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Travels In Hyperreality: What If Bipartisan ACA Fixes Were Possible?


April 23rd, 2014
by Billy Wynne

Since enactment of the Affordable Care Act in March 2010, a strange, relatively unnoticed phenomenon has occurred: Congress has passed bipartisan changes to it. These amendments were generally to such esoteric components of the law that they dodged the political block-aid that otherwise surrounds it.

But what would happen if things were different? If Congress could act to change the ACA in a meaningful way, what would it do? Here we briefly review the previous sub rosa changes to launch into a broader examination of macro ACA reforms that have a fighting chance of enactment in the not too distant future.

Tinkering. Most recently, in the Medicare “doc fix” in March, both parties acted to repeal the section of the ACA that capped deductibles for small group health plans. That legislation also delayed, again, implementation of the ACA’s Medicaid cuts to disproportionate share hospitals.

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Look At Consequences Of Rejecting Medicaid Expansion Leads First Quarter Health Affairs Blog Most-Read List


April 14th, 2014
by Tracy Gnadinger

Given their recent mention in Paul Krugman’s New York Times‘ column, it’s not surprising that Sam Dickman, David Himmelstein, Danny McCormick, and Steffie Woolhandler‘s discussion of the health and financial impacts of opting out of Medicaid expansion was the most-read Health Affairs Blog post from January 1 to March 31, 2014.

Next on the list was Robert York, Kenneth Kaufman, and Mark Grube‘s discussion of a regional study on the transformation from inpatient-centered care to an outpatient model focused on community-based care. This was followed by Susan Devore‘s commentary on changing health care trends and David Muhlestein‘s evaluation of accountable care organization growth.

Tim Jost is also listed four times for contributions to his Implementing Health Reform series on Medicaid asset rules, CMS letter to issuers, contraceptive coverage, and exchange and insurance market standards.

The full list appears below.

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Implementing Health Reform: Changing Focus, And Changing Leadership, At HHS (Updated)


April 11th, 2014
by Timothy Jost

With the March 31, 2014 deadline for applying for qualified health plan coverage through the health insurance exchanges behind us, and the April 15, 2014 deadline for completing those applications upon us, Affordable Care Act implementation has quieted considerably. The Centers for Medicare and Medicaid Services have been very active on the Medicare front, releasing in recent days their 2015 Medicare Advantage Rate Announcement and Call Letter and publishing data on Medicare payments to 880,000 Medicare providers. But on the exchange and insurance market reform side, CMS has only one major proposed rule pending at this time, the Exchange and Insurance Market Standards Rule proposed in March, and nothing pending for regulatory review at the Office of Management and Budget.

I am unaware of any major regulatory issuances expected in the immediate future from the Departments of Treasury or Labor, although Treasury does have a number of proposed rules on the table that have yet to be finalized dealing with issues such as minimum value of employer coverage or premium tax credit reporting requirements for exchanges.

On April 10, the media reported two major Health and Human Services developments. First, Secretary of Health and Human Services Kathleen Sebelius announced at a Senate Hearing that 7.5 million Americans have now signed up for health plans through the exchanges. Although opponents of the ACA continue to quibble about how many of these individuals have actually paid their premiums and how many were uninsured previously, the number far exceeds earlier estimates of how many would enroll in health insurance through the exchanges. A recently released Rand survey, which does not fully take into account the late surge that increased exchange enrollment by over 70 percent in the last month, indicates that in fact the ACA has made a significant dent in the number of uninsured in the United States.

The second announcement was of the resignation of Secretary Sebelius herself, and of the nomination of Sylvia Mathews Burwell as her replacement.

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Medicare Advantage Rolls On


April 11th, 2014
by Billy Wynne

Monday afternoon, the Centers for Medicare and Medicaid Services (CMS) released the final rates and other reimbursement policies for Medicare Advantage (MA) plans, referred to as the Final Call Letter. Once again, the Administration took pains to ameliorate planned cuts to MA, demonstrating the program’s increasing popularity with seniors and, by extension, its robust political strength.

For my money, we’ll look back at this year as the final hurdle the program jumped on its path to dominating the Medicare benefit for a generation to come. It’s already well on its way, covering 30 percent of Medicare beneficiaries and growing. So let’s take a quick tour of the MA program’s initially volatile history and the winning streak it’s been on of late, culminating with the breaks the Administration cut it this go round.

