Charity Discount Policy

  • Definitions:

    Non-Elective Care- means services that are medically necessary, i.e., services that are necessary to evaluate, diagnose or treat an illness, injury or disease.

    Patients with High Medical Costs – patients that incur out-of-pocket costs exceeding 10% of their family income in the prior 12 months excluding Essential Living Expenses and, for purposes of the charity discount, whose family income is at or below 200% of the Federal Poverty Level. . The 10% threshold may be documented in 2 ways 1) the out-of-pocket costs are incurred at the hospital; or 2) the patient provides documentation of the patient’s medical expenses paid by the patient or the patient’s family in the prior 12 months.

    “Essential Living Expenses” – any of the following expenses: rent or house payment and maintenance, food and household supplies, utilities and telephone, clothing, medical and dental payments, insurance, school or child care, child or spousal support, transportation and auto expenses, including insurance, gas and repairs, installment payments, laundry and cleaning and other extraordinary expenses.”

    Patient’s Family (for purposes of determining “family income”) – For persons 18 years or older, spouse, domestic partner as defined in Section 297 of the Family Code, and dependent children under 21 years of age, whether living at home or not. For persons under 18 years, parent, caretaker relatives and other children under 21 years of age of the parent or caretaker relative.

  • Eligibility for Charity Care:

    Patients with High Medical Costs receiving Non-Elective Care may qualify for a charity:

    1. Under insured patients (i.e., those patients with some form of third party payer coverage for health care services but such coverage is insufficient to pay the current bill) who have High Medical Costs and whose household income is at or below 200% of the Federal Poverty Level, and
    2. Uninsured patients - Those patients with no third party payer coverage for health care services, with High Medical Costs and whose household income is at or below 200% of the Federal Poverty Level.
    3. Medically Indigent – Based upon state guidelines or requirements the patient meets the medically indigent status and whose yearly income or whose family’s yearly income exceeds 350% of the Federal Poverty Level

    An initial screening must be completed to determine whether any portion of the patient's medical services can be paid by any federal, or state governmental health care program (e.g., Medicare, Medi-Cal, Champus, Medicare Secondary payer), California Health Benefit Exchange health plan coverage, private insurance company, or other private, non-governmental third-party payer. A charity discount can be applied to any account after the outstanding payer liability is satisfied (payment has been received and posted to the account).

  • Income Verification:

    All patients shall complete a Financial Assistance Application to assist in the determination of charity care unless a patient fits the extenuating circumstances outlined in 4) below. Approved applications are valid for:

    • any prior dates of service where there is an outstanding patient balance that meets the charity requirements in all other aspects.
    • use related to accounts across multiple facilities (at the discretion of the manager)
    1. Medicare Patients

      All Medicare inpatient and outpatient accounts will be required to have supporting income verification documentation. Medicare requires independent income and resource verification for a charity care determination with respect to Medicare beneficiaries.

      For Medicare beneficiaries, in addition to thorough completion of the Financial Assistance Application, the preferred income documentation will be the most current year’s Federal Tax Return. Any patient/responsible party unable to provide his/her most recent Federal Tax Return may provide two pieces of supporting documentation from the following list to meet this income verification requirement:

      • State Income Tax Return for the most current year
      • Supporting W-2
      • Supporting 1099’s
      • Most recent bank and broker statements listed in the Federal Tax Return
      • Current credit report
      • Qualified Medicare Benefits (QMB for inpatients only)

      A Medicare beneficiary who also qualifies for Medicaid (dual-eligible beneficiary) may be presumed indigent automatically as long as the “Must Bill” requirements are met which is supported by a State Medicaid remittance advice. Therefore, when claiming an amount as Medicare Bad Debt for a dual-eligible beneficiary, Medicaid must be billed and the remittance advice that shows non-payment be maintained as supporting documentation for the Medicare Bad Debt adjustment. Charity discounts for Medicaid Exhausted beneficiaries may be less than $1000.00.

