Considering Insurance Billing For College Health And Counseling Services

Abstract

A combination of decreased funding and increased demand for services has necessitated a transition from pre-paid funding to substantial fee-for-service charges and insurance reimbursement for many college health and counseling services. The Patient Protection and Affordable Care Act (ACA) is a contributing factor for this trend because it creates an opportunity to obtain 100 percent insurance reimbursement for preventive care services.

Some colleges have rushed to take advantage of insurance billing revenue opportunities without carefully considering the regulatory requirements for health care providers relative to insurance billing and charges for patients. This paper addresses the concern that college health and counseling services may inadvertently engage in impermissible billing practices if they, without first making individual patient ability-to-pay allowance determinations, (1) waive charges for uninsured students and/or (2) do not collect insurance copayments, deductibles, and coinsurance charges from insured students.

This paper explains the opportunity to obtain secondary payor status for health fees and other institutional funding arrangements in the coordination of benefits (COB) process with students' personal health insurance. While the net financial result might be the same, obtaining secondary payor status for health or counseling center funding is not the same as simply waiving charges as described in the preceding paragraph.

For many colleges and universities, the possibility that almost all students ultimately may be enrolled in a student health insurance benefit/program (SHIBP) is a major factor determining whether insurance billing is a worthwhile endeavor. The likelihood that states will consider formalizing the regulation and/or licensing of self-funded student health plans, as suggested by the regulations for student health insurance plans finalized under the ACA in March 2012,¹ may create an opportunity for also considering the permissibility of secondary payor status for college health service funding arrangements. Several states presently allow secondary payor status for health service funding arrangements.

Historical Values for Pre-Funding of College Healthand Counseling Services

Providing unfettered access to health and counseling services, regardless of students' insurance status or ability-to-pay, is a recognized best practice for the college field.² This was a cornerstone of the rationale for colleges to charge designated prepaid health fees and/or use other institutional funding arrangements to pre-fund primary care visits and counseling services. Confidentiality of care was another imperative. Confidentiality may be diminished if visit or other charges are submitted through a parent's employer-sponsored group insurance or a parent's individual policy that covers family members.³ A common third rationale for health fees and other institutional funding was that public health services and health promotion and wellness programs could not be funded adequately either from direct health insurance reimbursements or from fiscal surpluses derived from the operation of health and counseling services.

The Shift Away from Pre-Paid Funding for College Health Services

The majority of residential private colleges and universities have maintained pre-funding of their health and counseling services through designated health fees and/or institutional funding allocations. Generally, these private institutions assure students and parents that there will be no charges for medical or counseling visits, and that ancillary services (e.g., laboratory and radiology, prescription medication, and specialty services such as minor surgical procedures, dermatology, or physical therapy) will be provided with nominal costs. Although less common, many prominent public universities have maintained pre-funding of health service care by achieving long-term support among students, parents, and senior institutional leadership, resulting in consistent increases in health fee and/or institutional funding support.

In contrast to the situation described in the preceding paragraph, the adverse cost trend for higher education over the past three decades and the recent economic downturn, combined with the increased demand for services discussed in the following section, have resulted in the diminution of the historical linkage between pre-funding of services and unfettered access to care.⁴ In 2000, surveying by Hodgkins Beckley Consulting (HBC) found there were only four major college health services that derived more than 60 percent of annual revenue from fee-for-service charges and insurance reimbursements.⁵ By 2007, an extrapolation of a national survey by the American College Health Association (ACHA) suggested that more than 150 colleges were in the so-called "60% + Club" relative to health service funding.⁶ This projection was affirmed by the 2011 Sunbelt survey, showing that 25 percent of public universities had fee-for-service revenue that accounted for 50 percent or more of total operating budgets.⁷

These data are in stark contrast to those of the late 1980s when Dr. Kevin Patrick's overview article for the college health field in the Journal of the American Medical Association reported that less than 15 percent of college health service revenue was derived from fee-for-service among major public universities and less than eight percent among private colleges and universities.⁸ It is likely that from the 1950s through the 1970s, major college health services had only nominal charges for ancillary services⁹ and many also provided 24-hour care and infirmary services without charge.

