers and approved schemes.
Clause 14 – Provides for the Act to come into force on 1 August 2012.
CLAUSE BY CLAUSE
HEALTH INSURANCE (HEALTH INSURANCE PROVIDERS AND INSURERS) (CLAIMS) REGULATIONS 2012
Clause 1 – Sets out the title of these Regulations.
Clause 2 – Introduces definitions required for the abolition of upfront charges, including “claim” (electronic, unless specified), “clean claim”, “defective claim”, “expired claim”, “insured portion”, “notice”, “procedure”, etc.
Clause 3 – Prohibits against requiring payment of the insured portion at the time of service (i.e. upfront payment).
Clause 4 – Prescribes for claims to be submitted 30 days from completion of a procedure; for information requirements in a health insurance claim (e.g. insured’s name, policy number, clinical procedure, cost, date, etc.); and for information regarding a defective claim to be submitted 7 days from notice of defects.
Clause 5 – Provides for health service providers to apply to the Health Council to require payment of the insured portion where it can be proven that an insurer is delinquent in reimbursement times.
Clause 6 – Requires insurers to make information available to health service providers regarding a patients’ level of coverage at the time of the health visit.
Clause 7 – Requires insurers to notify providers within 24 hours that an electronic claim has been submitted. This enables subsequent requirement for reimbursement 30 days from this notice, unless the claim is defective.
Clause 8 – Requires insurers to notify providers within 7 days if a claim is defective and the information that is missing.
Clause 9 – Requires insurers to reimburse clean claims 30 days from notification of receipt, if a claim is submitted 30 days after a procedure; and to effect reimbursement 90 days from notification of receipt, if the claim is submitted between 31 and 365 days after a procedure.
Clause 10 – Provides for insurers to apply to the Health Council to vary time to pay claims, where the insurer can demonstrate valid reasons for being unable to comply with reimbursement time requirements.
Clause 11 – Provides for claims to expire 366 days after a procedure is completed; and for expired claims to not be payable.
Clause 12 – Provides for the Health Council to impose on health service providers that charge upfront, a penalty of $500 and to deny registration under the Bermuda Health Council Act 2004; and for providers to appeal to the Supreme Court.
Clause 13 – Provides for the Health Council to impose a penalty of $500 on health insurers who contravene regulations.
Clause 14 – Provides for penalties to be paid to the Consolidated Fund.
Clause 15 – Sets out transitional provisions enabling the Council to grant providers permission to charge upfront in circumstances where it deems that it would be unreasonable for the health service provider to comply with the prohibition of upfront charges.
Clause 16 – Provides for regulations to come into operation on 1 August 2012.
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FOR ALL OF YOU GREEDY DENTISTS’ AND DOCTORS’ SERVES YOU RIGHT! I DON’T FEEL SORRY FOR YOU ! ALL YOU SEEM TO CARE ABOUT IS MONEY OVER PEOPLES” HEALTH AND CARE AND I’M SO HAPPY IT’s THE LAW NOW FOR DENTISTS’ AND DOCTORS’ TO STILL PROCEED WITH THE WORK WITHOUT UP FRONT PAYMENTS. I WILL BE VISITING MY DENTIST AND DOCTORS OFFICE MUCH MORE OFTEN NOW FOR SURE! IF YOU WHERE DOING THE RIGHT THING FROM THE BEGINNING IT WOULD HAVE NEVER BEEN MADE INTO A LAW!!
Dentists and doctors aren’t bloody charity… they are there to perform a service for a fee…
If the insurance companies paid the healthcare services on time then the dentists and doctors wouldnt have had to charge up front..
hell look at HIP… wtih a 12month delay at times…
try and tell teh grocery store you’ll pay them in a few months for the food you got an see how much they like that.
Sorry “Finally Left” but lots of Businesses in Bermuda and around the world deal with terms and credit. If I give proof of insurance then why cant they wait to get the money from the insurers.
We have dental coverage at work that pays for most dental work. However, we have an employee that needs dental work (a crown a bridge and x-rays) but because his dentist forces him to pay 100% up front in advance instead of just the difference not paid by the insurer he is living in pain because he cant afford to pay the $2000 up front.
I don’t usually agree with the PLP but Im behind them 110% on this one.
Now if they could just adjust that bill to add the following Clauses.
(i) the customer will agree to pay for a missed appointment if he or she is 15 minutes late, however, the dentist will also have to pay if they keep the client waiting more than 30 minutes. EVERY TIME I HAVE GONE TO THE DENTIST IM WAITING 45 MINUTES + AND THAT IS CONSIDERED ACCEPTABLE. HOWEVER, I WAS LATE BY 18 MINUTES A YEAR AGO AND WAS TOLD SORRY YOU MISSED YOUR APPOINTMENT BUT YOU WILL STILL HAVE TO PAY.
