The national uninsurance rate hits record low; Georgia’s Chamber of Commerce outlines three Medicaid expansion proposals; and California legislation targets surprise medical bills.
FEDERAL AND STATE MARKETPLACE NEWS:
CMS Seeks Comment on SEP Verification Pilot
CMS is seeking public comment on a proposed pilot that will evaluate how requiring pre-enrollment verifications of eligibility for special enrollment periods (SEPs) may impact compliance, enrollment, continuity of coverage, the risk pool, and other outcomes. This pilot is one of several CMS efforts to prevent individuals from misusing SEPs. CMS recently implemented a new SEP verification process that requires consumers to provide documentation demonstrating their SEP eligibility, and early data indicates that use of SEPs has dropped by 15% relative to last year. For the pilot, CMS is seeking input on whether the pilot should be geographically targeted or include a sampling of HealthCare.gov consumers; whether it should focus on a specific subset of SEPs; how to limit burdens on consumers and disruptions in coverage; and how to measure the impact so that policy changes can be implemented for 2018. Comments are due September 20.
2017 Marketplace Plan Choices May Include Less Out-of-Network Coverage, Analysis Finds
Health maintenance and exclusive provider organization plans—“managed” plans that tend not to offer out-of-network coverage—are projected to account for 75% of all 2017 Marketplace offerings, up from 58% in 2014, according to a McKinsey analysis of preliminary filings in 18 states and the District of Columbia. The analysis also found that premiums for managed plans have been increasing at approximately half the rate of “unmanaged” plans (preferred provider and point-of-service plans), which do provide out-of-network coverage. The median premium increase for lowest-price silver managed plans was less than 1% in 2015 and rose to 9% in 2017. For unmanaged plans, premiums increased 2% in 2015, rising to 18% in 2017. The rise in managed plan offerings is occurring among both national and regional carriers; managed plans are projected to account for 97% of national carrier offerings—up from 76% in 2016--and 81% of regional/local offerings—up from 74%.
Marketplace Enrollees Received $12 Billion in Tax Credits in 2014
In 2014, 3.4 million tax returns indicated that Marketplace enrollees received $12 billion in advanced premium tax credits (APTCs), according to the IRS. Through IRS reconciliation, , additional tax credits totaling $1 billion were claimed on 1.5 million tax returns, while 1.8 million tax returns required repayment of tax credits totaling $1.4 billion. Additionally, over 13.3 million taxpayers claimed an exemption from the individual shared responsibility payment, which was paid on 8.1 million returns, totaling $1.7 billion in penalties and averaging $210 per tax return.
New Mexico: Rate Increases Approved for Qualified Health Plans
All Marketplace individual plans will have rate increases for 2017, ranging from 16% to 33%, and rates for all but one small group plan will also increase, according to final approved rates by the Superintendent of Insurance. Blue Cross Blue Shield will re-enter the Marketplace with rates that are nearly double its off-Marketplace plans in 2016. New Mexico is one of a few HealthCare.gov states in which all counties have three or more insurance options.
STATE MEDICAID EXPANSION AND REFORM ACTIVITY:
Alaska: Medicaid Expansion Spending Is $30 Million Over Original Budget Estimates
Alaska has spent $175 million on Medicaid expansion enrollees as of July 31, 2016, which is $30 million over original estimates, according to data from the State’s Department of Health and Social Services. The data also highlighted that nearly 20,400 individuals have enrolled in expansion, 36.7% of whom are between the ages of 19 and 34. Alaska expanded Medicaid in September 2015.
California: PCMH Model May Reduce Emergency Department Use
A new study found that implementing a patient-centered medical home (PCMH) model in safety net clinics in managed Medicaid plans reduced emergency department (ED) visits by 70 visits per 1,000 members per year and reduced avoidable ED visits by 20 visits per 1,000 members per year. However, the study also found that the PCMH model had a lesser impact on reducing ED visits in clinics that experienced a greater increase in seniors or people with disabilities, suggesting that the introduction of new popultions constrained resources that would otherwise be allocated to existing members. The authors conclude that the extent to which a PCMH can successfully impact these measures may depend on their capacity to increase access to primary care. To assess the PCMH impact, researchers examined seven PCMH safety net clinics in the Los Angeles area and 110 non-PCMH safety net clinics.