    2. Non-Medicare (Underinsured & Uninsured) Inpatients

      For non-Medicare Inpatients accounts, supporting income verification documentation will be limited to recent income tax returns or recent pay stubs. Patients must make a reasonable effort to provide hospital with documentation of income and failure to provide information to support income and expenses claims may be taken into consideration in determining eligibility for charity care.

      No information obtained in the evaluation of support for eligibility for Charity discounts shall be used for collections activities.

      After thorough review of the Financial Assistance Application and documented research through Medicaid Eligibility processing or other means, a manager may waive supporting documentation on non-Medicare, non-Champus, non-Medi-Cal, and non-Medicare Secondary Payer accounts only when it is apparent that the patient/responsible party is unable to meet the supporting documentation requirement but clearly meets the Charity guidelines.

    3. Non-Medicare (Underinsured and Uninsured) Outpatient

      For non-Medicare and non-inpatient accounts, supporting income verification documentation will NOT be required. For these accounts, the thorough completion of the Financial Assistance Application will be acceptable for determining Charity discount application.

      It is highly recommended that each SSC consider an electronic validation of patient information/income, especially for non-Medicare OP accounts where no income verification is obtained. SSC personnel processing charity applications should utilize all relevant on-line systems available to gather correct information.

    4. Charity Processing based on Extenuating Circumstances

      There may occurrences of extenuating circumstances where the patient/responsible party is not able to complete the Financial Assistance Application and/or provide supporting documentation and resource testing cannot be completed. In those circumstances, a manager may make the decision to waive the required documentation provided that all attempts to obtain additional information are documented clearly or perform additional resource testing to validate the need for charity. Some of the following could be considered extenuating circumstances:

      • Undocumented Residents or Homeless - Patients identified as an undocumented residents or homeless through
        • Medi-Cal Eligibility screening
        • Registration process
        • Discharge to a shelter
        • Clinical or Case Management documentation
        • Attempt to run a credit report
        may be considered for a charity discount if an attempt to complete the Financial Assistance Application was documented and a manager has reviewed and approved a policy exception.
      • Patient Expiration - Patients that expire and research determined through family contact and/or courthouse records that an estate does not exist and was documented, may be considered for a charity discount with the manager’s review and approval for a policy exception.
    5. Pending Medi-Cal Effect on Charity Discount

      The Pending Medi-Cal and Pending Charity processes should not be concurrent processes. Determination of Pending Medi-Cal should be resolved prior to evaluating for potential Pending Charity. However, a patient may request and complete a financial assistance application at any time in the process.

    6. Health Insurance Marketplace for Qualified Health Plans

      Pending qualification in the Health Insurance Marketplace may take place concurrently with the Pending Charity process. The QHP enrollment is not retro-active, rather the coverage becomes effective for future dates of service, therefore it is necessary to continue with the Pending Charity process for visits occurring prior to QHP effective dates.

    7. Charity Processing based on Federal Poverty Guidelines- Amount of Discount

      Patients that fall within 0-200% of the Federal Poverty Guideline will have a 100% Charity Discount processed. This process will be managed by establishing IPLANS with a Financial Class of 15 for Charity Pending, Charity 0%– 100%, and Charity 101% - 200%. In those instances where state regulations exceed the company policy, additional standard IPLANS will be established. These IPLANS will be attached to standard LOGIDS with the appropriate standard models to calculate the applicable discount and auto post to the account at final bill and should be prorated at 100% of patient charges. These logs will not be worked for discrepancies or any other purposes since self pay underpayments or overpayments would be identified as they are normally identified today through our collection pools/series and credit balance reports. On accounts where the charity IPLAN is placed in the secondary or tertiary position, Artiva will calculate the discount based on the discount table assigned to the Iplan. If the Artiva Charity Process is not utilized or a discount table is not assigned to the Charity Iplan,the applicable manual discount will need to be applied. Standard procedure codes will be established to use in those instances where the discount must be manually applied.

      For uninsured patients, the discount will be applied to total patient liability, less any payments received. For Example: For an account with total charges of $20,000, the Charity Discount would be applied to the total charges of $20,000. If the patient had paid $50 at time of service, the Charity discount would be $19,950.

