Health Care Reform & ACA

On October 3rd, the United States Senate passed a bipartisan opioids package with a sweeping vote of 98 to 1, after the U.S. House of Representatives passed the final version of the bill with a vote of 393 to 8. One of its components, the “Fighting the Opioid Epidemic with Sunshine Act,” expands the scope

Iowa has enacted legislation to permit the offering of certain health benefit plans that would not be subject to the restrictions of the Affordable Care Act (ACA).

The bill combined two separate measures, each intended to expand access to association health plans (AHPs) that are exempt from many of the ACA’s protections. First, the new law would allow small employers to band together to form associations that would be eligible to offer members’ employees coverage as if they were a single large employer group, which would be subject to less burdensome regulation under the ACA. Second, a health benefit plan sponsored by a nonprofit agricultural organization domiciled in Iowa (the Iowa Farm Bureau Federation) and covered by a third-party administrator that has administered the organization’s health benefits plan for more than 10 years (Wellmark Blue Cross & Blue Shield) is exempt from the definition of insurance that is subject to regulation by the state insurance department.

Recently, AHPs have been touted by opponents of the ACA as a tool to avoid its effects for larger covered populations. Iowa’s measure follows an executive order by President Trump last fall directing the administration to, among other things, promote the use of AHPs. In response to that order, the Department of Labor proposed a rule that would expand the definition of AHP to allow employers greater access to AHP coverage. As we noted in a previous post, several states have pressed the idea through comments to that proposed rule that expanded access to AHPs would create opportunities for employers to offer more affordable coverage.

The impact of Iowa’s enactment remains to be seen. Critics of the measure have expressed concern that it will water down consumer protections by exempting coverage from ACA requirements that plans cover essential health benefits, such as maternity and mental health care. Although plans could continue to include such benefits, they would not be legally obligated to do so, and could cut costs by eliminating coverage for broad categories of health care.
Continue Reading

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.


Continue Reading

On March 8, the White House encouraged Congress to pass stabilization legislation that would not authorize the reimbursement of cost-sharing reductions (CSRs) made by health plans in 2017, as reported by Modern Healthcare. This move comes almost five months after the Trump Administration’s announcement in October that it would discontinue CSR payments effective immediately. The legislation, if passed, would preclude the government from paying CSRs for the 2017 year and would allow CMS to claw back surplus money that plans have received from the federal government and applied towards CSRs.
Continue Reading

On Thursday, March 8, the Trump Administration rejected Idaho’s plan to sell health plans that do not include the consumer protections required by the Affordable Care Act (ACA). The rejection came in the form of a letter touting adherence to current law, though in many ways the letter was written by an apologetic Centers for Medicare and Medicaid Services (CMS) wanting to appease Idaho Republicans.

Earlier this year, Idaho Governor C.L. “Butch” Otter signed an executive order that allowed some Idaho health insurance plans to drop certain ACA requirements. For example, plans would not need to cover maternity care, mental illness, or other essential health benefits; insurers could charge higher premiums to those with preexisting conditions; and insurers could deny people coverage if they had failed to maintain continuous coverage. Insurers who sold such “junk” plans would be required to also sell at least one ACA-compliant option over the exchanges. Gov. Otter’s actions seemed to test just how far Alex Azar, Secretary of the U.S. Department of Health and Human Services, would go to support the “state experimentation” Mr. Azar himself advocated for under the exchanges, as discussed in our earlier post. The answer, for Idaho, is not far enough.
Continue Reading

Crowell & Moring has issued its Regulatory Forecast 2018: What Corporate Counsel Need to Know for the Coming Year.”

The health care section of the Forecast, “Mergers: Keeping Care Competitive,” outlines how regulators have kept a close eye on the impact of industry consolidation and how the government has been aggressively

Alex Azar assumed office as HHS Secretary on January 29, 2018, and has hit the ground running.  Among discussions on stabilization bills (see blog post discussion here and how these proposals further the Administration’s efforts on Trump’s Inauguration Day Executive Order here), Secretary Azar has been a vocal advocate for, in his own terms, “state experimentation” under both the Medicaid and health insurance exchanges (“Exchanges”).

