the marketplace - insurance exchanges and providers

888.879.7302 • www.SuccessEHS.com

The Marketplace – Insurance Exchanges and Providers

Adele Allison National Director of Government Affairs

August 28, 2013


• ACA Jargon • Timelines – Health Plans and Employers • States and Medicaid Expansion • Benefit Tiers, Individuals and SHOPs • Consumer Assistance and Provider Impact • Questions

Marketplace – Health Ins. Exchanges


Polling the Audience


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Supreme Court of the U.S. - SCOTUS

Chief Justice John Roberts

Justice Antonin Scalia

Justice Anthony Kennedy

Justice Clarence Thomas

Justice Ruth Ginsburg

Justice Stephen Breyer

Justice Samuel Alito

Justice Sonia Sotomayor

Justice Elena Kagan

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Understanding Common Terms • Affordable Care Act of 2010 (ACA) → 2 Laws passed by the

111th U.S. Congress in March, 2010 o Patient Protection and Affordable Care Act (PL 111-148) o Health Care and Education Reconciliation Act (PL 111-152) o SCOTUS – Oral Argument late Mar., 2012; Final Ruling 6.28.2012

• Health Insurance Exchange (HIX) a/k/a Health Insurance Marketplace o Feds → “Marketplace” not “Exchange” o Online resource for Individuals, Families, Small Businesses o Compare Qualified Health Plans (QHPs) costs, benefits, etc. o Select and enroll in coverage

• Affordable Coverage → 9.5% of household income for Employer Groups


Understanding Common Terms • Individual Mandate

o Under ACA, most Americans must have health insurance o Failure to have coverage could result in a “penalty” or tax o Exempt → Religious Exemption, Illegals, Incarcerated

• Medicaid Eligibility Expansion (State Option) o New eligible group → Adults not already eligible without

dependent children o Minimum income threshold → is it 133% or 138% of FPL?

• Modified Adjusted Gross Income (MAGI) o System for determining eligibility for Medicaid expansion

benefits and federal subsidies o Uniform across the states o A single, standard income disregard for most populations

of 5% → (138% FPL – 5% = 133%)


Understanding Common Terms • Qualified Health Plans (QHPs)

o Insurance plan that is “certified” by the Marketplace o Provides essential health benefits

• Marketplace Tiers o 4 Coverage levels → Bronze, Silver, Gold and Platinum o Bronze covers 60%, Silver 70%, Gold 80% and Platinum 90% o QHPs need not offer all tiers, but must offer 1 Silver + 1 Gold

• Open Enrollment o Period when eligible to enroll in QHP in the Marketplace o 2014 → Oct. 1, 2013 – Mar. 31, 2014 o 2015 and beyond → Oct. 15 – Dec. 7 preceding year of coverage o “Special Enrollment” is available for 30 days following a life event


Understanding Common Terms • Essential Health Benefits (EHBs)

o A minimum set of core benefits → mimics employer-sponsored coverage o Includes 10 categories of services

• Minimum Essential Coverage → 60% of Actuarial Value

Ambulatory Services (E.g., MD Visits)

Emergency Services

Hospitalization Maternity / Newborn Care

Mental Health / Substance Prescription Medications

Rehab Services and Devices Laboratory Services

Preventive, Wellness and Chronic Disease Mgmt.

Pediatric Care (Including Oral and Vision)


Understanding Common Terms • Essential Community Providers (ECPs)

o QHPs must have an “adequate network” of providers o Sufficient providers for low-income, underserved patients o CMS Defines 6 major ECP categories:

o Overseen by Center for Consumer Information & Insurance Oversight (CCIIO)

o Must contract with ECPs on CCIIO’s non-exhaustive database (denominator) if Federal-run or run through partnership (http://1.usa.gov/18gv4MZ)

o Operationalized for plan year 2014 by CMS – Letter to Issuers

Federally Qualified Health Centers Ryan White Providers

Family Planning Providers Indian Providers

Hospitals Other


Measuring Knowledge


2012 ACA Requirements

Insurance MLR 85% in Claims Paid or

Rebate Women’s Prev. Free Contraceptives

Sum. of Benefits and Coverage Uniform with Plans, 60 days notice of changes

Comparative Effectiveness Fee $1/covered life/year from

Employers for PCORI ($2/life in 2013)

W-2 Reporting Must reflect cost of

Health Care


2013 ACA Requirements

Health Care Exchange Notice

Requirement to provide employees written notice

about the HIX

Health Flex. Spending Acct. (FSA)

Contributions capped at $2,500/year

Medicare Payroll Tax

3.8% Medicare tax on unearned income for

high-income ind.

