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New Health Policy Brief: Reenrollment


December 22nd, 2014

This year open enrollment under the Affordable Care Act (ACA) began on November 15, allowing new customers to sign up for health insurance. Open enrollment also provided current policyholders the chance to change plans and request a redetermination on the amount of subsidy they received. During this second year of open enrollment for the ACA’s insurance Marketplaces, insurers and policy makers are working to keep last year’s enrollees in the system — and the Department of Health and Human Services (HHS) estimates that 95 percent of them are eligible for automatic renewal.

A new policy brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) examines the pros and cons of reenrollment options for consumers, whether they are using the federal Marketplace or live in states that operate their own exchanges. Automatic reenrollment means that almost seven million people already enrolled will not necessarily need to flood HealthCare.gov and exchanges during open enrollment. On the other hand, it also may discourage consumers from exploring alternative coverage that might better fit their needs and get a more accurate determination of eligibility for subsidies.

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The Medicare Shared Savings Program: CMS Turns To Stakeholders On Incentivizing ACO Risk


December 19th, 2014

On December 1, 2014, the Centers for Medicare & Medicaid Services (“CMS”) released its long awaited Proposed Rule to update regulation and operation of the Medicare Shared Savings Program (“MSSP”). In response to concerns raised by participating accountable care organizations, CMS proposes to revise the MSSP program in several ways to provide greater flexibility for ACOs.

However, in important areas CMS may not have gone far enough. This post describes the framework CMS has set forth and then suggests several ways in which the proposal could, in our view, be improved to achieve the CMS objective of encouraging ACOs to bear more risk. In particular, CMS should consider using its waiver authority more robustly; allowing Medicare beneficiaries to designate their primary care providers, and by extension their ACO; and revising the MSSP risk-adjustment methodology to better reflect the changing risk profiles of ACOs.

CMS is actively seeking stakeholder input, which may indicate agency recognition that further changes beyond those in the propose rule are needed. By all indications, stakeholder input will be seriously considered; more than any time in recent memory, stakeholder comments will make a difference in the shape of the Final Rule. This presents a unique opportunity for stakeholders and we urge concerned parties to share their perspectives through comments – the deadline for submitting comments is February 6, 2015.

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Implementing Health Reform: Enrollment And Reenrollment For 2015 (Updated)


December 16th, 2014

The December 15, 2014 deadline for reenrolling in qualified health plan (QHP) coverage to assure continuous coverage as of January 1, 2015 has come and gone.  Individuals who were enrolled through the federally facilitated marketplace (FFM) for 2014 but did not return to the marketplace to shop for 2015 plans will be passively reenrolled in their 2014 plan or in a plan similar to it.  The 2015 open enrollment period lasts through February 2015, and individuals can return to the FFM at any time before then to change plans.  But the change will not be effective for January 1.

A number of state-operated exchanges—including New York, Massachusetts, Idaho, Rhode Island, Washington, Minnesota, and California—have reportedly either extended the date by which individuals can enroll or reenroll and still have coverage effective January 1 or given individuals who had begun the enrollment process as of December 15 extra time to complete the process for January 1 coverage.  The FFM has not extended the deadline.

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Two Theologies Have Blocked Medicare-For-All


December 11th, 2014

Editor’s note: This post is part of a series of several posts stemming from presentations given at “The Law of Medicare and Medicaid at Fifty,” a conference held at Yale Law School on November 6 and 7.

In the 50 years since Medicare was enacted, Congress has never seriously considered extending Medicare to all Americans, nor even lowering Medicare’s eligibility age below 65. This pattern persisted even during those periods when national health insurance was at the top of the national agenda. This is not what the original advocates of Medicare anticipated when Medicare was enacted in 1965. They saw Medicare as the cornerstone of a national system of health insurance that would eventually cover all Americans.

Two Myths that Undercut Medicare-for-All: Managed Care and Competition

In the paper we presented at the Yale conference, we reviewed short- and long-term factors affecting the debate about Medicare over its lifetime, and then turned to a discussion of two long-term factors: the rise of what came to be called the managed care movement, and the resurgence of a longstanding campaign promoting the idea that competition can right the wrongs of American medicine.

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What To Watch For During This Year’s Open Enrollment Period: Lessons From The Health Reform Monitoring Survey


December 10th, 2014

The Obama Administration recently lowered its expectations on the number of individuals that are likely to enroll in health insurance plans through the Marketplace by the end of 2015—suggesting that it might be more difficult than expected to find and enroll remaining uninsured residents while retaining people who signed up during the first open enrollment period (New York Times; Wall Street Journal; Washington Post’s “Wonkblog”).

