Final Regulations Issued for Individual Market Stabilization

Final Regulations Issued for Individual Market Stabilization

 

From NAHU April 14, 2017

@nahudotorg

 

Yesterday, the Centers for Medicare and Medicaid Services (CMS) released the final market stability rule. The 139-page rule was largely unchanged from the proposal that was released in February and which NAHU submitted comments on in March. As proposed, the 2018 open enrollment period (OEP) will run from November 1, 2017, through December 15, 2017, which CMS has specifically designed to overlap with Medicare and most employer plan enrollments, even though NAHU has repeatedly noted the burden this places on agents. The rule also finalizes tighter restrictions on special enrollment period (SEP) eligibility, applies a more rigorous test for uses of the exceptional circumstances SEPs, and will now require these to be verified by supporting documentation.

Additionally, the final rule changes the actuarial value standard to allow a variation from -4 to +2 percentage points (except for bronze plans, which can vary -4 to +5 percentage points) and finalizes the proposal to rely on states for network adequacy reviews. It will reverse earlier guidance on the Essential Community Providers threshold requirement, and will now require that the network includes at least 20% as participating practitioners as it was for the 2014 plan year that was then increased to 30% for 2015. Finally, the rule will not impose continuous coverage requirements, such as imposing a 90-day waiting period, late enrollment penalty, or requiring 6-12 months of prior coverage; however, CMS will explore other policies to promote continuous coverage.

Notably, the rule did not address two critical issues that could have the greatest impact on the overall stability of the marketplace: whether the administration plans to fund the cost-sharing reduction (CSR) payment program, and whether the administration will enforce the individual mandate. However, neither of those provisions were included in the proposed rule.

Proposed Rule

NAHU Comments

Final Rule

Change the 2018 OEP from November 1, 2017-January 31, 2018, to November 1-December 15, 2017.

Noted issues with the overlap of the proposed OEP with the Medicare annual enrollment period and the OEP for many employer-sponsored plans that operate on a calendar-year basis.

Requested that in future years there should be three distinct open-enrollment windows.

Requested that state-based exchanges and all off-exchange individual-market issuers be required to align with the federal individual-market open-enrollment dates.

No change from proposal; the OEP will run from November 1, 2017, through December 15, 2017.

CMS noted that this was purposely done to more closely align with Medicare and the private market.

State-based exchanges (SBEs) that can’t meet the new OEP will be allowed to supplement with a special enrollment period as a transitional measure.

All new marketplace consumers during a SEP must complete expanded pre-enrollment verification. Applications would be “pended” and not released to the issuer until eligibility is confirmed. Consumers would have 30 days to provide documentation.

Supported the proposal to require appropriate documentation prior to the effectuation of coverage and the proposed 30-day timeframe for document submission.

Requested better verification standards on involuntary loss of eligibility for minimum essential coverage (MEC), such as if an individual who previously had access to group coverage through an employer but chose not to enroll, and then lost such eligibility mid-year due to a discontinuation of the employer group plan.

No changes from proposal; consumers will have 30 days from the date of qualified health plan (QHP) selection to provide documentation; enrollment will be delayed or “pended” until verification of eligibility is completed.

100% of new consumers enrolling in marketplace coverage through SEPs will need to complete pre-enrollment verification.

Will not require SBEs to conduct pre-enrollment verification, but recommend that SBEs that do not currently conduct pre-enrollment verification follow this approach.

Will begin pre-enrollment verification for SEPs in June 2017.

Tightening of SEP eligibility requirements relative to people who have a previous history of nonpayment of premiums, documentation of a move, and gaining a SEP for a marriage.

Requested that CMS change the 90-day grace period for recipients of advanced premium tax credits (APTCs) to make past-due premium payments prior to their insurance being terminated to 30 days to reflect exiting state policies for other coverage, and to prevent the risk-pool instability that results when individuals sign up for coverage, receive care and incur claims but do not ultimately make premium payments.

Suggested clarification that all special-circumstance cases are to be routed through the appeals process, including individuals who cannot obtain official documentation and individuals whose ability to obtain the documents eclipsed the 30 days allowed by the proposed rule.

Noted that the additional verification criteria of newly married couples is a different verification standard than what is used in the private individual market or employer-sponsored plans and requested consistency across markets.

Does not address changing the grace period from 90-days to 30-days.

Allows issuers to reject an enrollment for a record of termination due to non-payment of premiums by the individual, unless the individual fulfills obligations for premiums due for previous coverage.

Allows issuers to apply a premium payment to an individual’s past debt owed for coverage within the prior 12 months before applying the payment toward a new enrollment.