(ii) the customer must pay for all appointments cancelled with less than 24 hours notice, however, should a doctor or dentist cancel an appointment with less than 24 hours notice then he or she must pay the patient for their wasted times, loss of wages etc… CANCEL AN APPOINTMENT AND THEY BURN YOU – WHEN THEY CANCEL ON YOU – NOT EVEN A SORRY.
(iii) if a patient has more than one small filling then the dentist should do as many as possible in each appointment AND NOT STREATCH THEM OUT SO THEY CAN CHARGE MORE.
I recently found that I had three very tiny cavities. Three appointments later for three fillings – that each appointment took less than 25 minutes I was done. More time was spent waiting for the gum area to get numb then was spent on drilling and filling these almost non existing filings. I don’t see why all three couldn’t be done at the same time. Oh and please ban the practice of nickle and dimeing the patients to get as much out of them as possible. A friend of mine recently went to his dentist. They took his blood pressure which he though was odd but didn’t think much of it at the time. Then he got the bill at the end. I believe he was charged $60 for something that took 30 seconds and uses a simple piece of equipment. Rip offs .
IM HAPPY THAT THEY TO WILL LEARN WHAT IT MEANS TO BE INCONVENIENCED, LEARN WHAT IT IS TO HAVE A LITTLE LESS, AND WORK A BIT HARDER TO GET THEIR MONEY LIKE THE REST OF US DO.
I dont disagree that its a bad idea, but the situation with doctors and insurance is different in the US.
Why should the health services have to wait for overly long times before being paid? You cant just run a business on credit…
If the services were paid promptly, they wouldnt need to charge up front. Upfront charging is just due to the unreliable payment schedules. Fix the unreliable compensation and you can do away with up front payments without even having to legislate it.
Or in this case, at least legislate in that insurance co’s must pay within a set amount of time.
THANK YOU PLP !! People can say what they want but NO OTHER party has done this so my hats go off to you. You have my vote!
It is a good thing but that why it was done now it’s election time.
LOL PATI RIP
Just curious, but what other party did you expect to do it? Upfront payments were not a problem under the previous government. Doctors started doing this when the government insurers–GEHI, HIP and FutureCare–fell so behind on reimbursement, under the PLP’s watch.
Lol they do one thing right and they have your vote? It’s so rare to hear them do anything right that people get way too excited
This is nice that they have done this but i am sure they are after our vote. They still can’t get mine.
I have several questions and concerns.
I want to know what are the penalties for insurance companies that don’t pay within the 30 day period.
Are they planning an exemption for government-run insurance programmes such as GEHI, FutureCare and HIP that are notoriously late in paying??
I also note that medical providers will be allowed to charge up-front if they have applied to BHeC for permission to do so because of an insurer’s delays in reimbursement. This sounds like a back-door for continuing to charge up-front for those unfortunate enough to be dependent on government-run insurance programmes such as GEHI, FutureCare and HIP.
The idea is great but I have misgivings about the push for implementation in such a short time period, especially since this sort of electronic set-up doesn’t come cheap.
I wonder who developed the soft-ware for this, an on-island company or something that is already in implementation elsewhere? Both scenarios have the potential for glitches. I just hope poor Joe Public doesn’t have to bear the brunt yet again if things go wrong.
on the surface this looks good for the consumer, but like most overnight laws this will backfire as it’s ill-considered.
1. no upfront payment or co-payment will increase the amount of fraud and also increase the amounts and durations of outstanding amounts owed. there is a valid reason doctors want upfront payment now! so those costs will ultimately get passed on to the rest of us, either directly or through higher insurance premiums.
2. doctors offices are small businesses, and many of them have huge debt burdens from rent/employees/medical school/inventory/etc. despite what some think above, these doctors have worked very hard to get where they are, they are not handed the golden spoon or who-you-know jobs.
I agree they work hard but so do I and most others. I too have a business and have the same debt burdens like rent for office and warehouses / employees /university loans/ inventory and equipment, some of which cost $100K and up. However, I only charge $22 – $50 per hour and I don’t have a 3 moth waiting list and waiting room full of customers. I also don’t have the luxury of working when the weather is bad. However, Im still doing okay and able to pay my bills so please don’t cry poverty on their behalf.
By the way I to have to extend credit to my customers. Try funding a $1 million renovation and getting paid in installments and then waiting three months after the job is complete to get your final payment. That is the norm and were doing okay. Maybe that is why Zane doesnt side with the doctors on this one, he has been used to waiting and fighting for money always as a construction company owner,
I am so glad this was passed…i know plenty of people who are getting insurance taken out of their paychecks but yet don’t go to the doctor because they can’t afford to pay up fron costs. I don’t understand why Mrs. Louis-Jackson is opposed to this and she does a poor job of explaining how implementing this new system will effect the public in a negative way. I am very happy this law as passed!!