Secretary Azar has not provided detail as to what type of experimentation he would like to see from states, but in his remarks at HHS headquarters on Tuesday, February 20, he stated that he was working with the Centers for Medicare and Medicaid Services (CMS) Administrator, Seema Verma, to give states “a menu of options” to decrease the restrictions under the Affordable Care Act (ACA).  In particular, Secretary Azar noted that he was exploring ways to allow states greater flexibility through federal waivers.


Continue Reading

On Tuesday, February 20, Department of Health and Human Services (HHS) Secretary Alex Azar announced that the agency intends to expand access to short-term, low-cost insurance policies. On Wednesday, HHS published its proposed rule, which promises to reduce restrictions on such limited-duration policies. The short-term insurance plans have fewer benefits and more limited consumer protections as compared to those proscribed by the Patient Protection and Affordable Care Act (ACA). While such short-term plans currently can only be carried for 90 days, the new proposal would extend that maximum coverage period to one year.

The proposed rule is in response to President Trump’s Executive Order from October 12, 2017, which called for HHS to expand access to low-cost insurance plans. The Executive Order asked the agency to explore the possibility of extending the maximum duration of such short-term, limited-duration plans in order to increase options for consumers. The short-term insurance plans are contemplated for individuals who are unemployed, between jobs, or otherwise looking to reduce premium costs for up to one year. The plans do not have to meet ACA requirements. Notably, they do not have to cover individuals with pre-existing conditions and they do not have to cover prescription drug plans. The plans offer more limited coverage for consumers, but impose less immediate financial burden through reduced premium cost. Insurers who sell the short-term plans would need to include clear statements on applications and plan documents that the coverage does not meet ACA requirements.

The proposed rule continues the Trump administration’s efforts to roll back the ACA and minimize its economic burden and comes just over a year after the president issued an Executive Order laying out that goal. It comes on the heels of earlier rules from the administration geared at stabilizing the individual and small group insurance markets. It also follows the signing of the new tax reform bill, which repeals the individual mandate of Section 5000A of the Tax Code and eliminates the shared responsibility payment for failure to obtain health insurance starting in 2019.


Continue Reading

First 100 Days LogoOn Tuesday, April 18, 2017, our Health Care Group will hold a webinar on the health care policy and transition challenges still at play as the Trump Administration nears the end of its 100 days in power.  During the webinar, participants will hear important insights and predictions on what a Trump-led Executive Branch will mean

Two district courts[1] have recently stayed cases alleging that sex discrimination under ACA Section 1557 includes discrimination on the basis of gender identity and denial of coverage for gender transition, pending the Supreme Court’s decision in G.G. v. Gloucester County School Board.[2]  The Supreme Court accepted certiorari in Gloucester in October 2016 to determine the validity of recent Department of Education Title IX guidance regarding gender identity.  Briefing is currently under way.  The district courts stayed the Section 1557 cases, reasoning that the Supreme Court’s decision would likely determine the validity of the Department of Health & Human Services’ Section 1557 regulations on gender identity as well.

ACA Section 1557 and Title IX rules on sex discrimination

Section 1557 (42 U.S.C. § 18116) prohibits entities that receive federal funds for health activities or programs from discriminating on the grounds prohibited by Title IX.  Title IX generally prohibits discrimination on the basis of sex by recipients of federal education assistance.[3]  Title IX, however, permits federal fund recipients to set up “separate living facilities for the different sexes.”[4]  DOE and HHS regulations for Title IX, originally issued by the Department of Health, Education and Welfare, define sex in binary terms – “one sex” versus “the other sex”  —  and permit recipients to set up comparable but separate housing and “toilet, locker room, and shower facilities on the basis of sex.”[5]

The federal agency shift on sex discrimination:  from biological sex to gender identity

In the years prior to the enactment of the ACA, courts reached opposite conclusions as to whether Title IX and comparable sex discrimination laws, such as Title VII, prohibit discrimination based on gender identity.[6]  With the enactment of the ACA and Section 1557, suits began to be brought against health plans and providers which claimed that refusal to treat or cover services for transgender persons based on their gender identity constituted sex discrimination.  In one early Section 1557 decision from 2015, Rumble v. Fairview Health Services, a district court held that Section 1557 does provide a cause of action for discrimination based on gender identity.[7]
Continue Reading