.26 Working Capital Differentials — Payment of Charges.

A. Definitions.

(1) In this regulation, the following terms have the meanings indicated.

(2) Terms Defined.

(a) “Debt collector” has the meaning stated in COMAR 10.37.13.01.

(b) “Hospital” means a “facility” as defined in Health-General Article, §19- 301, Annotated Code of Maryland.

(c) “Income-based payment plan” means a payment plan based on the patient’s household income as set forth in COMAR 10.37.13.05.

(d) “Payment plan” has the meaning stated in COMAR 10.37.13.01.

B. A third-party payer may obtain a discount in rates established by the Commission if it provides current financing monies in accordance with the following terms.

(1) A third-party payer that provides current financing equal to the average amount of outstanding charges for bills from the end of each regular billing period and for discharged patients shall be entitled to a 2-percent discount. For purposes of this regulation, a regular billing period shall be based on a 30-day billing cycle. The current financing provided in here corresponds to a third party's paying on discharge.

(2) A third-party payer that provides current financing equal to the average amount of outstanding charges for discharged patients plus the average daily charges times the average length of stay, shall be entitled to a 2.25-percent discount. The current financing provided to hospitals corresponds to a third party's paying on admission.

(3) Outstanding charges shall be calculated by an amount equal to the hospital’s current average daily payment by the payer, multiplied by the hospital’s and third party payer’s processing and payment time. The precise calculation shall be made in accordance with the guidelines specified by Commission staff.

(4) Upon request from an applicant, the Commission may approve an alternative method of calculating current financing monies.

(5) The third-party payer shall adjust the current financing advance to reflect Commission rate orders and changes in volume associated with the particular payer and hospital. This adjustment shall be made within 45 days of a rate order or at such other time as circumstances warrant. In the absence of a rate order, the adjustment shall be made at least annually.

C. The third-party payer shall promptly provide the Commission with a verified record of the detailed calculation of the current financing and of each recalculated balance as adjustments are made. The detailed calculations shall become a part of the public record. The Commission may, at any time, evaluate the amount of current financing monies provided to a hospital to assure that it meets the discount of requirements specified in §B of this regulation. If the Commission finds that the amount of current financing is inconsistent with the requirements of §B of this regulation, the Commission may, at its sole discretion, require an adjustment to the working capital advance or to the discount.

D. Discounts.

(1) A payer or self-paying patient, who does not provide current financing under §B of this regulation, shall receive a 2-percent discount if payment is made at the earlier of the end of each regular billing period or upon discharge from the hospital.

(2) Payment within 30 days of the earlier of the end of each regular billing period or discharge entitles a payer or self-pay patient to a 1-percent discount.

(3) For those payers not subject to Insurance Article, §15-1005, Annotated Code of Maryland, after 60 days from the date of the earlier of the end of each regular billing period or discharge, interest or late payment charges may accrue on any unpaid charges at a simple rate of 1 percent per month.

(4) The interest or late payment charges may be added to the charge on the 61st day after the date of the earlier of the end of each regular billing period or discharge and every 30 days after that.

(5) For patients that have entered into a hospital income-based payment plan under COMAR 10.37.13.05, the interest rate shall be established in accordance with the Guidelines set forth in COMAR 10.37.13.05.

E. Hospital Billing Responsibilities.

(1) A patient shall be given a bill for services at the earlier of the end of each regular billing period or upon discharge or dismissal, when dismissal for outpatients is analogous to discharge for inpatients.

(2) This bill shall cover substantially all care rendered and should, except for some last day ancillary services and excepting arithmetic errors, represent the full charge for the patient's care.

(3) A notice shall be posted prominently at the billing office of the hospital clearly notifying all patients of the availability of the discounts referred to in §D of this regulation.

(4) The bill and the notice shall state that the patient shall receive a 2-percent discount by paying upon discharge or a 1-percent discount by paying within 30 days of discharge.

F. GME Discounts. In those instances where a teaching hospital is reimbursed separately for the costs associated with the provision of graduate medical education (GME), the Commission shall calculate the percentage of the hospital's rates that these GME payments represent and provide notice of the amounts that may be credited toward the payment for services rendered. At all times, total payment received by the teaching hospital shall be in accordance with Commission-approved rates.