One potential barrier to enrollment is low levels of Marketplace awareness among the uninsured: September 2014 estimates from the Urban Institute’s Health Reform Monitoring Survey (HRMS) indicate that only 52 percent of uninsured adults reported hearing some or a lot about the health insurance Marketplace created by the Affordable Care Act (ACA). Despite this large knowledge gap, awareness of the Marketplace has improved since last September, when only 30 percent of the uninsured reported hearing some or a lot about the Marketplace prior to the first open enrollment period.

While increasing awareness of the Marketplace will continue to be important as the second open enrollment period unfolds, there are two additional issues that may determine how many more uninsured people actually gain coverage this year. First, will the remaining uninsured be reluctant to seek coverage and enroll during the current open enrollment period, and if so, why? Second, for people seeking information on health plans, what sources of information are they likely to turn to, and will those sources be adequate to meet the demand?

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From The National Coordinator For Health IT: The Federal Strategy For Collecting, Sharing, And Using Electronic Health Information


December 8th, 2014

Making our nation’s health and wellness infrastructure interoperable is a top priority for the Administration, and government plays a vital role in advancing this effort. Federal agencies are purchasers, regulators, and users of health information technology (health IT), as they set policy and insure, pay for care, or provide direct patient care for millions of Americans. They also contribute toward protecting and promoting community health, fund health and human services, invest in infrastructure, as well as develop and implement policies and regulations to advance science and support research.

The Office of the National Coordinator for Health IT (ONC) has a responsibility to coordinate across the federal partners to achieve a shared set of priorities and approach to health IT.  To that end, today we released the draft Federal Health IT Strategic Plan 2015-2020, and we are seeking feedback on the federal health IT strategy.  This Strategic Plan represents the collective priorities of federal agencies for modernizing our health ecosystem; however, we need your input. We will accept public comment through February 6, 2015. Please offer your insights on how we can improve our strategy and ensure that it reflects our nation’s most important needs.

A collection of 35-plus federal departments and agencies collaborated to develop the draft Federal Health IT Strategic Plan: 2015-2020, identifying key federal health IT priorities for the next six years (Exhibit 1). The landscape has dramatically changed since the last federal health IT strategyWhen we released that Plan, the HITECH Act implementation was in its infancy. Since then, there has been remarkable growth in health IT adoption. Additionally, the Affordable Care Act implementation has begun to shift care delivery and reimbursement from fee-for-service to value-based care.

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Implementing Health Reform: Federal Exchange Reenrollment And More (Updated)


December 2nd, 2014

On December 1, 2014, the Centers for Medicare and Medicaid Services (CMS) released a Guidance for Issuers on 2015 Reenrollment in the Federally facilitated Marketplace (FFM).  This guidance sets out in great detail—with clarifying examples—the process which the FFM and insurers will use to send and receive enrollments and reenrollments for 2015, including the process that the FFM will use to communicate to an insurer when a 2014 enrollee selects a different insurer for 2015 coverage.  The guidance is primarily directed at insurers but should also be of interest to consumers and those who are assisting them.  It demonstrates, I believe, a much higher degree of planning and intentionality than was evident in the 2014 open enrollment period, when enrollment rules often seemed to be developed on the fly.

This post describes the reenrollment guidance, as well as initial enrollment figures for the FFM and other ACA-related developments.

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The Payment Reform Landscape: Tying It All Together


December 2nd, 2014

Throughout 2014, Health Affairs Blog has been generous in allowing us to share our insights and opinions on a monthly basis as we examine the evidence for different payment reform models. Along this journey, we’ve taken an in-depth look at how well different payment models are proving to enhance the quality and affordability of care.

We’ve taken a few detours to explore some of the building blocks of a higher-value health care system, like price transparency. And we took some time to share findings from our 2014 National Scorecard on Payment Reform, which revealed the commercial sector is moving toward more value oriented payment.

So with 2015 almost upon us, what did we learn from all this exploration? And based on our learnings, what are the logical next steps for our work at Catalyst for Payment Reform (CPR), and for health care leaders’ efforts as they think about moving the needle on payment reform?

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Implementing Health Reform: Minimum Essential Coverage And The Multi-State Plan


November 24th, 2014

Two earlier posts this past weekend analyzed the massive Department of Health and Human Services 2016 Benefit and Payment Parameter Proposed Rule, released on November 21.  Also on November 21, the Internal Revenue Service of the Department of the Treasury released a final rule on Minimum Essential Coverage and Other Rules Regarding the Shared Responsibility Payment for Individuals, while the Office of Personnel Management released proposed modifications to the multi-state plan (MSP) program rule.  This post explores these rules.