Verification criteria for newly married couples will be more stringent for exchange coverage because of the differences in the markets and the impacts on the risk pool warrant an approach in the individual market that diverges from long-standing rules and norms in the group market.

Medical Loss Ratio (not addressed in the proposed rule).

Requested that CMS allow for health insurance agent and broker commissions, as well as issuer fraud-prevention measures, be exempted from an issuer’s MLR calculation.

Not addressed in the final rule.

Age-Rating Bands (not addressed in the proposed rule).

Requested administrative action to expand the current age rating bands of 3:1 in the individual and small-group markets.

Requested CMS to rescind planned changes to the age rating rules for children age 15 and older finalized in the Notice of Benefit and Payment Parameters for 2018 and instead maintain the existing age-rating structure for children.

Requested that CMS grant state-based age-rating variations to allow for the return of small-group composite rates and more state-based variations.

Not addressed in the final rule.

Grandmothered Plans (not addressed in the proposed rule).

Recommended that CMS formally state that the federal transition policy will remain in effect until further notice and will not be rescinded until ACA statutory improvements are signed into law and can be fully implemented.

Not addressed in the final rule although guidance was released from CMS granting states the ability to determine whether to allow grandmothered plans through 2018.

 

NAHU Washington Update 

 

 

Congressional Republicans Continue Working on Possible Path Forward for Health Reform

Congressional Republicans Continue Working on Possible Path Forward for Health Reform

 

From NAHU Washington Update

@nahudotorg

NAHU

As congressional groups met this week to work out their differences in the wake of the decision two weeks ago to scrap the American Health Care Act (AHCA), President Donald Trump made a late plea on Wednesday urging Congress to vote on a repeal of the ACA before they left town for their two-week Spring Recess. While Congress opted against voting again on the AHCA this week, they did pass a reinsurance amendment to the AHCA and a separate bill that re-affirms the purpose of stop-loss insurance. Congress is now back in district and is set to return the week of April 24, when they will quickly face a tight deadline to pass a new budget agreement by April 28 to prevent another government shutdown.

After being notified late Wednesday that it would be called into emergency action to consider an amendment to the AHCA, by Thursday afternoon the House Rules Committee voted 9-2 along party lines to add language to the reconciliation bill to create a $15 billion “Federal Invisible Risk Sharing Program” to help insurers cover the costs of their sickest enrollees. The amendment is sponsored by Representatives Gary Palmer (R-AL) and David Schweikert (R-AZ) from the House Freedom Caucus and is similar to the ACA’s temporary reinsurance program that expired at the end of 2016. This reinsurance program is separate from and would be in addition to the AHCA’s “Patient and State Stability Fund,” which is designed to expand coverage, increase insurance options, promote access to benefits, and reduce out-of-pocket spending through $10 billion in annual funding over 10 years.

The new reinsurance program would provide states with $15 billion in funding between 2018 and 2026 to reimburse insurers for high-cost plan enrollees. The program would not function as a traditional high-risk pool, as individuals would continue to buy coverage from the individual market, but if they have certain medical conditions, federal funding would cover their claims cost. This could help bring stability to the fragile market and reduce premiums for all consumers in the individual market. The amendment is short on specifics, including which medical conditions would be covered or how insurers would apply for reimbursement, and instead defers to the federal and state agencies to implement the program. It would also permit states to be able to take over the program in 2020, although there aren’t details on how that would work.

A study by Milliman and the Foundation for Government Accountability found that this amendment could help lower premiums by an average of 31% and result in 2 million fewer uninsured individuals . The study includes several assumptions on provisions that were not included in the amendment, including that the reinsurance would only cover claims that exceed $10,000, that the reimbursements would be made at Medicare rates and not those negotiated by the insurers, and that insurers would transfer the full premiums of these consumers directly to the government in exchange for the protections of the reinsurance program. An earlier version of the amendment included some of these details, but because the amendment that was ultimately passed opted to defer to rule makers to implement, it is unlikely that, should the AHCA be passed with this provision, that it would conform to the study’s assumptions.

Meanwhile, the House voted 400-16 on Wednesday to pass H.R. 1304, the Self-Insurance Protection Act. The bill is sponsored by Representative Phil Roe (R-TN) and clarifies that medical stop-loss insurance cannot be redefined as health insurance coverage at the federal level. The bill would change the federal definition of “health insurance coverage” to make these clarifications that stop-loss plans cannot be regulated as health insurance by amending sections of the Employee Retirement Income Security Act, the Public Health Service Act, and the Internal Revenue Code. The Obama Administration had previously increased oversight of self-insured plans as small employers increasingly moved from the fully insured market to the self-insured market to avoid the ACA’s coverage requirements. H.R. 1304 now heads for consideration by the Senate where there is not a companion bill.

