Now that the Tri-agencies have drawn back the curtains to reveal some of the inner workings of their developing Mental Health Parity and Addiction Equity Act (MHPAEA) comparative analysis enforcement efforts, the question is: What’s next?
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Competing Surprise Billing Proposals Set to Collide in the U.S. House; States Test Different Solutions
In early February, two federal bills targeting surprise billing in healthcare advanced out of committee. On February 11, the House Education and Labor Committee passed the Ban Surprise Billing Act (H.R. 5800), which was introduced by Chairman Rep. Bobby Scott (D. – Virginia) and Ranking Member Rep. Virginia Foxx (R. – North Carolina). One day later, the House Ways and Means Committee unanimously advanced the Consumer Protections Against Surprise Medical Bills Act (H.R. 5826), led by Chairman Rep. Richard Neal (D. – Massachusetts) and Ranking Member Rep. Kevin Brady (R. – Texas). Both bills would prohibit providers from balance billing patients for surprise medical bills and would limit patients’ cost-sharing to in-network amounts. The two competing bills must be reconciled before the full House can vote on the issue. Leaders hope to include the final product in a spending bill that must pass Congress by May 22.
Similar scopes of coverage
The competing bills are substantively similar in several ways. Each bill applies to out-of-network emergency claims, to post-stabilization inpatient services provided to patients who are admitted to the hospital through the emergency room, and to non-emergency services provided at in-network facilities by out-of-network providers. The Ban Surprise Billing Act also covers air ambulance services. Additionally, both bills apply to all individual and group health plans (both fully- and self-insured) in the group and individual markets, but do not apply to federal programs such as Medicaid or the Federal Employees Health Benefits Program. The Ban Surprise Billing Act also extends to grandfathered health plans.
Notice requirements
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Tennessee Proposes First of Its Kind Block Grant Program for Medicaid
Last week, Tennessee proposed to the Centers of Medicare and Medicaid Services (“CMS”) the first of its kind Medicaid block grant program, which would constitute a fundamental restructuring of the Tennessee Medicaid program. The proposal is intended to implement Tennessee House Bill 1280, enacted in May of 2019, which directed the governor to request CMS to approve the block grant through a Section 1115 waiver amendment.
Tennessee currently operates its Medicaid program (“TennCare”) through a Section 1115 waiver approved by CMS. Under the proposed amendment, the state would receive a block grant in an amount calculated using the federal government’s projections for the state’s Medicaid program costs, calculated as if the state were not currently participating under a 1115 demonstration waiver. In years in which the state spends less than the block grant, the state and the federal government would evenly share in the resulting savings.
As part of the proposal, Tennessee has asked for significant exemptions from federal Medicaid managed care laws. Among other things, the state has asked for flexibility to spend block grant funds on items and services not otherwise covered under Medicaid; to adopt a commercial-style closed formulary; to make changes to its benefit packages without CMS approval; to vary benefit packages for members based on medical factors or other considerations; and to be relieved from compliance with Part 438 of Title 42 of the Code of Federal Regulations, including provisions requiring federal approval for pursuit of healthcare delivery system reform initiatives, managed care contracts, and actuarially certified capitation rates paid to managed care contractors. The state believes that the proposal would “appropriately recognize[] the state’s efforts to contain costs and improve program quality, while providing a meaningful incentive to continue building on those efforts to make TennCare a stronger and more effective program.”
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Health Care Fraud and Abuse Control Program FY 2017: Insights from Our Enforcement Team
The Health Care Group’s newest partners, William S.W. Chang and Laura M. Kidd Cordova, along with Counsel Stephanie D. Willis, have authored an Alert about the 21st Health Care Fraud and Abuse Control Program (HCFAC) annual report released last Friday. The HCFAC report is a joint effort of the U.S. Department of Justice (DOJ) and
States Seek Control over Association Health Plans in Comments on DOL Proposed Rule; Iowa Senate Approves Bill Expanding Availability of Association Health Plans—Potentially to the Detriment of ACA Exchange Plans
The Department of Labor’s proposed rule on association health plans (AHPs), issued in response to an October 12, 2017 Executive Order, has received almost 900 comments, including from several states and the District of Columbia (see, e.g., comments from Alaska, Iowa, Massachusetts, Montana, Pennsylvania, and Wisconsin). States emphasized the need for clarity in the rule and affirmation of states’ long-standing authority to regulate insurance including both solvency and consumer protection issues. Iowa, for example, attributed the more than 40-year success of a multiple employer welfare arrangement (MEWA) to both the entity’s interests to serve its members and the Iowa Insurance Division’s authority to ensure that MEWAs are “adequately solvent and following fair trade practices” and argued that continued robust state insurance oversight is critical to successful AHPs.
Last week, the Iowa Senate approved two bills which, if passed by the Iowa House of Representatives, would expand the availability in the state of AHPs, a type of MEWA covered by the Employee Retirement Income Security Act of 1974 (ERISA). The legislation would allow for Wellmark Blue Cross Blue Shield to administer an AHP for the Iowa Farm Bureau Federation and could threaten the membership of Medica, the only issuer of coverage through Iowa’s exchange.
Court Delays Action on Appeal of ACA Subsidies Case
On December 5, 2016, the U.S. Court of Appeals for the D.C. Circuit issued an order to stay the administration’s appeal of the district court decision in U.S. House of Representatives v. Burwell, a case challenging Cost-Sharing Reduction (“CSR”) payments to health insurance issuers under the Affordable Care Act (“ACA”) Section 1402. The district
Sequestration Extended to 2025 in Federal Budget Deal
On November 2, President Obama signed the Bipartisan Budget Act of 2015. As an offset for near-term increases in federal spending, the new law extends by one year – to 2025 – two-percent sequestration reductions in federal spending for mandatory federal programs including Medicare. The end result is that Medicare Advantage Organizations (MAOs) can expect their capitated payments from Centers for Medicare and Medicaid Services (“CMS”) to continue to be reduced, and Medicare fee-for-service providers can also expect to have sequestration reductions on their CMS reimbursements until at least 2025.
First established by the Balanced Budget and Emergency Deficit Control Act of 1985 (BBEDCA), “sequestration” is a process of automatic, largely across-the-board reductions enacted to constrain federal spending. Sequestration in its current form began on March 1, 2013, when President Obama, pursuant to the Budget Control Act of 2011, ordered cuts to federal spending effective April 1, 2013, after Congress and the President failed to reach a budget compromise.
Under the Budget Control Act of 2011, the size of reductions to the Medicare program is limited to two-percent. As required by President Obama’s sequestration executive order, on March 8, 2013, CMS notified providers that a “2 percent reduction in Medicare payment[s]” would apply to “Medicare FFS claims with dates-of-service or dates-of-discharge on or after April 1, 2013.” In other words, due to sequestration, as of April 1, 2013, CMS reduced the amount it pays to providers for fee-for-service Medicare claims by two-percent.
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