Increased Utilization of College Health and Counseling Services

The trend towards adopting substantial fee-for-service charges was necessitated by more than just institutional concerns for reducing tuition and fee increases. Over the past three decades, both increased demand for services and increased utilization of services (including a broad spectrum of high-cost prescription medications and immunizations) were additional major causes for the shift in the source of programmatic funding for many college health services. As explained below, the increased demand for services includes a sustained, widespread increase in need for mental health care services. Demand for services was also affected by the emergence of college students as one of the single largest cohesive groups of uninsured and under-insured Americans.¹⁰

Increased societal acceptability for using mental health care services,¹¹ more severe mental health conditions (a national survey of college counseling directors reported a 16 to 44 percent increase in severe psychological disorders from 2000 to 2010),¹² and proliferation in the use of depression screening¹³ have required significant expansions of counseling staffs. For example, at colleges and universities with enrollment between 7,500 and 25,000 students, there was a 33.5 percent increase in the number of counselors from 2007 to 2011.¹⁴

The ACAand Full Coverage for Preventive Care Services

The preventive care benefits mandated in the Patient Protection and Affordable Care Act (ACA) are a major new driver for college health service leaders to consider shifting funding resources to visit and ancillary service charges. There is a broad spectrum of preventive care services that must now be covered for adults, children, and women/pregnant women, without any out-of-pocket expense for the covered person. Covered services for adults include depression screening, alcohol misuse screening and counseling, obesity screening and counseling, routine immunizations, sexually transmitted infection prevention counseling for adults at higher risk, and numerous other services that would commonly be provided by college health and counseling services.¹⁵

One hundred percent coverage for preventive care services is required for all health insurance/ benefit plans, including plans with high deductibles. Generally, college health and counseling services cannot be excluded or limited from receiving ACA mandated preventive care benefit payments to the extent in-network participating provider status is obtained.

In creased Enrollment in Student Health/Insurance

Benefit Programs

Contrary to expectations for the impact of the ACA's age 26 mandate for dependent eligibility, for a second consecutive year almost all colleges and universities providing comprehensive coverage experienced either stable or increased student health insurance/benefit program (SHIBP) enrollment.¹⁶ This is primarily due to the cost advantage of these SHIBPs over employer-sponsored and individual health plans, and it is increasingly likely that SHIBPs will have favorable costs compared to options available to students on insurance exchanges created under the ACA.¹⁷ Alternatively, many low cost SHIBPs did not experience enrollment gains because they provided inadequate plan year or lifetime maximums and/or had severe internal plan limits.

If, as a result of comparably favorable benefits and costs, a college or university can project that almost all students will enroll in its SHIBP, it may not be worthwhile to incur the costs to change to a funding model based in large part on insurance reimbursements. If almost all students are covered by the SHIBP, a cost component (i.e., capitation) in the SHIBP could replace health fees and/ or institutional funding, and there would be no reason to bill charges on a fee-for-service basis for a relatively small number of students covered by other insurance plans. This long-term view for the favorability of SHIBPs for almost all students may be contingent on (1) the ACA being implemented with funding for health insurance for low income students and (2) such funding being available to pay for the cost of SHIBPs.

For other colleges that do not anticipate the majority of students will soon be covered by a SHIBP, the health service becoming a participating provider and developing new revenue streams for preventive care services could still provide important transitional funding. For colleges that discontinue providing a SHIBP, new insurance billing revenue may be essential for adequate health service funding.

Variable Success for Developing Insurance Billing Revenue

College health and counseling services that have adopted visit charges and ancillary fee-for-service charges are experiencing varying success for maintaining an open access objective for providing care to students. Most have found that access to services is best assured when there is an effective insurance requirement as a condition of enrollment, when the SHIBP provides comprehensive benefits (including full coverage for health service charges) and has a favorable cost, and when the health service is able to be a participating provider with almost all students' personal health insurance plans. Success in developing insurance billing revenue is optimal if the college or university is located in a geographic area where employer-sponsored health plans have relatively low copayments for primary care visits for illness or injury (even if there is a high deductible health plan) and the participating provider reimbursement rates for primary care visits are favorable.

For some colleges and universities that have joined the "60% + Club," the overall experience has not been favorable. The Lookout Mountain Group noted in its major 2009 report on health care reform for the college student population that ". . . [the movement away from pre-paid funding] has been adopted imprudently relative to environmental conditions, and/or implemented without appropriate understanding of insurance participating provider contracts, and many students were disenfranchised from access to health care services."¹⁸ Disenfranchising students from access to care has occurred through several different scenarios. In most instances, the health service effectively participates with only the SHIBP, resulting in most of the students with other private health insurance either seeking services off campus or forgoing care. The increased trend, particularly since the passage of the ACA, for employers to adopt high deductible health plans¹⁹ greatly increases the concern for access to care because of students' increased out-of-pocket expenses.