Minimum Essential Coverage

The ACA requires Americans to either maintain “minimum essential coverage” (MEC) or pay a tax.  There are a number of exceptions to the requirement, however, and the concept of MEC can become quite complicated.  The final rule published by the IRS provides guidance as to the meaning of MEC and the rules governing some of the exceptions.

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Implementing Health Reform: 2016 Benefit And Payment Parameters Proposed Rule, Insurance Provisions


November 23rd, 2014

On November 21, 2014, the Centers on Medicare and Medicaid Services of the Department of Health and Human Services released its proposed Benefits and Payment Parameters (BPP) RulePart I of this post examined the benefit provisions of this proposed rule. This post will analyze the parts of the rule that deal with the insurance market reforms; the reinsurance, risk adjustment, and risk corridor programs; health insurance rate review; and the individual and SHOP exchanges.

New Definitions Of ‘Plan’ And ‘State’

The regulation begins with a modified definition of the term “plan.”  The terms “plan” is important in the ACA regulations.  A plan has been defined, with respect to a health insurer, as the combination of a benefit package, metal tier, and service area.  The new definition adds to this combination cost-sharing structure and provider network, so that plans that differ in their cost-sharing structure (deductibles, copayments, or coinsurance) or provider networks are different plans, even if they are offered at the same metal tier.  This definition becomes important, for example, in determining whether a plan offered outside the exchange is the same as a qualified health plan (QHP) offered in the exchange and can thus participate in the risk corridor program.  The proposed regulations later propose that the unreasonable rate review regulation applies at the plan level.

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Implementing Health Reform: 2016 Benefit And Payment Parameters Proposed Rule, Consumer Provisions; Hardship Exemptions


November 22nd, 2014

On November 15, 2014, the marketplaces reopened for 2015.  Anecdotal reports indicate that in most places enrollment and reenrollment are running smoothly.  But the Centers of Medicare and Medicaid Services (CMS) of the Department of Health and Human Services (HHS) is looking forward to 2016.  On November 21 CMS published its massive 2016 Notice of Benefit and Payment Parameters (BPP) Proposed Rule  with accompanying fact sheet.  It also published the draft 2016 actuarial value calculator and draft actuarial value calculator methodology for 2016.  Finally, CMS published a guidance on hardship exemptions for certain individuals.

Not to be outdone, the Department of the Treasury, Internal Revenue Service released its final regulation on Minimum Essential Coverage and other Rules Regarding the Shared Responsibility Payment for Individuals, together with a Notice regarding Individual Shared Responsibility Payment Hardship Exemptions that May be Claimed on a Federal Income Tax Return Without Obtaining a Hardship Exemption Certificate from the Marketplace and a Revenue Procedure setting out indexed adjusted percentages of income that will be used for determining the level of contributions expected of individuals before premium tax credits become available, the affordability threshold for the shared responsibility payments unaffordability exemption, and the threshold for determining whether employer coverage is affordable for purposes of determining eligibility for tax credits.

Finally, the Office of Personnel Management released a lengthy proposed rule proposing modifications in the multi-state plan program.  These rules, proposed rules, and guidances will be addressed in a series of posts over the next several days.  This post will address primarily the consumer-facing provisions of the BPP proposed rule, focusing on changes in benefits.  A second post will follow, discussing the provisions of the rule more relevant to insurers, such as proposed changes in the reinsurance, risk adjustment, and risk corridor rules.  A final post will discuss the IRS rule, which is primarily a finalization of proposals and guidances already made public, and the OPM multi-state plan rule.

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How Consumers Might Game The 90-Day Grace Period And What Can Be Done About It


November 17th, 2014

Under the Patient Protection and Affordable Care Act (ACA), individuals receiving a federal subsidy are entitled to a three-month premium nonpayment grace period. As long as such an individual has paid at least the first month’s premium of the year, in any subsequent month the individual has three months to make the premium payment before coverage is terminated.

The grace period has obvious benefits for consumers, yet as a recent Health Affairs Health Policy Brief describes, this provision of the law has created significant apprehension among doctors and other health care providers who worry they will go unpaid when coverage is retroactively terminated for their patients. Unfortunately, as we explain here, this provision could have even broader adverse implications for the health care system.

The grace period law could encourage subsidized individuals to regularly pay only nine months of premiums and receive, in effect, twelve months of coverage. Should this gaming become widespread it could increase premiums (perhaps by as much as several percentage points) for everyone who purchases coverage in the individual (non-group) exchanges.

