The Government Accountability Office (GAO) agent and broker fees and commissions comprise the largest non-claims cost for insurers in the individual and group markets and, as such, trigger millions of medical loss ratio (MLR) rebates under the MLR rule. GAO published the report, titled Private Health Insurance Early Effects of Medical Loss Ratio Requirements and
The Congressional Research Service published a report detailing more than a dozen pending ACA-related rulemakings. The report comes on the heels of the Spring 2014 Unified Agenda and identifies 14 proposed rules and 17 final rules regarding the ACA that are expected during the next twelve months. Notable expected proposed rules include:
- CY 2016 Notice of Benefit and Payment Parameters (CMS-9933-P) (0938-ASI9)—Expected in November 2014, this rule would provide the CY 2016 payment parameters for Exchanges, including cost-sharing reductions, advance premium tax credits, reinsurance, and risk adjustment.
- Application of the Mental Health Parity and Addiction Equity Act to Medicaid Programs (CMS-2333-P) (0938-AS24)—Expected in December 2014, this rule would specify how MHPAEA would apply to Medicaid (including managed care), CHIP, and other benefit programs.
- Nondiscrimination Under the Patient Protection and Affordable Care Act (0945-AA02)—Expected in August 2014, this rule would implement the ACA Section 1557’s prohibitions against discrimination in health programs and activities by covered entities on the basis of race, color, national origin, sex, age, and disability.
- State Option to Provide Health Homes for Enrollees With Chronic Conditions (CMS-2331-P) (0938-AQ48)—Expected in October 2014, this proposed rule would provide guidance for development of a Medicaid State Plan option to provide health homes for enrollees with chronic conditions.
On June 25, the Internal Revenue Service, Centers for Medicare & Medicaid Services, and Employee Benefits Security Administration, published final regulations clarifying the maximum allowed length of a reasonable and bona fide employment-based orientation period. Specifically, the regulations permit employers to impose a one-month orientation period on employees’ enrollment in their group health plans in addition to the 90-day waiting period.
The new regulations provide relief from the Affordable Care Act’s (ACA) prohibition on employers imposing a waiting period longer than 90 days for all individuals that are eligible to participate in the plan, for all plan years beginning on or after January 1, 2014. The ACA’s waiting period requirement states that coverage must be available to otherwise eligible employees by the 91st calendar day (including weekends and holidays) following plan eligibility. A “waiting period” is defined as the period that must pass before coverage for an otherwise eligible employee or dependent is able to enroll in the employer’s group health plan. And, an employee or dependent is “otherwise eligible” for plan participation if they have met all the employer’s eligibility conditions.
The 30-day orientation period allows employers to define their plan entry date for new employees as the first day of the month following 90 days of employment, so long as their administrative waiting period is not over 30 days, giving employers 90 days to enroll employees plus up to 30 days for orientation purposes.
On June 20, 2014, Health and Human Services Secretary Sylvia Burwell announced management changes intended to improve the implementation of the Affordable Care Act. The changes are being implemented in response to the rollout of Healthcare.gov and recommendations submitted to the Secretary. Andy Slavitt will join the Centers for Medicare and Medicaid Services (CMS) as…
On May 2, 2014, the Internal Revenue Service, Department of Health and Human Services, and Department of Labor (the “Departments”) collectively released the Affordable Care Act’s (ACA) nineteenth set of Frequently Asked Questions (FAQs). The FAQ addressed outstanding questions regarding Health Care Continuation Coverage (COBRA) and Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA) releases, out-of-pocket maximums and limitations on cost-sharing, coverage of preventive services, FSA carryover and excepted benefits, and summary of benefits (SBA) requirements.
COBRA and CHIPRA
Following the Department of Labor’s (DOL) release of proposed COBRA regulations to better align COBRA with the ACA, the Departments issued FAQ guidance discussing COBRA’s general and election notice requirements, specifically when the notice is to be provided and the content of the notice. Although the proposed regulations eliminate the current model notice, although the FAQs state that the old version can still be used as good faith compliance with the notice requirement. (FAQ 1). Once the updated model notice is finalized it will be available on the DOL website. Additionally, the Departments noted that qualified beneficiaries may want to compare the price of COBRA coverage with coverage under the Health Insurance Marketplace (the Marketplace). The FAQs state that “[q]ualified beneficiaries may be eligible for a premium tax credit (a tax credit to help pay for some or all of the cost of coverage in plans offered through the Marketplace) and cost-sharing reductions (amounts that lower out-of-pocket costs for deductibles, coinsurance, and copayments), and may find that Marketplace coverage is more affordable than COBRA.”
The Department also clarified the CHIPRA notice requirement for group health plans located in a State that provides premium assistance. Under CHIPRA each employee must be provided notice of the potential opportunities for premium assistance in the State that the employee resides.
On March 17, 2014, the Centers for Medicare and Medicaid Services (CMS) issued for public inspection a proposed rule regarding the Exchange and Insurance Market Standards for 2015 and later years. The proposed rule addresses requirements under the Affordable Care Act (ACA) applicable to insurance issuers, exchanges, and other entities.…
Continue Reading CMS Issues Proposed Rule Regarding Exchange and Insurance Market Standards for 2015 and Beyond
The comment period closed today for an interim final rule that requires qualified health plans (QHPs) to accept premium and other cost sharing payments from certain federal and state programs and clarifies that failure to do so could result in a civil monetary penalty. The rule, promulgated on March 19th and effective on the same…
On March 20, Governor Jerry Brown signed AB 369, mandating that plans allow Californians whose individual health plans were canceled by the Affordable Care Act to continue to receive coverage for their non-participating providers through treatment for pregnancy, cancer, and chronic conditions, among others. The bill passed unanimously and as an urgency measure, allowing it…
The Obama Administration recently announced a policy change indicating that the Fiscal Year (FY) 2015 budget sequester will not cut cost-sharing subsidies for low-income enrollees in Affordable Care Act (ACA) health plans. According to a March 10, 2014 Office of Management and Budget (OMB) report detailing the federal government’s sequestration-based spending reductions for FY 2015,…
CMS issued an FAQ on coverage of same-sex spouses under PHSA section 2702, which requires health insurance issuers offering non-grandfathered health insurance coverage in the group or individual markets to guarantee the availability of coverage with certain exceptions. The FAQ clarifies that a health insurance issuer in the group or individual market that offers coverage…