Throughout the week, congressional Republicans have been continuing their discussions over how to tackle health reform moving forward. There remains significant disagreements between members of the far-right House Freedom Caucus and the centrist-Republican Tuesday Group and by the end of the week both groups seemed to admit that there is still no clear path forward. Representative Chris Collins (R-NY), a member of the Tuesday Group, doubted that a deal would ever be possible, noting his discouragement with hard-liners for never being satisfied with the concessions they are given, “The Freedom Caucus continues to play Lucy with the football,” and that, “Nothing’s going to change and they’re not there now. What would get them there?”

Vice President Mike Pence led the White House’s efforts this week to bring the two factions together. However, each of the concessions that Pence tried to win the support of Freedom Caucus members were quickly panned by centrist and mainstream Republicans. This included a proposal that would allow states to opt-out of the ACA’s essential health benefits and community rating provisions. While there would still be a prohibition on excluding individuals with pre-existing conditions, this would allow insurers to charge them more for coverage.

This proposal was later pared down to just allowing states to opt-out of minimum health benefits and narrowly increasing flexibility with age-rating bands, which led to confusion and consternation among members of both groups, as Freedom Caucus members saw the proposal as falling far short of their requests while the Tuesday Group thought that the proposal went too far. This has led to blame being cast by members of both groups and outside organizations, including Heritage Action, which called out the moderate Republicans saying, “They’re opposed because they do not want to repeal Obamacare” and “They do not believe in the basic premises of the Republican party.” Meanwhile, Representative Collins of the Tuesday Group cast blame on House Speaker Paul Ryan (R-WI) and House Majority Leader Kevin McCarthy (R-CA), “I’ve been extremely unimpressed at this point with the job House leadership is doing.”

Following the proposal’s rejection, the White House’s discussions with Speaker Ryan and Majority Leader McCarthy culminated in the demand for Congress to hold a vote on the bill before the two-week break and prompted the Rules Committee vote on the reinsurance amendment. While the House opted against holding a vote this week, just prior to leaving for the break, McCarthy claimed that members could be called back at some point during the recess to vote on a new healthcare package. But with a full calendar of items they must pass awaiting their return—including avoiding a government shutdown and re-authorization of the Prescription Drug User Fee Act—it is unlikely that repeal efforts will be seriously considered until May at the earliest, assuming Republicans determine there is any possibility for crafting a policy solution that will satisfy all constituencies of the party.

As Republicans continue to hash out these disagreements, the White House’s congressional liaison and the conservative-leaning Blue Dog Democrats held a meeting to discuss various issues where they could find agreement. President Trump previously noted that he may need Democratic support to push through his agenda items after Republicans have shown sharp policy disagreements. Yet, Democrats have also pushed back at the administration, including a score of Senate Democrats who called out Health and Human Services Secretary Tom Price for sharing a list of proposed regulatory changes with House Republicans and not Democrats during negotiations over the AHCA, and requested that the administration provide those changes and to work with Democrats on improvements to the ACA.

Democrats have also been relaying their concerns with the White House over the ACA’s cost-sharing reduction subsidies, imploring the administration to continue challenging the House of Representative’s lawsuit on their validity. Nine Democratic senators sent a letter to Attorney General Jeff Sessions this week noting their critical importance to the stability of the marketplaces. In February, the administration was granted a 90-day postponement of the case to determine how to proceed with the case. A federal judge had previously ruled that the subsidies were invalid, and if the administration were to drop their challenge then the payments made by the government to insurers would cease, while insurers would still be required to provide the roughly $9 billion in combined annual subsidy payments to individuals, likely causing insurers to abandon the marketplaces and throw them into chaos.

AHCA Withdrawn – What’s Next?

AHCA Withdrawn – What’s Next?

 

Great update from CIGNA’s Informed on Reform Series 

www.CIGNA.com  

March 30, 2017

 

On Friday, March 24, efforts by U.S. House Republicans to utilize the budget reconciliation process to repeal portions of the Affordable Care Act (ACA) experienced a significant setback with the withdrawal of the American Health Care Act (AHCA) before a full vote. As reported in our recent update, the AHCA had been proceeding through the House legislative process and provided a strong indication of the policy direction Congressional Republicans favor on health care reform. The withdrawal of the AHCA marks a crossroads with respect to the future of the ACA.

Here’s what we currently know — and don’t know — about what could be next to help you stay informed.

ACA Remains the Law of the Land
The ACA remains the law of the land. Ongoing compliance with the law is required unless and until official guidance to the contrary is issued.