The history. First there was the growth and then precipitous decline of managed care in the 90s, a wave that the program – then called Medicare+Choice – rode alongside the commercial sector.

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The Payment Reform Landscape: Price Transparency


April 2nd, 2014
by Suzanne Delbanco

Editor’s note: This is the third post in a Health Affairs Blog series on payment reform by Catalyst for Payment Reform Executive Director Suzanne Delbanco. The first two posts are available here and here.

Last week Catalyst for Payment Reform (CPR) and our partners at the Healthcare Incentives Improvement Institute (HCI3) released our second annual Report Card on State Price Transparency Laws. This year, we decided not to grade states on a curve and to place greater emphasis on the price information actually available to consumers—not just what is written in the law.

Forty-five states received an F in this year’s Report Card, but there were a couple of notable exceptions: Massachusetts and Maine. Each month in this blog, I’ve been sharing insights about payment reform and which models are proving to work, so this naturally raises the question: what is the relationship between payment reform and the success of state price transparency efforts?

At CPR, we like to say price transparency is one of the core building blocks of payment reform and a higher-value health care system. Purchasers and consumers need transparency for three primary reasons: (1) to help contain health care costs; (2) to inform consumers’ health care decisions as they assume greater financial responsibility; and, (3) to reduce unknown and unwarranted price variation in the system.

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Implementing Health Reform: First Marketplace Open Enrollment Ends With More Than Seven Million Enrollees


April 2nd, 2014
by Timothy Jost

The White House announced on Tuesday April 1, 2014 that as of the end of open enrollment, 11:59 p.m. on March 31, 2014, 7.1 million Americans had signed up for health plans under the Affordable Care Act. Tens of thousands more will be added from individuals who attempted to apply during the open enrollment period but were unable to complete their applications. And many more will be enrolled through special enrollment periods as they undergo life changes over the coming year.

Of course, arguments will continue as to how many of those who selected a plan will pay their premiums (which they must do before they are covered); how many were previously uninsured; and whether those who enrolled are young, healthy, and male enough to offer insurers a risk pool like that they anticipated when they set their rates. There is ample evidence that many have not yet paid, but it is reasonable to expect that the payment rate will pick up as enrollees figure out how to pay their insurers and insurers figure out who their enrollees are. There is also evidence that many of those who signed up were previously covered. Of course, one of the purposes of the ACA was to make insurance affordable, so if someone who was struggling to afford coverage (and might have had to drop it in the near future) can now afford it, that is also a success. Moreover, millions of the uninsured have also signed up for Medicaid and some have also obtained coverage in the individual market outside the exchange or from their employer. Finally, the size of the risk pool suggests that it is reasonably balanced demographically.

In any event, 7 million enrollees was the number that has constantly been held up as the unobtainable goal for the exchanges, and it has been reached–indeed surpassed. Pictures all over the web today of long lines and full waiting rooms of people eager to enroll in coverage demonstrate that in fact people want health care coverage and the ACA is allowing them to get covered.

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Three Better Bipartisan Health Policies To Pay For Repealing Medicare’s SGR


March 21st, 2014
by Robert Moffit

After months of House and Senate negotiations on legislation to replace the Medicare Sustainable Growth Rate (SGR) formula for updating Medicare physician payment, members of Congress are relieved to finally have an agreement. It is perfectly understandable that they, as well as professional medical organizations, want to act quickly. The danger is that even normally staid and stern budget hawks are prepared to move quickly to get this unworkable payment system permanently off the national agenda.

Of course, the Sustainable Growth Rate (SGR) should be repealed and replaced. Congressional leaders point out that since 2003, the routine cycle of emergency “doc fixes” have cost taxpayers $150 billion. The compromise legislation, which is barely better than the deplorable status quo, falls far short of what should be done.  In fact, the House bill (H.R. 4015), which passed the House of Representatives on March 14, and the Senate bill (S. 2000), which was reported out of the Finance Committee, would worsen the nation’s deficits.

It is not only critical for lawmakers to responsibly finance the $138 billion in new spending over the next 10 years that eliminating and replacing SGR will incur, but also do so without creating future budget deficits.

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Implementing Health Reform: The 2015 Health Insurance Marketplace Blueprints And More ACA News


March 14th, 2014
by Timothy Jost

In its final 2015 Notice of Benefit and Payment Parameters, the Centers for Medicare and Medicaid Services (CMS) noted that state applications to operate exchanges for 2015 would be due on June 30, 2014. On March 7, 2014, CMS released at its Paperwork Reduction Act (PRA) website the blueprints that states are to use to apply to operate an exchange (called a marketplace in the blueprint). The PRA listing also includes a helpful crosswalk between the proposed and final blueprint.

