CBO estimates 27 million would lose coverage under partial ACA repeal in the first year after elimination of Marketplace subsidies and Medicaid expansion; a federal judge orders delay in submission of North Carolina’s Medicaid expansion proposal; and New York moves to protect contraceptive coverage under ACA repeal.

ACA REPEAL ACTIVITY AND ANALYSIS:

Congress Passes Budget Resolution Providing Instructions for Reconciliation Legislation

Congress passed a budget resolution on Friday containing reconciliation instructions for House and Senate Committees with jurisdiction over Medicare, Medicaid, the Marketplaces, private insurance and taxes, which now must submit repeal legislation to their respective budget committees. Although the resolution itself does not make changes to the ACA, it is a critical first step in the repeal process and provides a blueprint for reconciliation legislation that could repeal significant portions of the ACA without the threat of a Senate filibuster. The resolution asks for legislation to be submitted by January 27, although the deadline is nonbinding. It appears unlikely that a bill will be submitted by this date given recent calls to include a replace plan with repeal.

CBO: 27 Million Would Lose Coverage and Individual Market Premiums Would Increase by 50% in the Year After Partial Repeal Takes Full Effect

The Congressional Budget Office estimates that adopting the ACA partial repeal bill (H.R. 3762) passed by Congress and vetoed by President Obama in 2016 would cause a significant loss of insurance coverage and an increase in Marketplace and other individual market premiums. The partial repeal bill would have eliminated the individual and employer mandate, as well as the Medicaid expansion and Marketplace subsidies after a transition period, but left the ACA’s insurance reforms in place. In the first new plan year after elimination of the mandates, CBO estimates that 18 million fewer people would have coverage and that individual market premiums would increase 20%-25%. After repeal of the Medicaid expansion and Marketplace subsidies, the estimated number of people losing coverage would jump to 27 million and individual market premiums would rise by 50%. By 2026, CBO expects 32 million fewer people would have coverage and individual market premiums would double, reflecting a worsening of the destabilizing effects of retaining market reforms without the mandates and subsidies. These estimates do not take into account the impact of any replacement provisions, and CBO is clear that estimates of the impact of future legislation will depend critically on the details of the proposals.

STATE MEDICAID EXPANSION AND REFORM NEWS:

Arizona: Governor Issues Executive Order, Sends Letter to Medical Board to Address Opioid Addiction

Governor Doug Ducey (R) issued an executive order creating a pilot program that will allow inmates with a history of opioid addiction to enroll in a substance abuse program prior to release to help reduce recidivism. Governor Ducey also sent a letter to the Arizona Medical Board and the Arizona Board of Osteopathic Examiners that requires physicians to take continuing education courses focused on drug addiction.

North Carolina: Medicaid Expansion Temporarily Blocked

A federal judge issued a 14-day restraining order preventing federal regulators from considering Governor Roy Cooper's (D) request for approval of state plan amendments authorizing Medicaid expansion, in response to a lawsuit filed by Republican State legislators. The lawsuit names both federal and State health officials and maintains that Governor Cooper cannot seek approval of the state plan amendments due to a 2013 State law. State and federal officials have filed motions asking a federal court to lift the restraining order.

Puerto Rico: Up to 900,000 Could Lose Medicaid Coverage as Block Grant Funding is Exhausted

Puerto Rico is projected to spend the last of its $6.4 billion Medicaid block grant—allocated through the ACA for fiscal years 2011-2019—as early as the first quarter of FY 2018, according to HHS’s Assistant Secretary for Planning and Evaluation. If Puerto Rico maintains its current contribution to its Medicaid program once the federal block grant funding is exhausted, spending would decrease by 44%, and 500,000 Medicaid enrollees would lose coverage. If Puerto Rico reduces its contributions to the minimum amount required to receive its maximum federal match (55%), total spending would decrease by 80%, and nearly 900,000 Medicaid enrollees would lose coverage.

Utah: Decision on Limited Medicaid Coverage Plan Delayed to New Administration

The Obama Administration will not issue a decision on the State's proposed limited Medicaid eligibility extension, opting instead to delay a decision until the Trump Administration takes office. Utah has proposed extending Medicaid coverage to approximately 16,000 Utahns, predominantly those living in extreme poverty, including the chronically homeless and those involved in the criminal justice system.

Wisconsin: State Aims to Impose Limits on Medicaid Benefits That Will Require a Waiver

Governor Scott Walker’s (R) administration has said it would like to impose time limits on Medicaid enrollment and implement other restrictions including drug testing and higher costs for smokers. Such changes would require a federal waiver.

FEDERAL MEDICAID REFORM UPDATES:

CMS Publishes FAQ on Medicaid Family Planning Services and Supplies

CMS provided answers to frequently asked questions on the delivery of family planning services and supplies to Medicaid enrollees, including how to encourage the use of long-acting reversible contraception. The FAQ also provides guidance on providing drug coverage for the treatment of sexually transmitted diseases.

CMS FAQ Clarifies Health Services Initiatives

CMS published an FAQ clarifying what types of services states can provide under a Health Services Initiative (HSI), which are aimed at improving the health of low-income children eligible for CHIP or Medicaid. The FAQ emphasizes that states can use an HSI to fund initiatives to increase screening of lead levels in children and highlights a Missouri initiative to increase awareness of the dangers of lead exposure.

