Insurance Payment Delays Causing Hardships for UIC Employees

By Gail Mansfield

MARIA MORALES’ daughter, who has GoldenHar Syndrome, needed an ocular prosthesis at a cost of $2,200. Morales, Associate Director in the Office of Student Financial Aid, promptly paid the portion she owed after insurance, $840—but the doctor refused to give her daughter the eye until full payment was received from the insurer.

FACED WITH the choice of letting her daughter go without her prosthetic eye for the better part of a year, Morales paid the entire $2,200 out of pocket…then waited nine months for the Quality Care Health Plan (QCHP) to reimburse her.

           

MORALES IS just one of the thousands of UIC employees whose physical, financial, and emotional well-being is being compromised by the State of Illinois’ budget disaster. Without sufficient revenue flow to pay its bills, the State is floating QCHP and Quality Care Dental Plan (QCDP) payments to healthcare providers and patients for month after month after month. The result: compromised credit scores, provider demands for payment in advance of services, unnecessary interest charges to both providers and patients, and useless Flexible Savings Plan (FSA) dollars.

301 days behind

“THE DELAY in payment of QCHP and QCDP claims by the State is a concerning and ongoing issue,” said Katie Ross, Director of Human Resources Administration from University Human Resources. “Due to its economic situation, the State does not have sufficient funds to maintain a timely and regular payment schedule.”

           

TO HELP keep State employees informed, the State’s Department of Central Management Services (CMS) created a website—updated frequently—to provide the date of claims currently being paid for the Quality Care health and dental plans, Ross noted. Visit http://www2.illinois.gov/cms/Employees/benefits/Insurance/Pages/QCHPQCDPClaimPaymentDelay.aspx, or access the site from NESSIE.

ACCORDING TO a statement on the site, “The State of Illinois is facing a difficult and unprecedented funding situation which has significantly impacted the State Employees' Group Insurance Program through the delay of claim payments under the Quality Care Health Plan and the Quality Care Dental Plan…Funding availability is based on State revenue, which fluctuates from month to month.

“AT THIS time funds remain insufficient to pay claims on a normal schedule, and we cannot estimate when a regular payment schedule will resume. Claim payments will be released according to the claim process date and available funding. CIGNA, the claims administrator, continues to process claims in a timely manner, but release of claims must be held until revenue is available. Late payment interest is paid to healthcare providers on health claims that take longer than 30 days from the receipt of a complete claim submission to pay.

“IF YOU decide to make arrangements with your out-of-network provider to pay the outstanding balance or establish a payment plan, your provider should reimburse you after they receive payment from CIGNA. It is your responsibility to make reimbursement arrangements with your provider.”

AS OF January 24, claims processed through March 29, 2012, have been released to QCHP-contracted providers: a whopping 301 days’ delay. Claims processed through February 2, 2012, have been released to non-QCHP-contracted providers.

A CIGNA representative reported on Jan. 3 that there was “a 43-week hold on checks” from CIGNA to State of Illinois employees.

THE SITE also provides a client services feedback form that invites users to send messages describing how the delay in claims payment is affecting them, as well as contact information for questions. “We encourage employees to use these mechanisms to provide feedback and seek assistance with concerns about delayed payment,” said Ross.

Credit ratings in distress

MULTIPLE STAFFERS report having their credit endangered or actually damaged due to the State’s late payments. One employee who asked to remain anonymous received a call from the provider asking her to pay her $8,500 hospital bill. She contacted an insurance representative and was told they probably would not pay the bill until seven to eight months after her hospital stay. The insurance rep “told me the provider would place my bill with a collection agency, which will eventually affect my credit rating,” the employee relates. “Well, it did. What am I supposed to do?”

“IT’S CRAZY that I have to call doctors and explain that although my insurance will pay in full, I need to make payments of $100 a month to stop my bills going to collections,” said Eric, an employee who asked that his last name not be used.

“I HAVE doctors chasing me around because the State is taking so long to pay the bills,” said Alexander Schilling, Director of the Research Service Facility-Mass Spectrometry, Metabolomics, and Proteomics, in the Research Resources Center. “Clearly, if doctors are pursuing collection, my credit rating may be damaged due to the State’s irresponsibility.”

ALTHOUGH UIC employees are holding up their end of the benefits bargain, the Illinois General Assembly is reneging on its commitments, Schilling said. “I paid my premium; they should pay the bills once they agree to cover them,” he continued. “Doctors who provide good, timely medical treatment do not deserve to have cowardly politicians try and balance the State’s books on their backs.”

ONE HOSPITAL employee who wanted to remain anonymous said she has paid some of her children’s dental bills up front “just to keep in good standing with my dentist, who has been very patient in waiting,” she said. “The turnaround time for payment has been as much as 200 days.”

