90-Day Grace Period Under New Health Law Has Insurers Flustered

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Under the Affordable Care Act, the grace period to pay a health insurance premium late has been extended to 90 days. Eric Whitney reports that this extension has insurers and doctors worried.


If you're late paying your health insurance premium, how long can you delay before your policy is canceled? Most insurance companies will give customers a 30-day grace period on the faith that they'll pay up by the end of the month. But that is changing under the Affordable Care Act. The law extends that grace period to 90 days for some new insurance policies. And as Eric Whitney reports, insurance companies, doctors, and state regulators are all confused about what exactly that means.

ERIC WHITNEY, BYLINE: Randy Bowen is an artist and musician in Colorado Springs. He's always paid for his own health insurance and it hasn't been cheap, but...

RANDY BOWEN: I have needed it a couple of times. So, on average, I've probably averaged out.

WHITNEY: Bowen says he makes sure he doesn't let his insurance payments lapse. He doesn't want to lose coverage. He remembers what it was like when he used to get behind on his bills.

BOWEN: It doesn't happen frequently now. In my past, in my youth, it happened often. You know, sometimes it would get dark in the house.


WHITNEY: The electric company might give you a 30-day grace period. But doctors aren't happy about a new rule that gives some of their patients a grace period of 90 days. Doctors have to treat people with new, government-subsidized policies as insured, even if they're months behind in paying their insurance premiums. And if the person never pays up, doctors have to go after the patient for payment themselves. Anders Gilberg represents doctors through the trade group MGMA.

ANDERS GILBERG: That's where I think the concern comes in, is if you've already chosen not to continue your insurance, then, again, the difficulty in collecting from someone who's already made that choice is a concern for physician practices.

WHITNEY: So doctors want to be able to know as soon as possible when a patient enters a grace period. That way they could maybe wait to schedule some procedures or work out a payment plan like they would with an uninsured patient. Bob Laszewski consults for health insurance companies. He says providing instant notification of a person's grace period status is actually pretty complicated. It means insurance companies have to set up a whole new tracking system for people who get extra time to pay their bills.

BOB LASZEWSKI: It's an administrative mess is what it is. The doctor is the one taking it on the chin right now. And the doctor is saying, no, I want the insurance company to take it on the chin. Well, there's a solution for you.

WHITNEY: Laszewski says insurance companies can't instantly verify whether a person is in a grace period now anyway, not until can get customer payment information to insurers. Even state insurance regulators are asking for clarification. They say states already have jurisdiction over some grace periods, and now there's confusion over who determines when a plan is canceled.

In a written statement to NPR, the Department of Health and Human Services says, grace periods are important to ensure customers aren't dropped from coverage, especially those experiencing economic challenges. Current regulations say insurance companies should tell doctors when a person enters a grace period as soon as is practicable. For NPR News, I'm Eric Whitney.

SIEGEL: And that story was produced through a partnership of NPR and Kaiser Health News.

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