News of Health Reform Activity in the Federal Government
Contents
Additional NCSL Resources
Reports of Interest
NCSL Contacts
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Updated May 16, 2012
NCSL Submits Comments on Key Affordable Care Act (ACA) Regulations
NCSL submitted comments to the Department of Health and Human Services expressing state concerns regarding two sets of final and interim final health care rules implementing key provisions in the ACA. The comment periods ended on May 7 for rules governing the Medicaid program and eligibility changes under the ACA, and May 11 for rules guiding the establishment of exchanges and Qualified Health Plans (QHPs), and exchange standards for employers.
42 CFR Parts 431, 435, and 457—Medicaid Program; Eligibility Changes under the ACA
The ACA contained several provisions affecting Medicaid eligibility, enrollment and coordination with the Affordable Insurance Exchanges (AIE), CHIP, and other insurance affordability programs. CMS published final rules and interim final rules implementing statutory provisions changing the minimum Medicaid income eligibility level to 133 percent of the Federal Poverty Level (FPL), eliminating some eligibility categories, modernizing eligibility verification rules, and ensuring coordination across Medicaid, CHIP, and the exchanges. Submission of comments were due May 7, and NCSL provided remarks focusing on timeliness and performance standards, Federally-facilitated Health Insurance Exchanges, and Medicaid coverage of incarcerated individuals.
NCSL Comments
42 CFR Parts 155, 156, and 157—Patient Protection and Affordable Care Act; Establishment of Exchanges and Qualified Health Plans; Exchange Standards for Employers
The ACA provides states with an opportunity to establish an exchange through which individuals can purchase affordbale insurance coverage.The exchanges will provide competitive marketplaces for individuals and small employers to directly compare available private health insurance options on the basis of price, quality, and other factors. The exchanges will become operational by January 1, 2014, and will help enhance competition in the health insurance market, improve choice of affordable health insurance, and give small business the same purchasing clout as large business. The final rule incorporates two proposed rules, the July 15, 2011 rule titled “Establishment of Exchanges and Qualified Health Plans” (Exchange establishment proposed rule), and the August 17, 2011 rule titled “Exchange Functions in the Individual Market: Eligibility Determinations and Exchange Standards for Employers” (Exchange eligibility proposed rule). While originally published as separate rulemaking, the provisions contained in these proposed rules are integrally linked, and together encompass the key functions of Exchanges related to eligibility, enrollment, and plan participation and management. In addition, several sections in this final rule are being issued as interim final rules and HHS is are soliciting comment on those sections.
The final rule:
(1) Sets forth the minimum federal standards that states must meet if they elect to establish and operate an Exchange, including the standards related to individual and employer eligibility for and enrollment in the Exchange and insurance affordability programs;
(2) Outlines minimum standards that health insurance issuers must meet to participate in an Exchange and offer qualified health plans (QHPs); and
(3) Provides basic standards that employers must meet to participate in the Small Business Health Options Program (SHOP).
NCSL comments submitted May 11 continue to advocate for state flexibility in structuring exchange governing boards and urges HHS to give that same flexibility to states in forming their navigator programs. It raises concern over the issue of deeming multi-state plans as certified by the states and exempts them from complyance with state laws. Interim final rule comments address agents and brokers, the eligibility process, and verification of eligibility process.
The Center for Medicare and Medicaid Services (CMS) Publishes Proposed Rules Implementing Medical Loss Ratio (MLR) Reporting and Notice Requirements under the Patient Protection and Affordable Care Act (ACA)
On May 11, 2012, CMS issued final rules implementing MLR standards for health insurance issuers. The final rules amend previously released regulations by establishing the notice requirements for issuers in the group and individual markets that meet or exceed MLR standards in the 2011. Previously issuers were only required to send notice to their beneficiaries if they failed to meet the standard. The ACA required individual and small group plans to meet the MLR standard by spending at least 80 percent of premiums on medical claims or quality improvements, and large plans to spend at least 85 percent. Notices of rebates based on the 2011 MLR reporting year must be provided by August 1, 2012. The Final Rule
CMS Releases Proposed Rules Governing Enhanced Medicaid Primary Care Physician Payments
On May 11, CMS published proposed rules to implement provisions in the ACA providing for an enhanced Medicaid payments for primary care services. Under this provision, physicians that provide primary care services would be paid the Medicare rates that were in effect in calendar years 2013 and 2014 (or if greater, the Medicare rate in effect in 2009) instead of their usual state established Medicaid rates. The increased payment will apply to primary care services furnished by a physician with a specialty designation of family medicine, general internal medicine, or pediatric medicine, and any primary care services paid through Medicaid managed care plans by incorporating the increased payment into their contract. States will receive a 100 percent federal match for the difference between the Medicaid state plan payment amount as of July 1, 2009 and the applicable Medicare rate; in other words, no state matching funds are required. The policy is intended to help states bolster their primary care networks in anticipation of increased enrollment under the ACA health insurance reforms.
The rule also proposes to update the interim regional maximum fees that providers may charge for administration of pediatric vaccines to federally vaccine-eligible children under the Vaccines for Children (VFC) program. The rates were issued on an interim basis in 1994 and have never been updated.
Provider Preventable Conditions Rule Becomes Effective
On June 6, 2011, CMS issued a final rule implementing provisions of the ACA affecting payment for Provider Preventable Conditions (PPCs) under the Medicaid program. The rule prohibits federal payments to states for any amounts expended providing medical assistance for health care-acquired conditions. The rule provides incentives quality improvement at the provider-level and cost savings for states by requiring states to reduce payments at the occurrence of hospital errors and Never Events in specific health care settings. The rule became effective July 1, 2011, but CMS provided states with an additional year to meet these new requirements. In preparation for full implementation, states should have submitted a state plan amendment (SPA) for their Medicaid programs to institute the changes. In preparation for the approaching final implementation date of July 1, 2012, CMS is offering technical assistance, and has provided on their website basic information about the requirements, SPA pre-prints and instructions, as well as a Frequently Asked Questions page.
The Georgetown Center on Health Insurance Reforms and the National Academy of Social Insurance (NASI) — Plan Management: Issues for State Partnership and Federally Facilitated Health Insurance Exchanges
This report reviews the activities involved in health plan regulation in the commercial marketplace and Medicaid programs. It evaluates the associated regulatory structure in six states: Arizona, Minnesota, New York, Tennessee, Washington, and Wisconsin. Because CMS may be responsible for plan management for some federally facilitated exchanges, it also examines CMS’ experience running Medicare Advantage, a federal program providing Medicare beneficiaries with private health plan choices. It is not a comprehensive evaluation of all plan management functions as defined by HHS, but focuses on a subset of plan management activities similar to what state and federal regulators are currently doing in various programs.
House Approves Budget Reconciliation Package Reducing Mandatory Spending By $310 Billion Over the Next Decade
On May 10, the U.S. House of Representatives voted 218—199 to approve the budget reconciliation package in H.R. 5652. The measure will cancel $98 billion in automatic cuts in discretionary spending scheduled to go into effect in January 2013 under current law, including a ten percent reduction in discretionary Department of Defense programs, and an eight percent reduction in discretionary domestic programs. The reconciliation savings were recommended by six House committees that over a decade would realize a reduction in mandatory spending of $310 billion.
