According to the Centers for Medicaid and Medicare Services, if a patient who receives subsidies misses a payment, the individual has three months to catch up on payments before their policy is canceled. During the first month, the insurer must cover all claims. During the last two months, the patient's claims are pending. If the patient catches up on premium payments, the insurance company will cover the claims. However, the insurer can cancel the policy if the patient does not catch up on payments, and the doctor must then bill the patient for any claims from the last two months, according to CMS.
Neurologist Dr. Sara Austin, who testified on behalf of the Texas Medical Association in support of the legislation, argued that the bill would help doctors understand what type of coverage patients have and help them remind patients to pay their premiums.
Although the bill originally singled out individuals who received subsidies through Obamacare, the legislation passed by both the House and Senate would label the cards for all individuals who purchased a health insurance plan through an exchange.
Opponents of the bill argue that the labels will lead to discrimination against individuals who purchased insurance through Obamacare.
The Texas Association of Community Health Centers, along with the Center for Public Policy Priorities and the Children's Defense Fund, sent a letter to the Texas Senate last week opposing the bill.
"Nothing is achieved by merely labeling someone as a marketplace patient. It is not helpful and, worse, it could result in providers avoiding patients who they are contractually obligated to serve," Jose Camacho, the executive director of the Texas Association of Community Health Centers, said in a statement.
Texas is not the first state to tackle the potential confusion associated with the grace period. While Obamacare requires that insurers notify providers when patients enter the grace period, lawmakers in Louisiana and Washington have passed legislation outlining when insurers must notify doctors.