This post discusses these blueprints as well as other news related to Affordable Care Act implementation, such as an additional one-month extension of coverage in the federal Preexisting Condition High Risk Pool.

The biggest change in the 2015 blueprint is that plan management state partnership exchanges are no longer available. States that decide to assist in plan management functions will do so on an ad hoc basis and are not required to file a blueprint. This change apparently recognizes the reality that many of the states assisting in plan management are not able politically to identify themselves as partners, and thus there is little point in requiring some to do so and not others. States do also not need to file a blueprint regarding their decision on whether to use the federal exchange to assess or determine Medicaid eligibility.

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Implementing Health Reform: Allowing Noncompliant Policies; Benefits And Payment Parameters Rule (Part 1)


March 7th, 2014
by Timothy Jost

March 5, 2014 was a banner day for Affordable Care Act implementation. The Department of Health and Human Services released its final 2015 Notice of Benefit and Payment Parameters rule (fact sheet here), as well as a bulletin extending until October 1, 2016 its transitional policy permitting the renewal of ACA non-compliant individual and small group health insurance policies. The Internal Revenue Service also issued two final rules regarding reporting by insurers of minimum essential coverage and reporting by employers on coverage under employer-sponsored health plans. (fact sheet here)

This post will discuss the HHS bulletin and begin consideration of the benefit and payment parameter rule. Subsequent posts will discuss the remainder of the benefit and payment parameters rule and the IRS rules.

HHS Bulletin On ACA Non-Compliant Policies

On November 14, 2013, the Center for Medicare and Medicaid Services issued a letter to state insurance commissioners informing them that CMS would permit state regulators to allow insurers to renew non-grandfathered health insurance policies in the individual and small group market that did not comply with the 2014 market reform rules for policy years beginning by October 1, 2014. Specifically, renewed 2013 plans did not need to comply with the guaranteed issue and guaranteed renewability requirements; limitations on health status underwriting and preexisting condition exclusions (for adults); the single risk-pool requirement; the prohibition against discrimination; the essential health benefit and clinical trial coverage requirements; and limitations on cost-sharing. (Group plans are not excluded from the preexisting condition and discrimination provisions.) Insurance departments in 27 states allowed insurers to renew 2013 policies, while 21 states and the District of Columbia prohibited renewals.

The March 5, 2014 bulletin permits states and insurers to extend this transitional relief for another two years, that is, for policies renewed prior to October 1, 2016. It also allows states to permit employers with 51 to 100 employees, which are currently considered large employers but will become small employers as of January 1, 2016, to renew their current policies through October 1, 2016. States that had not earlier decided to implement the transitional policy may still do so for 2013 policies renewing in 2014. States may also opt to implement the transitional policy for fewer than two years, or only in the individual or in the small-group market, or only for large employers that become small employers.

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Medicare Part D Proposed Rule: Where Did Things Go Wrong?


March 6th, 2014
by Ian Spatz

It’s worth sitting up and taking notice when everyone seems to hate what you are doing. Last week, 20 of the 24 members of the sometimes fractious Senate Finance Committee wrote Centers for Medicare and Medicaid Services Administrator Marilyn Tavenner about a Medicare Part D proposed rule CMS published on January 10. They told her that they were “perplexed as to why CMS would propose to fundamentally restructure Part D …” and urged her to scrap the plan.

The House Energy and Commerce Committee held a hearing, also last week, with the hardly neutral title of “Messing with Success: How CMS’ Attack on the Part D Program Will Increase Costs and Reduce Choices for Seniors.” At the hearing, Medicare Chief Jon Blum, one of the most well-liked federal health officials there is, was subjected to a bipartisan, first class, grilling.

These Congressional complaints followed on the heels of Feb. 28 letter slamming the proposed rule from 277 organizations (with more organizations continuing to sign on) including patient advocates, insurance companies, health plans, pharmacists, employers, and both brand and generic drug companies.

In fairness to CMS, this is only a proposed rule and comment is what they are seeking. Well, it is comment that they are getting. What has led to this firestorm of criticism?

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Physicians In Congress: A Prescription For Better Health Policy?