The health proposals in the measure would:
1. Eliminate the authority of the Health and Human Services (HHS) Department to award grants to states for the establishment health insurance exchanges. ($14.1 billion in federal savings over 10 years)
2. Repeal the Prevention and Public Health Fund, which provides grant assistance to states and other entities for prevention, wellness and other public health-related programs and activities authorized under the Public Service Health Act. ($10.9 billion in federal savings over 10 years)
3. Rescind unobligated balances provided for the Consumer Operated and Oriented Plan (CO-OP) program, a program created to provide grants to encourage the development of nonprofit insurance providers and plans that would be made for sale within the state insurance exchanges. ($300 million in federal savings over 10 years)
4. Reduce the Medicaid provider tax threshold from six to 5.5 percent. ($11.3 billion in federal savings over 10 years)
5. Eliminate increased Medicaid payments to territories established in the Patient Protection and Affordable Care Act (PPACA). ( $6.3 billion in federal savings over 10 years)
6. Rebase Medicaid payments to disproportionate share hospitals (DSH). ($4.2 billion in federal savings over 10 years)
7. Repeal state maintenance of effort (MOE) requirements established in the PPACA for Medicaid and the Children's' Health Insurance Program (CHIP). ($1.4 billion in federal savings over 10 years)
8. Repeal CHIP performance bonus program, established in the 2009 reauthorization of the program to provide incentives to states to increase enroll of eligible children in the program. ($400 million in federal savings in 2013)
9. Include the provisions of H.R. 5, the Help Efficient, Accessible, Low-cost, Timely Healthcare (HEALTH) Act
10. Repeal the provision in the PPACA that for individuals with income below 400 percent of the federal poverty level (FPL) limits the liability for overpayments resulting from advanced premium assistance payments and replace it with a provision that requires repayment of the full amount of the overpayment. ($43.9 billion in federal savings over 10 years)
Additional information
CBO analysis posted May 8.
The Centers for Consumer Information and Insurance Oversight (CCIIO) Questions and Answers Regarding the Medical Loss Ratio (MLR) Regulation
The Affordable Care Act (ACA) required health insurance issuers to submit MLR data to the Department of Health and Human Services (HHS) annually and to issue a rebate to enrollees if the issuer’s MLR was less than applicable percentages as required by the ACA. The final rule implementing the MLR requirements and the interim final rule implementing the MLR rebate requirements for non-federal governmental plans (state and local government employee plans) were published Dec. 7, 2011. The questions and answers in the CCIIO Technical Guidance 2012-2, published on April 20, provides additional guidance on the following topics: (1) the applicability of the MLE to certain types of plans; (2) applicability to employer groups of one; (3) counting employees for determining market size; (4) individual association policies; (5) offering policyholders a “premium holiday;” (6) reinsurance and reporting; (7) exchange user fees; (8) states with a higher MLR standard; (9) the “Mini-Med” experience- application of the adjustment; and (10) form of rebate. The guidance is available at http://cciio.cms.gov/resources/files/mlr-qna-04202012.pdf.
CCIIO Verification of Access to Employer-Sponsored Coverage Bulletin
The purpose of this CCIIO bulletin is to request comments on a proposed interim strategy and potential regulatory approach for verification of an applicant’s access to qualified coverage in an employer sponsored plan. HHS is soliciting comments on the development of a proposed interim verification strategy which would provide a standardized way for employees and employers to voluntarily collect and communicate coverage information to complete an exchange application, and allow exchanges to verify employer-sponsored during this period through use of pre-enrollment verification based on data available to an exchange. They are also asking for comments on an approach to verify data for exchange plan years in 2016 and beyond. The bulletin is available online at http://cciio.cms.gov/resources/files/exc-verification-guidance-vach.pdf and comments should be submitted to the following email address, EmployerCoverageBulletin@cms.hhs.gov .
The Centers for Medicare and Medicaid Services (CMS) Final Rule Implementing the Community First Choice (CFC) Option Program
On April 26, CMS released the final rule implementing the CFC program that establishes a new state option to provide home and community-based attendant services and supports. States electing the plan option under Medicaid may receive a six percentage point increase in their federal medical assistance percentage (FMAP) as an incentive to expand the use of home and community-based services. Services provided would be based upon a person-centered service plan based on a functional needs assessment and must be agreed to in writing by the beneficiary. Beneficiaries may “self direct” their services which may include assistance with activities of daily living and health-related tasks. States may choose to offer coverage for transition costs to assist Medicaid beneficiaries who are leaving an institution in order to return to the community. Provisions related to setting requirements for the CFC program are not final and are addressed in the NPRM on State Plan Home and Community-Based Services (see description in next bullet). The rule will be published in the Federal Register on May 7 and will become effective 60 days thereafter. The final rule is available at — https://s3.amazonaws.com/public-inspection.federalregister.gov/2012-10294.pdf and there is a CMS Fact Sheet .
State Plan Home and Community Based Services (HCBS) Program Proposed Rule
The proposed rule offers states new flexibility in providing necessary and appropriate services to elderly and disabled populations. The rule: (1) removes the eligibility link between HCBS and institutional care that exists under the current Medicaid HCBS waiver program; (2) provides authority for 5-year demonstration projects or waivers, at the discretion of the Secretary, when they involve individuals dually eligible for Medicaid and Medicare benefits; and (3) provides an additional limited exception to the general requirement that payment for services under a state plan must be made directly to the individual practitioner providing a service when the Medicaid program is the primary source of reimbursement for a class of individual practitioners, allowing payments to be made to other parties. The payment reassignment provisions were included in the rule because state Medicaid programs often operate as the primary or only payer for the class of practitioners that includes HCBS service providers. Finally, the rule amends Medicaid regulations to provide home and community-based setting requirements for the Community First Choice (CFC) state plan option program. The NPRM is available at http://www.ofr.gov/OFRUpload/OFRData/2012-10385_PI.pdf and there is a CMS Fact Sheet.
Internal Revenue Service (IRS) Notice of Proposed Rule Making (NPRM) and Notice of Public Hearing: Regulations Pertaining to the Disclosure of Return Information to Carry Out Eligibility Requirements for Health Insurance Affordability Programs
The NPRM and notice of public hearing published in the April 30 Federal Register addresses issues related to the disclosure of federal income tax return information to carry out eligibility requirements for health insurance affordability programs under the PPACA. A public hearing discuss all aspects of the rule is scheduled to be held on August 31, 2012 at 10:00 a.m. (EDT) in the IRS Auditorium in Washington, D.C. Comments on the NPRM and outlines of topics to be discussed at the hearing will be accepted until July 30. The NPRM is available online at, http://www.gpo.gov/fdsys/pkg/FR-2012-04-30/pdf/2012-10440.pdf.
