The Marketplace - Insurance Exchanges and Providers

888.879.7302 • www.SuccessEHS.com
The Marketplace – Insurance
Exchanges and Providers
Adele Allison
National Director of Government Affairs
August 28, 2013

• ACA Jargon
• Timelines – Health Plans and Employers
• States and Medicaid Expansion
• Benefit Tiers, Individuals and SHOPs
• Consumer Assistance and Provider Impact
• Questions
Marketplace – Health Ins. Exchanges

Polling the Audience

Statutory Law vs. Case Law
100 435
CONGRESS
Statutory Law
Health Care Policy
Act
30
Lawsuits
2 Cases
Case Law
ELECTEDOFFICIALS→TERMS
APPOINTEDOFFICIALS→LIFETIME
Appeals

Supreme Court of the U.S. - SCOTUS
Chief Justice John
Roberts
Justice Antonin
Scalia
Justice Anthony
Kennedy
Justice Clarence
Thomas
Justice Ruth
Ginsburg
Justice Stephen
Breyer
Justice Samuel
Alito
Justice Sonia
Sotomayor
Justice Elena
Kagan

Understanding Common Terms
• Affordable Care Act of 2010 (ACA) → 2 Laws passed by the
111th U.S. Congress in March, 2010
o Patient Protection and Affordable Care Act (PL 111-148)
o Health Care and Education Reconciliation Act (PL 111-152)
o SCOTUS – Oral Argument late Mar., 2012; Final Ruling 6.28.2012
• Health Insurance Exchange (HIX) a/k/a Health Insurance
Marketplace
o Feds → “Marketplace” not “Exchange”
o Online resource for Individuals, Families, Small Businesses
o Compare Qualified Health Plans (QHPs) costs, benefits, etc.
o Select and enroll in coverage
• Affordable Coverage → 9.5% of household income for
Employer Groups

• Individual Mandate
o Under ACA, most Americans must have health insurance
o Failure to have coverage could result in a “penalty” or tax
o Exempt → Religious Exemption, Illegals, Incarcerated
• Medicaid Eligibility Expansion (State Option)
o New eligible group → Adults not already eligible without
dependent children
o Minimum income threshold → is it 133% or 138% of FPL?
• Modified Adjusted Gross Income (MAGI)
o System for determining eligibility for Medicaid expansion
benefits and federal subsidies
o Uniform across the states
o A single, standard income disregard for most populations
of 5% → (138% FPL – 5% = 133%)

• Qualified Health Plans (QHPs)
o Insurance plan that is “certified” by the Marketplace
o Provides essential health benefits
• Marketplace Tiers
o 4 Coverage levels → Bronze, Silver, Gold and Platinum
o Bronze covers 60%, Silver 70%, Gold 80% and Platinum 90%
o QHPs need not offer all tiers, but must offer 1 Silver + 1 Gold
• Open Enrollment
o Period when eligible to enroll in QHP in the Marketplace
o 2014 → Oct. 1, 2013 – Mar. 31, 2014
o 2015 and beyond → Oct. 15 – Dec. 7 preceding year of coverage
o “Special Enrollment” is available for 30 days following a life event

• Essential Health Benefits (EHBs)
o A minimum set of core benefits → mimics employer-sponsored coverage
o Includes 10 categories of services
• Minimum Essential Coverage → 60% of Actuarial Value
Ambulatory Services
(E.g., MD Visits)
Emergency Services
Hospitalization Maternity / Newborn Care
Mental Health / Substance Prescription Medications
Rehab Services and Devices Laboratory Services
Preventive, Wellness and Chronic
Disease Mgmt.
Pediatric Care
(Including Oral and Vision)

