Health Care Reform & ACA

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.


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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]
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The Centers for Medicare & Medicaid Services (CMS) issued a proposed rule  to stabilize the individual and small group markets to entice issuers to continue participation in the exchanges in 2018 despite continued uncertainty surrounding repeal and replacement proposals for the Affordable Care Act (ACA). The proposed rule, published today, would make the following changes to the individual and small group markets:

  • Open Enrollment: The proposed rule would shorten the Open Enrollment period from November 1, 2017 – January 31, 2018 to November 1, 2017 – December 15, 2017. This would align open enrollment for exchanges with both the employer market (including the Federal Employees Health Benefits Program) and Medicare Advantage open enrollment periods. CMS hopes that the modifications in enrollment period will mitigate adverse selection by requiring individuals to enroll in plans before the benefit year begins and pay premiums day 1 of the benefit year rather than allowing individuals who learn they will need services in late December and January to enroll at that time.
  • Special Enrollment Period: In response to perceived abuses of special enrollment periods (SEPs)—which allow individuals to enroll outside of the open enrollment period when there is a special circumstance (e.g., new family member)—the proposed rule would require verification of an individual’s SEP eligibility 100% of the time beginning in June 2017. Currently, eligibility for an SEP is verified only 50% of the time. Under pre-enrollment verification for new customers, consumers would submit their information and select a plan but their enrollment would be “pended” until completion of the verification. Consumers would have 30 days to submit information to verify their eligibility. The start date of the coverage would be (as it is today) the date of plan selection, but it wouldn’t be effective until the “pend” had been lifted following verification. The rule is limited to pre-enrollment verification of eligibility to individuals newly enroll through SEPs in marketplaces using the HealthCare.gov platform. The proposed rule would also limit certain individuals’ ability to switch to different levels of coverage during an SEP. The SEP provisions of the proposed rule may offer the most significant relief of all the proposed changes.
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On January 20, 2017, hours after being sworn in as the 45th president of the United States, President Donald Trump issued Executive Order 13765 that aims to “minimize the unwarranted economic and regulatory burdens” of the Affordable Care Act (ACA) while its repeal is “pending.” 

The one-page Executive Order declares that it is the policy

On December 14, 2016, CMS issued an interim final rule with comment period to amend Medicare’s dialysis facility conditions for coverage to require certain disclosures to patients and health insurance issuers to address widespread concerns over inappropriate steerage of dialysis patients to individual market plans. After issuing an RFI about “inappropriate steering of people eligible

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

The Government Accountability Office (GAO), in a letter to members of Congress, found that the implementation of the Transitional Reinsurance Program by the U.S. Department of Health and Human Services (HHS) violates the Affordable Care Act.

The Transitional Reinsurance Program is one of three premium stabilization programs authorized by the Affordable Care Act (ACA),

On August 24, 2016, Judge Edgardo Ramos of the Southern District of New York approved a settlement in which Mount Sinai Health System (Mount Sinai) will pay $2.95 million to New York and the federal government to resolve allegations that it violated the False Claims Act (FCA) by withholding Medicare and Medicaid overpayments in contravention

On August 18, 2016, CMS issued a request for information on “inappropriate steering of people eligible for Medicare or Medicaid into Marketplace plans” by third parties. CMS voiced concern over “anecdotal reports” that Medicaid or Medicare eligibles received premium and cost-sharing assistance from third parties so they could enroll in Marketplace plans, enabling providers to receive higher reimbursement rates. In November 2013, CMS had issued guidance discouraging third-party payment of premiums because it has the propensity to “skew the insurance risk pool and create an unlevel field in the Marketplaces.” Almost three years later, it appears that CMS has determined that more decisive action may be necessary.

In July, UnitedHealthcare filed suit against American Renal Associates LLC in the United States District Court for the Southern District of Florida (complaint), alleging ARA violated Florida’s deceptive and unfair trade practices act, fraud, unjust enrichment, conspiracy, and other causes of action. The suit alleges that ARA coordinated with the American Kidney Foundation to pay premiums of low-income enrollees to switch from government health care programs to private insurance coverage. The suit alleges that by steering enrollees from Medicaid and Medicare to private insurance, ARA was able to increase billing from about $300 to $4,000 for the same services. The complaint also alleges that ARA did not collect copayments or deductibles from the enrollees after covering their premiums for private insurance and so committed negligent misrepresentation and tortious interference with a contract by misrepresenting the charges of claims submitted to UnitedHealthcare.


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