IRS Notice 2012-31—Minimum Value of an Employer-Sponsored Health Plan
Beginning in 2014, an individual eligible to purchase coverage in a health insurance exchange is eligible for premium tax credits as long as they are not eligible for other minimum essential coverage, including employer-based coverage that is affordable and provides minimum value. The notice describes and requests comments on several possible approaches to determining whether health coverage under an eligible employer-sponsored plan provides minimum value within the meaning as prescribed by the PPACA. It also describes how guidance issued by HHS on the determination of actuarial value is expected to be applied on determining minimum value and outlines ways in which the determination of minimum value is expected to differ from the determination of the actuarial value of qualified health plans (QHPs) and employer-sponsored plans. Comments may be submitted on or before June 11, 2012. The notice will be published in the Internal Revenue Bulletin scheduled to be published on May 14. The notice is available online at, http://www.irs.gov/pub/irs-drop/n-12-31.pdf.
IRS Notice 2012-32—Request for Comments on Reporting of Health Insurance Coverage
The notice invites comments concerning the reporting requirements of the Internal Revenue Code for health insurance issuers, government agencies, employers that sponsor self-insured plans, and other persons that provide minimum essential coverage to an individual. The reporting requirements apply to coverage provided on or after Jan. 1, 2014. Comments will be accepted until June 11, 2012. The notice will be published in the Internal Revenue Bulletin scheduled to be published on May 14. The notice is available online at, http://www.irs.gov/pub/irs-drop/n-12-32.pdf
IRS Notice 2012-33—Request for Comments on Reporting by Applicable Large Employers on Health Insurance Coverage Under Employer-Sponsored Plans
The notice invites comment on reporting for applicable large employers. Comments will be accepted until June 11, 2012. The notice will be published in the Internal Revenue Bulletin scheduled to be published on May 14. The notice is available online at, http://www.irs.gov/pub/irs-drop/n-12-33.pdf.
House Committee on Energy and Commerce Advances Reconciliation Recommendations
On April 25, the House Committee on Energy and Commerce approved recommendations required by the House Fiscal Year 2013 Budget Resolution. The recommendations, many proposing changes to the Patient Protection and Affordable Care Act (AAPCA), are projected to save $114 billion in the next decade and exceed the savings the committee was directed to identify by $17 billion. The committee proposes to: (1) Repeal the Prevention and Public Health Fund and rescind unobligated funds; (2) Repeal the state exchange authority and rescind unobligated funds; (3) Rescind unobligated funds for the Consumer Operated and Oriented Plan (CO-OP) Program; (4) Repeal the Medicaid and Children’s Health Insurance Program (CHIP) maintenance of effort (MOE) requirement related to program eligibility; (5) Rebase the disproportionate share hospital (DSH) allotment in FY 2022 to maintain the FY 2021 level of annual aggregate reductions that are set to begin in FY 2014; (6) Repeal the increased federal Medicaid funding cap and federal match rate for the territories; (7) Reduce the Medicaid provider tax threshold from 6 percent to 5.5 percent beginning in FY 2013; (8) Repeal the bonus payments to state authorized in the Children’s Health Insurance Program Reauthorization Act of 2009 (CHIPRA) to provide incentives to states to increase enrollment of eligible children in Medicaid and CHIP; and (9) Implement medical liability reforms (provisions of H.R. 5, the Help Efficient, Accessible, Low Cost, Timely Healthcare (HEALTH) Act of 2012, already enacted in the House). http://www.cbo.gov/sites/default/files/cbofiles/attachments/EnergyandCommerceReconciliation.pdf
The Centers for Consumer Information and Insurance Oversight (CCIIO) Announces New Funding Opportunity for Consumer Assistance Programs
The ACA made grant funding available to states to establish, expand or provide support for the establishment of independent offices of health insurance consumer assistance or ombudsman programs. On April 20, CCIIO announced funds are available for a new limited-competition funding opportunity. The 38 state grantees from the first grant cycle will be eligible to apply for the additional funding to strengthen their consumer assistance programs through May 21 The grant application outlines how the funds may be used. Eligible applicants include—the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, AR, CA, CT, DE, GA, IL, IA, KS, KY, ME, MD, MA, MI, MS, MO, MT, NV, NH, NJ, NM, NY, NC, OK, OR, PA, RI, SC, TN, TX, VT, VA, WA, and WV.
State Demonstrations to Integrate Care for Dual Eligible Individuals
Proposals for the Centers for Medicare and Medicaid Services (CMS) demonstration projects providing models of care designed to coordinate services to individuals covered by the Medicare and Medicaid programs, or “duals”, must be submitted by May 31. The goal of the project is to identify and validate delivery system and payment coordination models that can be tested and replicated in other states. CMS is also making technical assistance available to all states interested in improving services for duals. Open enrollment for the project will begin in October. Originally implementation of the program was to begin Jan. 1, 2013, but states may request a delayed implementation deadline as late as Jan. 2014. The program’s auto enrollment has drawn comments of concern including Medicare Payment Advisory Commission (MedPAC), and Medicaid and CHIP Payment and Access Commission (MACPAC) Commissioners who worry whether states and the provider community are prepared to address the needs of such a large number of Medicaid beneficiaries with complex care needs.
The George Washington University School of Public Health & Health Services: Multi-State Plans Under the Affordable Care Act
Health insurance exchanges were conceived in the ACA as a means of offering consumers a choice of affordable health insurance coverage through qualified health plans (QHPs) offered in the exchange. At least two of the QHPs offered in each state exchange are required by the ACA to be a multi-state plan or MSP. MSPs will be administered by the federal Office of Personnel Management (OPM) and must meet the same requirements as other QHPs. This paper, based on interviews conducted by the George Washington University School of Public Health & Health Services with federal and state policy makers and others, examines key implementation issues. http://www.gwumc.edu/sphhs/departments/healthpolicy/dhp_publications/pub_uploads/dhpPublication_A80A0AAA-5056-9D20-3D25B59C65680B79.pdf
Internal Revenue Service (IRS) Proposed Rules and Notice of Public Hearing on Health Insurance Policies and Self-Insured Plans—Impacts State Budgets
The IRS released proposed rules and notice of an April 12 public hearing outlining fees on health insurers and health plan sponsors of certain self-insured health plans that will be used to fund the Patient-Centered Outcomes Research Trust Fund. Provisions in the Affordable Care Act (ACA) established a private, nonprofit corporation, the Patient-Centered Outcomes Research Institute whose mission would be to assist, through research, patients, clinicians, purchasers, and policy-makers in making informed health decisions by advancing the quality and relevance of evidence-based medicine through the synthesis and dissemination of comparative clinical effectiveness research findings. The provision specifically imposes a fee on an issuer of a specified health insurance policy for each policy year on or after Oct. 1, 2012 and before October 1, 2019.
Application to State Sponsored Self-Insured Plans
The proposed rule defines specified health insurance policy as any accident or health insurance policy (including a policy under a group health plan) issued with respect to individuals residing in the United States. The ACA does not exempt a governmental entity that is a plan sponsor of a self-insured health plan from paying the fee. Only those governmental programs including Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP) or any program established under Federal law for providing medical care to individuals in the U.S. Armed Forces or their retirees, and members of Indian Tribes are exempt.
Comments on the rule will be accepted until July 16, 2012. The IRS has also issued a notice of a public hearing which will be held Wednesday August 8, 2012 at 10:00 a.m. Requests to speak must be received by July 30, 2012.