      For under-insured patients, the discount should be applied to the gross patient due, less any payments received. For example: For an account with total charges of $10,000 and an insurance payment of $6,000 would leave a remaining gross patient due of $4,000. If the patient meets the charity guidelines outlined above, the remaining balance of $4,000 would be written off as a charity discount. If the patient had paid $50 at the time of service, the Charity discount would be $3,950.

    8. Refunds on Charity accounts

      The general expectation is that all patients pay for services rendered if they are not fully covered by a third party. Therefore, any amount paid by the patient (even if the patient subsequently meets the charity discount guidelines for their balance due), will be retained. Only amounts paid by the patient that exceed the amount that patient would have paid had they received the uninsured discount, or that exceed their out of pocket responsibility per their insurance, will be refunded. For those patients that do meet the Charity discount criteria and have made a partial payment, the charity discount will be posted on the remaining patient balance.

    9. Patient Dispute Process

      In the event a patient wishes to file a dispute and appeal their eligibility for this policy, patient may seek review from the Vendor Collections Management Director, Hospital Chief Financial Officer or an SSC Executive as defined in the Charity Review Appeal Process policy (PARA.PP.VCM.020)

Uninsured Charity Discount Policy

  • Definitions:

    Patients with High Medical Costs – patients that incur out-of-pocket costs exceeding 10% of their family income in the prior 12 months excluding Essential Living Expenses and, for purposes of the uninsured discount, whose family income is between 201% and 350% of the Federal Poverty Level. Patients are eligible for this designation even if they receive a discounted rate as a result of third-party coverage. The 10% threshold may be documented in 2 ways 1) the out-of-pocket costs are incurred at the hospital; or 2) the patient provides documentation of the patient’s medical expenses paid by the patient or the patient’s family in the prior 12 months.

    “Essential Living Expenses” – any of the following expenses: rent or house payment and maintenance, food and household supplies, utilities and telephone, clothing, medical and dental payments, insurance, school or child care, child or spousal support, transportation and auto expenses, including insurance, gas and repairs, installment payments, laundry and cleaning and other extraordinary expenses.”

    Patient’s Family (for purposes of determining “family income”) – For persons 18 years or older, spouse, domestic partner as defined in Section 297 of the Family Code, and dependent children under 21 years of age, whether living at home or not. For persons under 18 years, parent, caretaker relatives and other children under 21 years of age of the parent or caretaker relative.

    “Reasonable Payment Plan” – means monthly payments that are not more than 10 percent of a patient’s family income for a month, excluding deductions for Essential Living Expenses.

  • Eligible Patients:

    All Self Pay patient accounts and all insured Patients with High Medical Costs accounts will be eligible for an uninsured discount, with the exception of elective cosmetic procedures; facility designated self-pay flat rate procedures, scheduled/discounted procedures for International patients and, accounts eligible for the charity discount. Uninsured discounts will also be applied to accounts where insurance benefits have been exhausted or terminated. Medicare outpatient self-administered drugs will also receive the uninsured discount.

  • Discount criteria:

    Uninsured Patients, as well as insured Patients with High Medical Costs, whose family income is between 201% and 350% of the Federal Poverty Level are eligible for a discounted payment equal to the amount of payment the hospital would expect, in good faith, to receive for providing services from Medicare, Medi Cal, Healthy Families, or “any other government-sponsored health program of health benefits” in which the hospital participates, whichever is greater. Uninsured patients and insured Patients with High Medical Costs will first be reviewed for Government Program Eligibility and Charity criteria.

    Uninsured Patients whose family income exceeds 350% of the Federal Poverty Level are eligible for a managed-care PPO like Uninsured discount.

  • Documentation of Income:

    To support a patient’s income relative to the Federal Poverty Level, documentation in the form of recent pay stubs or income tax returns is required. Patients must make a reasonable effort to provide hospital with documentation of income and health benefits coverage. If the patient fails to complete a Financial Assistance Application, the hospital could consider the patient to be above 350% of the Federal Poverty Level.

    No supporting documentation provided by the patient as part of the Financial Assistance Application for the Uninsured Discount shall be used for collections activities.