ROBERT E. LARSON, Assistant Director for Architectural Services in the Office for Capital Programs, said he paid a bill for an ER visit to avoid having it sent to collections. “My dentist now wants cash up front from patients with our State dental insurance,” he added, describing another situation State employees are facing: healthcare providers’ demands for payment at the time of services.

Patients, produce the cash

NICK ARDINGER’S dentist was paid for his last checkup and cleaning just before Ardinger arrived for his next visit…six months later. “As a result, my dentist now requires us to pay the whole amount and get reimbursed ourselves,” said Ardinger, Assistant Director for Marketing, Campus Housing.

           

OVER THE decade in which Darlene Peters’ family has been visiting its dentist, “he has been very willing to provide services and wait for reimbursement from our insurance company,” said the former employee in Interventional Radiology. “That all came to an end last summer when I became my family’s primary insurer.

           

“WHEN A family of five goes to the dentist and gets the routine cleaning, X-rays, fluoride, etc., it can be very expensive,” Peters continued. “I was shocked to learn the bill was close to $3,000 after a few fillings were added. When the dental office contacted our insurer and found out the payment would take almost nine months, they asked me to pay up front. This was obviously a shock to me.”

           

FRUSTRATED BY endless delays in payment, some providers have even closed the door to State-provided insurance. “My primary-care physician stopped accepting my insurance because he could not afford to wait,” said an employee who wished to remain anonymous. “This reduces the likelihood of my using his services, since I essentially would have to become a claims specialist to file the claims myself.”

SLOW PAYMENTS also translate into interest charges for some patients, a circumstance that Joan Johnson, Financial Aid Counselor in the Office of Student Financial Assistance, finds unfair. “I was surprised to find that my family is charged interest on our dental statements, because there are always outstanding charges hung up in the bill payment rotation with Delta Dental,” she said.

“BECAUSE OF this backlog in charges, we pay a combination of uncovered fees and interest on the charges delayed by late insurance payments. That causes us to pay more for dental services, and that’s not right.”

Rendering FSA tax savings useless

JENNIFER ROWAN, Assistant to the Director in the Office of Research Services, noted that extreme delays in payment also make it impossible for employees to take advantage of the pretax savings in their FSAs. “Because it takes CIGNA so long to pay, the flexible spending year has usually ended,” she explained.

“EXAMPLE: I go to the doctor in April, and they pay my doctor the following February. Since the service took place the previous April, it falls into that year’s flexible spending period, but I can’t submit my portion of the charges to the FSA since I received the final amount I owe outside of the service year.”

CINDY LEDONNE, Assistant Director of the Clinical Performance Center in the Department of Medical Education, had several substantial bills processed so late that she couldn’t retrieve money from her FSA for it. “I had to cover it with post-tax dollars, and that can add up pretty quickly,” LeDonne said. “After five years of employment, this situation has added up to several hundred dollars I've had to pay in taxes--money that should have been spent on living expenses and not taxes. It's very frustrating and there are no signs of improvement.”

VIVIANA KABABBE-THOMPSON, Academic Advisor in the Department of Kinesiology and Nutrition, has seen a six-month plus delay in payment of her dental bills, and watched as her annual physical took 11 months to be paid. Still, she counts herself among the lucky ones. Kababbe-Thompson is in good health—“I don’t expect any large costs, but feel bad for others who might have more health issues and as a result have larger issues with bills and planning for bills,” she said—and she has the option of switching to her husband’s insurance.

THOUGH IT will cost the couple more in insurance costs, “I hope to change insurance plans to my husband’s, which is reliable and hopefully less complicated,” she said.

MEANWHILE, UIC employees without the option of using their spouses’ or partners’ insurance struggle on, wondering when—and if—their healthcare bills will be resolved.

“I WONDER if it’s even worth it for us to have insurance?” said Carol Fendt, Co-Director and Senior Researcher, PRAIRIE Group, who has more than once waited in excess of six months for reimbursement. “Why am I paying monthly for a service I’m not receiving, and, with the state of our State, for which I’m likely not going to receive reimbursement?

“I’M BEGINNING to think I’ll see healthcare reform before I see the State pay its bills.”

With significant interest

THE STATE does pay its bills—but so late that it has to pay interest, too.

           

“THE FACT that the State is in fact paying 9% interest on the delayed payments concerns me also as a taxpayer,” Schilling said. “It would clearly be cheaper for the State to at least float a bond (easily at less than 3% yield in today's bond market) to clear the backlog rather than pay such an exorbitant interest rate. It isn't just employees who suffer—it’s the taxpayers also.

“CLEARING THE backlog does not solve the budget shortfall going forward, but at least it clarifies the problem to one of ongoing expenses and revenue and saves the taxpayers some money right now,” Schilling concluded.