March 5th, 2014
 
by Brian Powers and Sachin Jain

Editor’s note: This post is also authored by Sachin H. Jain of Harvard Medical School and Boston VA Medical Center.

Physicians in Congress are on the rise. From 1960 to 2004, only 25 of the 2196 members of Congress were physicians. During an era that brought such fundamental changes to health policy as the creation of Medicare and Medicaid, physicians were disproportionately less likely to hold congressional office than their counterparts in law (979) and in business (298). In recent years, the ranks of physician-representatives have swelled—twenty physicians currently hold seats in the 113th Congress.

This surge in membership comes at a crucial time, for health care has become a defining issue in American politics. The passage of the Affordable Care Act has divided the nation and brought party relations to a standstill. In the 2012 presidential election, health care ranked as the second most important issue to voters, its highest level in twenty years. And with health care spending projected to be the largest long-term contributor to national debt, the nation’s health and economic future depends on sound health policy. What role can this new cadre of physician-representatives play in shaping this process?

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Mendelson: Senate GOP Reform Proposal Provides Welcome Flexibility In Benefit Design


February 26th, 2014
by Chris Fleming

A health reform proposal introduced by three Republican Senators is a positive development both substantively and politically, Dan Mendelson, CEO of Avalere Health, said in a recent interview. He said the greater flexibility in benefit design afforded by the GOP proposal could be a boon for many uninsured people dissatisfied with the choices allowed by the Affordable Care Act.

Senators Richard Burr (NC), Tom Coburn (OK), and Orrin Hatch (UT) offered the proposal, designed to replace the ACA, earlier this year. “This is the discussion that I wish had happened before the passage of the law, said Mendelson, who served as Associate Director for Health at the White House Office of Management and Budget under President Clinton. “We have here three very knowledgeable, relatively moderate Republican Senators coming together on a construct that embraces a lot of what was passed in the ACA. There’s an individual market … prohibited from discrimination on the basis of pre-existing condition; there are patient protections like the age band ratings, albeit less restrictive than the ones that were enacted in the bill.”

Mendelson noted that the Burr-Coburn-Hatch framework retains the ACA’s Medicare provisions. “Everything related to health system change stays: The Medicare Advantage Star ratings, which are very significant and far reaching policy, the Center for Medicare and Medicaid Innovation, and the like,” he said.

The Senate GOP proposal also contains some “very significant changes” from the ACA, many of which provide greater state flexibility in the individual market and Medicaid, Mendelson pointed out. On Medicaid, the proposal “really goes much closer to the block grant proposal that Republicans have felt comfortable with for quite some time. Ironically block granting might actually result in more coverage [than the ACA Medicaid provisions], given where Texas and some of the other Republican states are right now, because they would accept this,” in contrast to their rejection of Medicaid expansion under the ACA.

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The State Of Health Reform: A Health Affairs Conversation With James Capretta, Genevieve Kenney, and Larry Levitt


February 25th, 2014
by Chris Fleming

The Obama administration touted a recent increase in the enrollment rate for young adults in the Affordable Care Act’s health insurance exchanges – how significant was this trend? What should we make of the recent Congressional Budget Office findings regarding projected decreases in hours worked by Americans as a result of the ACA? How does the recent introduction of a new health reform proposal by three Republican Senators affect the policy and political discussions around reform? And what should we expect as states continue to assess whether to expand their Medicaid programs?

In the latest edition of our Health Affairs Conversations podcast series, our guests address these and other health reform developments. James Capretta is a Senior Fellow at the Ethics and Public Policy Center and a Visiting Fellow at the American Enterprise Institute; Genevieve Kenney is Co-Director and a senior fellow in the Health Policy Center of the Urban Institute; and Larry Levitt is Senior Vice President for Special Initiatives at the Kaiser Family Foundation and Senior Advisor to the President of the Foundation.

You can access the podcast recording here.

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Arkansas Governor Beebe Talks Private Option At Health Affairs/Kaiser Health News Newsmaker Breakfast


February 24th, 2014
by Chris Fleming

Those who have watched the debate in Washington over the increasing use of Senate filibusters will likely have considerable sympathy for Arkansas Governor Mike Beebe (D), the guest at today’s Health Affairs/Kaiser Health News Newsmaker Breakfast. At least the majority party in the Senate can break a filibuster with 60 out of 100 votes. In […]

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To Pay For Medicare SGR Repeal, Build On Bipartisan Health Care Policy


February 20th, 2014

Something unexpected is happening in Washington. As most eyes track partisan battles over immigration and the Affordable Care Act, key Congressional committees have been quietly advancing truly bipartisan legislation to strengthen Medicare.

