Manatt on Health Reform: Weekly Highlights: December 2014

by Manatt, Phelps & Phillips, LLP
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This week, a federal Issuer Bulletin describes how issuers in the Federally Facilitated Marketplace will identify their existing enrollees who are switching plans for 2015 coverage. The Exchange Board in New Mexico proposes a premium-based assessment on and off the Exchange to achieve financial sustainability; the Illinois Legislature contemplates transitioning from a State-Partnership to a State-based Marketplace, at least partially spurred by a looming Supreme Court decision on the validity of their enrollees’ subsidies. And while implementation of Pennsylvania’s Medicaid expansion kicks off, Wyoming’s Governor releases new expansion plans.

FEDERAL NEWS:

CCIIO Releases Guidance on Health Plan Reenrollment in the Federally Facilitated Marketplace

CCIIO recently released an Issuer Bulletin in follow up to final rules from September 2014 that detail the Federally Facilitated Marketplace’s and issuers’ roles in renewing coverage in 2015. The Bulletin describes the limited circumstances under which individuals are not eligible for automatic reenrollment - including those with discontinued coverage or without key application data, out-of-area enrollments, and existing enrollees from Oregon and Nevada who applied last year through their State-based Marketplaces - noting that these individuals may experience a gap in coverage if they do not select a plan by December 15. The Agency also announced it will create a daily "Enrollee Switched List" that enables FFM issuers to identify and “non-renew” existing enrollees who elected a different issuer for 2015 coverage, as the FFM will not send 834 termination files in these instances.

CMS Releases Final Rule on Disproportionate Share Hospital Payments

CMS released a final rule clarifying a change in the methodology for calculating Medicaid Disproportionate Share Hospital (DSH) Payments that, CMS notes, provides flexibility for states to calculate hospital-specific DSH limits. In a departure from previous guidance, this rule allows states and hospitals to calculate uncompensated costs based on the specific services provided to uninsured individuals rather than on the number of uninsured individuals serviced by the hospital.

HHS Finds Lowest-Cost SHOP Marketplaces’ Premium Rates Hold Steady

Average premiums in the Federally Facilitated Marketplace Small Business Health Options Program (SHOP) Marketplaces have remained steady or declined slightly for the lowest-cost bronze, silver and gold plans from 2014 to 2015, according to an HHS blog post. Where premiums increased, the uptick was relatively small; average premiums for the median-priced plan across SHOP Marketplaces increased by 2.1% for bronze, 0.7% for silver, and 1.6% for gold.

STATE HEALTH REFORM ACTIVITY:

Arkansas: Governor-Elect Announces Plans to Appoint New Surgeon General

Governor-elect Asa Hutchinson (R) announced that he plans to appoint a new State Surgeon General upon taking office, according to the Associated Press. The current Surgeon General, Dr. Joe Thompson, has served in this role since 2007 and has been a “key advocate” for the State’s Private Option approach to Medicaid expansion. Governor-elect Hutchinson has not yet announced his position on the program.

Georgia: State Medicaid Director to Leave Position

Jerry Dubberly, Georgia’s Medicaid director for the last six years, will step down from his position effective January 2, 2015, according to Georgia Health News. The Department of Community Health Commissioner has not yet identified a replacement.

Illinois: House Committee Approves Bill to Establish a State-Based Marketplace

As reported by the State Journal-Register, the Illinois House Human Services Committee approved Senate Bill 636 to establish a State-based Marketplace. The bill requires approval through the Democratic-controlled House and Senate by the end of the week to ensure Illinois remains eligible to receive federal funding to transition from its State Partnership Marketplace, Get Covered Illinois. A similar bill was approved by the Senate in October 2013 but never received a House vote. During the Committee meeting, Representative Gabel, the sponsor of the bill, noted that she believes the threat of a potential U.S. Supreme Court ruling that could end subsidies for Get Covered Illinois enrollees has made more Democrats willing to take a stand toward establishing a State-based Marketplace.

New Mexico: Board Proposes Annual Premium-Based Assessment on Issuers On and Off Exchange to Achieve Marketplace Sustainability

The New Mexico Health Insurance Exchange (NMHIX) released for public comment draft amendments to the financial sustainability section of its Plan of Operation. Due to expiring federal funding, NMHIX must be able to fund its Small Business Health Options Program (SHOP) Exchange beginning January 1, 2015 and its individual Exchange beginning January 1, 2016. To achieve financial sustainability, NMHIX has proposed issuing an annual premium-based assessment on issuers offering major medical plans on and off the Exchange and dental plans on the Exchange. NMHIX is encouraging public feedback and will accept written comments through December 19, at which time the board will hold a hearing and consider taking final action on the proposed amendments.

Pennsylvania: Enrollment for Healthy Pennsylvania Medicaid Expansion Begins

Enrollment in Pennsylvania's Medicaid expansion program, Healthy Pennsylvania, began on December 1 for coverage beginning January 1. Healthy Pennsylvania, which requires enrollees to select a private health plan offered by one of eight different issuers across the State, is expected to expand coverage to approximately 600,000 Pennsylvanians with income up to 138% of the federal poverty level according to State estimates. On the first day of enrollment, the State’s hotlines experienced overwhelming call volume, though the website was reportedly working. It remains unclear how Governor-elect Tom Wolf’s (D) plan to pursue a "traditional" Medicaid expansion after taking office would affect enrollees in Heathy Pennsylvania, though a Department of Human Services spokeswoman stated that should a transition need to occur, the Department would do its “best to make sure it’s a seamless transition.”

Vermont: Marketplace Develops Fix for Assisters Encountering Difficulty Accessing Accounts

Due to security upgrades made to Vermont Health Connect (VHC) prior to the start of this year’s open enrollment period, approximately 70 navigators and brokers have experienced difficulty accessing existing accounts, reports the Vermont Digger. This issue has been particularly problematic for free clinics, whose directors brought this issue to VHC’s attention, as they rely heavily upon volunteer navigators to assist patients in applying for coverage. In response, VHC has developed a process that allows navigators renewed access to accounts within a day of a reported access denial.

Wyoming: Governor Releases Medicaid Expansion Plan

Governor Matt Mead (R) and the State's Department of Health released a plan to expand Medicaid, after months of meetings with CMS. The plan, which must still be approved by the Legislature, would expand Medicaid to adults with incomes up to 138% of the federal poverty level (FPL) and provide all essential health benefits required for new adults under the ACA. The plan would impose co-pays for certain services on all enrollees, while premiums ranging from $20 to $50 per month would be imposed on those with incomes above 100% FPL. Enrollees who complete certain health "challenges" would see reduced premiums in the following year. Participants would be enrolled in a work assistance benefit at the time of application, qualifying for job search and training services, but use of these services would not be a condition of eligibility. If Federal funding drops below 90% match for these new adults, the expansion program would terminate.

OTHER PUBLIC COVERAGE NEWS:

Missouri: State Requests Extension of Medicaid Waiver Covering St. Louis Adults

The State Department of Social Services requested to extend its "Gateway to Better Health" 1115 waiver program, which provides limited Medicaid coverage to uninsured adults in the St. Louis area with incomes under 100% of the federal poverty level. The program, which is set to expire on December 31, 2015, would be extended until December 31, 2016, or until Missouri's Medicaid eligibility is expanded to include the waiver population.

 

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