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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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Medicare, Medicaid, And Pharmaceuticals: The Price Of Innovation


November 20th, 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.

Through much of the last half century, Medicare and Medicaid (MM) have not for the most part supported research intended to lead to new drugs. For their role in drug development, we need to look to infrastructure and incentives. The record of the National Institutes of Health (NIH) illustrates the potential of both for pharmaceutical innovation. The current budget of NIH, the big elephant in the zoo of the federal biomedical enterprise, is $30 billion, but apart from a dozen small programs devoted to targeted drug development, most of these billions are not aimed directly at pharmaceutical innovation (See page 234).

Yet the NIH investment in biomedicine has indirectly fueled drug development in the private sector to a huge degree. It has paid for the training of biomedical scientists and clinicians, many of whom went on to staff the drug industry, especially its laboratories. NIH-sponsored research has also generated basic knowledge and technologies and it has encouraged universities to spin out their potentially useful findings into the industry by allowing for the patenting and licensing of the findings.

Like NIH, MM has helped fuel drug development indirectly by supporting selected experimental cancer treatments, medical education, and some clinical research and training. But investment in these activities has been small and their impact on drug development apparently very limited. In contrast to NIH, the MM stimulus to drug innovation has resided not in the production of new scientists or the patented uses of new knowledge, but principally in markets and pricing.

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Health Affairs Web First: In 11-Country Survey Of Older Adults, Americans Are Sickest But Have Quickest Access To Specialists


November 20th, 2014

A new survey of the health and care experiences of older adults in eleven different countries, released recently as a Web First by Health Affairs, found that Americans were sicker than their counterparts abroad, with 68 percent of respondents living with two or more chronic conditions and 53 percent taking four or more medications. Also, Americans were most likely to report cost-related expenses for care (19 percent of respondents) than residents in any of the other countries surveyed.

On the other hand, the United States compared favorably in some aspects: For example, 83 percent of US respondents had a treatment plan they could carry out in their daily life, one of the highest rates across the surveyed countries.

A few other key findings:

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The Case For Advancing Access To Health Coverage And Care For Immigrant Women And Families


November 19th, 2014

Before the end of the year, the Obama administration is expected to announce that millions of undocumented immigrants will be able to lawfully stay in the United States. The new Congress may also take action on immigration reform legislation. Regardless of how it happens, any immigration policy change presents a good opportunity to revisit what has gone wrong with insurance coverage and health care for millions of immigrants, both undocumented and lawfully present, living and working in communities across the country.

A web of policy barriers to public and private insurance options effectively keeps millions of immigrant women and their families from affordable coverage and the basic health care—including sexual and reproductive health services—that coverage makes possible. Removing these barriers would advance the health and economic well-being of immigrant women, their families, and society as a whole. Most immediately, administrative steps advancing access for even some immigrants would be an important step forward. The case for doing so is compelling.

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Challenges For People With Disabilities Within The Health Care Safety Net


November 18th, 2014

Medicare and Medicaid were passed to serve as safety nets for the country’s most vulnerable populations, a point that has been reemphasized by the expansion of the populations they serve, especially with regards to Medicaid. Yet, even after 50 years, the disabled population continues to be one whose health care needs are not being met. This community is all too frequently left to suffer health disparities due to cultural incompetency, stigma and misunderstanding, and an inability to create policy changes that cover the population as a whole and their acute and long-term needs.

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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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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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New Health Policy Brief: The Family Glitch


November 10th, 2014

A new health policy brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) looks at the Affordable Care Act’s (ACA’s) so-called family glitch. Low-to-moderate-income families are eligible for a subsidy to purchase health insurance on the Marketplace if the cost of health coverage through their employers is more than 9.5 percent of their household income.

However, this formula is based on individual-only coverage and does not account for the higher cost of a family insurance plan. If the family glitch is not fixed, the path to affordable insurance for many spouses and children could be blocked—and children could be even further impacted if Congress fails to extend funding for the Children’s Health Insurance Program (CHIP) after the current appropriation ends in September 2015, which the brief also explains.