Georgia: Task Force Proposes Medicaid Expansion Options
The Georgia Chamber of Commerce's healthcare task force released a report detailing three potential Medicaid expansion plans, all of which would require an 1115 Medicaid waiver. Each proposed expansion program would cover the minimum Medicaid benefit package allowable under federal law, require cost-sharing and premiums and establish health savings accounts for beneficiaries. The first option is a "partial expansion" to individuals earning up to 100% FPL; the second option is a full expansion for adults earning up to 138% of FPL; and the third option would enroll adults up to 100% of FPL into Medicaid and those with incomes between 100% and 138% of FPL in Marketplace plans paid for by Medicaid. In the past, CMS has allowed states to enroll Medicaid beneficiaries into Marketplace plans, but, it has ruled out partial expansion at the enhanced matching rate. Per 2014 legislation, any Medicaid expansion plan in Georgia is subject to legislative approval.
Kansas: Nearly One-Third of Uninsured Kansans Would Qualify for Medicaid Expansion, Report Finds
An annual report from the Kansas Health Institute analyzing the nearly 302,000 uninsured in the State found that 50% are eligible for subsidized coverage through HealthCare.gov, 16.6% are currently eligible for Medicaid or CHIP and 31.9% would be eligible for Medicaid if the State took up Medicaid expansion. Overall, the percentage of uninsured Kansans decreased from 12.3% to 10.5% between 2013 and 2014. Between 2009 and 2014, the percentage of Kansans enrolled in public insurance programs like Medicaid and the Children’s Health Insurance Program (CHIP) increased from 24.6% to 28.5%.
New Jersey: More Than 560,000 Covered Due to Medicaid Expansion
Nearly 567,000 residents have gained or maintained coverage under Medicaid expansion, according to NJ Family Care’s (the State’s Medicaid program) 2015 Annual Report. Governor Chris Christie (R) spoke to the success of the expansion, noting that of those who gained or maintained coverage due to expansion, 59% are newly eligible adults, 23% maintained eligibility due to expansion, and 18% were previously eligible but not enrolled. The report also found that the decision to expand Medicaid helped lower the State’s uninsured rate from 12% in 2013 to 6.9% in 2015, decreased the State’s share of overall Medicaid expenditures from 45% in 2014 to 39% in 2015, and lowered average costs per beneficiary from $9,690 in 2014 to $8,940.
Iowa: Early Results Indicate $22 Million in Savings From Transition to Medicaid Managed Care
Iowa’s Medicaid managed care program saved the State $22 million in its first three months and is projected to save $110 million in its first full year, according to the First Quarter Performance Data report from the Department of Human Services. Savings were attributed to a decrease in per member per month spending and “the administrative load paid on capitation rates.” The report includes wide-ranging analysis of various program components across the three managed care organizations administering the program, such as: enrollment (broken down by age, carrier and other factors), claims payments, and grievances.
Illinois: Cross-Agency Team Proposes Medicaid Transformation in Draft 1115 Waiver
Governor Bruce Rauner’s (R) administration has released for public comment a $2.7 billion 1115 waiver request that proposes to initially focus on addressing several behavioral health related goals, including integrating behavioral and physical health, reducing overreliance on institutional care b shifting to community-based care, and moving behavioral health providers towards outcomes- and value-based payments. Illinois is requesting to implement initiatives—such as infant and early childhood mental health interventions and workforce-strengthening initiatives—and new benefits, including housing and employment services and transition services for individuals incarcerated. Leadership across the Governor’s office and 12 State agencies (including the Departments of Juvenile Justice and Corrections, the Department of Aging, and the State Board of Education) have been assembled to invest it and participate in the behavioral health transformation efforts.
