DIFFICULT MORAL QUESTIONS

Question 75: May a physician waive coinsurance payments required by insurers?

My wife and I practice family medicine in a small midwestern city. Many of our patients have health coverage (usually under contracts between their employers and the insurance companies) requiring them to pay a portion (generally twenty percent) of most fees and other charges as coinsurance. Because these coinsurance payments are meant to discourage excessive use of health care services, the insurance companies do not want providers to waive them. This system probably works fine with people who are better off, but the payments oftentimes are very difficult for poorer families. When we know a family would have trouble paying the coinsurance, we do not bill it, partly to lighten the financial burden but more importantly to make it easier for those people to get care when they should—before small problems become serious and when proper care requires a follow-up visit or ongoing treatment.

Almost all the insurance plans now set our charges for us, saying exactly how much they will allow for office visits, procedures, and so forth. When we waive a coinsurance payment, we do not receive more than we otherwise would. We have only been forgoing some income to which we are entitled, and have not been cheating the insurance companies.

Now some insurers are writing into their contracts with providers or including on their claim forms language ruling out the waiving of coinsurance payments. If we sign such contracts or forms, I suppose we will be agreeing to conform to the companies’ rules or stating that we have done so in the particular case. Yet we do not wish to begin requiring coinsurance payments from families that cannot afford them, and it seems to us the insurers are being unreasonable. May we sign the contracts and forms but continue waiving the payments?

Analysis:

This question concerns the application of the norm excluding lying. It is unjust for insurers to insist that coinsurance payments be collected even from poorer families. But the norm forbidding lying excludes agreeing without reservation not to waive coinsurance payments while intending to do so, and also excludes stating that the rules were followed when they were not. Though there may be no workable resolution of the conflict between the insurers’ rules and the physicians’ policy, alternatives can be suggested for further investigation. It also should be pointed out that the policy of forgoing coinsurance payments by poorer families could occasion abuses by the physicians and/or their patients.

The reply could be along the following lines:

As you may know, an influential code of professional ethics deals with the problem you raise, without providing a solution. On the one hand, it favors the policy you have been following: “When a copayment is a barrier to needed care because of financial hardship, physicians should forgive or waive the copayment.” On the other hand, it warns you not only to avoid fraud but to conform to agreements with insurers: “Routine forgiveness or waiver of copayments may constitute fraud under state and federal law. Physicians should ensure that their policies on copay-ments are consistent with applicable law and with the requirements of their agreements with insurers.”²⁵⁴ Thus, your question truly is difficult, and cannot be answered without additional ethical reflection.

Applied to affluent families, the requirement of coinsurance payments probably does not impede the appropriate use of health care resources and may be a reasonable deterrent to frivolous and wasteful use. But, as you suggest, for many less well-to-do families, requiring coinsurance payments probably does deter appropriate use of these resources. This likely adverse impact makes it gravely inequitable for insurers to insist that these payments never be waived. Moreover, unless health care providers are themselves needy, it is appropriate that they reduce charges to patients who cannot afford them, since that enables such patients to seek and obtain needed services. Therefore, the insurers’ efforts to compel you to collect coinsurance payments from your poorer patients unjustly impede you from fulfilling your professional responsibility to serve the poor, insofar as you can, without placing heavy financial burdens on them.

Nevertheless, lying is always wrong. Presented with a contract including the unjust requirement not to waive coinsurance payments, you may not agree without reservation while planning to continue waiving the payments. That would be making a promise you did not intend to keep, saying “I will do X” while thinking “I will not do X”—a lie. Likewise, you may not subscribe to a claim form including the statement that you have followed the insurance company’s rule requiring a coinsurance payment when you have not done so, since that would be lying. Moreover, violating the terms of a contract with an insurance company or lying in making insurance claims might render you vulnerable to a lawsuit.

I am not sure there is any workable solution to the problem. However, there are several possible approaches you might investigate and consider trying.

First, since your policy of waiving coinsurance payments by poorer families is reasonable while it is unjust for insurers to require that you never waive them, you might communicate straightforwardly with the insurers and try to convince them to allow providers to waive all or at least part of the payments for poorer patients. That would have the advantage of admonishing the insurers about the wrong they are doing to many people besides you and your patients; also, in taking this approach you might seek the cooperation of other health care providers, advocacy groups, and so on. Moreover, this straightforward approach undoubtedly would clarify some possible abuses, and, if it succeeded, the outcome probably would include provisions to limit abuses.

You also might invoke public authority. Since the insurers’ unjust requirement no doubt affects all health care providers and insured persons throughout your state, you might seek action by some state regulatory body or by the legislature to protect the right of providers to waive coinsurance payments by patients otherwise likely to be impeded from seeking and obtaining needed services. If successful, this not only would solve the problem for everyone but, like the first approach, would include the opportunity to clarify and limit possible abuses.

If neither of these approaches is feasible and successful, the language in the contracts and on the claim forms may leave room for you honestly to subscribe to them while in practice circumventing the insurers’ intent. One tactic would be to bill poorer families for the portion of the insurers’ approved charges designated as coinsurance while at the same time assuring them that you will not press them to pay these bills. Then, in due course, you would write off those that remain unpaid as bad debts. Another tactic would be to establish a special charitable fund, perhaps administered by a church near your office, from which poorer families could obtain the money for their copayments. You could contribute to the fund, and disbursements from it could be made by a check payable to both the patient and you. To investigate such possibilities, you undoubtedly will need legal and tax advice.

Again, in signing contracts forbidding you to waive coinsurance payments, you might send along a covering letter saying you mean to adhere carefully to the rules insofar as that is consistent with meeting your obligations to your patients. Similarly, when signing claim forms, you could strike out the statement that you are not waiving the coinsurance payment, without making the strike out any more noticeable than necessary to make it unambiguous. In expressing your reservation in these ways you would avoid lying, yet the reservation might be overlooked by insurers. The difficulty, of course, is that this approach is hardly likely to succeed in every instance.

If you find a way to continue forgoing coinsurance payments, you should take care to resist the abuses that could occasion. In general, insurance companies have a good reason for requiring coinsurance payments. Families for whom you waive the payments might be tempted to waste health care resources, including your time, and thereby impose unfair burdens on those who, sooner or later, will have to pay higher insurance premiums. You must keep track of your patients’ use of your services and correct any who begin to be wasteful.

Finally, as you point out, your present practice of waiving coinsurance payments by needy families means you lose some income. This could lead you to be tempted to compensate by doing additional procedures which, though not medically pointless, go beyond what you would consider appropriate for the same patients if they could afford the coinsurance. You also might be tempted to recoup the income by increasing your fees to other families, when no schedule of payments applies. That could be wrong, since it might arbitrarily impose burdens on people hardly more able to bear them than the families whose poverty comes to your attention. Doing such an injustice would be practicing false mercy.

But you seem well aware of the demands of mercy. You have been sacrificing income to serve your patients well. You have not been trying to enlarge your practice, but serving patients as you do may well have that effect, and so be to your own advantage. Even if it reduces your income, however, you can hope to profit in the long run: “Make purses for yourselves that do not wear out, an unfailing treasure in heaven, where no thief comes near and no moth destroys. For where your treasure is, there your heart will be also” (Lk 12.33–34; cf. Mt 6.19–21).

254. Council on Ethical and Judicial Affairs, American Medical Association, Code of Medical Ethics: Current Opinions with Annotations, 1996–97 ed. (Chicago: American Medical Association, 1996), 6.12 (p. 100).