What’s Next for ACA Repeal and Replace?
The withdrawal of the AHCA signals a pause by Congressional Republicans in their repeal and replace effort without bipartisan support, but the debate about the future of the ACA is likely far from over. Now there are significant questions about what type of action, if any, Congress or the Administration will take to continue efforts to dismantle, replace or reform the ACA. Here are a few possibilities:

·         Regulatory Action for Market Stabilization and Regulatory Relief
Secretary of Health and Human Services Tom Price has authority to propose changes to current ACA regulations, which could be done to help stabilize the individual marketplace and/or provide regulatory relief “to the maximum extent permitted by law” as directed in the January 20 Executive Order.

·         Regulatory Non-Enforcement
Similar to directing agencies to offer regulatory relief, it is possible the Administration may adopt policies of non-enforcement of certain regulations, such as potentially directing the Internal Revenue Service (IRS) to not to enforce penalties related to specific ACA provisions.

·         Comprehensive Tax Reform
The Administration and House Republican Leadership have indicated that their next priority is tax reform. It’s possible that certain ACA taxes or penalties could be repealed or changed as part of Congressional efforts to rewrite the Internal Revenue Code.

·         Targeted Legislation
While the next steps for a new repeal and replace bill remain unclear, piecemeal legislation could be introduced on specific provisions, such as individual insurance market reforms. Bipartisan support will be required for this legislation to be successful in the Senate.

·         Increased State Autonomy
As part of the regulatory efforts, the Administration could defer decisions on certain health care reform provisions to the state level. Recently, Secretary Price invited governors to submit State Innovation Waivers (allowed under the ACA beginning in 2017), which would grant states more autonomy in making decisions about their health care structures.

Other Marketplace Issues to Watch
In addition to any potential changes to the public Marketplaces, there is current litigation about funding for cost-sharing subsidies for individuals covered through a Marketplace. Additionally, insurers will soon submit their plans regarding if and where they will participate in Marketplaces for 2018.

 

Upcoming ACA Employer Compliance Deadlines and Staying Informed
With the ACA remaining in place, employers and broker partners can use Your ACA Roadmap to receive a personalized snapshot of the annual responsibilities and applicable deadlines for 2017 and 2018. Visit www.YourACARoadmap.com for more information. Additional information can also be found on Cigna’s reform website at www.InformedOnReform.com.

Cigna will communicate via updates, news alerts and web meetings as the state of U.S. health care reform continues to evolve. 

Pulling the plug on Healthcare in the US – Dissecting the Regular Facts from the Alternative Facts

Pulling the plug on Healthcare in the US – Dissecting the Regular Facts from the Alternative Facts

 

With all cards on the table, is this Pay or Play 2.0?

 

Where do we stand now?

New changes in the last 24 hours were made among them:

1. Repeal the 10 essential health benefits mandate (Conservative Caucus)
2. Add an addition $15B into a flexibility fund (for states to manage Medicaid) (Coverage Caucus – side note here – Senator Cassidy R-LA – who worked with Senator Collins R-ME on a separate bill is heading the coverage caucus as they are working to keep coverage in the Medicaid programs)
3. Keep the .9% Medicare tax for high-income earners making over $200,000 filing single for six more years – this would be to keep bringing in new revenue (This was originally in the bill to sunset as of 2018, then adjusted to sunset this year but looks to be sunsetted in 6 years)

 What else did I miss?

Earlier this week, additional changes were made to the bill as it was attempted to garner enough votes to pass on the floor of the House.  Most of these are changes in implementation dates to appeal to different parts of the House GOP.

1. Moving the repeal of the Tanning & Medical Device tax from 2018 to 2017
2. Moving the repeal of the business tax cap for executives in health insurance companies from 2018 to 2017
3. Sunset new Medicaid expansion for states that have not expanded from 2020 to 2017 (Kansas is currently trying to expand Medicaid as we speak)
4. NY Representatives add an amendment to move $2.3B Medicaid costs from local (county – excluding large metropolises like NYC) to the State Budget
5. Lower the medical expense deduction from 7.5% under the original bill now to a new low of 5.8% and to move up implementation from 2018 to 2017
6. Delay Cadillac tax from 2025 now pushed out to 2026
7. Repeal the maximums and over the counter medication bans on Flexible Spending Accounts from 2018 to 2017
8. Increase the HSA limits to maximum out of pocket costs from 2018 to 2017

What does this all mean?  Well, to be absolutely frank – not much, if they don’t have the votes today.  What does it mean in the future, though, EVERYTHING.  

I don’t think you will find someone who doesn’t think we have work to do on the ACA.  I am the first to say it.  I also think that we have to get a bi-partisan committee to work together with consumer groups; AARP; AHIP; AHA; AMA and the healthcare consulting (i.e. the broker) community.  We are in the battle on a daily basis.  We know what can work and what should work and this needs to be done right and it needs to be done soon.