The Department of Health and Human Services (HHS) Provides Notice of a Meeting to Discuss the Risk Adjustment Program
HHS has announced that they will be holding an open public meeting May 7 and 8 in Arlington, Virginia to provide information to states, issuers, and other interested parties to discuss the risk adjustment program required under the ACA. The meeting will focus on the risk adjustment model, calculation of plan average actuarial risk, calculation of payments and charges, data collection approach, and the schedule for running risk adjustment. The meeting will provide stakeholders and opportunity to communicate with HHS about the program. Attendance will be limited to the space available and registration must be completed before April 30, 2012.
Federal Register Notice— http://www.gpo.gov/fdsys/pkg/FR-2012-04-11/pdf/2012-8771.pdf.
Registration is available online at http://www.regonline.com/builder/site/Default.aspx?EventID=1081800.
HHS Proposes New Rules for Administrative Simplification and Delays ICD-10 Coding System Until Oct. 1, 2014
HHS released proposed rules establishing new requirements for administrative transactions that would improve the utility of existing Health Insurance Portability and Accountability Act of 1996 (HIPAA) transactions and reduce administrative burden and costs. The rule adopts a data element to serve as an identifier for entities that are not health plans, health care providers, or individuals that need to be identified in standard transactions. The rule proposes an addition to the National Provider Identifier (NPI) requirements. The rule also proposes to delay by one year, until Oct. 1, 2014, the date by which covered entities must comply with the Classification of Disease 10th Edition or ICD-10 disease coding system.
The Centers for Consumer Information and Insurance Oversight (CCIIO) Release Instructions for Medical Loss Ratio (MLR) Annual Reporting
Effective 2011, provisions in the ACA establish minimum MLR standards for health insurance issuers, and requires issuers to provide rebates when their MLRs are lower than the applicable MLR standards established in the act. Issuers must submit annually to HHS data on their use of premium dollars within major categories, including data required to calculate the MLRs and rebates. An MLR form must be prepared and submitted for each state in which the issuer has written direct health insurance coverage or has direct amounts paid, incurred or unpaid for the provision of health care services.
Annual MLR Reporting Form Filing Instructions http://cciio.cms.gov/resources/files/mlr-annual-form-instructions.pdf
MLR Annual Reporting Form, http://cciio.cms.gov/resources/files/mlr_annual_form.xlsx
Twenty-Six States Award Medicaid Recovery Audit Contractor (RAC) Contracts
The Centers for Medicare and Medicaid Services (CMS) announced that 26 states have awarded RAC contracts. These states are reviewing Medicaid claims for under and overpayments as required in the Affordable Care Act. CMS posted an at-a-glance map of states who have implemented this review program, http://www.cms.gov/medicaidracs/ .
Ten Non-Profits Receive COOP Funding
In creating a new framework to improve access to more affordable health insurance coverage, the ACA created a new type of nonprofit health insurer called the Consumer Oriented and Operated Plan or COOP. HHS is providing funding to plans in 10 states—IA, ME, MT, NE, NJ, NM, NY, OR, SC, WI— as a low-interest loan to enable the COOPs to offer health coverage through a state exchange beginning in 2014. There will be additional quarterly opportunities for these loans through December 31, 2012. http://www.healthcare.gov/news/factsheets/2012/02/coops02212012a.html
Center for Medicaid, CHIP and Survey & Certification (CMCS) Informational Bulletin: Medicaid Information Technology Architecture (MITA) Guidance – Version 3.0
CMS announced the release of MITA Version 3.0. This system will help foster integration of information technology (IT) systems enabling states and the federal government to build an IT framework for Medicaid eligibility functions. The 3.0 version incorporates a number of recent legislative changes, including the CHIP Reauthorization Act (CHIPRA), the ACA, and the Health Information Technology for Economic and Clinical Health Act (HITECH) under the Recovery Act of 2009. The recent revisions are intended to accommodate newer technologies, such as cloud computing, as well as IT-related guidance from CMS also. The 3.0 version does not incorporate the recent Medicaid and Exchange eligibility rules. Those updates are forthcoming. The MITA 3.0 Framework can be downloaded at http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Data-and-Systems/Medicaid-Information-Technology-Architecture-MITA.html.
CMS Informational Bulletin, http://www.medicaid.gov/Federal-Policy-Guidance/Downloads/CIB-03-28-12.pdf
Health Reform before the U.S. Supreme Court: HHS v. Florida
The Affordable Care Act (ACA) was argued before the U.S. Supreme Court March 26, 27, and 28. Audio files are available online at the following link, http://www.supremecourt.gov/oral_arguments/argument_audio.aspx . Written transcripts may also be obtained on the Supreme Court web page at the following link, http://www.supremecourt.gov/oral_arguments/argument_transcripts.aspx.
Links to the orders and briefs as well as other pertinent documents are available on the U.S. Supreme Court resource page, http://www.supremecourt.gov/docket/PPAACA.aspx .
The arguments were presented as follows:
Monday, March 26, 2012 (90 minutes for oral argument)
Issue: Anti-Injunction Act
Whether the challenge to the constitutionality of the individual mandate is barred by the Tax Anti-Injunction Act, under which generally a court will not enjoin the government from assessing a tax, but may later consider a suit to provide a refund of a tax.
________________________________________
Tuesday, March 27, 2012 (2 hours for oral argument)
Issue: Minimum Coverage Provision
Whether the individual mandate exceeds Congress’ enumerated powers under the Commerce Clause of the U.S. Constitution.
The minimum coverage language in the ACA is located in Title I, Subtitle F, Part I, Sec. 1501 (http://www.ncsl.org/documents/health/ppaca-consolidated.pdf).
________________________________________
Wednesday, March 28, 2012 (90 minutes for oral argument)
Issue: Severability
If the individual mandate is found to be unconstitutional, to what extent, if any, can the provisions related to the individual mandate be separated, or is severable from other provision of the ACA
________________________________________
Wednesday, March 28, 2012 (1 hour for oral argument)
Issue: Medicaid
Whether the Congress unconstitutionally coerced the states into agreeing to substantially expand the Medicaid program by threatening to withhold states’ federal Medicaid funding. In a highly unusual move, the Court has allotted five and a half hours for oral arguments providing one hour on the Tax Anti-Injunction Act issue.
Additional Resources
1.Individual Mandate and Related Information Requirements under PPACA (September 21, 2010)
2. Requiring Individuals to Obtain Health Insurance: A Constitutional Analysis (May 7, 2010)
3. Health Care: Constitutional Rights and Legislative Powers (April 5, 2010)
The Department of Health and Human Services (HHS) Releases Several Key Rules Governing Health Insurance Exchanges
During the week of March 12 HHS released several rules that implement key provisions from the Affordable Care Act through 2014.
− Medicaid Program; Eligibility Changes under the Affordable Care Act of 2010
Final/Interim Final Rule. Implements provisions of the Affordable Care Act (ACA). This final rule codifies policy and procedural changes to the Medicaid and CHIP programs related to eligibility, enrollment, renewals, public availability of program information and coordination across insurance affordability programs. The rule becomes effective January 1, 2014. The applicable comment period ends May 8, 2012.
