*** The Health Care Programs Manual (HCPM) has been replaced by the Minnesota Health Care Programs Eligibility Policy Manual (EPM) as of June 1, 2016. Please refer to the EPM for current health care program policy information. ***
Effective: January 1, 2010 |
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24.15.10 - Determining Net Health Care Expenses |
Archived: June 1, 2016 (Previous Version) |
Allowable net health care expenses are applied to a client’s spenddown. This section provides steps to calculate the net health care expense. It also provides information regarding third party payments.
Steps to Calculate Net Health Care Expenses.
One Payment for Multiple Expenses.
Steps to Calculate Net Health Care Expenses
To calculate net health care expenses, follow these steps:
1. Verify the actual gross cost of the health care expense.
2. Deduct from the gross cost the following amounts:
l Verified portions of the expense paid by the client prior to the current certification period.
l The portion of the expense used to meet a previous spenddown.
3. Determine if third party liability coverage exists to cover all or part of the cost.
l Deduct verified amounts paid by a liable third party, such as health insurance or Medicare.
Note: See One Payment for Multiple Expenses when one payment is made by the third party covering multiple expenses.
l Verify amounts denied by liable third party payers.
Note: Clients must provide the Explanation of Medical Benefits (EOMB) from the payers. Contact the third party directly if the client does not provide it but signs the appropriate consent for release.
l Deduct anticipated third party payments based on coverage information in the insurance policy or other sources.
n Use the best information available to estimate the amount a third party will pay if verification cannot be obtained during the processing period.
Note: Do not delay processing the application or redetermining eligibility beyond the program processing standards.
n Estimate Medicare payments to be 80% of gross health care expenses for a client on Medicare.
4. Deduct non-liable third party payments from the gross medical expenses if the payment, write-off or discount occurs before the application is processed.
l Do not anticipate or estimate non-liable third party payments if there is not enough information to establish an amount.
l Spenddowns are not recalculated for payments, write-offs or discounts made after the MA approval.
Example:
Harold states that his mother is willing to pay $100 on an old unpaid medical expense.
Action:
Do not anticipate that Harold’s mother will pay the unpaid medical expense if she does not pay the $100 before the application is processed. Apply the current unpaid balance as an allowable expense.
5. Document third party coverage payments, denials and estimates in case notes, including but not limited to:
l Attempts to get third party verification and information.
l How the third party payment calculations were determined.
l How third party payments were used to determine net health care expenses.
One Payment for Multiple Expenses
Sometimes third parties will issue one payment for several different health care services and not break down the payment by date, type, and cost of each service covered. If this is the case, follow these steps:
1. Attempt to get a breakdown of the payment by service, including the date of service and the amount paid for that service. The information may be obtained by either:
l Requesting the third party to provide a breakdown.
l Examining available coverage information.
2. Deduct the third party payment from the gross cost of each service.
Note: If it is not possible to get the breakdown within the case processing standards, apply the total payment against the services it covers starting with the oldest expense. Continue applying the payment until it is used up.
Consider any remaining health care expenses to be the client’s responsibility and use them to satisfy the spenddown.
3. Document the following in case notes:
l How the information was obtained or attempted to be obtained.
l The exact calculation to show how the third party payments were applied.