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CMS seeks to give states more freedom to define essential benefits


FierceHealthcare reports that the  Trump administration has proposed a new federal rule to  give states more freedom  to define essential health benefits, as well as other changes to the regulations governing the individual and small-group markets.

The 2019 Notice of Benefit and Payment Parameters (PDF) was released Friday by the Centers for Medicare & Medicaid Services.

Fierce reported that “{p}erhaps most notably, CMS’s proposed rule would allow states to alter their essential health benefits  {EHB} benchmark plan annually, beginning as early as 2019.”

“As mandated by the Affordable Care Act, insurers in the individual and small-group markets will still have to cover 10 basic benefits, such as preventive care and prescription drugs. But once CMS’s proposed rule takes effect, states could borrow another state’s EHB benchmark plan—in whole or part—or create a new one altogether, provided it follows certain criteria,” the news service reported.

CMS said: “In addition to granting states more flexibility regulating their markets, we believe this change would permit states to modify EHBs to increase affordability of health insurance in the individual and small group markets.”

But the agency conceded that the proposed changes might cause some people  with specific health needs to lose coverage for certain services, depending on what option their state chooses.

 Fierce reported that CMS also seeks to (in the news service’s words), among other things:
  • “Allow states to assume a larger role in the qualified health plan certification process for the federally facilitated exchanges.”
  • “Explore ways to make state-based exchanges that use the platform a more appealing and sustainable option for states.”
  • “Gives states ‘significantly more flexibility’  {in CMS’s words} in how they operate a Small Business Health Options Program, also known as SHOP.”
  • “Recalibrate the parameters for risk adjustment methodology and give states more flexibility regarding risk adjustment transfers in their markets.”
  • “Let states  apply for an adjustment to their individual market medical loss ratio standard.”
  • “Raise the threshold for review of ‘unreasonable’ premium increases from 10% to 15%.”
  • “Remove the requirement that each exchange have at least two navigator entities, and the rule that navigators provide in-person outreach/enrollment support.”

To read more, please hit this link.


5 takeaways from the AHCA collapse


Billy Wynne, writing in Health Affairs, presents five lessons from the failed launch of the American Health Care Act:

They are:

“Nothing is inevitable”

“There’s a difference between making a political statement and enacting real policy. The latter is invariably complex and time-consuming, creating vulnerabilities and pitfalls both known and unknown at the outset. While a cornerstone of tried and true policymaking is to leverage the ‘strategy of inevitability’—more than seven years ago, the ACA campaign itself vigorously deployed just such a strategy—the underlying premise of that strategy is always inherently false.’’

“Stakeholders matter’’

“Virtually every hospital and hospital group, every physician group, nurses, patient groups representing the young, old, disease-stricken, and disabled, and many others fervently opposed AHCA. They added analysis of AHCA’s impact on them, as governors did regarding its impact on their states. At the end of the day, this was simply a bad bill. Stakeholders figured it out and acted when it counted.’’

‘’Ultimately, on the day AHCA was originally supposed to get its final House vote, a Quinnipiac University poll came out showing only 17 percent of the public supported the bill, while 56 percent opposed it, a startling gap rarely seen in any bona fide political polling.’’

“The ACA stole most of  the good conservative ideas’’

‘’While it was lambasted by Republicans as the manifestation of a Marxist dystopia, the truth of the ACA is that it is a very moderate law. …As Health Policy Counsel to then-Finance Committee Chairman Max Baucus in the prelude to President Obama’s election, I know the pains he took to build bipartisan consensus. In 2008, he negotiated with Republican counterparts on reforming the market for small businesses, in what became the SHOP Act component of the ACA (drawing from legislation originally co-led by Republican Olympia Snowe). He convened an all-day, fully bipartisan Prepare to Launch summit to query experts and debate ideas. He released a series of white papers that laid out detailed policies he believed could gain bipartisan support (welcomed by the conservative Heritage Foundation as ‘a starting point for serious discussion’). And all of that was before President Obama was elected.”

‘’The centerpiece of the ACA became tax credits for the purchase of commercial—not government—health insurance, with a tax-driven mandate that everyone take responsibility for buying in. This had been the linchpin of numerous Republican health reform proposals prior to that time. While Medicaid expansion was also included, it took on a greater role only because that is a less costly way to expand coverage, and Democrats were utterly committed to ensuring the bill did not increase the deficit.”

‘’Other key conservative ideas were embedded in the law as well. Numerous new payment reforms were instituted to drive efficiency and lower costs; states were allowed to pool their markets (though notably none have yet); price and value transparency was instituted so consumers could compare their coverage options side-by-side; emphasis was placed on prevention and community health centers; states were free to run their own exchanges and establish their own essential health benefits; dozens of new program integrity and oversight protections were instituted.’’

“Tom Price is now the most important person in healthcare”

“While the Trump Administration has some more thinking to do before it commits to letting our health care system crash and burn, via sabotage or neglect, it certainly has that power. The locus of that power is the Department of Health and Human Services and its Secretary, former Republican Congressman Tom Price, M.D., a former orthopedic surgeon.

