Grace periods and claims pending policies during the grace period

• Grace Period – Health insurers like Octave Blue Cross and Blue Shield must provide a three consecutive month grace period before terminating coverage for nonpayment of premium(s), if a member is receiving advance payments of the premium tax credit and has previously paid at least one full month’s premium during the benefit year.
• Health insurers are not allowed to cancel a member’s policy during the first month of the grace period. However if no payment is received during the second or third month of the grace period, any medical claims received may be held or “pended” until the end of the three-month grace period or until such time that the outstanding premium payments are received. “Pending” a claim means to hold, but not process and pay, the claim. If the outstanding premium payment is not received by the end of the three-month period, the policy is canceled and any pended claims are denied. If the outstanding premium payment is received by the end of the three-month grace period, any pended claims are released and allowed to process through the system for evaluation and payment.
• For those enrollees who are not eligible for a monthly premium subsidy, the issuer is required to observe a 30 day grace period. The premium payment is due on the first day of the month of coverage. Medical claims are "pended" until payment is received. If the premium is not received by the end of the 30 days, the policy is cancelled and all pended claims are denied. If the outstanding premium payment is received by the end of the 30 days, any pended claims are released and allowed to process through the system. Pharmacy claims are processed normally through the 10th of the month. However after the 10th, if no premium payment has been paid for the current month, pharmacy claims are processed using the issuer's agreed upon discount, as opposed to the member just paying normal out of pocket amounts. One premium is paid for the current month, pharmacy claims will then be paid at normal benefits.