  • Patient Notification at the Time of Registration:

    If it is determined the patient is uninsured or an insured Patient with High Medical Costs at the time of registration, the patient/responsible party will be presented with an Uninsured Patient Information document (PARA.FT.VCM.015) that provides information on the Uninsured Discount Policy and other available discounts and payment options. This document will outline the process for uninsured discounts and inform the patient of additional account resolution options (i.e. monthly payments). The patient/responsible party will be asked to sign and date the document. The document will then be scanned into the imaging system and be placed in the imaging Patient Folder document type, as a validation that information regarding discounts has been communicated to all uninsured patients and insured Patients with High Medical Costs.

  • Patient Access Responsibilities at the Time of Registration:

    Patient Access will be responsible for assigning the Uninsured IPLAN using the selections above and for presenting the Uninsured Patient Information Document to the patient/responsible party. However, the Uninsured IPLAN may need to be modified when the supporting documentation evaluation shows the family income falling between 201% and 350% of the Federal Poverty Level. Patient Access will explain the process as documented, answering questions related to the document and obtaining a signature from the patient/responsible party documenting that the information regarding available discounts was provided.

    All requests for payment will be based on estimated total charges less the appropriate uninsured discount based on the income criteria listed above.

    Patient Access will be responsible for requesting from the patient/responsible party the expected patient liability amount by using a facility specific deposit schedule which has been updated to reflect the Uninsured Discount.

    Patient Access will be responsible for asking the patient/responsible party for payment in full or, at the request of the patient with High Medical Costs, shall negotiate monthly payment arrangements on the patient liability amount. If the patient/responsible party and Patient Access employee cannot agree on a payment plan, the Patient Access employee shall establish a “Reasonable Payment Plan” as defined herein, taking into consideration the patient’s monthly family income less Essential Living Expenses. Once the payment plan is negotiated, the account will be referred to NPAS, Inc. or other early-out agency for monitoring and collection.

  • Inpatient and Outpatient self pay patients who are able to make payment in full or monthly payment arrangements.
    • Assign the appropriate Uninsured Discount IPLAN if the family income is known. If the family income is not known, use the 099-40 unless this is a Burn Unit or Transplant patient.
    • The Uninsured Discount IPLAN should reflect proration of 100% of the total charges for the patient.
    • A facility/SSC specific prompt pay discount may be applied in addition to the Uninsured Discount as set forth in the PARA.PP.SS.035 Discount Policy for Patients.
    • The facility and the patient shall negotiate interest free, payment plans if the patient cannot pay for the entire encounter in full, taking into consideration the patient’s family income and Essential Living Expenses. If the facility and patient cannot agree on an extended payment plan, the payment plan shall meet the requirements of a Reasonable Payment Plan as defined herein.
  • Inpatient self pay patients or insured Patients with High Medical Costs who are not able to make payment in full or monthly payment arrangements, including a Reasonable Payment Plan, and Outpatient self pay patients will be considered for Medi-Cal eligibility.
    • Assign the facility designated Pending Medi-Cal IPLAN as the primary payor.
      • The Pending Medi-Cal IPLAN should reflect proration of 100% of the total charges for the patient.
    • Assign the Pending Charity IPLAN (099-50) as the secondary payor.
      • Present the patient with a Financial Assistance Application for Charity consideration.
    • Assign the appropriate Uninsured Discount IPLAN as the tertiary payor if the family income is known. If the family income is not known, use the 099-40 IPLAN unless this is a Burn Unit or Transplant patient.
  • Outpatient self pay patients or insured Patients with High Medical Costs who are not able to make payment in full or monthly payment arrangements, including a Reasonable Payment Plan and do not meet the Medi-Cal eligibility threshold.
    • Assign the Pending Charity IPLAN (099-50) as the primary payor.
      • The Pending Charity IPLAN should reflect proration of 100% of the total charges for the patient.
      • Present the patient with a Financial Assistance Application for Charity consideration.
    • Assign the appropriate Uninsured Discount IPLAN as the secondary payor, if the family income is known. If the family income is not known, use the IPLAN 099-40 unless this is a Burn Unit or Transplant patient.
  • All Inpatient and Outpatient self pay patients registered for elective cosmetic procedures, facility designated self-pay flat rate procedures and scheduled/discounted procedures for International patients.
    • Assign the facility/SSC designated IPLAN for the discounted/flat rate procedure.
  • Emergency Department self pay patients who opt out to a QMP process will be assigned an Uninsured QMP IPLAN.
    • Assign the Uninsured QMP –Left or Referred IPLAN (099-45) as the primary payor if the patient elects to Leave or be Referred during the QMP process.
    • Assign the Uninsured QMP – Treated IPLAN (099-46) as the primary payor if the patient receives treatment via the QMP process.