Federal Register document http://www.ofr.gov/OFRUpload/OFRData/2012-06560_PI.pdf
Regulatory Impact Analysis http://www.medicaid.gov/AffordableCareAct/Provisions/Downloads/MedicaidEligibilityFinalRule_Regulatory-Impact-Analysis.pdf
Fact Sheet http://www.medicaid.gov/AffordableCareAct/Provisions/Downloads/MedicaidCHIP-Eligibility-Final-Rule-Fact-Sheet-Final-3-16-12.pdf
− Establishment of an Exchange and Qualified Health Plans, and Exchange Standards for Employers
Final/Interim Final Rule. Implements the new Affordable Insurance Exchanges, consistent with the ACA. An exchange will allow individuals and small employers to directly compare available private health insurance options on the basis of price, quality, and other factors that increase competition in the marketplace. This rule addresses the key functions of an exchange that will become operational by Jan. 1, 2014. In addition. Several sections of this final rule are being issued as interim final rules and HHS is soliciting comments on those sections. The rule becomes effective May 27, 2012. The applicable comment period ends May 12, 2012.
Federal Register Document http://www.ofr.gov/OFRUpload/OFRData/2012-06125_PI.pdf
Regulatory Impact Analysis http://cciio.cms.gov/resources/files/Files2/03162012/hie3r-ria-032012.pdf
Fact Sheet http://www.healthcare.gov/news/factsheets/2011/07/exchanges07112011a.html
− Standards Related to Reinsurance, Risk Corridors, and Risk Adjustment
Final Rule. Implements standards for states related to reinsurance and risk adjustment, and for health insurance issuers related to reinsurance, risk corridors, and risk adjustments consistent with the ACA. These programs will lessen the impact of potential adverse selection and stabilize premiums in the individual and small group markets as insurance reforms exchanges are implemented, starting in 2014. The rule becomes effective May 23, 2012.
Federal Register Document http://www.ofr.gov/OFRUpload/OFRData/2012-06594_PI.pdf
Regulatory Impact Analysis http://cciio.cms.gov/resources/files/Files2/03162012/hie3r-ria-032012.pdf
Fact Sheet http://www.healthcare.gov/news/factsheets/2012/03/risk-adjustment03162012a.html
− Certain Preventive Services Under the Affordable Care Act
Advanced Notice of Proposed Rulemaking. This is a request for comments in advanced of proposed rulemaking on the potential means of accommodating religious organizations objecting to the coverage of contraceptive services and ensuring coverage for plan participants and beneficiaries without cost sharing. The comment period ends June 21, 2012.
Advanced Notice of Proposed Rulemaking in the Federal Register
− Student Health Insurance Coverage
Final Rule. Establishes requirements for student health insurance coverage under the ACA. The final rule defines “student health insurance coverage” as a type of individual health insurance coverage, and specifies that certain Public Health Service (PHS) Act requirements are inapplicable to this type of individual health insurance coverage. It also amends the medical loss ratio (MLR) and annual limits requirements for student health insurance coverage under the PHS Act. The rule becomes effective April 21, 2012. No comment period applies.
Final Rule Document
Fact Sheet http://www.healthcare.gov/news/factsheets/2012/03/student-health-plans03162012a.html
CBO—Effects of Eliminating the Individual Mandate to Obtain Health Insurance
Senior Advisor for Health and Human Resources Jessica Banthin's Presentation at the RAND BGOV Event on the Individual Mandate. http://cbo.gov/publication/43117
HHS to Administer Risk Adjustment Programs in Federally Facilitated Health Insurance Exchanges
HHS has announced that they will take control of health insurance risk adjustment programs for states not operating their own exchanges and those partnering with the federal government on exchanges. The ACA created three programs to eliminate incentives for health insurance plans to avoid insuring people with pre-existing conditions or those who are in poor health, and to reduce uncertainty that could increase premiums when health insurance exchanges begin. The three programs are risk adjustment, reinsurance, and risk corridors. The primary goal of the risk adjustment program is to better spread the financial risk borne by health insurance issuers. States certified to operate an exchange have the option to establish a risk adjustment program, but are not required to do so. If a state does not establish a risk adjustment program, HHS will establish the program and will perform the risk adjustment functions for that state. A federally-developed risk adjustment methodology will be proposed in the annual HHS Notice of Benefit and Payment Parameters in the fall of 2012. On a March 22 conference call with groups representing state government, HHS announced that there will be fees assessed on states for the administrative costs associated with HHS running the risk adjustment programs.
Standards Related to Reinsurance, Risk Corridors and Risk Adjustment Final Rule: http://www.ofr.gov/OFRUpload/OFRData/2012-06594_PI.pdf
Fact Sheet: http://www.healthcare.gov/news/factsheets/2012/03/risk-adjustment03162012a.html
HHS Deems Health Insurance Rate Hikes in Nine States Excessive under Rate Review
HHS Secretary Sebelius released a new report on March 22 showing initial results of six months of a rate review program established under the ACA. Since the inception of the program more states have taken an active role in monitoring rate increases by insurers, resulting in a 4.5 percent increase in premium increases. The report released shows that:
- Texas, Kentucky, Nevada and Indiana are reporting fewer requests for rate increases over 10 percent.
- California, New York, Oregon, and many others, have proactively lowered rate increases for their residents.
- The rate review program requires insurance companies to explain their increases, and more than 180 reviews have been posted publicly and are open for consumer comment on companyprofiles.healthcare.gov.
Information on the specific determinations is available at: http://companyprofiles.healthcare.gov/
The rate review report released today is available at: http://www.healthcare.gov/law/resources/reports/rate-review03222012a.html
The Centers for Medicare and Medicaid Services (CMS) Guidance Regarding the Adoption of Operating Rules for Health Information Transactions
In a CMS bulletin on March 21, CMS describes standards for adoption of operating rules for eligibility for a health plan and health care claim status transactions. The bulletin is one of a series CMS will publish while implementing the provisions of the ACA. This bulletin specifically addresses provisions in the ACA pertaining to the Health insurance Portability and Accountability Act of 1996 (HIPAA). HHS has adopted operating rules for the eligibility and claim status transactions which require health plans, including Medicaid, to use certain codes, templates and/or formats in the process.
CMS Bulletin, http://www.medicaid.gov/Federal-Policy-Guidance/Downloads/CIB-03-21-12.pdf.