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Implementing Health Reform: Setting The Stage For 2015 Open Enrollment


November 16th, 2014

On November 15, 2014, the Affordable Care Act marketplaces reopened for 2015 enrollment, the second year of ACA coverage.  On November 14, the Centers for Medicare and Medicaid Services and the Office of Personnel Management released guidance and reports laying the groundwork for the second year.  This post covers these and notes briefly a couple of ACA court decisions that also came down on November 14.

Plan data release.  CMS released a number of data files containing information on plans available on the marketplaces for 2015 and their rates.  First, the release includes “landscape files” including plans available by county along with premium and cost-sharing data for selected scenarios and services for the 2015 plan year for the federally facilitated marketplace and federally facilitated SHOP.

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Risk And Reform Of Long-Term Care


November 14th, 2014

Editor’s note: This post is part of a series of several posts stemming from presentations given at “The Law of Medicare and Medicaid at Fifty,” a conference held at Yale Law School on November 6 and 7.

The 50th Anniversary of Medicare and Medicaid offers an opportunity to reflect on how U.S. social policy has conceived of the problem of long-term care.

Social insurance programs aim to create greater security—typically financial security—for American families (See Note 1). Programs for long-term care, however, have had mixed results. The most recent attempt at reform, which Ted Kennedy ushered through as a part of the Patient Protection and Affordable Care Act (ACA), called the CLASS Act, was actuarially unsound and later repealed. Medicare and especially Medicaid, the two primary government programs to address long-term care needs, are criticized for failing to meet the needs of people with a disability or illness, who need long-term services or supports. These critiques are valid.

Even more troublesome, however, long-term care policy, especially in its most recent evolution toward home-based care, has intensified a second type of insecurity for Americans. This insecurity arises when someone becomes responsible for the long-term care of a loved one. In a longer forthcoming article, I argue that this insecurity—which I call “next-friend risk”—poses a serious threat to Americans and needs to be addressed. (I borrow the phrase next friend from a legal term for a person who in litigation represents someone with a disability who is otherwise unable to represent him or herself. Although not a legal guardian, the next friend protects the interests of an incompetent person.)

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Reforming Medicare: What Does The Public Want?


November 13th, 2014

Is Medicare adequately meeting the needs of seniors, or are there ways that its core attributes could be improved? Numerous elected officials, policymakers, and other thought leaders have offered perspectives on ways to change the program. Few efforts, however, have been directed at understanding how the public—given accurate information, a variety of options, and a valid structure for weighing the pros and cons—would change Medicare’s basic design.

The MedCHAT Project

Recently, the American Enterprise Institute and the Brookings Institution co-hosted a briefing on the results of a California project that did just that. The “MedCHAT” project, sponsored by the nonprofit, nonpartisan Center for Healthcare Decisions, asked 800 residents—the lay public, as well as health care professionals and community leaders—to consider Medicare’s current benefits and decide if those should be changed. Respondents represented the full spectrum of age, race, ethnicity, education, and income level.

Using an interactive, computer-based system, participants were asked to respond as “social decisionmakers;” they were tasked with making Medicare more responsive to the needs of current and future generations without imposing a greater cost burden on the country. The computer-based CHAT (“Choosing All Together”) program uses actuarial estimates to show the relative costs of health care benefits, allowing participants to make trade-offs with an understanding of the fiscal impact each benefit has on the program.

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High Quality, Affordable Care: Making The Case For Smarter Networks


November 13th, 2014

Narrow networks are one means health insurance plans have used to mitigate increases in health insurance premiums. These networks have become more prevalent since the expansion of coverage brought about by the Affordable Care Act (ACA). But these narrow networks have given rise to complaints that consumers are being denied access to, and choice of, providers. These complaints are causing policymakers to consider, and in some cases adopt, new laws and regulations on network adequacy.

In the following blog post, I argue that policymakers should consider that there are different types of narrow networks and should be careful not to adopt policies that inhibit new contractual arrangements among payers, providers, and hospitals, such as Accountable Care Organizations, which hold the promise of better quality care at lower cost. At the same time, issuers must provide accurate and current information on which hospitals and providers are in the network and are accepting new patients, and must make the case that smarter networks can lead to better outcomes at lower cost.

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The Short-Term And Long-Term Outlook Of Drug Coupons


November 12th, 2014

In the October 2014 Health Affairs article, “Specialty Drug Coupons Lower Out-Of-Pocket Costs And May Improve Adherence At The Risk Of Increasing Premiums,” Catherine Starner and coauthors explore the relationship between drug coupons and specialty drugs. Specialty drugs, primarily injectables and biologics, are costly drugs used to treat complicated, chronic conditions that typically require special handling, administration, and monitoring. Starner et al. report that specialty drugs have an average monthly cost to patients and payers of about $3,500.

