The Ohio Department of Insurance announced on August 24, 2017 that CareSource has agreed to offer exchange coverage in Paulding County, Ohio, the last “bare county” in the country. Of course, insurers have until September 27 to make a final decision as to whether they will participate in the exchanges for 2018; if the administration announced tomorrow that it would no longer reimburse insurers for reducing cost sharing as insurers are required to do under the Affordable Care Act, we could see a lot of bare counties quite quickly.
Barring further developments, however, exchange coverage will now be available in every part of the United States, although over 1,300 counties with 2.6 million enrollees will be in counties where only one insurer is available.
CMS Says Oklahoma 1332 Waiver Application Is Complete
On August 24, 2017, the Centers for Medicare and Medicaid Services also determined that Oklahoma’s application for a 1332 state innovation waiver was complete. This determination begins the 180-day period during which CMS must complete its evaluation of the proposal, as well as a one-month period during which the proposal is available for public comment.
Oklahoma is in the process of developing its own alternative to the ACA, some elements of which would require further 1332 waivers and other elements of which probably cannot be accomplished without a rewrite of the ACA. For 2018, however, Oklahoma is only asking for a 1332 waiver to establish a reinsurance program, which seems quite straightforward.
Oklahoma is asking CMS to waive a particular provision of the ACA’s single-risk pool requirement that would impede the state’s ability to establish a reinsurance program. It is also asking for a pass-through of the savings the federal government would enjoy from the reduction in premium tax credits that would result from the reinsurance program.
Oklahoma’s program would reinsure 80 percent of single year claims between $15,000 and $400,000. It estimates that this program would reduce premiums by 34 percent by 2018 and increase enrollment by 28,000 by the third year of the program. The program is similar to Alaska’s recently approved 1332 waiver, although eligibility for reinsurance is based on dollar claims costs rather than health conditions.
The proposal will probably be relatively uncontroversial. The remaining elements of Oklahoma’s program, which are not included in this waiver request, are likely to provoke far more debate.
Court Mostly Sides With Plaintiff In Dispute Over Coverage Of Lactation Support
On August 15, 2017, Judge Vince Chhabria of the Northern District of California denied in part and granted in part a motion to dismiss in Rachel Condry v. UnitedHealth Group. The plaintiff sued UnitedHealth claiming that United failed to cover comprehensive lactation support and counseling services by trained providers during pregnancy and the postpartum period, as it was required to by the ACA’s preventive services requirement.
The ACA requires health insurers and group health plans to cover preventive services, including women’s preventive services, without cost sharing. The Health Resources and Services Administration, which is responsible under the ACA for identifying women’s preventive services, lists lactation services and support as a covered women’s preventive service. In-network services must be covered without cost sharing. Insurers can impose cost sharing for out-of-network preventive services, but only if in-network service providers are available.
The complaint in the Condry case alleged that United has neither established networks of lactation counselors nor fully reimbursed enrollees for out-of-network services. The plaintiffs further argued that to the extent United may offer in-network providers of lactation counseling, it is impossible for members to identify those providers. The complaint recited a history of difficulties the named plaintiffs have experienced in getting access to lactation services. The complaint alleged violations of fiduciary duties under the Employee Retirement Income Security Act (ERISA), the sex discrimination prohibition of section 1557 of the ACA, contractual obligations to comply with the ACA, and unjust enrichment.
United claimed in its motion to dismiss that it did have providers that could provide lactation counseling services and that it had no obligation to separately identify those providers. Judge Chhabria described United’s arguments as “absurd.” Unless a patient can find a provider of a service and the service is available in a meaningful way, he concluded, the service is not covered. The plaintiffs had thus alleged a violation of the ACA, which can be asserted in turn as a violation of their contractual rights and of the defendant’s ERISA obligations.
The court thus refused to dismiss the claims based on ERISA and the ACA. The court did dismiss common law tort claims against ERISA group health plans as preempted by ERISA. It also dismissed the sex discrimination claim as not properly alleged but allowed the plaintiffs to amend their complaint to allege such a complaint. The plaintiffs must file an amended complaint within 21 days, at which time the case will proceed.
CBO Director Responds To Rep. MacArthur On CBO Evaluation Of AHCA
On August 24, 2017, the Congressional Budget Office (CBO) released a letter from Congressional Budge Office director Keith Hall responding to questions from Congressman Tom MacArthur regarding the CBO’s review of the American Health Care Act. The letter outlines the measures the CBO takes to ensure the objectivity, impartiality, and integrity of its work. Director Hall explained that the CBO and the Joint Committee on Taxation (JCT) had used their March 2016 baseline for determining coverage, costs, and sources of insurance under the current law, as compared to the proposed AHCA, and that this had resulted in an underestimate of the number covered through the exchanges, but not of the total number uninsured. The CBO had not had time to apply its January 2017 analysis for comparison, although it is unclear how this would have affected various categories of insurance coverage or budgetary effects.
Responding to questions from Congressman MacArthur, Director Hall explained that the CBO and JCT had not estimated the average premiums of people in states that waived both the essential health benefit and community rating requirements of the ACA because premiums in these states would have been lower for healthy people but very high for people with health problems, and the CBO had no way of knowing how high premiums could go for those people. The CBO also concluded that too many variables might affect decisions by states as to whether to waive ACA requirements for the CBO to predict which specific states might decide on which waivers, but that it was possible based on pre-ACA state benefit mandates and approaches to underwriting regulation, as well as current market conditions, to estimate what proportion of the states might seek waivers.
On REGTAP, Laying Out What Happens When Consumers Resolve Data Issues
Finally, CMS addressed on August 23, 2017 an issue of some interest in a frequently asked question at its REGTAP.info website. The question concerns a situation in which an enrollee in an exchange plan loses eligibility for advance payment of premium tax credits (APTC) because of an income data matching issue, but returns to the marketplace and updates household income information, thus restoring APTC eligibility. The FAQ clarifies that in this situation the consumer may qualify for a special enrollment period, but eligibility for APTC will only apply prospectively, not retroactively. If the consumer appeals the eligibility decision successfully, eligibility may apply retroactively.