Is waiving a copay illegal?

Asked by: Winona Dooley  |  Last update: July 5, 2025
Score: 4.1/5 (7 votes)

NO! While the practice of routinely waiving a patient's co-pay or balance may seem like a harmless favor, it actually can be a violation of a provider's contract with insurance companies.

Is it illegal to waive copays?

Providers sometimes waive patients' cost-sharing amounts (e.g., copays or deductibles) as an accommodation to the patient, professional courtesy, employee benefit, and/or a marketing ploy; however, doing so may violate fraud and abuse laws and/or payor contracts.

Can a pharmacy waive a copay?

To waive your copay: Pharmacies are not allowed to routinely waive their copays for people without Extra Help, but your pharmacist can waive copays on a case-by-case basis. Tell your pharmacist you cannot afford the copay, and request that it be waived.

Can insurance waive copay?

Both federal healthcare programs and private insurance allow occasional waivers for patients who can demonstrate financial hardship. HHS' 1994 Special Fraud Alert noted that providers need to make good faith efforts to collect co-pays, apart from the cases of special financial needs of certain patients.

Is waiving deductibles illegal?

Deductibles. It is illegal for a contractor to pay, waive, or discount your insurance deductible. It is insurance fraud if homeowners don't pay their deductible. Some contractors offer waived or discounted deductibles as a selling point to their customers.

Can I waive a copay when I'm in-network with an insurance company?

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Can copays be written off?

If you are itemizing and entering medical expenses, yes, you can include co-pays and other out of pocket expenses that were not covered by insurance. The medical expense deduction has to meet a rather large threshold before it can affect your return. The amount of medical (including dental, vision, etc.)

What to do if a patient asks you to waive the deductible?

The only legitimate reason to waive co-pays and deductibles is the patient's genuine financial hardship. Documentation in patients' own handwriting must include income; assets; expenses, including the local cost of living; family size; and the extent of their medical bills.

What if you can't pay a copay?

Provider Policy: The healthcare provider's policy may vary. They may allow you to receive the necessary medical treatment or prescription medication, even if you can't pay the copayment immediately. In such cases, they might bill you later for the copayment amount.

Can a deductible be waived?

The California Insurance Code requires insurers to offer a Waiver of Collision Deductible if you carry Collision Coverage on any of your motor vehicles and if you carry Uninsured Motorist Bodily Injury Coverage.

Why do I have to pay a copay if I have insurance?

Health insurance companies require members to share the cost of healthcare, often in the form of copayments and deductibles. A copayment, which is typically shortened to copay, is a fixed amount you are required to pay for covered medical services.

Can a pharmacy force you to use insurance?

Yes, they can decide how they do and don't take payment. Pharmacies do not have to take insurance at all if they do not want to. They can be cash only or no cash as well and or refuse to take credit cards.

Why is my copay so high for prescriptions?

If your drug is on a higher tier, your copay or coinsurance will likely be higher. If you don't already know your copay or coinsurance for your prescription, you can often use your insurance's web portal to look up what you will pay — or you can give them a call to get an estimate.

Can a doctor not charge a patient?

"No charge" visits are prohibited if they are part of a fraudulent scheme. For example, a no charge visit is still a patient care encounter and must be fully documented. Assume that a patient has severe asthma and is waiting out a one year preexisting illness exclusion in a health insurance policy.

Can a pharmacy waive copay?

As a general rule, copayments can only be waived due to the patient's financial hardship if done on an individual, case-by-case determination. Pharmacies are also generally prohibited from advertising that the pharmacy provides such waivers.

Are copays negotiable?

A copay is an out-of-pocket payment, and it is final. A copay cannot be reimbursed, nor can it be negotiated, because it is governed by a strict contract between providers and insurers. However, in some cases in which a patient is unable to pay the fee, a provider may waive a copay.

What is an example of a Stark law violation?

What Are Stark Law Violation Examples? To give an example, let's say a physician invests in a freestanding lab diagnostics center and refers their patients, with Medicare, to that lab center for bloodwork. Whether or not they intended to benefit from the referrals, the physician would appear to violate the law.

Is it legal to waive deductibles and copays?

Routine waiver of deductibles and co-pays violates the law for two reasons. First, it violates the Anti-Kickback Statute. Second, it causes Medicare to pay more than it should in violation of the False Claims Act.

Is it better to have a $500 deductible or $1000?

Remember that filing small claims may affect how much you have to pay for insurance later. Switching from a $500 deductible to a $1,000 deductible can save as much as 20 percent on the cost of your insurance premium payments.

Is waiving a deductible legal?

A provider who routinely discounts or waives a patient's copayment or deductible (collectively referred to as copayment) obligations, for example, can run afoul of the federal antikickback statute, 42 U.S.C. § 1320a-7b, or be accused of false billing by private insurance carriers not receiving the discount.

Why is the physician not allowed to waive a copay?

This also means that discounted services are seen as a form of kickback. Anytime a healthcare provider routinely waives copays to make their services seem cheaper to potential customers, they are offering a thing of value and violate the Anti-Kickback Statute.

Can you ignore medical bills?

Well, no. Depending on the state, hospitals and providers could still sue, foreclose, or affect the chance of a person getting hired or being able to rent an apartment. “All the other ways to collect continue,” a CFPB official told me.

Why do copays exist?

Insurance companies use copayments to share health care costs to prevent moral hazard. It may be a small portion of the actual cost of the medical service but is meant to deter people from seeking medical care that may not be necessary, e.g., an infection by the common cold.

What happens if I don't pay copay?

If you don't have your copay, you may be denied the service or treatment you are seeking. Many healthcare providers require payment of the copay at the time of service. If you are unable to pay, you may be asked to reschedule your appointment or to provide payment at a later time.

Can doctors bill your copay?

Providers typically collect copayments at the time of service. For example, upon checking in at a doctor's office, you may be asked to pay the copay before seeing the doctor. Alternatively, some doctor's offices may bill you for the copay after the visit.

What does copay waived if admitted mean?

But the ER copay is really a fee.

This “copay” is essentially a disincentive designed to make you think twice before going to the ER. The good news, though, is that if you are admitted to the hospital, this “copay” (fee) is waived.