for DR.SAMUELSON only!!!!
frguerradi
week_7_lecture.pptxState and Federal Regulation of Health Insurance and Managed Care, The Patient Protection and Affordable Care Act
WEEK 7 LECTURE
State Regulation – Key Functions
Corporate operations
Company licensing – Insurance and COA
Producer licensing
Holding companies/subsidiaries
Consumer protections
Market conduct
Consumer assistance (complaints/appeals)
Consumer disclosures (EOCs and EOBs)
External review organizations
Coverage mandates
Solvency
Risk Based Capital (RBC) requirements
Guarantee Funds
State Regulation – Key Functions (cont.)
Market regulation
Individual and small group rating requirements
Individual and small group access requirements
Licensing of brokers and agents
Premium rate and form approval
Will enforce MLR requirements (2011) and individual and small group rating requirements (2014) under the ACA
Will oversee state-level health insurance Exchange
Unless the state refuses to do so, in which case DHHS will step in
Combination of federal ACA requirements and state variability
Health Care Provider Relationships
Provider network standards/Any-willing provider
“Prompt-pay” requirements
“Down stream risk” oversight
Quality Assurance/Utilization Review standards
Pharmacy Benefits Manager requirements
National Association of Insurance Commissioners (NAIC)
Trade association formed in 1871 to represent state insurance departments – offices in Kansas City, New York, and DC
Creates model laws/regulations for non-uniform adoption by states
Create the annual financial reporting requirements (“Blanks”) for non-uniform adoption by states
System for Electronic Rate and Form Filing (SERF)
Facilitates information sharing between state regulators
Producer licensing clearinghouse
ACA responsibilities (Medical Loss Ratio Definitions, Reporting Blanks, etc.)
Federal Legislation Impacting Health Insurers and Managed Care
Health Maintenance Organizations Act (1973)
Employee Retirement Income Security Act – ERISA (1974)
Tax Equity and Fiscal Responsibility Act – TEFRA (1982) enabled Medicare HMOs
Consolidated Omnibus Budget Reconciliation Act – COBRA (1985)
Emergency Medical Treatment and Active Labor Act – EMTALA (1985)
Health Insurance Portability and Accountability Act – HIPAA (1996)
Title I – Health Care Access, Portability and Renewability
Title II – Administrative Simplification/Privacy
Title III – Medical Savings Accounts
Mental Health Parity Act
Newborns and Mothers Health Protection Act
Women’s Health and Cancer Rights Act
Federal Legislation Impacting Health Insurers and Managed Care
Health Maintenance Organizations Act (1973)
Employee Retirement Income Security Act – ERISA (1974)
Tax Equity and Fiscal Responsibility Act – TEFRA (1982) enabled Medicare HMOs
Consolidated Omnibus Budget Reconciliation Act – COBRA (1985)
Emergency Medical Treatment and Active Labor Act – EMTALA (1985)
Health Insurance Portability and Accountability Act – HIPAA (1996)
Title I – Health Care Access, Portability and Renewability
Title II – Administrative Simplification/Privacy
Title III – Medical Savings Accounts
Mental Health Parity Act
Newborns and Mothers Health Protection Act
Women’s Health and Cancer Rights Act
Federal Regulatory Framework…
Department of Health and Human Services
Office for Civil Rights (health information privacy)
Centers for Medicare & Medicaid Services
Medicare
Medicaid
Data and Security Standards
Center for Consumer Information and Insurance Oversight (ACA)
Office of the National Coordinator for Health Information Technology
Centers for Disease Control (vaccines, preventive services, etc.)
National Committee on Vital and Health Statistics (data and security standards)
Department of Homeland Security Nuclear Biological or Chemical events (NBC events)
Department of Defense – TRICARE
Federal Regulatory Framework (cont.)
Department of Labor
Employee Benefits Security Administration
Employment Standards Administration
Department of the Treasury
Internal Revenue Service
Financial Crimes Enforcement Network (FinCEN)
Department of Justice (anti-trust)
Federal Trade Commission (anti-trust, “do-not-call,” CANSPAM)
Equal Employment Opportunity Commission
ADEA
ADA
Office of Personnel Management (FHEBP)
Office of Management and Budget / Office of Information and Regulatory affairs (OIRA) at White House
Legal Issues – Preemption
ERISA - preempts any state law that relates to ERISA plans.
