Archive: April 2012

CMS takes steps to improve transparency of demonstration waiver process

Posted on April 30, 2012

The Centers for Medicare & Medicaid Services (CMS) issued guidance on Friday, April 27 regarding the process the agency will use to review and approve state demonstration projects under Medicaid and the Children’s Health Insurance Program (CHIP). The guidance outlines how CMS plans to implement requirements for improving public input and transparency with regard to the demonstration projects. These “1115 Waivers” authorize states to test new coverage and delivery models after obtaining appropriate waivers from CMS.

The guidance, accompanied by a letter to state Medicaid directors, also introduces the user guide that CMS is providing for stakeholder organizations.

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Three federal agencies release request for information on stop-loss coverage

Posted on April 30, 2012

On April 27, 2012, the Department of the Treasury’s Internal Revenue Service (IRS), the Department of Labor’s Employee Benefits Security Administration, and the Department of Health and Human Services’ (HHS) Centers for Medicare & Medicaid Services (CMS) issued a request for information (RFI) regarding the use of stop loss insurance by group health plans and their plan sponsors, with a focus on the prevalence and consequences of stop loss insurance at low attachment points, or the point at which excess insurance or reinsurance limits apply.

Concerns have circulated that the practice could lead to higher costs in small group health insurance exchanges. Stop-loss insurance protects self-insured companies against claims above the attachment point. Employers and plans that purchase stop-loss insurance generally are not subject to state health insurance laws regarding coverage, rating policies, and other state and federal consumer protections, and thus could prove financially risky in the exchange market. Specifically, if the practice is widespread, it could worsen the risk pool and increase premiums in the insured small group market, including the Small Business Health Options Program (SHOP) exchanges.

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IRS releases regulations on information disclosure for Health Insurance Affordability Program eligibility requirements

Posted on April 30, 2012

Today, the Federal Register published the Internal Revenue Service’s (IRS) proposed rules on the disclosure of return information under Internal Revenue Code to carry out Affordable Care Act (ACA) eligibility requirements. The proposed regulations define certain terms and prescribe certain items of return information in addition to those items prescribed by statute that will be disclosed, upon written request, under section 6103(l)(21) of the Internal Revenue Code. The IRS will disclose to the Department of Health and Human Services (HHS) certain items of return information for any relevant taxpayer—meaning any individual listed, by name and Social Security number or adoption taxpayer identification number, on the application whose income may bear upon a determination of the eligibility of an individual for an insurance affordability program, according to the proposed rules.

IRS and the Treasury Department are requesting comments by July 30 on the proposed rules and have a public hearing scheduled at 10 a.m. Aug. 31 at the IRS Building.

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KFF analysis reports on MLR insurance rebates

Posted on April 27, 2012

A new analysis from the Kaiser Family Foundation reports that consumers and businesses are expected to receive an estimated $1.3 billion by August 2012 in rebates from insurers who exceeded Affordable Care Act (ACA) limits on administrative expenses and profits.

The rebates include…

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House passes student loan bill

Posted on April 27, 2012

The House passed H.R. 4628: Interest Rate Reduction Act 215-195 to hold subsidized student loan interest rates at 3.4 percent for one year. House Republicans attached a Democratically unfavorable rider to the bill. The rider would tap into the Prevention and Public Health Fund, the Affordable Care Act (ACA) provision designated to improve public health efforts such as screening programs. The White House has threatened to veto such a bill, arguing that further slashing the Prevention Fund would cause harm to those in need of preventive services.

The Senate will debate its own student loan interest rate freeze bill on May 7. While the House bill pays for the bill through cuts to the Prevention and Public Health Fund, Senate Democrats will fund the bill through tax increases on certain corporations.

