Prepaid care plans

Any arrangement or agreement between a chiropractor and a patient for a course of future treatment for which funds in an amount of five hundred dollars or more during any twelve month period are collected in advance of these services shall be considered a prepaid care plan within the meaning of this section. Services under a prepaid care plan may cost less than if the services were purchased individually. The reduction in cost must bear a reasonable relationship to the expense avoided by the provider due to reduced accounting and debt collection activities in accordance with Office of Inspector General (OIG) Advisory Opinion 08-03, regarding prompt payment discount. The prepaid care plan may provide for either an annual or monthly fee out of pocket. A chiropractor who offers such a plan is subject to the following requirements: 1. Escrow account. A designated escrow account insured by the FDIC shall be established for deposit of all funds received in connection with the prepaid care plan. Such funds may not be commingled with a chiropractor's personal or business account. a. All instruments, including checks and deposit slips, must bear the phrase "Escrow Account." b. The chiropractor shall maintain a clear accounting of all funds received, including date and from whom the funds were received. c. The chiropractor shall maintain a clear accounting of all disbursements including the dates and to whom the disbursements were made, and to which patient the disbursements are to be applied or accounted for. d. If a patient's deposit in the escrow account earns in excess of five dollars during a twelve-month period, the interest must be paid or credited to the patient by the end of the period. e. No more than one account is required regardless of the number of prepaid plans maintained by the chiropractor. f. Funds may only be transferred out of the escrow account for the following reasons: (1) After services, goods, or appliances have been provided to the patient, and only in the usual and customary amounts specifically related to the services, goods, or appliances provided. (2) To reimburse the patient any amounts owed following a notice by either the patient or the chiropractor to terminate the prepaid plan. Any amounts must be transferred according to the written agreement. (3) Payment to the patient of interest earned when it exceeds five dollars per twelve month period. g. The chiropractor shall cause a reconciliation of the escrow account to be made no less than quarterly, with a copy provided to the patient, and shall retain a copy of the reconciliations and all supporting documents for no less than seven years. 2. Written plan. All prepaid care plans require a written plan, signed by both the chiropractor and the patient, with a copy maintained in the patient's record and a copy provided to the patient, and must include at least the following: a. A list of all services, goods, and appliances which are covered by the plan. b. A list of all fees related to the services described in the plan. c. A statement that an accounting can be requested by the patient at any time. This accounting must: (1) Be provided to the patient within five working days of a written or verbal request; and (2) Itemize all fees used to calculate any reimbursement. d. An explanation of the reimbursement policies and formula that are used in returning unused funds to the patient in the event of early termination by either the chiropractor or the patient. e. An explanation of any policy modifying the plan in the event of a injury, such as an auto injury or work-related injury or in the event of extended absence or new illness. These explanations must be separately initialed by the patient. f. A provision that the patient will be notified in writing when the patient's account reaches a zero balance. g. A statement that indicates the chiropractor makes no claim or representation that a particular treatment, procedure, or service, or any combination of treatments, procedures, or services, is guaranteed to result in a particular clinical outcome. h. A statement that the patient has the right to cancel the prepay plan without penalty within three business days of entering into the plan by submitting a written and signed cancellation notice, and upon the chiropractor's receipt of the cancellation notice, the chiropractor shall have seven working days to fully refund any unused funds to the patient. This right of cancellation may not be waived or otherwise surrendered. 3. Early termination. The patient has the right to terminate the prepaid plan at any time; under such circumstances as completing care early, moving, or a new injury or illness. The chiropractor may terminate the prepaid plan at any time, for good and sufficient cause, except the chiropractor must ensure that patient abandonment does not occur. a. In event of early termination of a prepaid plan by the patient, the maximum fee charged cannot exceed the chiropractor's usual and customary fee for services rendered. b. In event of early termination of a prepaid plan by the chiropractor, any cost reduction for the package of services must be prorated when determining the amount of repayment. c. In event of early termination of a prepaid plan, the fee for the unused portion must be returned with no penalty. 4. Prepaid plans must be compliant with all applicable state and federal laws. 5. When providing care as a part of a prepaid plan a chiropractor shall provide competent, necessary care in a timely and professional manner. All care recommended and rendered must be clinically justified and appropriately documented. 6. A prepaid plan is not health insurance and does not meet the Affordable Care Act "individual mandate" requirements for health insurance coverage. 7. The regulations in this section do not release a chiropractor from any contractual obligations that the chiropractor has with an insurer or other entity. A chiropractor who is contracted with an insurance carrier shall adhere to the terms of their provider contract in regards to the collection of copayments, co-insurances, and applied deductibles. A chiropractor may not bill a reimbursement entity or a patient for any amount exceeding what is earned and distributed to the chiropractor. 8. Failure to abide with the requirements of this section is unprofessional conduct.