Monthly Archive: March 2016

Proposed Minnesota legislation would allow Basic Health Plan on state exchange to expand rural choice

Area legislators believe they have found one possibility for cutting premiums and adding coverage to health insurance for those in rural Minnesota.They’ve introduced a bill to request a federal waiver so that MinnesotaCare, the state-run health insurance plan for low-income individuals and families, can be sold on the state exchange to those above the current income limit. Any new enrollees would pay a premium based on a statewide calculation that considers MinnesotaCare as other privately offered health insurance plans are.“In the metro area, there are a lot of insurance carriers who provide multiple products,” said Sen. Kathy Sheran, DFL-Mankato. “In the rural area, where we are more remote and there are fewer customers to be pursued, there are fewer providers of those products.”

Source: Legislators want MinnesotaCare open to all | Local |

This is an interesting development (h/t to Manatt’s Liz Osius) given that many state exchanges struggle to offer much in the way of choice among qualified health plans (QHPs) in their rural rating regions. This bill would allow a special state insurance plan authorized under Section 1331 of the Patient Protection and Affordable Care Act known as a Basic Health Insurance Plan (BHP) for individuals under age 65 with household incomes between 133 and 200 percent of the federal poverty level (FPL) and ineligible for Medicaid (which tops out at 138 percent of FPL in states that opt to expand Medicaid eligibility) to be offered on Minnesota’s state health benefit exchange. MinnesotaCare is the state’s BHP. The preamble to federal rules issued earlier this year governing federal funding for BHPs recognizes their utility as adjuncts to exchange QHPs and Medicaid plans:

BHP provides another option for states in providing affordable health benefits to individuals with incomes in the ranges previously described. States may find BHP a useful option for several reasons, including the ability to potentially coordinate standard health plans in BHP with their Medicaid managed care plans, or to potentially reduce the costs to individuals by lowering premiums or cost-sharing requirements.

Despite this language suggesting flexibility, it remains to be seen whether the federal government would grant a state innovation waiver under Section 1332 of the Affordable Care Act allowing MinnesotaCare to be offered on the exchange if the legislation is enacted. Section 1332 provides program flexibility on exchange requirements but does not extend to BHPs under Section 1331.


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email or call 530-295-1473. 

California exchange mulls flexing market power to enforce hospital care quality

California’s insurance exchange is threatening to cut hospitals from its networks for poor performance or high costs, a novel proposal that is drawing heavy fire from medical providers and insurers.The goal is to boost the overall quality of patient care and make coverage more affordable, said Peter Lee, executive director of the Covered California exchange.“The first few years were about getting people in the door for coverage,” said Lee, a key figure in the rollout of the federal health law. “We are now shifting our attention to changing the underlying delivery system to make it more cost effective and higher quality. We don’t want to throw anyone out, but we don’t want to pay for bad quality care either.”

“California is definitely ahead of the pack when it comes to taking an active purchasing role, and exclusion is a pretty big threat,” said Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms. “There may be a dominant hospital system that’s charging through the nose, but without them you don’t have an adequate network. It will be interesting to see how Covered California threads that needle.”

Source: California Insurance Marketplace Wants To Kick Out Poor-Performing Hospitals | Kaiser Health News

State health benefit exchanges aggregate individual and small group health plans and purchasers in order to facilitate a more functional market and make health coverage more accessible and affordable. When they actively negotiate with health plan issuers on terms and conditions for exchange participation as Covered California does, they in effect become super payers relative to providers since they can leverage their market power to establish quality standards for medical care covered by participating plan issuers. Covered California now wants to exercise that power relative to hospitals. That dynamic disrupts the traditional contractual relationship between plan issuers and providers and both are initially reacting to the proposal by telling Covered California to butt out.

Hospitals operate in a market that tends to be oligopolistic in metro areas and monopolistic in less populous areas. In California’s expansive geography, it has a mix of both. Georgetown University’s Sabrina Corlette points up the tension between enforcing quality standards on hospitals and the realities of the hospital market relative to ensuring an adequate number of hospitals exist in exchange plan provider networks. The California exchange has a large degree of purchasing power. But in a market with few sellers and many buyers (plan members in a given rating region), sellers have a natural advantage relative to determining price and quality.


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email or call 530-295-1473. 

New Kentucky state benefit enrollment portal to include Medicaid E&E

Kentucky: State Launches New Website for Medicaid and Public Assistance Programs. The Cabinet for Health and Family Services launched Benefind, a new web portal through which residents can enroll in Medicaid, Supplemental Nutrition Assistance Program and the State’s cash assistance program. Program enrollees can also use Benefind to renew benefits, check benefit amounts, report changes, upload verification documents, check claim status, make claim payments and receive electronic notices. The rollout of Benefind comes shortly after Governor Matt Bevin (R) announced plans to dismantle kynect, Kentucky’s State-based Marketplace, and transition to by the end of the year.

Source: Manatt on Health Reform: Weekly Highlights – March 2016 | Manatt, Phelps & Phillips, LLP – JDSupra

This latest development in Kentucky comes as the state shifts from a state-based health benefit exchange (kynect) to a federally supported state-based exchange. Benefind allows Kentucky residents to enroll online in Medicaid as well as the state’s supplemental nutrition assistance and cash assistance to families with children programs.

Benefind appears at odds with the Patient Protection and Affordable Care Act’s “no wrong door” policy that requires a single application to determine eligibility for subsidized individual plans sold on all state health benefit exchanges as well as for state subsidy programs such as Medicaid and CHIP. It’s contained at ACA Section 1413, titled Streamlining Of Procedures For Enrollment Through An Exchange And State Medicaid, Chip, And Health Subsidy Programs.

With its own portal for Medicaid eligibility as well as for individual plans offered on the exchange, the Bluegrass State won’t have a single application door but rather two: one offered though the state health benefit exchange and another through its Benefind web portal. The Benefind portal will also refer applicants to the exchange portal if it determines their household income potentially qualifies them for enrollment in an exchange plan, Vickie Yates Brown Glisson, Kentucky’s health and family services secretary, told state lawmakers.

While perhaps not compliant with the ACA’s single, no wrong door policy, Kentucky’s model may address problems in some state exchanges getting Medicaid-eligibles quickly qualified and enrolled in coverage due to difficulty interfacing with state Medicaid computer systems.


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email or call 530-295-1473. 

Report tempers outlook for HIX enrollment

The 10 best-performing states – which include several large states such as Florida, North Carolina, and California — have collectively signed up 59% of the potential market. While that might appear to leave room for substantial further growth, there are reasons to believe that enrollment has close to plateaued in those states. The potential market includes people who are buying their own coverage outside the marketplaces, many of whom do not qualify for subsidies. The experience so far is that the vast majority (82%) of marketplaces enrollees are receiving premium subsidies, while people who are ineligible for subsidies typically buy coverage on the outside market. In fact, we estimate that in the top-performing states the number of people who have selected a plan and qualified for a subsidy represents more than 90% of subsidy-eligible people. This is a very high take-up rate for a public program, suggesting there is very little potential for growth in these states. The only way enrollment could grow substantially is to attract people not eligible for subsidies who are already buying their own coverage directly.
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There are signs that marketplace coverage could continue to grow modestly in the years ahead. But, absent a substantial boost in outreach or changes to the subsidies to make insurance more affordable, substantial increases in marketplace enrollment are unlikely.

Source: Assessing ACA Marketplace Enrollment | The Henry J. Kaiser Family Foundation


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email or call 530-295-1473. 

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