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Routine Waiver of Patient Financial Responsibility – A Wolf in Sheep’s Clothing

By: Michael Silverman

While not a ‘classic’ kickback – such as the scenario of a practitioner receiving remuneration in exchange for a prescription or referral of healthcare business – the routine waiver of patient financial responsibly by a healthcare provider ALSO constitutes healthcare fraud, even for commercially insured patients!

Unfortunately, such a serious violation does not readily come to mind for many of those operating in the healthcare space, but its relatively straightforward once you think about it. In essence, a financial incentive is being provided to the patient to utilize the services of a certain healthcare provider by virtue of that individual not being subjected to out-of-pocket expense they normally would be subjected to if they were to utilize another similarly situated provider.

As a recent settlement by a pharmaceutical company reminds us, routine waivers of (or paying for) a patient’s financial responsibility – such as a co-payment or deductible – violates a myriad of state and Federal regulations, including the Federal False Claims Act and Federal Anti-Kickback Statute.

Clients often present me with the scenario where there are no state or federally funded healthcare programs (e.g., Medicare, Medicaid, Tricare) and inquire as to whether routine waiver of patient financial responsibility is compliant.

The short answer is “NO” – the routine waiver of patient financial responsibility even for strictly commercially insured patients is against several laws!

For example, here in the state of Florida, in addition to violations of state anti-kickback regulations, such waiver of patient financial responsibility specifically violates F.S. § 817.234(7)(a) , which states that waiver of deductibles or copayments/lack of intent to collect constitutes insurance fraud.

There are acceptable situations in which a healthcare provider may ultimately not collect patient financial responsibility, but routine waiver is not one of them. Healthcare business owners need to ensure they are apprised of the regulatory do’s & don’ts of all aspects of their operations.