Employee Benefits Security Administration (EBSA) Frequently Asked Questions (FAQs) about ACA Implementation (Part VIII)
EBSA has published FAQs regarding implementation of the summary of benefits and coverage (SBC) provisions of the ACA. These FAQs have been prepared jointly by the Departments of Labor (DOL), HHS, and the Treasury. http://www.dol.gov/ebsa/faqs/faq-aca8.html
CMS Call for Applications for the Graduate Nurse Education Demonstration
CMS has announced a call for applications for a new ACA initiative designed to strengthen the primary care workforce. Under the Graduate Nurse Education Demonstration, CMS will provide hospitals working with nursing schools to train advanced practice registered nurses (APRNs) with payments of up to $200 million over four years to cover the costs of APRNs’ clinical training. The primary goal of the demonstration is to increase the provision of qualified training to APRN students. The clinical training included in this demonstration will provide APRNs with the clinical skills necessary to provide primary care, preventive care, transitional care, chronic care management, and other services appropriate for Medicare beneficiaries. The demonstration will be operated by the Center for Medicare and Medicaid Innovation (Innovation Center). The Innovation Center was created by the ACA to test innovative payment and service delivery models to reduce expenditures while preserving or enhancing the quality of care. http://innovation.cms.gov/initiatives/gne/
CMS Launches Initiative to Reduce the Number of Preterm Babies Born to Medicaid Moms
Approximately 12 percent of infants born in the U.S. today are born prematurely. That rate has increased by 36 percent over the last 20 years. The rate of preterm births, medically defined as less than 37 weeks of gestations, is a growing public health problem and has been estimated to cost society at least $26 billion each year. Medicaid currently finances about 40 percent of all births in the United States. The ACA authorized the CMS Innovation Center to develop, implement, and evaluate innovative payment and service delivery models to reduce program expenditures in public programs while preserving the quality of care. This solicitation offers direct funding to applicants for the purpose of providing specific combinations of enhanced prenatal care services. Funding may be used for start-up and implementation costs associated with these programs focusing on one of three approaches— enhanced prenatal care through centering/group visits, enhanced prenatal care at birth centers, and enhanced prenatal care at maternity care homes. Up to $43.2 million is available to fund this initiative and awards will be made for a four-year period. Eligible applicants include providers in partnership with states, state Medicaid agencies applying in partnership with providers, and Medicaid-contracted managed care entities and/or convener proposals in partnership with states and providers. Applications must be received by June 13, 2012, with an anticipated award date of September 10, 2012.
Center for Medicare and Medicaid Innovations Overview— http://innovations.cms.gov/initiatives/Strong-Start/index.html
National Association of Insurance Commissioners (NAIC) Issue Brief Health Insurance Exchanges Plan Management Functions
NAIC has stressed that whether an exchange is state or federally operated that states should examine the coordination of activities between the exchanges and state departments of insurance. This brief lists the major plan certification requirements from the ACA and subsequent federal regulations that should be consider as you plan for coordination activities. The brief is available at the following web address, http://www.naic.org/documents/committees_b_exchanges_1203_issue_brief.pdf .
The Centers for Medicare and Medicaid Services (CMS) Extends Application Dates for Level Two Establishment Grants
The ACA provided for grant funding to states to plan for and establish health insurance exchanges. Forty-eight states and the District of Columbia were awarded the first planning grants in Sept. of 2010. Ultimately every state with the exception of Alaska received grants for planning which made them eligible to receive additional funding through establishment grants beginning in January of 2011. There are two levels of awards for states to apply for establishment grants. Level One Establishment grants provided one year of funding to state that are ready to initiate establishment activities after having made sufficient progress under their planning grants. Level Two Establishment grants provide funding to states that have achieved benchmarks identified in the Level Two Establishment review criteria. HHS anticipates releasing the funding opportunity announcement June 15, 2012. CMS announced in the Federal Register March 2, 2012 that they have extended opportunities to apply for Level One and Level Two Establishment grant funding quarterly through the end of 2014.
The period of performance for Level One Establishment grants is up to one year after the date of the award, and up to three years after an award for a Level Two Establishment grant award. The Federal Register notice stressed the importance of the timely submission of information regarding state progress to HHS. States should anticipate additional guidance on data submission from HHS in the future. The Federal Register notice is available online, http://www.gpo.gov/fdsys/pkg/FR-2012-03-02/pdf/2012-5011.pdf .
Center for Consumer Information and Insurance Oversight (CCIIO) ACA Announcement: Actuarial Value Bulletin
HHS released a bulletin regarding Actuarial Value and Cost Sharing Reductions. The purpose of this bulletin is to provide information and solicit comments on the regulatory approach that HHS plans to propose to define actuarial value (AV) for qualified health plans (QHPs) and other non-grandfathered coverage in the individual and small group as well as to implement cost-sharing reductions from the ACA. AV is a measure of the percentage of expected health care costs a health plan will cover. AV is calculated based on the cost-sharing provisions for a set of benefits. Provisions in the ACA direct issuers to reduce cost-sharing on essential health benefits (EHB) for individuals with household incomes below 400 percent of the Federal Poverty Level (FPL) who are enrolled in a QHP in the individual market through an Affordable Insurance Exchange. The bulletin is available online at http://www.cciio.cms.gov/resources/files/Files2/02242012/Av-csr-bulletin.pdf
House Committees Approve Bill Repealing the ACA’s Independent Payment Advisory Board (IPAB)
The ACA created the IPAB and a process by which the board would make recommendations to Congress to affect economies in the Medicare program. The process would automatically permit the HHS Secretary to follow the IPAB’s recommendations should Congress fail to enact policy or in some way achieve necessary savings to meet specific targets. H.R. 452, the Medicare Decisions Accountability Act of 2011, would repeal the ACA provisions. The measure has been approved in the House Committees on Energy and Commerce, and Ways and Means with 234 co-sponsors which include 20 Democrats. Offsets for the bill have not yet been identified but must be included before going to the House floor.
Resources:
1. House Committee on Ways and Means markup— http://waysandmeans.house.gov/Calendar/EventSingle.aspx?EventID=283481
2. House Committee on Energy and Commerce Summary— http://energycommerce.house.gov/News/PRArticle.aspx?NewsID=9105
3. (CBO) Cost Estimate— http://cbo.gov/publication/43048
4. The White House Blog, The Facts About the Independent Payment Advisory Board, http://www.whitehouse.gov/blog/2011/04/20/facts-about-independent-payment-advisory-board
5. Kaiser Family Foundation—Explaining Health Reform: Medicare and the New Independent Payment Advisory Board, http://www.kff.org/healthreform/upload/7961-02.pdf
The Centers for Medicare & Medicaid Services (CMS) Final Rules on the Application, Review, and Reporting Process for Waivers for State Innovation
CMS has published the final rules, which lay a framework for the submission and review of initial applications for a Waiver of State Innovation, implementing the Affordable Care Act (ACA) provisions that allow HHS to waive certain requirements respective to health insurance coverage within the state beginning in plan year Jan. 1, 2017. Proposed rules were published March 14, 2011, and the final rules only vary on a few small issues. One particular change clarifies that states will not be required to enact legislation pertaining to a waiver if the state already has a law in place. The rule becomes effective April 27, 2012 and is available for review at http://www.ofr.gov/OFRUpload/OFRData/2012-04395_PI.pdf.
CMS Final Rules on the Medicaid Program: Review and Approval Process for Section 1115 Demonstrations
Provisions in the ACA revised procedures in the review and approval of demonstration projects under section 1115 of the Social Security Act relating to Medicaid and the Children’s Health Insurance Program (CHIP). The goal of the new procedures is to promote greater transparency in the process and allow for public input and availability of outcomes data. The procedural requirements also include review standards pertaining to goals of the demonstrations and provide for state reporting requirements on all approved demonstrations.
To allow for public comment, states must provide for a 30-day notice and comment period before submission of an application to CMS for any new demonstration project or an extension of any existing program. In addition, at least two public hearings must be held approximately 20 days prior to submission of the application. States will be held accountable for annual reporting including program impact analysis and outcomes of care, quality of care, cost of care, access to care, and complaints made by the demonstration populations. Proposed rules were published Sept. 17, 2010 and the final rule will become effective April 27, 2012. The rule is available for review online at (will insert web address Monday after posting). The Center for Medicaid and CHIP Service (CMCS) issued a bulletin February 22nd that provides some additional guidance to the rule http://www.medicaid.gov/Federal-Policy-Guidance/downloads/CIB-02-22-12.pdf.