• Essential Community Providers (ECPs)
o QHPs must have an “adequate network” of providers
o Sufficient providers for low-income, underserved patients
o CMS Defines 6 major ECP categories:
o Overseen by Center for Consumer Information & Insurance
Oversight (CCIIO)
o Must contract with ECPs on CCIIO’s non-exhaustive database
(denominator) if Federal-run or run through partnership
(http://1.usa.gov/18gv4MZ)
o Operationalized for plan year 2014 by CMS – Letter to Issuers
Federally Qualified Health Centers Ryan White Providers
Family Planning Providers Indian Providers
Hospitals Other

Measuring Knowledge

2012 ACA Requirements
Insurance MLR
85% in Claims Paid or
Rebate
Women’s Prev.
Free Contraceptives
Sum. of Benefits
and Coverage
Uniform with Plans, 60
days notice of changes
Comparative
Effectiveness Fee
$1/covered life/year from
Employers for PCORI
($2/life in 2013)
W-2 Reporting
Must reflect cost of
Health Care

2013 ACA Requirements
Health Care
Exchange Notice
Requirement to provide
employees written notice
about the HIX
Health Flex. Spending
Acct. (FSA)
Contributions capped at
$2,500/year
Medicare
Payroll Tax
3.8% Medicare tax on
unearned income for
high-income ind.
Hospital
Insurance Tax
Must reflect cost of
Health Care

2014 Grandfathered Plans Changes
• No annual limits on Essential Health Benefits
• No pre-existing condition exclusions for children under 19
• New hire waiting periods limited to 90 calendar days
• Fair Labor Standards Act amended → 200+ FTEs must
automatically enroll new FT employees
• Reinsurance Fee (2.2% Tax) of $5.25 PMPM assessed 2014
o Runs through 2016, but decreases
o Used to partially subsidize individual insurers of high-cost individuals
o Will impact premium rates
• Limits on cost-sharing and annual deductibles
• Age-rating ratio limited to 3:1; Tobacco rating limited to 1:1.5
• No gender rating

Employer Mandate – Delayed
• Employer Mandate required 50+ Businesses offer
coverage by 2014 or pay penalty
• Delayed 1 year (Jul. 2) → BUT Ind. Mandate still in place
• 2 Direct Impacts
o Uptick in federally subsidized enrollment under the HIX
o Lower the unemployment rate
 Employers not offering “minimum essential coverage” penalties
• $2,000/worker, $3,000/work if employee receives fed. Subsidies
• E.g., 50 Employees – 20 (first 30 are exempt from penalties) x $2,000 =
$40,000 in Fines
 Employer Strategy → stay below 50 full-time employees; hire part-
time workers

ACA and Medicaid Expansion
• SCOTUS → States may truly “Opt-Out”
• Financial Considerations
o Should create a net savings
o Could increase hospital revenues, offsetting ACA hospital reductions
o Some states concerned about federal deficit reduction efforts impact
• Impact on Coverage
o ↑ Access to care for low-income Americans
o No Implementation → Large gaps in coverage
• State Flexibilities
o Benefit design, cost-sharing, care delivery models, and reimbursement
o Ability to seek approval for demonstration waivers (2017) → 1115 waivers
can be mixed with State Innovation Waivers

Where do States stand?
• 19 Opting-in
• 16 Opting-out
• 5 Leaning Towards Opting-in
• 7 Leaning Towards Opting-out
• 3 Considering Alternative Model

Where do States stand?

HIX and States
• Each State will have 1 Marketplace
• 3 Type of Marketplaces, variance by State
o Federally Facilitated
o Federal-State Partnership
o State-based
• Coverage facilitated for 2 types of consumers
o Individuals and Families
o Small Businesses
• 27 are Federally Run; 16 are State-based; 7 are Federal-
State Partnerships

Health Ins. Marketplace by State
State-Run Partnership
State-Run SHOP
Fed-run Ind. Federal-Run
Federal Run
State Plan Mgmt.