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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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Health Care Policy After The Mid-Term Elections


November 7th, 2014

As President Obama said in his post-election news conference, Republicans had a good night on November 4. They increased their majority in the House to a level not seen since the 1920s and may hold as many as 250 seats in the lower chamber. In the Senate, Republicans defeated at least three incumbent Democratic Senators, and are likely to defeat two more when all of the voting and counting is over.

The most likely scenario is that the GOP will hold 54 seats in the Senate come January — an increase of nine seats from the current Congress. It is noteworthy that half of the Democratic Senators who voted to pass the Affordable Care Act (ACA) nearly five years ago will no longer be in the Senate in 2015. Despite some commentary to the contrary, the ACA was a big issue in the election. To a person, the successful GOP Senate candidates ran strongly against the ACA. In the middle of October, anti-ACA ads were among the most frequently-aired political advertisements from Republican Senate candidates. By and large, these candidates won their races.

The conventional wisdom is that the ACA, now heading into its second year of full-scale implementation, cannot be rolled back in any substantial way at this point. That’s certainly the view of major corporate players and the health care industry. But it is decidedly not the view of the newly-elected Republican members of the House and Senate, or their constituents. They believe voters sent them to Washington to do their best to push back against the perceived excesses of the ACA and to begin replacing it with a reform plan that is less expensive, less damaging to the economy, and less reliant on federal regulation and control.

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Enrolling College Students In Health Insurance: Lessons From California (Part 2)


October 21st, 2014

Editor’s note: As we approach the beginning of the second open enrollment period under the Affordable Care Act, Walter Zelman describes an effort he led during last year’s initial open enrollment period to enroll students in the California State University (CSU) system in coverage. Part 1 of this post provided background on the CSU system and the enrollment effort, the CSU Health Insurance Education Project, as well as a discussion of what worked well. Part 2, below, addresses what worked less well, as well as project results, lessons and policy implications, and next steps.

In addition to Zelman, authors of this post include Wendy Lee, now in a Masters of Public Health Program at Johns Hopkins; Natasha Buransombati, now in a graduate program in Nursing and Public Health at the University of Seattle in Washington; and Carla Bracamonte, now in an MPH program at California State University, Fullerton. As CSU students, Lee and Buransombati served as regional coordinators for HIEP and Bracamonte served as a coordinator, CSU Los Angeles.

IV.  What Worked Less Well

Assessments as to what did not work must be rendered with caution. In most cases lack of success may have been due to lack of emphasis or time, to the relative inexperience of student educators, or the failure of project leaders to follow-up aggressively with CSU or administrative personnel.

Campus groups, social media, and web pages

Most striking and disappointing, was the difficulty in engaging campus groups. Many seemed supportive of the mission. But, in the end, most were unable to commit time and resources to the project, even after repeated engagement by project representatives. Most campus groups had specific goals and agendas, and promoting insurance coverage to students was not one of them. More time or resources might have produced more campus organization support, but these were not available.

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Enrolling College Students In Health Insurance: Lessons From California (Part 1)


October 20th, 2014

Editor’s note: As we approach the beginning of the second open enrollment period under the Affordable Care Act, Walter Zelman describes an effort he led during last year’s initial open enrollment period to enroll students in the California State University system in coverage. Part 1 below provides background on the CSU system and the enrollment effort, the CSU Health Insurance Education Project, as well as a discussion of what went well. Part 2, which will appear tomorrow, addresses what did not go so well, as well as project results, lessons and policy implications, and next steps.

In addition to Zelman, authors of this post include Wendy Lee, now in a Masters of Public Health Program at Johns Hopkins; Natasha Buransombati, now in a graduate program in Nursing and Public Health at the University of Seattle in Washington; and Carla Bracamonte, now in an MPH program at California State University, Fullerton. As CSU students, Lee and Buransombati served as regional coordinators for HIEP and Bracamonte served as a coordinator, CSU Los Angeles.

The California State University (CSU) system is the largest public university system in the nation, as well as one of the most diverse. The CSU Health Insurance Education Project (HIEP) received a $1.25 million grant to educate students in the CSU system about the Affordable Care Act and health coverage options through California’s new marketplace, Covered California. A pre-open enrollment, multi-campus poll found that approximately 25-30 percent of CSU students were uninsured, primarily because they could not afford insurance.