    The default of Self Pay IPLAN 000-00, due to the absence of an IPLAN, should be avoided once this policy is implemented. All accounts that are not assigned an IPLAN and systematically assigned Self Pay 000-00 should be reviewed and moved to the appropriate IPLAN. All accounts excluding Client/Industrial accounts must be registered with an appropriate IPLAN for the third party payor, Medi-Cal Pending, Charity Pending, elective cosmetic/facility designated flat rate plan or an Uninsured Discount Plan. A Business Objects script has been developed to assist in identifying accounts without an IPLAN assignment.

  • IPLAN Assignment if the Patient has Insurance:

    If at any time it is determined that the patient is covered by a health plan, the Uninsured Discount IPLAN should be removed; except that where the patient meets the definition of an insured Patient with High Medical Costs. The Uninsured Discount IPLAN is limited to patients who have no third party payor source of payment. The IPLAN assignment of the third party payor should be assigned to the account in place of the Uninsured Discount IPLAN.

  • Retroactive consideration for Medi-Cal eligibility or Charity Discount:

    Uninsured Discount Plan patients that retroactively are considered for Medi-Cal eligibility or Charity discounts will have the appropriate Pending Medi-Cal eligibility and Pending Charity IPLANS assigned as outlined in the Patient Access process above. The Uninsured Discount will be reversed until determination of Medi-Cal eligibility and Charity can be ruled out. If a patient applies, or has a pending application, for Medi-Cal or other health coverage at the same time as he/she applies for a discount payment program, the pending Medi-Cal or other health coverage application shall not prevent the patient from applying for discounted care.

  • Insurance Denials for Patient Non-Compliance:

    Accounts where a denial is applied due to the patient’s lack of cooperation are considered “uninsured”.

    Based on the liability due from the payor, the following collection guidelines will be followed and approval obtained prior to releasing liability to the patient where the patient failed to provide the requested information timely. Once efforts to obtain required information is exhausted, the 09947 Uninsured Discount Iplan is assigned and remaining liability after the uninsured discount will become the patient’s responsibility.

    Artiva letters 1100 Request for Additional Information Request and 1153 Additional Insurance Information Request are available to send to the patient for 1st and 2nd letter attempts. The letters contain a dropdown to allow the requester to select the information required or enter free form text if not listed in the dropdown. The next follow-up should occur 7 – 14 days the after action is taken.

    Once the appropriate collection activity and approval is completed, ensure both the Uninsured IPLAN 099-47 and discount is applied appropriately. No approval is required for insurance liability less than $1000 however; an audit must be performed monthly on 15 percent of the accounts to ensure liabilities are released appropriately. To retain the original insurance plan information, assign Uninsured IPLAN 099-47 as the primary payor and resequence the original insurance IPLAN as the secondary payor.

    • Assign the 099-47 Uninsured Discount IPLAN and resequence to the primary payor retaining the original IPLAN as the secondary payor.
      • The Uninsured Discount IPLAN should reflect proration of 100% of the total charges for the patient.

    Subsequently, if patient complies with the payor request, the uninsured IPLAN can be removed and the original IPLAN information will move to primary intact.

  • Insurance Denials for no coverage including pre-existing:

    Accounts where the insurance remits a denial of coverage including pre-existing conditions and there is no other insurance coverage on file will be considered self-pay accounts. The IPLAN for the insurance denial should be removed and the Pending Medi-Cal IPLAN added as primary (if the account meets local screening guidelines), Pending Charity IPLAN assigned as secondary and the Uninsured Discount IPLAN assigned as tertiary. A Financial Assistance Application will need to be forwarded to the patient/responsible party.