An Early Retiree Reinsurance Program (ERRP) Status Report
The ERRP program was established by the ACA with an appropriation of $5 billion dollars to temporarily offer financial assistance to health plan sponsors as an who provide coverage to early retirees between the ages of 55 and 64. ERRP payments were to be used to reduce plan participants’ costs thereby acting as an incentive for plan sponsors to continue coverage. The program received a significant response from the employer community including 47 states and the District of Columbia. In fact the program was so well received that it ceased accepting applications for participation May 6, 2011, and in December 2011 informed participants that claims incurred after Dec. 31 would not be accepted. HHS has released updated information regarding the ERRP program payments in a report available online at http://cciio.cms.gov/resources/files/Files2/02172012/errp-posting_feb2012.pdf. On the State Affordable Care Call February 23, HHS officials informed state program participants that documentation detailing all claims for which payments had been received would have to be submitted by March 31. Any outstanding documentation requirements after that date would result in recoupment of the funds provided to the plan sponsor for the associated claim.
HHS Reports on the Pre-Existing Condition Insurance Plan Program (PCIP)
HHS has released two reports providing state specific information on the funding that has been provided to cover individuals with pre-existing conditions across the country. The PCIP was established in the ACA as a temporary high risk health insurance program in all 50 states and the District of Columbia for uninsured people with pre-existing conditions. Twenty-seven states are operating their own program, often in coordination with existing High Risk Pools (HRPs), and 23 states and the District of Columbia have opted to have a federally-operated program. The first report, Covering People with Pre-Existing Conditions: Report on the Implementation and Operation of the Pre-Existing Condition Insurance Program is available online at http://www.cciio.cms.gov/resources/files/Files2/02242012/pcip-annual-report.pdf. The second report, Pre-Existing Condition Insurance Plan Data as of December 31, 2011, is also available online at http://cciio.cms.gov/resources/files/Files2/02242012/pcip-data-12-31-2011.pdf.
New Loan Program Helps Create Customer-Driven Non-profit Health Insurers
CMS has announced that $638.7 million dollars has been loaned to seven nonprofit health insurance co-operatives who are the first to receive these types of loans. The ACA created the Consumer Operated and oriented Plans (CO-Ops) that are intended to be directed by their customers. These low interest loans will only be provided to eligible non-profit organizations and begin providing coverage in their states in 2014. The announcement is on the HealthCare.gov web page at http://www.healthcare.gov/news/factsheets/2012/02/coops02212012a.html.
CCIIO Releases Frequently Asked Questions (FAQs) on the Essential Health Benefits Bulletin
The Center for Consumer Information and Insurance Oversight (CCIIO) released FAQs to provide additional guidance on the Essential Health Benefits Bulletin released Dec. 16, 2011, which outlined the proposed policies to give states more flexibility to create an EHB package for their exchanges. HHS intends to define the EHB packages through a benchmark approach. The FAQs provide further information about the process of selecting and updating a benchmark and more information on the disposition of state mandated benefits.
Milliman Client Report: PPACA Health Insurer Fee Estimated Impact on State Medicaid Programs and Medicaid Health Plans
Section 9010 of the PPACA imposes an annual fee on health insurance providers beginning FY2014. The fee will apply to any entity that provides health insurance in the United States with the exclusion of governmental entities, and not-for-profit organizations. The health insurer fee is to be considered as an excise tax and is nondeductible for income tax purposes. The report was commissioned by the Medicaid Health Plans of America, who argues that this treatment of nonprofit Medicaid MCOs in the health insurer fee calculation may distort the competitive balance between for profit and nonprofit Medicaid MCOs, possibly resulting in additional costs to states. The Medicaid Health Plans of America is the leading national organization that represents health plans participating in Medicaid managed care. Milliman estimates that as a result of this fee, Medicaid managed care premiums will increase by 1.5 and 1.6 percent nationwide, and as much as 2.5 percent in some states. They project the state and federal government funding for the increase in premiums will be between $36.5 billion and $41.9 billion over a 10 year period. The report is available online at, http://www.mhpa.org/_upload/MillimanReport.pdf.
NCSL Comments on the CMS Essential Health Benefits Bulletin
On December 16, 2011, HHS issued a bulletin outlining proposed policies that will give states more flexibility and freedom to implement the ACA. The bulletin describes a proposal that HHS intends to pursue in rulemaking to define essential health benefits and requested comments by January 31, 2012. NCSL submitted comments in a memorandum to CMS Acting Administrator Marilyn Tavenner http://www.ncsl.org/documents/health/EHBbultn.pdf.
The Center for Medicaid and CHIP Services (CMCS) Proposes New Rules Governing Medicaid Covered Outpatient Drugs
CMCS has published a list of proposed rules for implementation of Medicaid drug provisions of the Affordable Care Act (ACA). These rules will increase transparency in drug pricing and through a number of changes including:
1. Aligning reimbursement rates for all drugs closer to the actual price the pharmacy pays for the drug;
2. Increasing rebates paid by drug manufacturers that participate in Medicaid;
3. Providing rebates for drugs dispensed to individuals enrolled in a Medicaid managed care organization; and
4. Lowering reimbursement for certain generic drugs.
The notice of proposed rulemaking (NPRM) will be open for public comment through April 2, 2012, and CMS encourages all interested parties and stakeholders to submit comments. Please refer to the Federal Register http://www.ofr.gov/OFRUpload/OFRData/2012-02014_PI.pdf . The NPRM will be officially posted Feb. 2, 2012 in the Federal Register.
Rules Implementing ACA Requirements Under Review at the Office of Management and Budget (OMB)
Proposed Rules
Medicaid-Payments for Primary Care Services—This proposed rule will implement the ACA provisions requiring states to pay primary care providers equivalent to Medicare reimbursement rates. Once implemented, the requirements of Section 1202 of the ACA will remain in effect for calendar years 2013 and 2014 for primary services delivered by physicians designated as practicing family medicine, general internal medicine, or pediatrics. As of Jan. 1, 2013, the federal government will pay 100 percent of the amount that the new minimum will exceed state reimbursement rates that were in place as of July 1, 2009.
Guidance
Draft Actuarial Value and Cost Sharing Reductions Bulletin—specific details of this guidance are still pending.
Final Rule
− Medicaid Eligibility Expansion under the Affordable Care Act of 2010— This rule implements provisions of the ACA expanding access to health insurance through improvements in Medicaid, the establishment of American Health Benefit Exchanges, and coordination between Medicaid, the CHIP, and exchanges. It also implements sections of the ACA related to Medicaid eligibility, enrollment simplification, and coordination.
− State Requirements for Exchange--Reinsurance and Risk Adjustments— This rule finalizes guidelines for the transitional risk-sharing programs, reinsurance and risk corridors, as well as for the risk adjustment program that will continue beyond the first three years of exchange operation. The purpose of these programs is to protect health insurance issuers from the negative effects of adverse selection and to protect consumers from increases in premiums due to uncertainty for issuers.