The project placed student educators on the CSU’s 15 largest campus. Over a seven-month period they gave approximately 1500 classroom presentations, and conducted 70 forums and 300 enrollment events. University administrators sent out over 1 million emails to CSU students. Project strategy emphasized a focus on affordability, the need for insurance (accidents happen), and the simplicity of the enrollment process.

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Will Employers Favor Private Exchanges Over Coverage Sponsorship?


October 17th, 2014

Over the past couple years, health care exchanges probably have consumed more of corporate benefits managers’ time and psychic energy than any other topic. An outstanding question is whether the rank and file of American businesses will drop the hassle that employer-sponsored coverage represents, or default to private exchanges.

Private exchange offerings typically move employees from their companies’ previous self-funded health plans to fully-insured individual arrangements, purporting to offer more flexibility and choice that can adapt to the wide-ranging needs of employees and employers, while creating a more competitive health plan marketplace.

Several recent surveys have reported that employers plan to move aggressively to private exchanges. In a survey last year of more than 700 businesses, the Private Exchange Evaluation Collaborative, a group of regional business health coalitions working with the consulting group PwC, found that 45 percent of employers have implemented or are considering using a private exchange for active employees before 2018. Similarly, a February Aon Plc survey found that, while 95 percent of employers say they expect to continue offering health care for the next 3-5 years, and 5 percent of employers currently use a private exchange, 33 percent say they may consider using one in the future.

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Health Policy Brief: The Ninety-Day Grace Period


October 17th, 2014

A new Health Policy Brief from Health Affairs and the Robert Wood Johnson Foundation (RWJF) examines the ninety-day grace period, a provision of the Affordable Care Act (ACA). Of the eight million people who enrolled in the insurance Marketplaces between October 2013 and March 2014, 85 percent received an advance premium tax credit. This provision allows a three-month grace period for nonpayment of insurance premiums for this group of consumers–and this group only–if they have previously paid at least one month’s full premium in that benefit year.

This grace period allows these new enrollees continuity of care, preventing them from shifting or “churning” in and out of coverage for nonpayment. Health care providers, however, have expressed concerns that this provision and the way the Centers for Medicare and Medicaid Services (CMS) has implemented it could expose them to considerable financial risk. This Health Policy Brief focuses on how this provision is being implemented and the concerns from the provider community.

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Implementing Health Reform: Renewing Coverage For 2015


October 16th, 2014

On October 15, 2014, the Centers for Medicare and Medicaid Services (CMS) announced, with a month to go before the 2015 open enrollment begins on November 15, that it is beginning to send out notices to enrollees in the federally facilitated marketplace (FFM), explaining to them how to renew their coverage for 2015.

CMS is urging consumers to come back to the marketplace as it opens on November 15 to update their 2015 application and to make sure they are enrolled in the qualified health plan (QHP) that best meets their financial situation and health needs for 2015. The procedure outlined in the announcement is that set out in the FFM redetermination guidance issued in June. State-operated exchanges are also, presumably, beginning to inform their enrollees regarding their own 2015 redetermination processes.

Redetermination Notice

FFM Consumers will receive one of six notices. Consumers who visited the marketplace in 2014 and were determined eligible for coverage but who did not enroll, are being sent a notice urging them to return to the marketplace and enroll when the open enrollment period begins. Consumers who enrolled for 2014 but have not been receiving tax credits either because they were not eligible, did not apply, or were determined eligible for tax credits but declined assistance, are urged to return to the marketplace and reenroll in coverage.

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Health Affairs Web First: New Study Shows Low-Income Residents In Three States Support Medicaid Expansion


October 9th, 2014

Expansion of Medicaid under the Affordable Care Act (ACA) to millions of low-income adults has been controversial. However, little is known what these Americans themselves think about Medicaid. A new study, recently released as a Web First by Health Affairs, surveyed nearly 3,000 low-income adults in Arkansas, Kentucky, and Texas (states that have adopted different approaches for Medicaid expansion).

This telephone survey, conducted in late 2013, found that 83 percent of respondents in Arkansas and Kentucky and 79 percent of those in Texas were in favor of their state expanding Medicaid under the ACA. Roughly two-thirds of uninsured respondents planned to apply for coverage in 2014. The majority of adults surveyed viewed Medicaid as comparable to or better than private insurance in overall health care quality.