In their innovative study, Starner et al. find that nearly half of the patients in their sample who were prescribed specialty drugs used personal drug coupons to reduce their personal financial responsibilities. Coupons come in the form of maximum copay and monthly savings cards, and can be accessed from the brand-name manufacturer’s website, printed out, and cashed in at the pharmacy.

Manufacturers promote drug coupons as supplementary patient assistance programs that can fill gaps in insurance coverage by reducing individual patients’ responsibilities for out-of-pocket health care costs related to high-cost specialty drugs or other pharmaceutical products. For example, patients taking etanercept (Enbrel), an expensive biologic specialty drug indicated for rheumatoid arthritis, can receive savings via the Enbrel Support plan, which reduces the monthly co-pay to $0 for the first six months and $10 per month thereafter.

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Implementing Health Reform: New HHS 2015 Marketplace Enrollment Estimates


November 11th, 2014

On November 10, 2014, the HHS Assistant Secretary for Planning and Evaluation (ASPE) released an estimate of “How Many Individuals Might Have Marketplace Coverage After the 2015 Open Enrollment Period.”  ASPE estimates that 9.1 to 9.9 million will be enrolled, substantially lower than the 13 million enrollee estimate the Congressional Budget Office issued in the Spring of 2014.

Both the ASPE and CBO estimates see the marketplaces as eventually covering 24 to 25 million people.  But while CBO projected that the marketplaces would reach this number in 3 years, ASPE believes that a 4 to 5 year ramp-up period is more realistic based on the launch experience of other programs, like Medicaid and CHIP.

Examining the numbers.  The marketplaces enrolled 8.1 million individuals during the 2014 open enrollment period.  The ASPE brief states that 7.1 million were still enrolled as of October of 2014.  It is not clear whether or not this number includes 112,000 individuals that HHS recently announced have been dropped from the marketplaces because they failed adequately to document their immigration or citizenship status.  HHS has also announced that another 105,000 individuals will have their financial eligibility determined on data available to HHS (in most instances 2012 tax returns), because they failed to document the income levels they claimed on their applications.  These individuals will not lose coverage, but may receive smaller tax credits.

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Health Insurance Without An Annual Expiration Date? A Case For Exchange-Based Long-Term Policies


November 10th, 2014

Today, consumers make decisions every year about whether to renew or change health plans. Exchange-based multi-year plans would have to overcome significant obstacles before they become reality, but they hold the potential for helping the United States move toward goals of a healthier society and a more efficient health care system.

Since the launch of the federal and state health insurance exchanges in October 2013, set up to facilitate the purchase of insurance in line with the Affordable Care Act (ACA), millions of Americans have obtained coverage. In addition, several large employers, such as Sears and Walgreens, have announced that they will stop offering coverage and instead provide a defined contribution for their employees to purchase coverage on an exchange.

The growing role of exchanges, their price transparency, and the increasing share of the cost of coverage borne by enrollees is likely to make consumers pay increased attention to price. Price-sensitive buyers could encourage competition and thus efficiency. But there might be unintended consequences. Consumers might deliberately choose low-cost plans with limited benefits when they are healthy, knowing that the ACA allows them to purchase a more generous plan should they develop a chronic disease. The possibility of changing health plans when becoming sick might exacerbate the self-selection problem in the insurance market because the public exchanges allow only limited risk adjustment based on such factors as age, family composition, rating area, and tobacco use.

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Implementing Health Reform: Supreme Court Will Review Tax Credits In Federal Exchanges


November 7th, 2014

On November 7, 2014, the Supreme Court granted certiorari (review) in King v. Burwell, one of the cases involving the question of whether federally-facilitated marketplaces can grant premium tax credits.  The Fourth Circuit in King had upheld the Internal Revenue Service rule allowing FFMs to grant premium tax credits.  A panel of the District of Columbia Circuit had decided the same day that only state-operated exchanges could grant tax credits; however, that decision was vacated by the D.C. Circuit when it decided to rehear the case as a whole, so at the time the Supreme Court accepted certiorari, King was the only circuit court decision in effect, and that upholding the rule.

The challenge to the IRS rule is based on the wording of the provision of the ACA that authorizes premium tax credits, which refers to enrollment “in through an Exchange established by the State.”  The plaintiffs in King argue that this means that only state-operated exchanges can grant premium tax credits.

The government responds that this is an incorrect reading of the statute, which recognizes FFMs as the state-established exchange in states that elect not to establish a state exchange.  This is certainly the way that the members of Congress who wrote the legislation and the states that elected not to operate their own exchange understood the legislation.

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