Exception for any state laws that regulate insurance, banking, and securities (the “savings clause”).
But – states cannot deem employee plans to be insurers (the “deemer” clause).
HIPAA
Title I – state laws that “prevent the application of” the federal standard are preempted
Title II (privacy) – state laws that give consumers greater protections are not preempted
Title II (administrative simplification) – “contrary” state laws are preempted
ACA (insurance market provisions) – state laws that “conflict” with the federal requirements are preempted.
“Immediate Reforms” (first “Plan Year” on or after 9/23/2010)
No lifetime dollar limits on covered benefits
Only “restricted” annual dollar limits may be applied to “essential benefits”*
Policy rescissions are prohibited
Coverage for preventive services is mandated with no-cost sharing allowed**
Dependent children must be covered until age 26
No pre-existing condition limits for enrollees under age 19*
Mandatory internal and external appeals process**
Emergency services must be covered out-of-network with no prior authorization and at same cost-share as in-networks**
Must allow access to OB/GYNs without referral**
Must allow pediatrician to be designated as child’s PCP**
Additional Immediate Reforms
Authority for HHS/States to review “unreasonable” rate increases (2011)
Creation of new state risk pool mechanisms (90 days from enactment)
Creation of insurance web portals (July 1, 2010)
Beginning 2011 Insurers must report incurred loss/claim ratios to HHS, and beginning 2012 pay rebates if insured coverage loss ratios fall below:
85% large group
80% small group
80% individual
Early retiree coverage reinsurance program (2010-2014)
All insurers and group health plans must use uniform coverage documents and standard definition of terms as determined by HHS (within 24 months of enactment)
2014 Reforms (non-grandfathered plans)
All coverage must be guarantee issue/renewable
No pre-existing condition limits
Use of health status factors to condition eligibility or set rates prohibited
Limits on rating variations (permitted based on family size, geographic region, age, smoking)
All individual/small group insurers must offer essential benefits (inside/outside exchanges)
Total cost-sharing limited to 2014 HSA limits (individual and fully insured/self-funded groups)
Small group (> 100 employees) deductibles limited to $2,000 individual/$4,000 family
Additional Major Actions in 2014
Expand Medicaid to all individuals under age 65 with incomes up to 133% of the poverty level ($14,400/individual or $29,300/family of 4)
Create new Health Insurance Exchanges where individuals and small employers can purchase coverage
Qualified Health Plan Essential Benefits Levels
In order for individuals to comparison shop among health plans offered on the Exchange, the ACA specifies four tiers of coverage that health plans can offer. Each plan must provide coverage for the essential health benefits described in the ACA,* and must cover more than half of the cost of the benefits with an out-of-pocket limit equal to the 2010 Health Savings Account (HSA) limit: $5,950 for individuals and $11,900 for families (as of 2010, and recalculated each year). The coverage percentage is determined by the combination of deductibles, coinsurance and/or copayments, not the coinsurance alone.
Bronze level—60% actuarial value.
● Silver level—70% actuarial value.
● Gold level—80% actuarial value.
● Platinum level—90% actuarial value.
Insurers must offer the Silver and Gold levels in order to participate in the Exchange. The Bronze and Platinum levels are optional. HRAs and HSAs are allowed under the ACA, and would be potentially applicable to a Bronze or possibly Silver level benefits plan.
Qualified Health Plan Essential Benefits Levels (cont.)
A “catastrophic” plan is also an additional option an insurer can offer but only to those under 30 and others who are exempt from the individual mandate.
* The details of what are considered essential health benefits will be determined by the Secretary of Health and Human Services (HHS) based upon recommendations by the Institute of Medicine (IOM), and re-assessed on a regular basis.
Requirements and Incentives
Employers
Larger employers that don’t offer affordable coverage will face penalties of up to $2,000 per full-time worker per year beginning in 2014, but only if an employee (even a single employee) receives subsidized coverage through the Exchange
Small employers with up to 50 employees will be exempt from penalties
Tax credits available for some small businesses that offer health benefits
Additional Health Care Mandates
Creation of State Health Exchanges for individuals and employers to purchase insurance
New taxes on “high-value” employer coverage
Employer “responsibility” requirement
Individual “responsibility” requirement
New fees on insurance providers
Limits on deferred compensation
Limits on spending accounts – FSA contributions capped and use of HRA, HSA, and FSA funds for over-the-counter medications prohibited