Since 2002, an outdated Medicare cost control called the Sustainable Growth Rate (SGR) has repeatedly threatened drastic Medicare provider cuts. After a decade of temporary fixes, SGR repeal appears within reach. A bipartisan, bicameral agreement by key Congressional leaders announced on February 6, 2014 goes a step further by pairing repeal with bipartisan reforms that pay physicians for the quality and value of care they deliver, not the number of tests and procedures they order.

When one of every three health care dollars is wasted on care that does not improve patients’ health, transitioning away from volume-based reimbursement would be momentous. Few policy changes are more fundamental to containing health care costs and protecting the solvency of Medicare.

The challenge in Congress has shifted from getting a bipartisan agreement on new cost controls to paying for the repeal of the old one. The Congressional Budget Office (CBO) estimates the cost of the Senate version of the bipartisan repeal bill at $149 billion over 10 years.

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Implementing Health Reform: A January Exchange Enrollment Report


February 13th, 2014
by Timothy Jost

Editor’s note: From February 15 until March 5, Tim will be in Africa. We wish him well on his trip, even though limited internet connectivity and well-deserved time with family and friends will likely restrict his posts here during this period.

On February 12, 2014, the Department of Health and Human Services released an exchange enrollment report covering the period of October 1, 2013 to February 1, 2014. The headline is the 3.3 million people have now selected exchange plans, 1.4 million through state-based exchanges and 1.9 million through the federally administered exchanges. Exchanges have determined or assessed an additional 3.2 million individuals eligible for Medicaid or CHIP.

The 3.3 million individuals who have selected plans include 1.15 million who have done so in January, down from the 1.79 million who selected plans in December, but up considerably from the 365,000 who selected a plan during the troubled first two months of the program’s operation. It is not surprising that the number of new enrollees dropped in January, as December was the first month during which the exchanges were really functioning and the last month in which individuals could enroll and be eligible for coverage and premium tax credits when the exchanges opened. It is very likely that enrollment will climb sharply over the next two months before open enrollment ends on March 31.

The report contains exhaustively cross-referenced data on enrollees by age, gender, selected metal level, state, and type of exchange. The number of “young invincibles” (aged 18-34) who have selected plans in the exchanges increased somewhat in January, making up 27 percent of enrollees as compared to 24 percent in the first three months of enrollment (although the overall 18-34 enrollment for the first four months moved up only to 25 percent). Thirty-one percent of those who selected plans over the first four months were 55 to 64, compared to 33 percent for the first three months.

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Implementing Health Reform: The Employer Responsiblity Final Rule (Part 2)


February 12th, 2014
by Timothy Jost

Editor’s note: This post continues analysis of the employer responsibility rule released by the Internal Revenue Service on February 10, 2014. Part one of this analysis is available here.

Safe harbors. An employer is subject to the 4980H(b) penalty of $3,000 for each full-time employee who receives premium tax credits because the employer failed to offer affordable and adequate coverage. Coverage is affordable if the employee’s share of the premium for employee coverage does not exceed 9.5 percent of the employee’s modified adjusted gross household income. An employer has no way, however, of knowing what an employee’s household income is. The final rule, therefore, provides three safe-harbors for employers to satisfy the affordability requirement.

First, employer-sponsored coverage is affordable if the employee’s share of the premium for the lowest-cost minimum value coverage is not more than 9.5 percent of the employee’s W-2 wages. Second, coverage is affordable if the employee does not have to pay more than 9.5 percent of the employee’s monthly salary or 130 times the lowest hourly rate paid the employee during the month. This safe harbor cannot be used for employees paid through tips or commissions. Third, the employer is protected if the employee is charged no more than 9.5 percent of the federal poverty rates, since an employee is ineligible for premium tax credits if the employee earns less than the poverty rate.

