States continue to prepare for a potential decision adverse to the government in King v. Burwell, with Pennsylvania submitting an application to be a supported State-based Marketplace; CMS releases information reflecting wide variation in proposed 2016 premium increases from insurers in the Federally-facilitated Marketplace; and, a new report finds alternative Medicaid expansions result in significant coverage increases.
KING V. BURWELL UPDATES:
Issue Brief Examines Possible Changes to ACA in Light of Supreme Court Case
Should the Supreme Court hand down a decision in King v. Burwell invalidating subsidies in the Federally-facilitated Marketplace, the fixes proposed to date would likely fail to retain a broad enough variety of consumers, maintain competition, and reduce health spending growth, according to a new issue brief by the American Academy of Actuaries. The issue brief urges policymakers to develop solutions that achieve all three of these goals, noting that failure to do so will threaten the viability of the insurance market. The issue brief concludes that options proposed to date like temporary premium subsidy extensions and eliminating the individual mandate would only delay market disruptions.
Pennsylvania: State Applies for State-based Marketplace
Governor Tom Wolf (D) announced that the Pennsylvania Department of Insurance submitted an application to CMS to establish a State-based Marketplace. Because the State currently operates a Federally-facilitated Marketplace, the governor framed this as part of his King v. Burwell contingency plan, “in order to protect 382,000 Pennsylvanians from potentially losing subsidies that help them afford health care coverage.” Submitting the application does not require Pennsylvania to establish a State-based Marketplace, but ensures the State has that option.
QHP SUBMISSIONS FOR OPEN ENROLLMENT:
Proposed 2016 Premiums Posted on HealthCare.gov
As required by the ACA, yesterday CMS made public on HealthCare.gov a list of individual and small group plans in the Federally-facilitated Marketplace that have proposed 2016 rate increases of 10% or more. The list contains hundreds of filings from across the country and reflects wide variation in proposed premium increases, ranging from 10% to 85%. Insurers cite uncertainty regarding healthcare costs, their enrollee mix and the King v. Burwell outcome as reasons for the premium increases, reports the New York Times. The current rate review process offers an opportunity for consumers and other stakeholders to weigh in on the proposed premiums, and while the Obama Administration does not have the authority to reject rate increases, some state regulators do. Final rates, which will be released in October, could differ dramatically from proposed rates.
Connecticut: Marketplace Increases Fees on Insurers
The board of Access Health CT voted to increase the Marketplace insurer assessment from 1.35% to 1.65% in order to build up the organization's existing financial reserves and bring in roughly $36 million in revenue in 2016, compared to the $29.6 million that was earned under the previous rates. Due to the change, insurers will have to revise their rate proposals for 2016 insurance rates, which were filed last month.
MARKETPLACE UPDATES:
Arkansas: Businesses Will Need to Re-Enroll in State-Run SHOP Marketplace
As Arkansas transitions from a federally-operated to a State-run Small Business Health Options Program (SHOP) Marketplace for coverage year 2016, State Marketplace officials learned that due to "privacy and security" issues, the federal government will not be able to transfer current SHOP enrollees’ data to the State and as a result, businesses will need to re-enroll, reports the Arkansas Democrat-Gazette. According to Arkansas Blue Cross and Blue Shield, the only carrier to currently participate in the SHOP Marketplace in Arkansas, about 20 employers currently purchase SHOP plans for 156 employees; given the small number of customers, Marketplace officials expect that the re-enrollment process will be "manageable."
MEDICAID EXPANSION ACTIVITY & ANALYSIS:
Report Finds Alternative Medicaid Expansions Increased Coverage
A review of six states’ alternative Medicaid expansions—Arkansas, New Hampshire, Indiana, Iowa, Michigan, and Pennsylvania—found that Section 1115 waivers enabled these states to extend Medicaid to hundreds of thousands of people who otherwise would have been uninsured, according to a report by the Robert Wood Johnson Foundation and the Urban Institute. The report found that the three states that purchased Qualified Health Plans (QHPs) for Medicaid enrollees additionally allowed for increased provider access, better integration between Medicaid and the Marketplace, increased Marketplace competition, and lower overall QHP costs. The report also identified a handful of issues to watch including ensuring access to “wrap-around” benefits covered by Medicaid but not offered in QHPs and effective implementation of medical frailty screeners.
Arkansas: Department of Human Services Director Provides Update on New Medicaid IT System
Director of the Department of Human Services John Selig explained to the Health Reform Legislative Task Force that the cost of implementing the State’s new Medicaid eligibility and enrollment system doubled to $200 million—almost 88% of which will be covered by federal dollars—due to changing specifications from the federal government and trouble processing federal enrollment files. Additionally, despite earlier delays, the State has started to perform annual eligibility redeterminations for individuals enrolled in the State's Private Option (Medicaid expansion) program, as reported by the Arkansas Democrat-Gazette. Selig said that the State started performing eligibility checks two weeks ago and that he expects the State will be able to meet the federal government's September deadline for completion.
Louisiana: Legislature Approves Mechanism to Finance Medicaid Expansion
The Louisiana legislature approved a resolution (HCR75) allowing the Department of Health and Hospitals to collect a fee from some State hospitals to help pay for Medicaid expansion should the next Governor implement the expansion. Current Governor Bobby Jindal (R), whose last term ends in December 2015, has steadfastly opposed expanding Medicaid, but several gubernatorial candidates have said they may be supportive of expansion under certain conditions.
Montana: Twelve Appointed to Medicaid Expansion Panel, Including Two Expansion Foes
Twelve legislative and industry leaders have been chosen to serve on the Montana’s Medicaid Expansion panel, tasked with determining how to fund the program, decrease the incidence of Medicaid fraud, and expand access to behavioral health services, among other responsibilities. The panel consists of nine voting members, five of whom were appointed by Governor Steve Bullock (D) (including two hospital CEOs, the Deputy State Auditor, the Governor's Health and Families Advisor, and a primary care physician.) Democratic House and Senate majority leaders selected Representative Pat Noonan (D) and Senator Mary Caferro (D). Notably, two staunch opponents to Medicaid expansion, Representative Art Wittich (R) and Senator Bob Keenan (R), were selected to represent the GOP caucus on the panel. Senator Ed Buttrey (R), the Medicaid expansion bill's sponsor, was originally slated to sit on the panel; however, GOP legislative leaders replaced him with Senator Keenan. "We won't be sitting in the committee meetings with pom-poms," Senator Keenan said in response to his and Senator Wittich's placement on the panel.
OTHER STATE HEALTH REFORM NEWS:
California: Survey of Low and Moderate Income Documents Post-ACA Experience
A report released by the Kaiser Family Foundation documenting Californians’ experience in the first year of ACA implementation finds links between coverage and access: 61% of new Marketplace and Medi-Cal enrollees have a usual source of care compared to 43% of those who remain uninsured; and 58% of the newly enrolled accessed at least one medical service since enrolling into coverage compared to 45% of uninsured. Both the newly insured and uninsured with a usual source of care are most likely to use a clinic or health center, whereas previously insured are more likely to use a doctor’s office or HMO. Many (44%) of those who remain uninsured cite coverage affordability as a barrier.