‘’As we have already seen, simple maneuvers like pulling publicity for and creating an aura of uncertainty can adversely impact insurance enrollment. Payment and delivery system reforms, intended to lower costs and improve quality, have been halted in their tracks. Governors have been informed that they are now freer to impose premiums and increase cost-sharing for Medicaid enrollees.

“As destabilizing as these changes are, they pale in comparison to some of the more nuclear options Secretary Price has at his disposal to wreak havoc on health care. Perhaps the foremost of these, and the one readily accessible at any moment, is the option to refrain from defending the cost-sharing subsidies.”


“Bipartisanship is still possible’’

“While not as expedient or gratifying to the inner ideologue inside us all, the long, frustrating work of compromise is the only viable path forward.

‘’There is a lot of lower-hanging fruit and we should give AHCA credit for bringing some of those to people’s attention. Insurers have now made clear what they think will help stabilize markets and perhaps make them more competitive, including funding risk corridor and reinsurance programs. Meanwhile, several start-up health plans are eyeing a wide array of markets where competition is limited and ripe for a lower-cost competitor. Some have faced obstacles at the state-level, undoubtedly due in part to the objections of entrenched interests. Can a Price-led HHS help open up these markets?’’


How the ACA dismantling might go

Paul Keckley, writing in Hospitals & Health Networks, predicts  that these things may happen in the early days of GOP efforts to dismantle the Affordable Care Act:

  • “Dismantling and transitioning control of the marketplaces to the states.
  • “Negotiating with congressional budget officers and the Department of Health & Human Services for the transfer of Medicaid responsibility to the states via block grants.
  • “Expanding tax credits and high risk pools for individuals and allowing purchases of insurance across state lines.
  • “And through legislative negotiations, transitioning oversight and subsidies for its 12 million newly insured to states over a period of several months.”

To read more from Mr. Keckley on the dismantling of the Affordable Care Act, please hit this link.

The missing 6 million potential Medicaid clients


The Journal reported:

“The Obama administration was closing out the latest sign-up period for coverage under the health law on Sunday, already heralding a late rush of applicants for private coverage. They put the administration well on track to exceed targets of having 10 million people enrolled in plans bought through and state equivalents at year-end, up from nine million at the end of 2015.

“From here, making a bigger dent in the uninsured rate will likely hinge on Medicaid sign-ups, an area that has gotten little formal attention. Federal officials have focused on continuing to expand eligibility for Medicaid and will soon ask Congress for fresh financial incentives for the 20 states that hadn’t agreed to do so at the start of 2016.”

“There are about three million people who now can’t get government-funded insurance because their states haven’t extended Medicaid eligibility, and they don’t make enough money to qualify for private coverage. Still, they are significantly outnumbered by those… who have chosen not to enroll.”

Study: Many plans lack out-of-network coverage


A study by health-plan ranking and comparison company HealthPocket found that 53 percent of exchange  plans offer out-of-network coverage, with the rest  without out-of-network coverage except in medical emergencies or when providers and/or patients health plan  formally ask for out-of-network care and  the request is approved.

The study also looked at data on individual and family plans in the 37 states that provide coverage through the federal marketplace. The percentage of plans offering out-of-network coverage in each state varied from 0 percent in South Dakota to 100 percent in Alaska, Alabama, Louisiana, Tennessee and West Virginia. In 13 states, fewer than half of the plans offered out-of-network coverage.

No wonder many providers  and patients don’t like such “narrow networks”.

“What is unclear at the present time is whether more Affordable Care Act insurers will be able to offer new plans in the future that achieve the price point necessary in the individual health insurance market while satisfying consumer concerns over network breadth and coverage of out-of-network care,” the study says.


Prepare for political fear and chaos?



The Obama administration says that it  couldn’t repair the damage that would result from a Supreme Court decision against subsidies under the Affordable Care Act. Striking down the subsidies would make insurance unaffordable for millions of Americans.

The justices are expected to rule by the end of June on whether residents in at least 34 U.S. states are eligible for federal tax subsidies.  Oral arguments are scheduled for March 4.

Some states are madly scrabbling to address what could be a chaotic and angry situation if millions lose their insurance. The Republicans fear that they’ll be blamed more than would the Democrats.

Republican plaintiffs argue that the federal funds cannot pay for insurance in states that didn’t create their own insurance exchanges and instead rely on the Feds’ Web site.

GOP launches healthcare offensive


Republican lawmakers eager to repeal the Affordable Care Act are pushing tax credits and much greater freedom for states and health insurers  to make healthcare-finance policy as the GOP  starts to present its plan  to replace the ACA.

The Republican program, which President Obama is expected to veto, would end ACA coverage requirements for individuals and employers,  end expansion of Medicaid, kill  state and federal insurance marketplaces and, indeed, end virtually everything else under the ACA,  including taxes ”it imposes on medical devices and other things to finance enlarged coverage,” the Associated Press reported.

On Medicaid, the GOP plan would give states much more freedom in how to spend money in that federal-state pr0gram — even as more conservative states now seek the ACA’s added Medicaid money.

Given President Obama’s veto pen, we suspect that most of the Republican offensive is primarily rhetorical, leading up to the 2016 presidential election.  And because the  ACA has already developed powerful constituencies of beneficiaries, it’s far from clear how the GOP program will play politically in 2016, especially given that voter turnout is always higher in presidential-election years than in others.


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