There are good ideas out there and we have to approach this on a more macro level and look at the outside forces that are affecting the current delivery system, i.e. lowering the cost of pharmaceuticals by introducing competition; providing incentives for smaller companies to do more development on generic alternatives; banning pharmaceutical companies from shelving generic patents when they become available; more efficient medical record data sharing; cutting out redundancy; providing affordable medical malpractice insurance programs to incent OBGYNs and other speciality providers who want to provide care but can’t afford the malpractice premiums; identifying high-cost chronic conditions and look at possibly pooling them into a national program such as Medicare, as we do with End Stage Renal Disease; providing TRANSPARENCY to the consumer by giving them the means to shop for a procedure with outcomes and cost as easily as they can today with houses; technology and cars; getting more funding and education to fight the opioid epidemic.

We cannot continue to kick the can down the road, adjust the programs to suit a small group of interest.  The health of this country is at stake; the health of its citizens are at stake and millions of jobs are at stake.  We need to pull this out of the halls of Congress and get the experts, who manage this, at the table now before it is too late.  

There are solutions, there is a way – but we have to do this together with experts and support it as a country.  This is one thing neither party should own but every party should want to see succeed.  


 

Pulling the plug on Healthcare in the US – Dissecting the Regular Facts from the Alternative Facts

Dismantling the employer option . . . and then there were none    There is a well known English nursery rhyme by Mother Goose, about an egg that sat on a wall and had a great fall.  All the king’s horses and the all king’s men could not put that poor egg back together again. As we have been following the repeal and replace of the Affordable Care Act (ACA) or aka – Obamacare, the elimination or capping of the employer tax-exclusion on employer sponsored benefit programs, has been brought up again.  This idea has been floating around for the last couple of years as a way to increase revenue and now looked at as one potential revenue funding option in a replacement to the current Affordable Care Act (ACA). So what is the employer tax – exclusion? Currently employees are NOT taxed on the employer paid portion of their benefits for income and payroll tax purposes. Under this new regulation, the employer paid portion of premiums could end up being considered taxable income.  In addition, the employer could face higher FICA (Federal Insurance Contributions Act) matches, which would be an added financial burden to the employer.   FICA is made up of the employer and employee both contributing equal shares of Social Security Tax (6.2%); Medicare Tax (1.45%) for a total of 12.4% and 2.9% respectively.  Currently there is a cap on Social Security, so once you have paid this tax on $127,200, you no longer pay the 6.2% Social Security tax.  You can find more information on this and additional taxes HERE. We are sitting in a precarious situation if we start to look changing or altering the current employer model, as part of the repeal and replace.  The Kaiser Foundation has data showing 156 million Americans covered through employer based plans through the end of 2015.  As of 2017, approximately 175 million Americans receive healthcare through the employer based model. Remember the risk pools?  The employer based market is heavily involved in helping to balance risk pools by spreading out the costs of the healthy and unhealthy covered employees. If the employer has no incentive to offer these benefits to their employees, or they end up costing both the employee and the employer more money, the employer could easily have their employees go to the individual marketplace to purchase their coverage by offering a salary increase to the employee to offset some of the costs.  This would mean higher income taxes to the employee.  The costs in the individual market are higher; the choices are lower and employees would lose the benefit of having their employer advocate in coverage disputes. If Congress decided, instead, to cap the employer-tax exclusion, this would in turn, cause the employer to look at providing less rich benefit to employees, to stay underneath the maximum premium cap so not to trigger a tax.  This would push employees to higher out of pocket costs and possibly shift the cost of the premium from the employer to the employee at a faster rate then we are seeing today. The employer-sponsored health insurance is a valuable benefit and a keystone to the American worker and a financial foundation for the healthcare system today.  If we attempt to upset this model, while undergoing additional repeal and replacement options, we run the risk of the entire system breaking, just like that egg.  And there is not a king nor a horse strong or powerful enough to be able to pick it up, once the system has fallen off the wall.   ]]>

Pulling the plug on Healthcare in the US – Dissecting the Regular Facts from the Alternative Facts

Pulling the plug on Healthcare in the US – Dissecting the Regular Facts from the Alternative Facts  