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A Senate GOP Health Reform Proposal: The Burr-Coburn-Hatch Plan


February 12th, 2014
 
by James Capretta and Joseph Antos

Republican Senators Richard Burr, Tom Coburn, and Orrin Hatch recently released a blueprint for repealing and replacing Obamacare, called the Patient Choice, Affordability, Responsibility, and Empowerment Act, or the Patient CARE Act (PCA). The plan is getting significant attention from supporters and critics alike (including the editorial page of the New York Times) because both sides recognize that it is a serious effort to address the problems in U.S. health care in a manner that is strikingly different from Obamacare. The debate over the merits (or perceived drawbacks) of the PCA proposal was given further impetus by an assessment of its coverage and cost implications from the Center for Health and Economy (H&E), a new think tank headed by former Congressional Budget Office Director Doug Holtz-Eakin (and with a board including several other academics, including Uwe Reinhardt of Princeton University) and devoted to providing independent analytical assessments of major public policy initiatives.

In this short post, we describe the major provisions of the PCA, as we understand them from the descriptive material and conversations with the authors’ staffs. We also offer our views on how to think about the budgetary and coverage implications of the PCA proposal in the context of the estimates produced by H&E.

Major Provisions of the Patient CARE Act (PCA)

Repeal of Obamacare. The starting point for the PCA is repeal of Obamacare in its entirety, with the exception of the law’s Medicare provisions. We do not take the retention of the Medicare provisions from Obamacare as an endorsement of them by the authors. That would be inconsistent with the public record. For instance, Senator Coburn has proposed sweeping reforms of Medicare that differ substantially from the Obamacare Medicare provisions. The retention of the Obamacare Medicare provisions would seem instead to be an acknowledgement that it will be difficult enough politically to enact a sensible reform of the insurance market for the under age-65 population without also having to pass in the same legislation a comprehensive reform of Medicare. A reworking of Medicare is badly needed, of course, but it can be addressed on a separate legislative track from an Obamacare replacement plan.

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Implementing Health Reform: The Employer Responsibility Final Rule (Part 1)


February 11th, 2014
by Timothy Jost

Editor’s note: This is part 1 of a two-part post by Timothy Jost describing the Internal Revenue Service’s final rule implementing the Affordable Care Act’s employer responsbility requirement. Part 2 will appear later today or tomorrow.

It is arguable that as of early February 2014, the most important missing piece of the 2014 Affordable Care Act implementation puzzle was the final employer responsibility rule. The ACA’s market reform, premium tax credit, qualified health plan, and exchange provisions have been in effect, more or less, since the beginning of January, and, although new guidance continues to emerge, the basic rules for these programs have been in place for months. The individual responsibility rule is also in effect, although individuals covered by the rule still have until March 31 to get coverage and those who fail to comply will not pay the penalty until 2015. But the employer responsibility requirement, which was delayed until 2015 in July, has remained in limbo.

On February 10, 2014, the Internal Revenue Service released the final employer responsibility rule, together with a fact sheet and a series of questions and answers about the rule. The rule finalizes rules proposed late in December 2012 and analyzed at that time.

The employer mandate plays a vital but secondary rule in the Affordable Care Act scheme. Our current health care financing system is overwhelmingly employment based. 171 million Americans are currently covered by employment-based coverage, compared to only 11 to 13 million in the individual market. Virtually all (99 percent) of large firms (200 plus workers) offer health insurance to their employees.

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The Changing Health Care World: Trends To Watch In 2014


February 10th, 2014
by Susan DeVore

While today’s news is bombarding us with headlines about Healthcare.gov, the Affordable Care Act isn’t just about insurance coverage. The legislation is also about transforming the way health care is provided. Consequently, it has ushered in new competitors, services and business practices, which are in turn generating substantial industry shifts that affect all players along healthcare’s value chain. Following are some of the top trends that our alliance is preparing for in 2014:

Chronic Care, Everywhere. It’s no secret that providers are moving quickly to implement accountable care organizations (ACOs). Recently, the Premier healthcare alliance released a survey of hospital executives projecting that ACO participation will nearly double in 2014. As providers work to improve their way to shared savings payments, look for a more intensive focus on the biggest health care consumers: those with multiple chronic conditions.

Since each chronic condition increases costs by a factor of three, managing this population is the sweet spot for the ACO, and the deepest pool from which to pull savings. To do it, an increasing number of providers will deploy Ambulatory Intensive Care Units (A-ICUs) or patient centered medical homes as part of their ACO, which will be charged with better managing chronic conditions exclusively within a clinically integrated, financially accountable primary care practice. As part of the approach, providers will develop care pathways for better managing chronic conditions and behavioral health needs, with an eye toward lowering hospital utilization, including inpatient bed days, length of stay, admissions, readmissions, and ED visits.

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