  • Patient Statements:

    Statements should not be sent out until the uninsured discount has been posted. Letters to a Self Pay patient/responsible party should not include the account balance until the Uninsured Discount has been posted. If you use letters in your Medicaid Pending or Charity Pending process, you will need to remove the account balance reflected on them. If the facility bills a patient who has not provided proof of coverage by a third party at the time care is provided or upon discharge, as part of that billing, the facility shall provide the patient with clear and conspicuous notice of: 1) the charges; 2) request that the patient inform the facility if patient has health insurance, including Medicare, Healthy Families, Medi-Cal or other coverage, including coverage under the California Health Benefit Exchange; 3) a statement that, if the patient does not have health insurance coverage, the patient may be eligible for Medicare, Healthy Families Program, Medi-Cal, coverage offered through the California Health Benefit Exchange, California Children’s Services program, other state or county-funded health coverage or charity care; 4) a statement indicating how the patient can obtain applications for the above coverage and that the facility will provide these applications; 5) a referral to a local consumer assistance center housed a legal services office

  • Patient Default on Extended Payment Plans:

    An extended monthly payment plan may be declared inoperative if the patient fails to make three consecutive payments in a 90 day period; provided that, the facility, or its collection agent, shall make a reasonable attempt to contact the patient by telephone and, give notice in writing, that the extended payment plan may become inoperative due to non-payment, and that the patient has an option to renegotiate the extended payment plan. The facility, or its collection agent, shall renegotiate the extended payment plan if the patient so requests. The notice and telephone call may be made to the last know telephone number and address of the patient. No adverse information may be reported to a consumer credit reporting agency and no civil action may be commenced against the patient until the payment plan is declared no longer operative.

  • Late Charges:

    Accounts with the Uninsured Discount IPLAN as the primary payor should not have late charges posted. If late credits are posted to the account, the Uninsured Discount should be recalculated to reflect the correct patient liability. The Bill Code master file on Patient Accounting should be modified to reflect no posting of late charges. Late charges after the Late Charge Days have elapsed should be NPST (not posted) from the Late Charge Report.

  • Patient Dispute Process:

    In the event a patient wishes to appeal a dispute regarding eligibility for this policy, patient may seek review from the Patient Access Director, Hospital Chief Financial Officer or SSC Executive in accordance with the Charity Review Appeal Process, PARA.PP. VCM. 020.

  • Patient Overpayments:

    If any amount is paid by the patient and is subsequently determined to be in excess of the patient’s liability, the patient will be refunded monies overpaid on the associated account, plus 10% interest beginning on the date the payment by the patient was received by the hospital. Hospital is not required to reimburse the patient or pay interest if the amount due is less than five dollars ($5.00).

  • Insurance Denials for Partially Exhausted Benefits:

    Accounts where a denial is applied due to partially exhausted benefits, the Uninsured – Partially Exhausted Benefits IPLAN (099-49) should be applied to the secondary position, after the payor with partially exhausted benefits. A manual p-line must be performed to adjust the exhausted benefit portion of the account by the facility Uninsured Discount percentage.

    Guidelines to determine if an uninsured discount qualifies based on Partially Exhausted Benefits (All three guidelines must be met):

    • The remit indicates a Final Denial, or verbiage used on the remit such as “Exhausted Benefits” or “Maximum Coverage Exceeded” and
    • The patient was considered for Charity for the remaining balance and not approved and
    • Days being considered for the uninsured discount were not covered by insurer. Also, no insurance payment or contractual adjustment was received or posted for a portion of the day’s charges.
  • Medicare Outpatient Accounts containing Self-Administered Drugs:

    Self-Administered drugs (SADs) provided to Medicare outpatients are considered a non-covered service by Medicare. SADs will not be tracked using an IPLAN. A manual p-line using procedure code 957983 must be performed to adjust the SAD portion of the account by the facility specific outpatient Uninsured Discount percentage.