Hospital Insurance Tax

Must reflect cost of Health Care


2014 Grandfathered Plans Changes • No annual limits on Essential Health Benefits • No pre-existing condition exclusions for children under 19 • New hire waiting periods limited to 90 calendar days • Fair Labor Standards Act amended → 200+ FTEs must

automatically enroll new FT employees

• Reinsurance Fee (2.2% Tax) of $5.25 PMPM assessed 2014 o Runs through 2016, but decreases o Used to partially subsidize individual insurers of high-cost individuals o Will impact premium rates

• Limits on cost-sharing and annual deductibles • Age-rating ratio limited to 3:1; Tobacco rating limited to 1:1.5 • No gender rating


Employer Mandate – Delayed

• Employer Mandate required 50+ Businesses offer coverage by 2014 or pay penalty

• Delayed 1 year (Jul. 2) → BUT Ind. Mandate still in place • 2 Direct Impacts

o Uptick in federally subsidized enrollment under the HIX o Lower the unemployment rate

Employers not offering “minimum essential coverage” penalties • $2,000/worker, $3,000/work if employee receives fed. Subsidies • E.g., 50 Employees – 20 (first 30 are exempt from penalties) x $2,000 =

$40,000 in Fines

Employer Strategy → stay below 50 full-time employees; hire part-time workers


Measuring Knowledge


ACA and Medicaid Expansion

• SCOTUS → States may truly “Opt-Out” • Financial Considerations

o Should create a net savings o Could increase hospital revenues, offsetting ACA hospital reductions o Some states concerned about federal deficit reduction efforts impact

• Impact on Coverage o ↑ Access to care for low-income Americans o No Implementation → Large gaps in coverage

• State Flexibilities o Benefit design, cost-sharing, care delivery models, and reimbursement o Ability to seek approval for demonstration waivers (2017) → 1115 waivers

can be mixed with State Innovation Waivers


Where do States stand? • 19 Opting-in

• 16 Opting-out

• 5 Leaning Towards Opting-in

• 7 Leaning Towards Opting-out

• 3 Considering Alternative Model


Where do States stand?


Measuring Knowledge


HIX and States

• Each State will have 1 Marketplace • 3 Type of Marketplaces, variance by State

o Federally Facilitated o Federal-State Partnership o State-based

• Coverage facilitated for 2 types of consumers o Individuals and Families o Small Businesses

• 27 are Federally Run; 16 are State-based; 7 are Federal-State Partnerships


Health Ins. Marketplace by State

State-Run Partnership State-Run SHOP Fed-run Ind. Federal-Run Federal Run

State Plan Mgmt.


Core Marketplace Requirements • Enrollee Assistance

o 34 states with Federal involvement → $54 Million in HHS funding for Navigators

o 16 states and D.C. operating state-based → snag in Federal funding = “in-person assister” for first year

o CHCs, hospitals, other orgs. can offer a certified application counselor

• Management of plans → private and public • Eligibility determination and verification • Beneficiary enrollment

o CBO estimates add’l 13 million to enroll in Medicaid and CHIP over next 10 years

o Cost increase of $74 billion over previous estimates

• Overall financial management


Individual Mandate – Penalties • Individual Mandate Penalty Tax

o 2014 → Greater of $95/individual (capped at 3), or 1% of household income

o 2015 → Greater of $325/individual, or 2% of household income

o 2016 and beyond → Greater of $695/individual, or 2.5% of household income

o 2017 → penalties will be increased by cost-of-living adjustment

• Exemptions o Religious, unlawfully present in U.S., and Incarcerated o Cannot afford based on legal formulas o Income below federal income tax filing threshold o Members of Indian tribes o Uninsured for less than 3 months, hardship waiver, residing outside of U.S.


The Marketplace – Benefit Tiers

Platinum 90%

Gold 80%

Silver 70%

Bronze 60%

• 30 and Under o Ind. Catastrophic o Certain Mandate

Exemptions

• QHPs → must offer minimum of 1 Silver and 1 Gold level plan


Qualified Health Plans

• Only Qualified Health Plans (QHPs) can be on HIX • HHS requirements of QHPs

o Accredited by URAC or NCQA o Demonstrate Network Adequacy o Have sufficient number of Essential Community

Providers (ECPs)

• State Guidance on Network Adequacy → Review and approval by 1 of 2 accrediting agencies

• First Effective date Jan. 1, 2014 • Open Enrollment begins Oct. 1, 2013


Federal Subsidies • Federal Subsidies → Available for incomes between 100%

and 400% of FPL (E.g. Family of 4, income of $89,000) o Premiums deemed unaffordable → more than 9.5% of

household income, or o Plan is inadequate → covers less than 60% of cost of covered

benefits

Income Premium Limit Up to 133% FPL 2% of Income

133-150% FPL 3 – 4% of Income

150-200% FPL 4 – 6.3% of Income

200-250% FPL 6.3 – 8.05% of Income

250-300% FPL 8.05% - 9.5% of Income

350-400% FPL 9.5% of Income

Source: Community Catalyst, Center for Health Insurance Studies, Georgetown University