The 21st Century Cures Act

By Rob Bujan    Oh goody!  Another bill to repeal and replace the ACA!   nope, wrong. This is one of the last bills that President Omaba signed into law before leaving office.  The 21st Century Cures Act is packed with investments for improved healthcare.  There are some great programs to address the heroin and prescription opioid epidemic; improve mental health; improve the timing on drug trails within the FDA and accelerate cancer research discoveries. It also had a program included that allows employers to provide an account to give to employees to shop for their health insurance plans in the marketplace or directly with an insurance carrier in the individual market. For many years, brokers have been using  Health Reimbursement Arrangements (HRA) coupled with a high-deductible plan.  An employer would put a plan with a $4000 deductible for hospital care, for example, have copays for medication and doctor visits. About 20% – 25% of employees in a group setting drive approximately 80% of high-level (inpatient) claim costs, so the employer could fund the deductible for the employee if they had a claim that processed against the deductible, which would normally be less frequent than office visits or pharmacy claims.  The premium would be lower, and the employer would use those savings to fund the deductible.  The HRA money was used only if a claim entered the deductible mode.  The money was not taxable money to the employee if they used it. Some employers also used these accounts to allow employees to purchase individual health plans to give employees a choice and not administer benefits.  These were also known as Premium Reimbursement Accounts (PRA)  The ACA actually did away with this program as they did not want employers to adversely select against folks who could drive up claim costs, and they did not want employees who could get a subsidy in the marketplace to use that subsidy and receive tax free money from their employer.   The new bill allows HRA stand alone account to pay for premiums for employers with less than 50 employees.  With some new mandates, they can curb some of the abuse that they felt could occur under the original model.  If an employer decides to offer this, the employer must offer it to all their employees (no discrimination).  They are NOT allowed to offer a group product next to this reimbursement program (to protect the risk in the group market), and employees must identify they have this reimbursement if they shop in the marketplace and get an advance premium tax credit (APTC).  The APTC would be reduced dollar by dollar so there is no double dipping.  The maximum amounts that employers could provide to employees would be $4,950 for employee-only coverage and $10,000 for employee/spouse; employee/child or full family coverage.   The goal of this was to get more small group employers who might not be participating in offering group coverage, to do so.  It would also increase the individual market and strengthen it by adding more individual to the risk pool, again keeping that pool full.  The reality is though; this might be a fix that is a little too late.  The individual markets in many states have been hit hard with carriers dropping out; rates increasing due to the medical loss ratios (claims paid versus premiums received) running higher than expected; and an overall lack of choice in the individual marketplace.  Most individual plans are in-network only; have local networks with only national coverage in case of a true emergency. Group coverage offered through an employer is still going to give you larger network access; more carrier offerings and in most cases, lower group rates.   While the 21st Century Cures Act looked good on paper, it is not going to be enough to breathe life back into the individual market without incentives for more competition and a leveling off of rates.  The individual market needs both the state and the federal government to come together to work on a better program for those that don’t fall into Medicaid; Medicare or have employer-based coverage.  Why don’t we get a discussion about this going and work on fixing one piece of the market at a time?  That is how we really could provide a safe and thoughtful way to enhance and adjust our current state of the ACA. ]]>

Republicans Face Dilemma on Timing of Health-Law Replacement

Do they act before or after the 2018 midterm elections? Either choice carries political risks

The Wall Street Journal
By Stephanie Armour and Kristina Peterson
Dec. 9, 2016 7:00 a.m. ET

WASHINGTON—Republicans united in their desire to overturn the Affordable Care Act are divided over whether to replace it before or after the 2018 elections, a choice that holds political peril either way.

Waiting until after the midterms could pose a political risk to the most conservative Republicans who campaigned on the repeal and whose constituents want the law to be gone as quickly as possible.

But passing a hastily-written replacement for the complex law could create chaos in markets and leave millions without health insurance. Some Senate Republicans believe putting a new system in place could take until 2019 or longer.

Along with likely legislative action by Republicans in January to dismantle parts of the ACA, President-elect Donald Trump is expected to take executive action that would weaken parts of the law. House Republicans also are likely to seek to cut off federal funding for Planned Parenthood Federation of America.

Midterm elections tend to disfavor the party that controls the White House, and Republicans are aware of the drubbing Democrats took in 2010, after they enacted the law with almost no Republican support.

“One of the lessons we learned from Obamacare is that partisan legislation is not sustainable and what we need to do is go back to the old-fashioned way” of reaching bipartisan consensus, Senate Majority Whip John Cornyn (R., Texas) said this week.

A transition period would be aimed at preserving health insurance for the roughly nine million consumers who get tax credits to offset premiums. “There needs to be a reasonable transition period,” House Speaker Paul Ryan (R., Wis.) said Thursday. “It’s just premature to suggest that we know exactly how long this transition will last.”

Some House Republicans insist a replacement can be done in two years or less. Their calculus is that getting rid of the law early in 2017 with a short or no transition period would force action on its replacement. “The only way this gets done is if our backs are against the wall,” said Rep. Mark Meadows (R., N.C.), chairman of the conservative Freedom Caucus.

