Final PPACA Essential Health Benefit Regulations

HHS released final regulations defining the “essential health benefits” (EHBs) that must be included in 2014 under individual and small group health plans offered outside of and under health insurance exchanges.  The 149-page rule implements the statutory requirement that plans cover ten major categories of care, including: ambulatory patient services; chronic disease management; emergency care; hospital services; laboratory services; maternity and newborn care; prescription drugs; preventive wellness services; rehabilitative care; pediatric dental care and vision care; as well as parity protections for mental health and substance use disorder services, including behavioral health treatment.  States can designate certain health plans in their states as “benchmark” plans for EHB purposes, but mental health parity benefits must be included in any event.  Plans must also cover a minimum of 60% of the actuarial value of covered services (for the least expensive “bronze plans” with the most expensive “platinum plans” covering 90% of such costs).  Plans can substitute actuarially equivalent benefits for certain base benchmark benefits, but states may eliminate or otherwise regulate this plan element.  HHS will designate the largest small group plan as the benchmark plan in the 23 states that have not named benchmark plans.  Plans with prescription drug formularies must provide for an exceptions process to make non-formulary drugs available under certain circumstances.  The plans to be offered under health insurance exchanges must also meet standards for qualification as set forth under the regulation (separate guidance was issued regarding the role states may play in certifying qualified health plans).  The Departments of Treasury, Labor and HHS also released separate “Frequently Asked Questions About Affordable Care Act Implementation” which clarifies that: the conditions under which plans that use more than one service provider will be able to coordinate out-of-pocket maximum limits; separate out-of-pocket maximum limits may be applied to prescription drug coverage and pediatric dental coverage; the deductible limits for small group plans may exceed the PPACA limits if needed for such plans to meet the 60% minimum actuarial value coverage level; and there are certain limitations on cost sharing and coverage of preventive services, including contraception.

Final PPACA Non-Discrimination Rating Rules

HHS released final PPACA “Health Insurance Market Rules--Rate Review” which require: guaranteed availability; guaranteed renewability; insurers to vary premiums only on age, tobacco use, family size and geography (not preexisting medical conditions); separate student plan risk pools; separate insurer statewide risk pools for the individual market and the small group market unless states merge the two in online exchange markets; and catastrophic plans offered to young adults in the individual market to have out-of-pocket cost protections and preventive services covered without cost sharing.  Premium rates for individuals age 64 and older cannot be more than 3 times the rates for the youngest age category (beginning with age 21).  States can set tougher rules, however.  Insurers must provide HHS with information regarding all proposed rate increases for such policies and pay a 3.5% premium “exchange fee” charge.  For non-grandfathered individual and small group plan offerings in 2014, the rules become effective on April 29.

PPACA State Innovation Awards

HHS announced that six states have been awarded $250 million to help them implement State Health Care Innovation Plans which have been approved by CMS.  An additional $35 million was awarded to 19 other states to help them design and test State Health Care Innovation Plans that are being developed.  The State Innovation Model initiative is intended to create multi-payer models having goals to raise community health status and to reduce long-term health risks for Medicare, Medicaid and State Children’s Health Insurance Program (SCHIP) beneficiaries.

Republican Members Join PPACA Challenge

Oklahoma Attorney General Scott Pruitt filed an amicus brief with the 10th U.S. Circuit Court of Appeals in support of retail chain Hobby Lobby’s lawsuit against the PPACA’s mandated contraceptive coverage rules.  He said “Any regulation that requires an employer to violate their lawful religious beliefs and practices goes directly against the ideals that our Founding Fathers set in place to protect Americans from an overbearing and intrusive government”.  Senator Orrin Hatch, eight other Republican Mulberry senators and two Republican House members also filed a similar brief.  Senator Hatch (R-UT) said he and his fellow legislators were instrumental in helping pass the 1993 Religious Freedom Restoration Act which he said “sought to curb government-imposed infringements on religious liberty” such as the PPACA regulations which did not exempt private businesses from the contraceptive mandate (although the regulations did exempt breitling replica certain religious institutions).

State Health Insurance Exchange Implementation

HHS announced that a total of 24 states and the District of Columbia have applied or been approved for state-run or state-federal “partnership” health insurance exchanges under the PPACA.  By the February 15th deadline, the following states applied to operate partnership exchanges: Iowa, Michigan, New Hampshire, West Virginia, Arkansas, Delaware and Illinois.  States have awarded a number of multi-million dollar contracts to develop their exchanges and Medicaid expansions.  The largest contract, for $359 million, was awarded to help develop the California exchange.

Upcoming Health Hearings

House Ways and Means Health Subcommittee: will hold a hearing on the current benefit design of the Medicare fee-forservice program and consider ideas to update and revise the benefit structure to better meet the needs of current and future beneficiaries; 10:30 a.m., 1100 Longworth Bldg; Feb. 26.

House Committee on Veterans’ Affairs: will hold a hearing titled “Electronic Health Record U-Turn: Are VA and DoD Headed in the Wrong Direction?” 9:15 a.m., 334 Cannon Bldg; Feb. 27.

House Energy and Commerce Health Subcommittee: will hold a hearing titled “Fostering Innovation to Fight Waste, Fraud and Abuse in Health Care;” 10:15 a.m., 2123 Rayburn Bldg; Feb. 27.

Senate HELP Committee: will hold a hearing titled “The Power of Transparency: Giving Consumers the Information They Need to Make Smart Choices in the Health Insurance Market;” 2:30 p.m., 253 Russell Bldg.; Feb. 27.

Senate HELP Committee: will hold a hearing titled “Animal Drug User Fee Agreements: Advancing Animal Health for the Public Health;” 10:00 a.m., 430 Dirksen Bldg; Feb. 27.

Senate Finance Committee: will hold a hearing titled “Delivery System Reform: Progress Report from CMS,” focusing on how new programs in the Affordable Care Act are modernizing Medicare and Medicaid to boost program efficiency; 10:30 a.m., 215 Dirksen Bldg; Feb. 28. 

House Energy and Commerce Oversight and Investigations Subcommittee: will sponsor a forum titled “After Newtown: A National Conversation on Violence and Severe Mental Illness;” 10:00 a.m., 2123 Rayburn Bldg; March 5. 

House Appropriations Labor, Health and Human Services, Education and Related Agencies Subcommittee: will hold hearings on proposed FY 2013 appropriations for programs under its jurisdiction; 10:00 a.m., 2358-C Rayburn Bldg; March 13.

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