OTHER FEDERAL AND STATE HEALTH INSURANCE REFORM ACTIVITY:
Uninsurance Rate Hits Historical Low in 2016
The uninsurance rate in the first quarter of 2016 hit a record low of 8.6% (27.3 million individuals), according to the CDC’s National Health Interview Survey. Compared to 2015, 1.3 million fewer people were uninsured, a decrease of one-half of a percentage point (though not statistically significant). The report also found that the percentage of individuals under age 65 with private insurance enrolled in a high-deductible health plan increased from 25.3% in 2010 to 36.7% in 2015 and to 40% in the first 3 months of 2016. The report, which is updated quarterly, also reviews long-term trends in uninsurance as well as uninsurance rates by poverty status, race and ethnicity, Marketplace model, and Medicaid expansion status.
HSA at One Large Employer Lowered Care Utilization Among Lower-Income Workers
Lower-income workers enrolled in a health savings account (HSA) eligible health plan were more likely than their higher-income counterparts to reduce their physician office visits and their use of certain “high-valued” services even when not subject to a deductible, such as flu vaccinations and breast cancer screenings, according to a study of one HSAs’ impact on healthcare utilization from the Employee Benefit Research Institute. However, the authors suggest the reduced use of services among lower-income workers may reflect an erroneous assumption that those services are not fully covered, rather than the impact of HSA enrollment. The report also found that the HSA-eligible health plan was associated with a decline in non-preventive outpatient office visits for all income levels, but that the decline was more than twice as large for workers with incomes below $50,000 compared to workers with incomes over $100,000, primarily because lower-income workers saw specialists less frequently. In contrast, the HSA-eligible health plan was associated with an increase in emergency department visits and inpatient hospital admissions among lower-income individuals. The study is based on six years of data from a single large employer that offered an HSA-eligible health plan alongside a preferred provider organization and the authors caveat that findings may not be generalizable to broader populations. Findings do not account for socio-demographic and company cultural characteristics of that single employer, nor do they control for other sources of income, such as earnings from a working spouse.
California: State Passes Legislation Addressing Surprise Medical Bills
Californians who receive care from an out-of-network provider at an in-network facility will only be responsible for in-network cost sharing, if Governor Jerry Brown (D) signs into law AB-72, which he is expected to do. The bill would require health plans to pay out-of-network providers the greater of the plan’s average contracted rate or 125% of the Medicare rate and would establish an “independent dispute resolution process” by which providers could appeal a claim payment. The new requirements would not apply to self-insured employer health plans.
Illinois: Emergency Department Visits Increased “Modestly but Significantly” Post ACA, Study Indicates
Average monthly emergency department (ED) visits increased 5.7% from the pre-ACA study period (2011 through 2013) to the post-ACA study period (2014 through 2015), according to a study published in the Annals of Emergency Medicine. ER visits by Medicaid patients increased by nearly 42%, visits by commercially and privately insured patients increased 10.2%, and uninsured patient visits dropped by 42.4%. The authors note that their findings are consistent with previous studies of ED use post-ACA, though not all studies have shown an increase in ED use. They also note that the overall increase in the ED visit rate is consistent with findings that people are more likely to use health services when financial barriers to care are removed and that it is unclear whether changes in ED utilization rates may represent a temporary spike due to pent-up demand.
STATE STAFFING UPDATES:
New Mexico: Exchange Senior Staff Named Interim beWellnm CEO
The New Mexico Health Insurance Exchange (beWellnm) board has named Linda Wedeen—the current Senior Director of Communications, Marketing and Outreach—the interim CEO of the Exchange beginning in September. Current CEO Amy Dowd is stepping down to join Molina Healthcare. The Exchange board has established an executive search committee to identify a permanent replacement.
Oklahoma: Health Care Authority CEO Resigns
Nico Gomez, CEO of the Oklahoma Health Care Authority (OHCA), resigned after 3 years in his current role and 16 years with the agency, which administers the State’s Medicaid program. Gomez will become the President and CEO of the Oklahoma Association of Health Care Providers (OAHCP) beginning in October.