Balance Billing Protections for Dual Eligibles and Qualified Medicare Beneficiaries

Individuals covered by Medicare and the Qualified Medicare Beneficiary program (QMB) cannot be balance billed by Medicare-participating providers. These providers cannot require people with Medicare and QMB to pay any co-pay, co-insurance, or any other out-of-pocket expenses.

Individuals covered by Medicaid (with or without Medicare) can not be balance billed by Medicaid-participating providers. These providers cannot require people with Medicaid to pay any co-pay, co-insurance, or any other out-of-pocket expenses.

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Improper billing of dual eligible Medicare beneficiaries (dual eligibles) and Qualified Medicare Beneficiaries (QMBs), sometimes referred to as a form of balance billing, is a persistent problem. Under the QMB program, state Medicaid agencies help pay Medicare premiums, deductibles, co-payments, and coinsurance. But states do not have to pay doctors the full amount of such costs, leaving doctors with unreimbursed expenses. Doctors sometimes bill patients for these expenses in violation of federal and state law.
This article explains the origin of the balance billing problem, discusses state and federal protections, and advises advocates on what to do when doctors improperly bill patients.

The Problem

What is the QMB Program?

The QMB program is one of several Medicare Premium Payment Programs designed to help pay for out-of-pocket costs for Medicare beneficiaries. People age 65 and older and adults with disabilities may qualify for the QMB program if they meet certain income and financial resource requirements. For those who are eligible, Medicaid will pay for costs not covered under Medicare Part A and B.

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For more information on eligibility, see the regulations (at pg. 87) promulgated by the RI Executive Office of Health and Human Services (EOHHS). QMBs are not always aware of their status. Individuals can confirm their QMB status by calling 1-800-MEDICARE. Advocates can confirm QMB status through the State’s Medicaid Management Information System (MMIS) or through the Medicare Plan Finder.

Many QMBs are also full-benefit dual eligible s who qualify for full Medicaid coverage under their state laws. Likewise, most dual eligible s with full Medicare and Medicaid benefits also are QMBs. But not all QMBs are dual eligible, and not all dual eligible s are QMBs. They are two separate programs, with separate eligibility requirements.

What is Balance Billing?

Generally, Medicare beneficiaries are responsible for paying certain costs like premiums, deductibles, co-payments, and coinsurance. The purpose of QMB is to help pay for these out-of-pocket costs. QMB protects beneficiaries from having to pay for costs not covered under Medicare Part A and B.

Example 1:
Quentin, a dual eligible QMB, goes to see his primary care doctor. The office visit is valued at $100 on the Medicare fee schedule. Medicare pays 80 percent ($80). The doctor is prohibited from billing Quentin for any balance.

This does not always mean that the doctor gets paid the other $20. The QMB program may or may not cover that payment, but the beneficiary is protected anyway. A federal statute explicitly allows states to limit payment to either the Medicare cost-sharing amount or the state’s Medicaid rate for the same service, whichever is smaller. This is known as the “lesser-of ” rule. This policy, given generally low Medicaid rates, often leads to providers not being entitled to any additional payments from Medicaid.

Example 2:
Quentin, a dual eligible QMB, goes to see his primary care doctor. The office visit is valued at $100 on the Medicare fee schedule. Medicare pays 80 percent ($80). The Medicaid rate for this office visit is $70, lower than the Medicare rate. Quentin lives in Rhode Island, which has adopted the “lesser-of” rule for physician visits, so his doctor is only entitled to $70 under the Medicaid rules. Since the doctor has already been paid $80, she receives no additional payment from the state Medicaid program. The doctor is prohibited from billing Quentin for any balance.

What to do in the Event of a Violation

Beneficiaries and their advocates should first tell their providers that they may not be billed. Justice in Aging has produced model letters that a beneficiary or advocate can send to a provider as part of its Improper Billing Toolkit.

If the provider does not successfully resolve the billing problem, beneficiaries can call 1-800-MEDICARE, where representatives will refer the issue to the Medicare Administrative Contractor (MAC) for the region where the beneficiary lives. The Medicare contractor will send a letter to the provider instructing the provider to return any payments received from the QMB and to cease any current billing or collection effort. Importantly, the MAC will also send a letter to the beneficiary with a copy of the provider communication and with instructions not to pay the bill.
To report violations of the Rhode Island prohibition on supplementary payments to Medicare providers, contact EOHHS.

Billing Protections

Federal

For QMBs

Federal law, 42 U.S.C. § 1396a(n)(3)(B), provides that no Medicare-enrolled provider may require payment directly from a QMB for Medicare-covered services. The statute subjects Medicare providers to federal sanctions, including disenrollment from the Medicare program, for violating this provision. Note this applies to all QMBs, regardless of whether they have original Medicare or Medicare Advantage, or whether they have Medicare only or are dual eligible.

For Other Dual Eligibles
CMS regulation, 42 C.F.R. § 422.504(g)(1)(iii), requires that Medicare Advantage plans, in their contracts, ensure that all Medicare Advantage plan providers accept the capitated rate from the plan as payment in full. Providers cannot charge full-benefit dual eligible or QMBs for Medicare cost-sharing.

Rhode Island

A Rhode Island regulation, R.I. Admin. Code 39-3:0301.10, provides that “payments to Medicaid providers represent full and total payment. No supplementary payments are allowed, except as specifically provided for by contract.” Note that this protection applies to all Medicaid beneficiaries, not just QMB’s or other dual-eligibles.
Neighborhood INTEGRITY, sometimes called the Medicare-Medicaid Plan (MMP), is a plan under which eligible individuals receive all their covered benefits in Medicare and Medicaid plus additional services through a single integrated plan. Under RI EOHHS regulations, Neighborhood is required to “ensure Provider Network compliance with all Enrollee payment restrictions, including balance billing restrictions, and develop and implement a plan to identify and revoke or provide other specified remedies for any Enrollee of the Contractor’s Provider Network that does not comply with such provisions.”

Contact Information

1-800-MEDICARE
(Call to report improper billing, or confirm QMB status)
1 (800) 633-4227 (TTY 1 (877) 486-2048)
Hours: 24 hours a day, 7 days a week

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