Authors Arnold Epstein, Benjamin Sommers, Yelena Kuznetsov, and Robert Blendon developed a thirty-eight-item survey and targeted citizens ages 19–64 with household incomes of less than 138 percent of the federal poverty level. Forty percent of Texas respondents were Latino. A significant number of respondents (40 percent in Arkansas and Kentucky and 32 percent in Texas) said they were in “fair” or “poor” health, with a substantial number of respondents reporting living with chronic health conditions.

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Implementing Health Reform: Resolving Income-Related Data Inconsistencies (Updated)


September 16th, 2014

On September 15, 2014, the Centers for Medicare and Medicaid Services (CMS) announced a second deadline in its efforts to resolve data inconsistencies remaining from the 2014 open enrollment period.  This second deadline is for the submission of documentation to resolve income inconsistencies for exchange enrollees.  The first deadline was announced in August, when CMS sent final letters to about 310,000 federal marketplace (exchange) enrollees whose enrollments raised citizenship or legal-immigrant status issues, informing them that they must provide verification documents by September 5 or be terminated from coverage as of September 30.

CMS received hundreds of thousands of documents in response to the August request, reducing the number of individuals with citizenship and immigration data-matching issues from 966,000 as of May 31 to 115,000 as of September 14.  These individuals will be terminated as of September 30, 2014, but under the revised bulletin 11, they will be reinstated retroactively if they subsequently produce the documents needed to verify their citizenship or legal alien status. They may also purchase insurance outside the exchange.  Insurers are legally required to offer coverage to individuals who reside in their service area, regardless of citizenship or alien status.

Under the procedure announced on September 15, CMS is sending final notices to individuals enrolled through the federally facilitated exchange who still have income-related data-matching issues, informing them that they must send required information to verify their income as of September 30, 2014 or their premium tax credits and cost-sharing reduction payments will be modified to reflect information reflected in data sources otherwise available to CMS.  For example, if an enrollee’s 2012 tax return reported income higher than that reported by the enrollee on his or her application for advance premium tax credits and cost-sharing assistance, and the enrollee failed to provide verification of the claimed income, the enrollee’s premium tax credits and cost-sharing reduction payments would be modified as of November 1 in accordance with the income reflected in the tax return.

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Birth Control Pills Should Be Available Over The Counter, But That’s No Substitute For Contraceptive Coverage


September 10th, 2014

In recent weeks, some opponents of the Affordable Care Act’s (ACA) contraceptive coverage guarantee have promoted the idea that oral contraceptive pills should be available to adult women without a prescription. Sens. Kelly Ayotte (R-NH) and Mitch McConnell (R-KY), for example, recently introduced the so-called Preserving Religious Freedom and a Woman’s Access to Contraception Act, a bill that would urge the Food and Drug Administration (FDA) to study whether to make contraceptives over the counter (OTC) — though for adults only.

Making birth control pills available over the counter, if done right, would meaningfully improve access for some groups of women. However, such a change is no substitute for public and private insurance coverage of contraceptives — let alone justification for rolling back coverage of all contraceptive methods and related services for the millions of women who currently have it.

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Transcending Obamacare? Analyzing Avik Roy’s ACA Replacement Plan


September 2nd, 2014

Avik Roy’s proposal, “Transcending Obamacare,” is the latest and most thoroughly developed conservative alternative for reforming the American health care system in the wake of the Affordable Care Act. It is a serious proposal, and it deserves to be taken seriously.

Roy’s proposal is a curious combination of conservative nostrums (limiting recoveries for victims of malpractice), progressive goals (eliminating health status underwriting, providing subsidies for low-income Americans), and common sense proposals (enacting a uniform annual deductible for Medicare).

Most importantly, however, Roy proposes that conservatives move on from a single-minded focus on repealing the ACA toward building upon the ACA to accomplish their policy goals. He supports repealing certain features of the ACA—including the individual and employer mandate—but would retain others, such as community rating and exchanges. As polling repeatedly shows that many Americans are not happy with the ACA, but that a strong majority would rather amend than repeal it, and as it is very possible that we will have a Congress next year less supportive of the ACA than the current one, Roy’s proposal is important.

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