If the docs and dentists don’t get paid efficiently by government, then they will need to increse prices, to ensure adequate cashflow. Insurance companies and government won’t increase coverage and therefore the consumer will end up carrying the cost, or docs and dentists will just retire or leave. This whole issue arose under the PLP, as government were apparently failing to cover payments in a reasonable time frame. Jackson is all for going no up front, but is concerned, that without systems in place, We will suffer as consumers and medical professionals already in short supply will understandibly increase prices or leave. PLP caused this problem and have thrown a bandaid on it before an election.
THEY DON’T NEED TO RAISE PRICES AT ALL. THEY CAN CHARGE A LATE FEE OR INTEREST IF GEHI OR AN INSURANCE COMPANY DOES NOT PAY WITHIN 30 DAYS (ON UNDISPUTED CLAIMS) BUT IF THEY RAISE FEES THEY HURT ALL CUSTOMERS EVEN THOSE WITH NO INSURANCE OR THOSE THAT PAY ON TIME.
and what about those who never pay? they’ll be plenty. like others have said the problem has been governments cash flow, they almost didn’t even make payroll a few times in the last couple years never mind insurance reimbursements!
Ultimatly the consumer will pay cause insurers will adjust rates to cushin the late charges after all they know how long it will take to pay the bill.
LOL
GEHI service STINKS! They have the most inept, totally useless coordinator. She apparently is there to make things run smoothly and stress free for patients. This could NOT be further from the truth! Mr. Desilva said on the news this evening that GEHI would not be so well run without her………..he needs to deal with her on a personal level and see how well GEHI runs!
Mr De Silva has obviously never dealt with GEHI. They are the most inefficient health insurance company on the island. The person in charge just can not cope.Telephone calls are never returned. It is embarrassing when bills to overseas hospitals are not paid and one keeps getting letters regarding unpaid bills.Seniors have to wait for a very long time for reimbursement.This is all very stressful especially when a person is ill.I hear positive comments about Argus and BFM but have yet to hear anything but negativity regarding GEHI. I know doctors on this island charge a lot for services rendered and I understand patients are allowed 10 minutes for a visit so you can imagine how much a doctor accrues in a day but they still need to be paid and the best of luck if they wait for GEHI to pay .
A few points:
1. The government insurance plans regularly pay late. Those plans are: GHEI (an insurance company for government employees), Futurecare, and HIP.
2. Health providers use late payment by government as an excuse to charge upfront charges. This may or may not be the reason, but that’s their argument.
3. Clause 5 of the new legislation seems to allow upfront charges in some cases. See below:
“Clause 5 – Provides for health service providers to apply to the Health Council to require payment of the insured portion where it can be proven that an insurer is delinquent in reimbursement times.”"
4. However, clause 10 seems to allow late payment by insurance companies in some cases: See below:
“Clause 10 – Provides for insurers to apply to the Health Council to vary time to pay claims, where the insurer can demonstrate valid reasons for being unable to comply with reimbursement time requirements.”
I can see a few scenarios following from this law:
a. Gov (and other insurers) are forced to pay on time, and doctors have no cause to ask for upfront payments. -> Nirvana
b. Gov gets permission to pay late, and doctors get permission to charge up front. -> Nothing changes
c. Gov gets permission to pay late, and doctors refused permission to charge up front. -> Pure politics
I hope the Health Council can resist any pressure to adopt scenario “c”.
Whilst I can see the benefit to patients for not having to pay the full sum for medical/dental services “up front”, I am still not clear on an important point in this issue. Most doctors/dentists charge a fee which is over and above the amount which is reimbursed by the insurance company. This results in a “co-payment” on the part of the patient. Will this legislation now mean that the co-payment cannot be charged upfront?
In many cases the co-payment is still a very substantial sum (eg. after tooth extractions) as only a fraction is covered by insurance. So will this amount be left to be owed by the patient or will it be required to be paid in advance? If it is not paid in advance, I predict a lot of unpaid bills……then requiring offices to take out proceedings against their patients.
It will become like other places where this type of interference happens. Government of course is out of money and cannot pay these bills, which is really the issue. So, make the provider provide the service and don’t pay them -or pay them next year, or the year after that. So what happens? Bermuda no longer attracts the doctors and dentists it needs, and people no longer have access to proper or competent medical services. It really is quite simple. This is not a PLP/OBA thing, it is again an economic thing. You know, if we had jobs, money, and confidence in the future this would never have come up. Now, that lack of confidence is a direct result of the PLP and its policies.