Tri-agency Letter on Cost Allocation Requirements
Jan. 23, 2012. In August of 2011, the Centers for Medicare and Medicaid Services (CMS), the Administration for Children and Families (ACF), and the U.S. Department of Agriculture (USDA) provided guidance on a time-limited exception to cost-allocation requirement associated with building a state-based information technology system used in eligibility-determinations in state insurance exchanges, Medicaid and the Children’s Health Insurance Program (CHIP). Normally cost allocation requirements from the Office of Management and Budget (OMB) require benefitting programs to pay their fair share of the costs associated with building the state-based technology system (OMB Circular A-87, Sec. C.3, http://www.whitehouse.gov/sites/default/files/omb/assets/agencyinformation_circulars_pdf/a87_2004.pdf ).
The three agencies have released additional guidance that focuses on integrated eligibility system strategies. The guidance provides an implementation timeline that would have the systems fully operational and tested by no later than the summer of 2013. A phased development of the system is highly recommended and would expand the functionality after all the health components are operational. State agencies would be permitted a one-time exception of the cost-allocation requirements in order to support the development of the system. The guidance provides some clarification of the allowable shared savings under the exception, and provides instruction for submission of funding requests. The document is available on the web at, http://www.medicaid.gov/Federal-Policy-Guidance/downloads/SMD-01-23-12.pdf.
CMS Guidance Regarding the Termination of Provider Participation in Medicaid
Jan. 20, 2012. CMS issued an informational bulletin providing clarification of the definition of “for cause” terminations provided in earlier guidance. The earlier guidance implemented final rules governing requirements in the Affordable Care Act (ACA) that State Medicaid agencies terminate the participation of any individual or entity provider of health care if they had previously been terminated by Medicare or any other State Medicaid plan. The guidance was issued in response to requests from states for further clarification and is available online at http://www.medicaid.gov/Federal-Policy-Guidance/downloads/CIB-01-20-12.pdf .
CMCS Informational Bulletin: Use of Federally Imposed Civil Money Penalty (CMPs) Funds by States
The ACA provided that funds collected from long-term care facilities as a result of federally imposed CMPs may be used to support activities that benefit residents of those facilities in some way. This bulletin provides guidance to states on the implementation of the provisions from the ACA. Use of CMPs levied for deficiencies as a result of federal requirements must be approved by CMS. http://www.medicaid.gov/Federal-Policy-Guidance/downloads/CIB-01-13-12.pdf
Federally Facilitated Exchanges: Progress Report
In states that elect not to establish an exchange, the ACA requires the HHS to establish and operate one for the citizens of that state. This would also apply in the event HHS determines that despite state efforts to establish an exchange, the exchange has not made sufficient progress to become fully operational by January 1, 2014. HHS has begun laying the groundwork to establish what will become a federally facilitated exchange in 2014. Contracts to build and support the IT systems, state exchange implementation support, eligibility and enrollment strategy and planning, and the eligibility appeals process are under way.
Quality Software Services Inc. (QSSI) has been awarded the contract to build and support the operations of a federal data service hub that will provide data verification to support eligibility processes for all exchanges, Medicaid and the Children’s Health Insurance Program.
CGI Group Inc. will work with CCIIO to build and support the IT systems for the federal exchange. CGI will also design, develop and implement the CCIIO Rate and Benefits Information System (RBIS) that will collect rate and benefit data from health insurance providers to be used by consumers to review in a comparison format.
Booz Allen Hamilton was awarded three separate contracts by CMS to provide state exchange implementation support, eligibility and enrollment strategy and planning, and for the development of the exchange eligibility appeals process.
The Center for Medicaid and CHIP Services (CMCS) Releases Guidance on the ACA Changes to Medicaid/CHIP Provider Screening and Enrollment
Provisions in the ACA requires the HHS Office of the Inspector General (OIG) to establish screening procedures for the enrollment of health care providers and suppliers who wish to participate in Medicare, Medicaid, or CHIP. The level of screening must be based on the risk for fraud, waste and abuse with respect to the category of provider or supplier. In addition, institutional providers of medical services and suppliers must pay a fee in order to participate in the program. States must submit a state plan amendment (SPA) to the Centers for Medicare and Medicaid Services (CMS) for review and approval by April 1, 2012 demonstrating that all participating providers will be screened upon initial application, including applications for new service locations, and requests for reenrollment. The guidance provides a list of questions and answers each state should review regarding collection of information, application fees, and other enrollment procedures required by CMS. The guidance is available at http://www.medicaid.gov/Federal-Policy-Guidance/downloads/CIB-12-23-11.pdf.
CMCS Guidance to States on the Expansion of the Recovery Audit Contractor (RAC) Program to Medicaid
CMCS provided additional guidance to states on the expansion of the RAC program to Medicaid in an informational bulletin Dec. 30, 2011. The final rule implementing the ACA provisions became effective Jan. 1, 2012. In the rule, CMS restricted states from paying contingency fees to Medicaid auditors that would exceed the highest fees paid to a Medicare Recovery Auditor. The bulletin also provides information on recent modifications CMS has made regarding Medicare contingency fees. http://www.medicaid.gov/Federal-Policy-Guidance/CIB-12-30-2011.pdf
National Academy of Social Insurance (NASI)−Federally-Facilitated Exchanges and the Continuum of State Options
Under the support of the Robert Wood Johnson Foundation (RWJF) NASI examines how the various core functions of a health benefit exchange carried out in a variety of models, and the implications for states selecting one model over another, http://www.nasi.org/sites/default/files/research/Federally_Facilitated_Exchanges_and_the_Continuum_of_State_Options.pdf.
HHS “Bulletin vs. Proposed Rule”: Congressional Republicans Question HHS on Chosen Methods for Guidance in the Development of the Essential Health Benefits
House and Senate Republicans have requested in a letter to Health and Human Services (HHS) Secretary Kathleen Sebelius, information concerning the process by which HHS chose to issue a “bulletin” rather than a proposed rule to provide direction to states in creating an essential health benefit package that would be offered by health plans through state exchanges. http://republicans.energycommerce.house.gov/Media/file/Letters/112th/011312ehbbulletin.pdf
House Committee on Ways and Means Approves H.R. 1173 to Repeal the CLASS Act
On Jan. 24, 2012 the House Committee on Rules approved legislation, H.R. 1173, which would repeal the Community Living Assistance Services and Support (CLASS) program created in the Affordable Care Act (ACA). The law was designed to establish a voluntary, national insurance program for American workers to help pay for long-term services and supports. The Department of Health and Human Services (HHS) suspended work on the implementation of the program in 2011 when it was determined that the plan benefits required by the statute would not meet solvency tests. The measure will be presented for floor consideration sometime next week. The language of H.R. 1173 and committee report is available at, http://www.rules.house.gov/Legislation/legislationDetails.aspx?NewsID=695.
NCSL State Federal Relations Staff Contacts
Joy Johnson Wilson, NCSL Federal Affairs Counsel, Health Policy Director at joy.wilson@ncsl.org or Rachel B. Morgan RN, BSN, NCSL Health Committee Director, at rachel.morgan@ncsl.org .
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