Even if there is a considerable increase in new revenue derived from insurance coverage, and no overall decrease in utilization is attributable to a specific funding model, or if any decrease in utilization is offset with operational cost reductions, a much more subtle question remains: Do overall campus health utilization statistics mask underlying access issues for lower income students? Cornell University found this to be the case and reported their findings at the American College Health Association's (ACHA) 2012 annual meeting.²⁰ Cornell provides access to professional services (primary care, psychiatry, and counseling visits) as a tuition benefit, but its health service charges for all other services and is a participating provider only with Cornell's student health insurance program. Cornell has tracked its utilization data according to students' financial and insurance status since 2006, and these data have consistently demonstrated that as a students' financial resources decline, a growing gap in access to care emerges for those students who waived enrollment in Cornell's student health insurance program. Cornell has evaluated the option of insurance billing and found that, without being able to waive remaining balances, out-of-pocket costs would increase for approximately 60 percent of students, worsening access issues.

Waiving Insurance Co-payments, Deductibles, and Coinsurance Charges

As was noted in numerous open discussion comments at the 2012 ACHA meeting in Chicago and in regional college health meetings in the fall of 2012, some college health services have obtained participating provider status with students' personal health insurance and are automatically waiving insurance copayments, deductibles, and coinsurance charges without completing individual ability-to-pay allowance determinations. The open discussion comments suggest many of these college health services have simply adopted a policy to automatically waive charges for uninsured students and/or for students who have remaining balances from their insurance coverage.

As shown in a 2010 advisory publication issued by the Minnesota Medical Association (refer to Appendix A), there are both federal and state laws that affect the permissibility for waiving charges in excess of small gift and service allowances. Generally, the only way for a health care provider to permissibly waive insurance remaining balances is to document that the patient has limited financial resources and that the charges, if not waived by the health care provider, would create a substantial financial hardship for the patient.²¹ Thus, while there are exceptions in varying states, health care providers can waive charges for patients only when detailed financial information supports reduction or elimination of charges based on the provider's completion of an individual ability-to-pay determination. This financial hardship assessment must be periodically updated to remain valid. Based on a review of literature and case law in preparation for this paper, there is no reason to believe college health and counseling services are not under the same constraints for waiving insurance charges as private-sector health care providers.

In addition to states having anti-fraud and false claim statutes and regulations, participating provider contracts usually stipulate that all copayments, coinsurance, and deductibles must be collected, absent an ability-to-pay allowance determination for the patient. There are no state insurance regulatory authorities that have issued interpretive bulletins allowing waiving of student health service charges without following ability-to-pay determinations. While the net financial result might be the same, obtaining secondary payor status for health or counseling center funding, as discussed in this paper, is not the same as waiving copayment, coinsurance, or deductibles for insured students or waiving charges for uninsured students.

Understanding Coordination of Benefits

Coordination of benefits (COB) refers to the process for determining the order in which payments will be made when a person is covered by two or more health plans. On its website, one prominent multi-state Blue Cross and Blue Shield plan provides this explanation of COB for employers providing group health insurance coverage:

"When a member of your group is covered by more than one health plan (for example, when one of your employees is covered under your group plan as well as a spouse's health plan), one plan is considered to be the primary carrier and the other is considered to be the secondary carrier. The primary carrier covers the major portion of the bill according to plan allowances, and the secondary carrier covers any remaining allowable expenses. The COB provisions of your policy or plan determine which plan is primary. That plan's benefits are applied to the claim first. The unpaid balance is usually paid by the secondary plan to the limit of its responsibility. Benefits are thus "coordinated" among all of the health plans, and payments do not exceed 100% of charges for the covered services."²²

A common example of COB occurs when both of a child's parents cover him or her through each of their respective employer-sponsored group health insurance plans. When the child incurs health care expenses, the parent's plan that is required to pay first is referred to as the primary plan, and the plan that covers the remaining balance is the secondary plan.

Most states have adopted some form of the model coordination of benefits statute endorsed by the National Association of Insurance Commissioners (NAIC). The NAIC's model statute is available at its web site at http://www.naic.org/store/free/MDL-120.pdf . Finding a specific state's COB statute is relatively easy with a Google search (statutory citations by state can also be obtained at:

http://www.askmariatodd.com/resources/articles/state/163-sbscob.html).