Kaiser Publishes Its Annual 50-State Medicaid Eligibility and Enrollment Survey

The Kaiser Family Foundation released the results of its 15th annual 50-state plus the District of Columbia survey, which provides state-by-state data on Medicaid and CHIP eligibility, enrollment, renewal and cost-sharing policies.

OTHER FEDERAL AND STATE HEALTH REFORM NEWS:

Most Individuals That Gained Coverage in 2014 Were Long-Term Uninsured

The majority of adults that were newly insured in 2014, the first year of full ACA implementation, had been uninsured for more than three years, according to a new report from Health Affairs. The share of these adults declined from 9.4% in 2013 to 7.1% in 2014. The report also finds that, on average, non-expansion states have significantly higher rates of long-term uninsurance than states that have expanded despite having similar rates of short- and medium-term uninsurance.

ACA Increased Access to Substance Use Disorder Treatment

The uninsured share of substance use or mental health disorder hospitalizations decreased from 22% at the end of 2013 to 14% by the end of 2014, the year the ACA’s major coverage provisions were implemented, according to HHS’s Assistant Secretary for Planning and Evaluation. In expansion states, the share fell from 20% at the end of 2013 to 5% by mid-2015. The report notes that states with the highest rates of drug overdose deaths would see “dramatic” increases in their uninsured rates under ACA repeal. In West Virginia, New Hampshire and Kentucky, which had the three highest drug overdose death rates in 2015, uninsurance would nearly or more than triple.

New York: State Legislature Moves to Codify ACA Contraceptive Coverage

The New York State Assembly has passed a bill requiring that insurance companies cover contraception for free in the event of an ACA repeal. The bill, which also mandates several other consumer protections, now moves to the State Senate for consideration.

FEDERAL AND STATE MARKETPLACE ACTIVITY:

Record 11.5 Million People Sign Up for 2017 Marketplace Coverage

More than 11.5 million signed up for 2017 Marketplace coverage through HealthCare.gov as of December 24, 2016, an increase of 286,000 from the same time last year. A portion of this increase may be attributed to the 67,915 Kentuckians who moved from kynect, Kentucky’s State-based Marketplace, to HealthCare.gov. However, roughly 70,000 individuals in Louisiana moved from HealthCare.gov to Medicaid coverage when that State expanded Medicaid eligibility in mid-2016.

One in Ten Small Business Owners Rely on Marketplace Coverage, Report Finds

Nearly one in ten small business owners buy coverage through ACA Marketplaces, compared to 2.9% of independent workers, according to a new report from the U.S. Treasury Department. Small business owners and other workers with incomes below $65,000 were most likely to have Marketplace coverage. The report also finds that one in five Marketplace consumers in 2014 (1.4 million people) was a small business owner or self-employed. The report also includes state-by-state data on Marketplace participation among small business owners and independent workers.

California: Marketplace Enrollees Shop for Lower Cost Plans, Study Finds

A new Health Affairs study found that 62% of new Marketplace enrollees and 56% of returning enrollees purchased the lowest or second-lowest plan available in a tier, indicating that enrollees will seek out lower cost plans within an existing tier.

California: Study Finds Nearly a Third of Individual Market Enrollees Missed Out on Financial Assistance

A Health Affairs study found that 31% of 2014 individual market enrollees who were “likely” eligible for financial assistance did not enroll in plans for which they could receive financial assistance. Fourteen-percent of those eligible for both premium and cost-sharing assistance purchased off-Marketplace plans, and 20% selected plans not in the silver tier, thereby forgoing financial assistance.

Minnesota: Senate Passes Premium Relief Plan

The State Senate voted to appropriate $300 million for premium assistance to Minnesotans ineligible for ACA tax subsidies who purchase coverage on the individual market. The bill also includes several health reform initiatives, which Governor Mark Dayton (D) and Democrats urged be separated from the relief part of the plan. The bill now goes to the House for consideration.

STATE STAFFING UPDATES:

California: Senior White House Official to Head New State Health Information Exchange

Claudia Williams was named CEO of California’s new Health Information Exchange (HIE), a merger between the existing California Integrated Data Exchange (Cal INDEX) and the Inland Empire Health Information Exchange (IEHIE). Williams previously served as Senior Advisor for Health Innovation and Technology in the White House Office of Science and Technology Policy and as Director of HIE for the Office of the National Coordinator for Health Information Technology.

Florida: Agency for Health Care Administration Secretary Named

Governor Rick Scott (R) tapped Justin Senior as Secretary of the Agency for Health Care Administration, after serving as Interim Secretary for four months. Before becoming Interim Secretary, Senior served as the agency's Deputy Secretary for the Division of Medicaid.

North Carolina: Dr. Mandy Cohen Named as Health and Human Services Secretary

Governor Roy Cooper (D) named Dr. Mandy Cohen, most recently the Chief Operating Officer and Chief of Staff at CMS, as Secretary of Health and Human Services. Under a law passed in December 2016, cabinet appointments, including Dr. Cohen’s, require Senate approval. However, this law is currently being challenged by Governor Cooper.