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CCIIO and IRS release simultaneous info bulletins on premium tax credits

Posted on April 27, 2012

Yesterday, the Center for Consumer Information and Insurance Oversight (CCIIO), a branch of the Centers for Medicare and Medicaid Services (CMS), released a bulletin outlining how government will verify access to employer-sponsored coverage. This is a necessary part of the process for determining eligibility for advance payments of the premium tax credit available to support the purchase of qualified health plans (QHPs) through Affordable Insurance Exchanges. The purpose of the bulletin is to request comment from the public on a proposed interim strategy and potential regulatory approach for verification of an applicant’s access to qualifying coverage in an employer-sponsored plan under section 1411 of the Affordable Care Act (ACA). The Department of Health and Human Services (HHS) also solicits comments on the development of a long-term verification strategy.

Also yesterday, the Internal Revenue Service (IRS)…

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GAO releases report on medical underwriting and pre-existing conditions

Posted on April 27, 2012

Individuals who buy coverage directly from a health insurer are often denied coverage due to a pre-existing condition during a process called medical underwriting, which assesses an applicant’s health status and other risk factors. Beginning January 1, 2014, the Affordable Care Act (ACA) prohibits health insurers in the individual market from denying coverage, increasing premiums, or restricting benefits because of a pre-existing condition. The Government Accountability Office (GAO) examined the effect of this provision on adults who are 19-64 years old in a new report released today. GAO examined (1) the most common medical conditions that would cause an insurance company to restrict or deny insurance coverage for adults and the average annual costs associated with these conditions, (2) estimates of the number of adults with pre-existing conditions, and (3) the geographic and demographic profile of adults with pre-existing conditions.

To address these three issues…

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KFF issue brief compares Medicare to plans offered by large employers

Posted on April 26, 2012

The Kaiser Family Foundation recently released an issue brief which compares the expected value of benefits for individuals ages 65 and older under Medicare’s fee-for-service program to two “typical” plans offered by large employers: a typical large employer preferred provider organization (PPO) plan and the Blue Cross/Blue Shield Standard Option for enrollees in the Federal Employees Health Benefits Program (FEHBP), also a PPO plan.

The analysis updates a 2008 Kaiser Family Foundation report that found…

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RWJF releases 2012 HIT report

Posted on April 25, 2012

Health information technology (HIT) has become central to health care reform policy-making due to its potential to improve efficiency and increase the quality of health care in the United States. Adoption of these technologies has remained a priority of the federal government as evidenced by incentive programs enacted through legislation, including the American Recovery and Reinvestment Act of 2009 and the Affordable Care Act (ACA). The Robert Wood Johnson Foundation (RWJF) has released annual reports since 2006 tracking slow steady increases in the level of adoption for physicians and hospitals throughout the United States. As these incentive programs and other reform initiatives begin implementation, RWJF has continued to track the progress of the nation’s health care system toward universal adoption of electronic health records (EHRs). Mirroring the emphasis at the federal level on the use of this technology in a way that has the greatest potential to improve the overall quality and efficiency of care, this year’s report expands on previous analyses by investigating health care providers’ readiness to meet program requirements and explores the role of HIT in other health care reform initiatives.

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CMS releases bulletin providing MLR guidance

Posted on April 25, 2012

The Center for Consumer Information and Insurance Oversight (CCIIO), a division of the Centers for Medicare and Medicaid Services (CMS) recently released a bulletin providing medical loss ratio (MLR) guidance. Section 2718 of the Public Health Service Act (PHS Act), as added by the Affordable Care Act (ACA), requires health insurance issuers to submit a MLR report to the Secretary. The PHS Act also requires issuers to provide a rebate to enrollees if the issuer’s MLR is less than the applicable percentage established in the PHS Act. The CCIIO bulletin covers the following topics:

  • Applicability of the Medical Loss Ratio to Certain Types of Plans
  • Employer Groups of One
  • Counting Employees for Determining Market Size
  • Individual Association Policies
  • Offering Policyholders a “Premium Holiday”
  • Reinsurance and Reporting
  • Exchange User Fees
  • States With a Higher Medical Loss Ratio Standard
  • “Mini-Med” Experience – Application of the Adjustment
  • Form of Rebate

CMS issued a final rule implementing MLR requirements and an interim final rule implementing MLR rebate requirements in December 2011.

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