POLICY BRIEFINGS


PPACA Multi-State Plan Rules Finalized


The Office of Personnel Management (OPM) issued final regulations spelling out the requirements, including a mandated Gold and Silver value plan, that multistate insurance plans (MSPs) must meet in order to be offered under at least 31 state health insurance exchanges beginning in 2014 (and in all states and DC in 2017). OPM will negotiate for and administer at least two such plans for each exchange in a manner similar to that used for the Federal Employee Health Benefits Program (FEHBP). MSPs must also comply with any standards set by states for participation in state-based Small Business Health Options Program (SHOP) exchanges.


PPACA SHOP Rules Proposed


CMS released a proposed rule spelling out the requirement for all PPACA health insurance exchanges, including the FFE, to include a Small Business Health Options Program for facilitating the coverage of the workers of small businesses having fewer than 100 employees. State-run exchanges could allow an employer to require employees to select only one plan (or multiple plans) under a SHOP while the FFE would allow only one plan to be offered to an employer’s employees for 2014 only (presumably after 2014 employees must be given multiple plan choices). Small employers would be eligible for the PPACA small business tax credit only in SHOPs, including the FFE SHOP, beginning in 2014.


IRS Proposes PPACA Premium Fees


The IRS issued proposed regulations requiring health insurance companies to pay annual fees based on the premium volume of in-force fully-insured health policies. The total of such fees are as follows: $8 billion for CY 2014; $11.3 billion for CY 2015-16; $13.9 billion for CY 2017; and $14.3 billion for CY 2018. The total for subsequent years would be increased by the rate of premium growth in the preceding year.


DOL Issues Final PPACA MEWA Rules


The Department of Labor Employee Benefits Security Administration (EBSA) issued final rules providing the means for the department to issue cease-and-desist and summary seizure orders to fraudulent or insolvent multiple employer welfare arrangements (MEWA) established or maintained by two or more employers (MEWAs as defined under ERISA). DOL also released revisions to the Form 5500 annual information return required to be filed by ERISA-covered employee benefit plans as well as to the Form M-1 report required to be filed by MEWAs and plans claiming an exception to MEWA rules.


CMS Says PPACA Reduces Health Costs


At a Senate Finance Committee hearing, the acting principal deputy administrator of CMS testified that the PPACA payment and delivery reforms are working so as to help cause Medicare per capita spending to decline and the 30-day all-cause hospital readmission rate to drop in the last half of 2012 to 17.8% after averaging 19% in the previous 5 years. He also cited the PPACA as an incentive for the health care delivery system to move away from fee-for-service medicine. Of note, at the hearing Senator Maria Cantwell (D-WA) said she might not support Marilyn Tavenner’s nomination for CMS Administrator because of the delayed effective date for the implementation of the PPACA’s Basic Health Program which would make federal tax subsidies available to states to help cover individuals with incomes between 139-200% of the federal poverty level. Acting Administrator Tavenner also came under fire in a letter from Senator Orrin Hatch (R-UT) and Reps. Dave Camp (R-MI) and Fred Upton (R-MI) who questioned the CMS proposal to reduce payments to Medicare Advantage plans by about 2% in 2014. They expressed their concern that coverage under such plans could fall significantly, particularly for low-income beneficiaries.


House and Senate Hearings on Medicare Reform


At a House Ways and Means Health Subcommittee hearing, Dr. Mark Fendrick (a UM professor of internal medicine) testified that medical services differ by the benefit they provide to health, but that Medicare implements cost sharing in a one-size-fits-all form under which beneficiaries are charged the same amount for every doctor visit, diagnostic test and prescription drug. He suggested that the Medicare benefit design be changed, for example, by removing beneficiary cost sharing for life-saving services and by increasing cost-sharing for lower value services. Subcommittee chairman Brady (R-TX) touted the structure of Medicare Advantage plans and said that all beneficiaries should have the types of benefits and cost sharing that one-in-four beneficiaries currently enjoy under MA plans. Dr. Fendrick replied that Medicare Advantage plans are constrained by nondiscrimination rules that prohibit plans from tailoring benefits to particular subgroups of patients who may receive particularly high value from a given service. MedPAC Chairman Glenn Hackbarth cited his commission’s June 2012 report suggesting Medicare restructuring, such as eliminating cost sharing based on evidence of service value; replacing coinsurance with copayments that vary by the type of service and provider; and including an out-of-pocket maximum that would protect beneficiaries from very high medical costs. A Kaiser Family Foundation spokesperson cautioned that while the current system of separate deductibles for Medicare Parts A and B is complicated, a combination could raise costs for the majority of beneficiaries. The Ways and Means Committee agenda includes work to develop legislation to replace the Medicare physician payment system and to develop a means to make health entitlement programs viable in the long term. At a Senate Special Committee on Aging hearing, Chairman Bill Nelson touted the PPACA as a means to strengthen Medicare, reduce costs and improve the care beneficiaries receive. The president of the Commonwealth Fund said Congress should repeal the current Medicare SGR physician reimbursement system and replace it with a system that ties payments to performance and patient outcomes. He also recommended a new option, a Medicare Essential Plan, which would combine Parts A, B and D benefits and require beneficiaries to pay one copayment and deductible for all services.



March 4, 2013: | Page 1 Page 2 Page 3

SERVICES




BRIEFING ARCHIVE


 -  2018


 +  2017


 +  2016


 +  2015


 +  2014


 +  2013


 +  2012


 +  2011