Doctors Will Be Left Paying Tab for Obamacare 'Grace Periods': Report

The Affordable Care Act entitles consumers eligible for the federal subsidy to three “free” months of health care if they choose to default on their premiums, meaning  doctors and hospitals will be left paying the tab.

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If people can’t pay their premiums and instead decide to cancel their policies, they are given a three-month “grace period,” Watchdog.org reports.

All these consumers have to do is wait until the next year’s open enrollment period to get onto the exchanges.

"It will help break the system," Rep. Louie Gohmert (R-Texas) told Watchdog.org. "This is a huge piece of evidence to show this can’t work, you will break the system and bankrupt people involved."

"The hospitals, doctors and insurance companies will be left holding the bag. There will be disagreements over who will pay for what. Lawyers will get involved because we are talking about a lot of money," he added.

Consumers need to pay a premium for just one month to be eligible for the three-month grace period, according to Section 156.270 of the Affordable Care Act. The insurance company then covers claims for the first month while doctors and hospitals are left covering the remaining two months.

Obviously, the provision has raised concerns that there will be mass fraud perpetrated on the system.

“In a sense, it legalizes fraud,” said senior fellow at the Discovery Institute of Human Exceptionalism and longtime Obamacare critic Wesley J. Smith. “It legalizes putting your burdens on the insurance companies’ shoulders and never paying your premiums. The government wants people to be irresponsible and apparently they want the whole system to descend into chaos.”

Massachusetts, home to the original Obamacare, is already seeing enrollment fraud issues, said senior fellow with the National Center for Policy Analysis Devon Herrick.

“People are signing up and getting care and bailing out,” Herrick said. “I was talking to an insurance agent a few years ago (in Massachusetts). She said once a week she would get a call from a college girl who discovers she’s pregnant and wants health insurance. That’s an example of a condition that you can schedule.”

Medical professionals are preparing for the worst of the new health care law.

“It’s pretty scary,” Dr. Stephen Brotherton, president of the Texas Medical Association, told Watchdog.org. “I fix your torn ACL, you don’t pay for your insurance and three months later you’re off the rolls for non-payment.”

The Texas Medical Association is working closely with medical professionals to prepare them for the full implementation of the law.

Brotherton said doctors paid by insurance companies during the last two months of Obamacare’s “grace period” will have to return that money.

“Our overhead is about 50 percent; I get $100 and it costs me $50 to stay in business,” Brotherton said. “The most obvious solution is anything through the exchange, we’re not taking it.”

The California Medical Association is also preparing its members for the law and has even touched base with the American Bar Association about its concerns.

“The more nefarious insureds may take advantage of HHS-acknowledged opportunities to game the grace period and get 12 months of coverage for the price of nine before simply enrolling in a new plan under (Obamacare’s) guaranteed issue requirements,” wrote Association associate director C. Brett Johnson.

He added: “For instance, an oncology practice generally purchases the drugs to be used in a course of chemotherapy up front — which can run into the tens of thousands of dollars — and is then reimbursed by the payor as part of the medical service. Costs such as these are on top of the costs of displacing other patients with coverage.”

Meanwhile, the taxpayer-funded Obamacare website remains nearly inoperable, raising serious doubts over whether it’ll be ready by Dec. 1 as promised.

(H/T: Reason)

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