Small Business Health Options Program • The Good

o 2014 SHOP Marketplace → businesses with 50 or less FTEs Allows for health plan comparison SHOP-purchased plans can bring up to 50% tax credit (based on

premiums) in 2014

o SHOP opens to employers up to 100 FTEs in 2016 o Not available for self-employed → must use ind. Marketplace o 1 online application process, 1 bill, 1 monthly payment o Small business can decide contribution toward premiums

• But … o Must have office/work site within SHOP service area o Many states require at least 70% FTE enrollment o Delayed requirement of having numerous QHPs until 2015 =

Opens on time, but may only be 1 QHP option


Measuring Knowledge


Consumer Assistance

• 4 Types of Consumer Assistance o Navigators o Non-Navigator, In-Person Assistant o Certified Application Counselor o Agents and Brokers

• Role of Consumer Assistants o Increase awareness about the Marketplace o Determine eligibility and facilitate enrollment o Alleviate consumer fear


Consumer Assistance • Navigators

o At least 2 Navigator organizations (minimum) o 1 must be Non-Profit, Community Org. o Health Insurers cannot be Navigators o Requires 30 hours training and testing o Must be linguistically/culturally appropriate o HIXs cannot use establishment grant dollars

to fund o If Federally-run HIX → State-run Navigators o Partnership HIX → Feds will establish and

train; state responsible for management o State-run HIX → all done by the State


Consumer Assistance • Non-Navigator, In-Person Assistant

o Similar duties to navigators with similar training o Must pass a conflict-of-interest check o HIX can use establishment grants for funding in the 1st year o Federally-run HIX → Not required o Partnership HIX → Required o State-run HIX → Optional

• Certified Application Counselor o Required for all of the exchanges o Training → 5-7 hours + test; materials open to all o Cannot discriminate on assisting patients (E.g. HIV clinic

cannot limit help to HIV patients) o No separate funding o Additional details at www.cms.gov/cciio/resources/marketplace-grants/


Consumer Assistance • Agents and Brokers

o State-by-state as allowed by the State o Must show all QHPs offered and be knowledgeable o Must take a test

• Consumer Assistance by Marketplace-Type Type of

Marketplace

Navigators In-Person Assistant

Certified Application Counselor

Agents and

Brokers State-based Yes Optional Yes Optional

Federal-State Partnership

Yes Yes Yes Yes, if state permits

Federal-run Yes No Yes Yes, if state permits

Source: HRSA, ACA: Outreach, Education and Enrollment Presentation, Aug. 6


Impact on Federal Budget – CBO • ACA’s Coverage Provisions (May, 2013) → $1.4 Trillion over 2014-2023

• CBO Cost Impact Factors o ↑ Number of Medicaid / CHIP enrollees → 13 Million o ↓ Number of HIX enrollees because of Expansion = less subsidies

• CBO Impact of the delay in Employer Mandate → +$12 Billion o Almost $10 Billion less in employer penalty payments o Almost $3 Billion more in federal subsidies paid

• Estimated Uninsured in 2016 → 30 Million o Majority not subject to Individual Mandate penalty tax → 18-19 Million

Mostly unauthorized immigrants Rest → Indian tribes, Income too low to file tax return, premium exceeds

share of income

Source: Congressional Budget Office Reports


Projected Enrollment

Source: CBO Report on HIX, May 2013 Baseline


Provider Impact

• Challenges o Health IT adoption and use o Increased workforce shortages and

overburdened providers o Health care reform value-based re-

imbursement models o Quality and Transparency o Enterprise-wide risk and liability o Continuing Education o Market Consolidation o HIX Coverage “Gotcha”


Provider Impact

• Call to Action o Patient-Centered Care o Care Coordination o Seamless financial, operational and clinical

information sharing through Health IT Must support organizations clinical AND business

requirements Must have Business Intelligence and Dashboards Must flawlessly integrate core organizational functions Must be secure and private Must engage the patient


Provider Impact • What can you do today?

o Identify number of uninsured patients in your market o Understanding what kind of Marketplace your state has o Ask your Insurance Commissioners or Marketplace which QHPs are

participating o Initiate contract negotiations with QHPs o Educate QHPs about your organization and role in care delivery – Are you a ECP?

o Talk with patients about eligibility / enrollment options o Refer patients to Healthcare.gov for more information o Identify and refer patients to Consumer Assistance Programs in your state o Additional details at www.cms.gov/cciio/resources/marketplace-grants/


QUESTIONS

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the marketplace - insurance exchanges and providers

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