Secondary Payor Status for HealthFees and Institutional Funding

Even though college health fees are not a form of health insurance, and do not constitute health insurance premiums, state insurance regulatory authorities often conclude that health fees and other institutional funding arrangements fall within the definition of a "plan" in their COB statutes (refer to Appendix B) and are precluded from automatically covering remaining balances for copayments, deductibles, and coinsurance under students' personal health insurance plans. More specifically, some state insurance departments have found that health fees and other institutional student health care funding arrangements constitute "Group Type Contracts" (refer to Appendix B). Having found that health fees and other institutional funding arrangements are a form of "plan" under COB, they also find student health care funding arrangements are not listed in the plans/funds that are excluded from the COB statute (refer to Appendix B). It is noteworthy that student health insurance plans that provide accident-only coverage (e.g., plans that cover only intercolle-giate sports injuries) are permitted to take secondary payor positions by being excluded from their state's definition of "plan" under COB.

Several states (e.g., Minnesota, Massachusetts, and Florida) either directly or indirectly permit college health and counseling services to establish their funding systems as secondary payors in coordinating benefits with students' personal health insurance. In these states, colleges can use a funding model in which medical expenses are submitted to students' personal health insurance before their health fees or other institutional health funding arrangements provide coverage. In other words, health fees and other institutional funding are able to take a secondary payor position in coordinating benefits with students' personal health insurance (see examples below for health fees covering copayments, deductibles, and coinsurance). In such states, college health services have developed new insurance revenue streams that often exceed one-third of operating budgets. This substantial revenue may increase significantly as ACA preventive care services are expanded and appropriately charged to students' personal insurance.

Colleges and universities in Minnesota, Massachusetts, and Florida have successfully contracted with insurance companies and health plans and are obtaining insurance reimbursements for office visit charges, ancillary services, and preventive care services that would have otherwise been funded by the college or university and/or direct charges to students. This requires health services to become participating providers with the health insurance plans that cover their students, develop electronic billing systems/processes, insure accurate service coding, and engage in other practices that are common for community health care providers. As is the case with community health care providers, small college health services with limited administrative capability may choose to retain a third party to submit medical claims to students' insurance plans.

In summary, having a definitive statutory or regulatory authorization that establishes that health service funding arrangements may take secondary payor positions is the only certain path to having health fees or other student health care funding arrangements cover the expenses not paid by students' private health insurance.

Common Components for a Secondary Payor System

When allowed by state statute, regulation, or regulatory ruling, the following are common components for a secondary payor system college health service funding (the same components would apply if counseling is provided or if there is a separate counseling service).

• The health service enters into participating provider agreements with the major insurance carriers/health plans covering its students. It is often advantageous for a health service to join a local independent provider association (IPA) or a physician hospital organization (PHO) to obtain participating provider status through a single contracting entity. Various commercial billing services may also be available to assist with obtaining participating provider status. Many large college health services have sufficient resources to obtain participating provider status without having to use an IPA, PHO, or commercial billing service.
• The health service develops fee-for-service charges for all medical services, including office visits. Counseling services usually continue to be pre-funded for students, regardless of whether they have personal health insurance coverage. Visit costs and other fee-for-services are typically set at a level that is above the highest participating provider reimbursement rates (i.e., participating provider contractually allowed charges).*
• If not already in existence, the college health service enters into a direct participating provider agreement with the college- or university-provided SHIBP. The reimbursement system can be based on either capitation or fee-for-service charges, but the total reimbursement must reflect the fair market value of the services provided. While the allowed charges can be at the lowest level of reimbursement among all participating provider agreements, some state insurance regulatory authorities will require the SHIBP's reimbursement level be generally comparable to the aggregated reimbursement (as a percentage of charges) from other private insurance plans. For example, the average total reimbursement from insurance plans other than the SHIBP could be 45 percent of billed charges (net of copayments, coinsurance, deductibles, and exclusion of services not covered), and the SHIBP capitation or fee-for-service charge system could be set to result in 40 percent of charges being covered.

• The health service defines the services for which it will use health fees or other institutional funding to cover (i.e., covered services) what students' primary health insurance plans do not reimburse. For example, covered services could include charges for office visits, procedures allergy injections, flu shots, radiology, and lab tests (including certain reference lab tests). The scope of covered services typically excludes travel medicine services/immunizations, employment physicals, and other services routinely excluded by health insurance/benefit plans.
• The health service bills students' health insurance plans using its electronic health record/ practice management systems. These systems typically have billing capability through the use of an electronic billing clearing house. Alternately, the health service may bill insurance plans directly or contract with a commercial billing service.
• Health fees or other institutional funding continue to cover health education and promotion services which are generally excluded by health insurance plans (i.e., no charges rendered for these services). Most colleges also continue to cover counseling services to insure there are no confidentiality barriers for students to access care (e.g., concern that explanation of benefits statements will be sent to parents when students are covered under a parent's group health insurance plan or individual family policy).*

* A discussion of the validity of the concern for confidentiality for counseling services versus medical care services is provided in point D on page 15.