Senate Republicans have indicated they want Democratic buy-in for their health-care overhaul. Finance Committee Chairman Orrin Hatch (R., Utah) said “three years would be better” for a transition, but acknowledged there is pressure from the House to move faster.

If House Republicans who want a speedier replacement defect, the House could lack enough votes to push through a three-year replacement plan. The clash also reflects the difficult path ahead for Mr. Ryan, who wants to keep the GOP united in its repeal and replacement plan.

“This election showed that people want things done now,” said Rep. Roger Williams (R., Texas). “People in America deal in real time and they want real-time solutions.”

Democratic leaders have signaled they are unlikely to cooperate, at least in the initial repeal phase, while some in the party up for re-election in 2018 in conservative-leaning states may feel pressure to fill the void if the law has been repealed.

“They have nothing to put in its place, and believe me, just repealing Obamacare even though they have nothing to put in its place and saying they’ll do it sometime down the road will cause huge calamity from one end of American to the other,” said Sen. Charles Schumer of New York, the next Democratic leader.

Each party will face political headwinds going into the 2018 midterms. Senate Democrats will be defending 25 of 33 seats in play, putting them at a disadvantage.

But Republicans will have political ownership of the health-care law at a time it is likely to still be in flux—and possibly in turmoil. And because they will control Congress and the White House, any voter angst could favor the Democrats in a sort of reverse dynamic of 2010

Senate Republican Leaders Vow to Begin Repeal of Health Law Next Month

THE NEW YORK TIMES
By ROBERT PEAR
DEC. 6, 2016

WASHINGTON — Senate Republican leaders, after meeting with Vice President-elect Mike Pence, said on Tuesday that they would move immediately next month to start repealing the Affordable Care Act, despite qualms among some of their members.

“The Obamacare repeal resolution will be the first item up in the new year,” said Senator Mitch McConnell, Republican of Kentucky and majority leader.

Republicans have not fleshed out a plan to replace the 2010 health care law, President Obama’s signature legislative achievement. But on Tuesday they laid out their principles for a replacement plan and said they would try to minimize disruption for the 20 million people who have gained coverage under the law.

Senate Republican leaders appeared to agree with House Republican leaders on a “repeal and delay” strategy, which could keep parts of the health law in place for several years, as Congress works with the administration of Donald J. Trump to devise a replacement.

The Senate Republican strategy would start the repeal process in early January and could defer the effective date for several years, but not all party members were on board.

“They have to be done together,” said Senator John McCain, Republican of Arizona, referring to efforts to repeal and replace the health law. “We don’t want to have people left out.”

Democrats vowed to fight for preservation of the health law, on which public opinion has been deeply divided for six years.

“Bring it on!” Senator Chuck Schumer of New York, the next Democratic leader, said to Republicans. “Just repealing Obamacare, even though they have nothing to put in its place, and saying they’ll do it sometime down the road will cause huge calamity from one end of America to the other.”

Many health policy experts say the law has been beneficial. But Senator John Thune of South Dakota, the No. 3 Senate Republican, said: “It’s well documented, everybody agrees, both Republicans and Democrats, that Obamacare has serious problems. I would say it’s been a failure, and I think the American people agree.”

After repealing the law, Mr. Thune said, Republicans will proceed step by step to develop a replacement, built around four principles: States, not the federal government, should have the primary responsibility for health policy. Patients and doctors should be “in control.” There should be more competition among health plans, so consumers would have more choices. And small businesses should have more discretion and flexibility to configure health benefits for their employees.

After their lunch on Tuesday with Mr. Pence, many Senate Republicans were energized. After the inauguration of Mr. Trump, the schedule will be “very aggressive,” said Senator Michael Rounds, Republican of South Dakota.

But other Republican senators were still mulling their strategy.

Senator Bob Corker, Republican of Tennessee, suggested that it might make sense to repeal and replace the heath law at the same time, and that there could be pitfalls in deferring a replacement for several years.

“People are trying to figure out the best route,” Mr. Corker said. “It’s not really repeal if it’s still in place for three years.”

Senator John Barrasso of Wyoming, a member of the Senate Republican leadership, said Congress would need time to develop a replacement.

“Health care has been driven into the ditch by President Obama and this health care law,” Mr. Barrasso said. “It will take time to get the cart out of the ditch.”

Senator Susan Collins, Republican of Maine, said she supported efforts to repeal and replace the health law, but not Republican efforts to cut off federal funds for Planned Parenthood clinics. Last December, she voted against a budget bill that would have repealed major provisions of the health law because it would also have terminated funds for Planned Parenthood.

“Under the incoming administration, Republicans and Democrats will have a new opportunity to fix Obamacare, and there is a lot to fix,” Ms. Collins said on Tuesday, noting that premiums for health plans on the exchange in her state were increasing an average of 22 percent next year.

Insurers aren’t drinking GOP health reform Kool-Aid

Nov 16, 2016 | By Dan Cook BenefitsPro

As the nation holds its breath in anticipation of the Republican Party’s reform of health care reform, insurers have already moved into the hyperventilation stage.

The health insurance industry is one that, historically, has evolved by increments.

Yet since the passage of the Patient Protection and Affordable Care Act, it has been asked to change by leaps and bounds. But now, with an incoming president and Congress that have vowed to undo the ACA with no replacement plan to offer, the industry doesn’t know what to brace for next.

Outgoing President Obama neatly summed up the dilemma facing the nation in an interview with the media the other day. “If they can come up with something better that actually works, a year or two after they’ve replaced the ACA with their own plan, and 25 million people have health insurance and it’s cheaper and better and running smoothly, I’ll be the first one to say that’s great,” he said.

While there’s been no shortage of criticism of the ACA’s structure, most insurance authorities say its basic components were, in theory, solid. The ACA offered truly affordable health insurance to those with pre-existing conditions and others who, due to their age and other factors, were previously facing budget-busting insurance premiums—if they could get coverage at all.

The poor were finally able to “buy” basic coverage, and insurers’ profits were somewhat protected by the “buy-or-pay-a-fine” law included to extract money from those who might not want coverage so that the subsidy pool could be filled.

Republicans say they intend to continue to offer affordable coverage to those with pre-existing conditions. (The poor will apparently be on their own again, at least based on current GOP statements.) But they do want to eliminate the “mandate.”

But insurers fear that, without the stick of the mandate, the carrot of pre-existing coverage just won’t work. And they will face the choice of either plummeting profits or escalating premiums—or both.

President-elect Trump and others in his party have floated various “solutions” to creating a mandate-less national health system. But insurers who spoke to The Hill poked large holes in all of them.

In a tweet reported by The Hill, the Kaiser Family Foundation’s Larry Levitt laid out the challenge facing the GOP: “There is a bipartisan desire to guarantee insurance for pre-existing conditions. Sadly, there’s no magic pixie dust that makes it easy.”

Final 1095-C 2016 Forms and Instructions for IRS Reporting Requirements

On October 3, 2016, the Internal Revenue Service (IRS) released final 2016 Forms 1094-C and 1095-C and their accompanying instructions. These forms and instructions will be used for Affordable Care Act (ACA) Applicable Large Employer reporting (for compliance with the ‘employer mandate’) and self-insured large group Minimum Essential Coverage (MEC) reporting for coverage offered in calendar year 2016.

In September 2016, the IRS released final 2016 Forms 1094-B and 1095-B and the applicable instructions for insurance carriers and small employers who self-insure their group health plans to report MEC.

Changes to Form 1094-C are minimal from the 2015 Forms. The most notable changes include:

• Line 22 is “Reserved,” as it pertained to the “Qualifying Offer Method Transition Relief,” which is not applicable to 2016 coverage.
• Part III, column (b) includes a new distinction, “Section 4980H” before “Full-Time Employee Count for ALE Member.” This is intended to remind filers that only the section 4980H definition of “full-time employee” should be used in this column (no other definition can be used).

Changes to Form 1095-C are also minimal from the 2015 Forms, but include these more prominent updates:

• New language below the form title states “Do not attach to your tax return. Keep for your records.” This is intended to help prevent individuals from submitting the form with their tax return.
• Line 15 has a revised header, “Employee Required Contribution (see instructions).”
• Lines 14 and 16 have certain codes “Reserved,” as they no longer apply to 2016 coverage, and new codes (1J and 1K) have been added to Line 14.
• Transition relief available to employers for 2015 under sections 4980H and 6056 has limited applicability in 2016. References to transition relief that applied only in 2015 have been removed. Descriptions of the remaining forms of transition relief have been amended to clarify for which months in 2016 the transition relief applies (description and when it applies is available in Section 4980H Transition Relief for 2015 Plan Years).

The 2016 IRS Forms 1094-B and 1095-B have similar changes for reporting 2016 coverage in 2017. The instructions for both sets of forms include applicable code information to help ensure correct reporting for each line item.

Instructions for Froms 1094-C and 1095-C, used by applicable large employers, i.e., those subject to the employer mandate. Self-insured plan sponsors complete the entire Form 1095-C:

Form 1095-C

Form 1094-C (a transmittal/cover sheet) to the IRS:

Form 1094-C

Form 1095-C to both the IRS and individuals. Applicable large employers with insured plans will only complete Parts I and II of Form 1095-C:

Form 1095-C

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