Footnotes

1 "Student Health Insurance Coverage, Final Rule," Federal Register 46 CFR Parts 144, 147 and 158 (21 March 2012). 16455.

2 Lookout Mountain Group, "Analysis and Policy Recommendations for Providing Health Insurance and Health Care Services for the College Student Population," 25, June 2, 2009. http://lookoutmountaingroup.net/

3 Michelle Andrews, "Insurance Dependent Can Face Special Challenges on Privacy," Kaiser Health News, October 1, 2012. http://www.kaiserhealthnews.org/features/insuring-your-health/2012/under-26-insurance-privacy-michelle-andrews-00212.aspx?referrer=search

4 Hodgkins Beckley Consulting, "Preparing for FY10 Health Service Funding," October 15, 2008. http://hbc-slba.com/EM101508.pdf

5 Ibid.

6 Ibid.

7 University of North Carolina at Charlotte, 2011 Sunbelt General Information Survey. https://studenthealth.uncc.edu/sites/studenthealth.uncc.edu/files/media/pdf_library/3.%20General%20Info.% 20Survey%20Results%20Fall%202012%2003%2005.pdf

8 Kevin Patrick, MD, MS, "Student Health Medical Care Within Institutions of Higher Education," Journal of the American Medical Association, 1988;260(22):3301-3305.

9 Ibid.

10 Lookout Mountain Group, "Analysis and Policy Recommendations," 5-6.

11 Suzanne Jacobs, "Experts Mull Trend of Mental Health Issues Among Students," The Michigan Daily, March 28, 2011. http://www.michigandaily.com/news/experts-unsure-causes-increase-mental-illness-among-college-students?page=0,2

12 Trip Gabriel, "Mental Health Needs Seen Growing at Colleges," The New York Times, December 19, 2010. http://www.nytimes.com/2010/12/20/health/20campus.html?pagewanted=all

13 Jacobs, The Michigan Daily, 9.

14 Hodgkins Beckley Consulting, analysis of the 2007 and 2011 Association for College and University Counseling Center Directors annual counseling center director surveys. http://hbc-slba.com/cctrend.pdf

15 US Department of Health and Human Services, "Preventive Care Services Covered Under the Affordable Care Act," Last Updated, September 27, 2012. http://www.healthcare.gov/news/factsheets/2010/07/preventive-services-list.html#CoveredPreventiveServicesforAdults

16 Hodgkins Beckley Consulting, "Enrollment in High Quality Student Health Insurance Plans Remains Stable," January 11, 2013. http://www.hbc-slba.com/costsur0113.pdf

17 Christian Torres, "College Health Plans: Exploring the Options," Kaiser Health News, June 18, 2012. http://www.kaiserhealthnews.org/Stories/2012/June/19/student-health-plans.aspx?p=1

18 Lookout Mountain Group, "Analysis and Policy Recommendations," 33.

19 Chad Terhume, "More Employers Embrace High-deductible Health Plans to Pare Costs," Los Angeles Times, November 14, 2012. http://www.latimes.com/business/money/la-fi-mo-employer-health-plans- 20121114,0,5072819,print.story

20 Christopher Payne, "Policy Implications of Insurance Billing for Campus Health Services," Presentation at the 2012 annual meeting of the American College Health Association, June, 2012, Chicago, Illinois.

21 Andrew O. Bunn and Wilson D. Antoine, "Preserving Copayments and Deductibles to Contain Healthcare Costs," Business and Torts Journal, Volume 18, No. 2, Winder 2011, 3. http://www.dlapiper.com/files/Publication/31a8adf1-e3d3-43fd-9c75-9411668cadc7/Presentation/Publication Attachment/a2676d8b-f92b-4eab-bb7c-9c55466d7927/reprint_bunn.pdf

22 Anthem Blue Cross and Blue Shield, Coordination of Benefits, "How COB Works." http://www.anthem.com/wps/portal/ahpemployer?content_path=employer/va/f5/s1/t0/pw_034763.htm&state=va&rootLevel=4&label=Coordination%20of%20Benefits%20%28COB%29

23 American College Health Association, "Standards for Student Health Insurance/Benefit Programs," March 2008, 2. http://www.acha.org/Publications/docs/Standards%20for%20Student%20Health%20Insurance_Benefits%20 Programs_Mar2008.pdf

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