Core Marketplace Requirements
• Enrollee Assistance
o 34 states with Federal involvement → $54 Million in HHS funding for
Navigators
o 16 states and D.C. operating state-based → snag in Federal funding =
“in-person assister” for first year
o CHCs, hospitals, other orgs. can offer a certified application counselor
• Management of plans → private and public
• Eligibility determination and verification
• Beneficiary enrollment
o CBO estimates add’l 13 million to enroll in Medicaid and CHIP over
next 10 years
o Cost increase of $74 billion over previous estimates
• Overall financial management

Individual Mandate – Penalties
• Individual Mandate Penalty Tax
o 2014 → Greater of $95/individual (capped at 3), or 1% of household
income
o 2015 → Greater of $325/individual, or 2% of household income
o 2016 and beyond → Greater of $695/individual, or 2.5% of
household income
o 2017 → penalties will be increased by cost-of-living adjustment
• Exemptions
o Religious, unlawfully present in U.S., and Incarcerated
o Cannot afford based on legal formulas
o Income below federal income tax filing threshold
o Members of Indian tribes
o Uninsured for less than 3 months, hardship waiver, residing outside of U.S.

The Marketplace – Benefit Tiers
Platinum
90%
Gold
80%
Silver
70%
Bronze
60%
• 30 and Under
o Ind. Catastrophic
o Certain Mandate
Exemptions
• QHPs → must
offer minimum of 1
Silver and 1 Gold
level plan

Qualified Health Plans
• Only Qualified Health Plans (QHPs) can be on HIX
• HHS requirements of QHPs
o Accredited by URAC or NCQA
o Demonstrate Network Adequacy
o Have sufficient number of Essential Community
Providers (ECPs)
• State Guidance on Network Adequacy → Review and
approval by 1 of 2 accrediting agencies
• First Effective date Jan. 1, 2014
• Open Enrollment begins Oct. 1, 2013

Federal Subsidies
• Federal Subsidies → Available for incomes between 100%
and 400% of FPL (E.g. Family of 4, income of $89,000)
o Premiums deemed unaffordable → more than 9.5% of
household income, or
o Plan is inadequate → covers less than 60% of cost of covered
benefits
Income Premium Limit
Up to 133% FPL 2% of Income
133-150% FPL 3 – 4% of Income
150-200% FPL 4 – 6.3% of Income
200-250% FPL 6.3 – 8.05% of Income
250-300% FPL 8.05% - 9.5% of Income
350-400% FPL 9.5% of Income
Source: Community Catalyst, Center for Health
Insurance Studies, Georgetown University

Small Business Health Options Program
• The Good
o 2014 SHOP Marketplace → businesses with 50 or less FTEs
 Allows for health plan comparison
 SHOP-purchased plans can bring up to 50% tax credit (based on
premiums) in 2014
o SHOP opens to employers up to 100 FTEs in 2016
o Not available for self-employed → must use ind. Marketplace
o 1 online application process, 1 bill, 1 monthly payment
o Small business can decide contribution toward premiums
• But …
o Must have office/work site within SHOP service area
o Many states require at least 70% FTE enrollment
o Delayed requirement of having numerous QHPs until 2015 =
Opens on time, but may only be 1 QHP option

Consumer Assistance
• 4 Types of Consumer Assistance
o Navigators
o Non-Navigator, In-Person Assistant
o Certified Application Counselor
o Agents and Brokers
• Role of Consumer Assistants
o Increase awareness about the Marketplace
o Determine eligibility and facilitate enrollment
o Alleviate consumer fear

Consumer Assistance
• Navigators
o At least 2 Navigator organizations (minimum)
o 1 must be Non-Profit, Community Org.
o Health Insurers cannot be Navigators
o Requires 30 hours training and testing
o Must be linguistically/culturally appropriate
o HIXs cannot use establishment grant dollars
to fund
o If Federally-run HIX → State-run Navigators
o Partnership HIX → Feds will establish and
train; state responsible for management
o State-run HIX → all done by the State

Consumer Assistance
• Non-Navigator, In-Person Assistant
o Similar duties to navigators with similar training
o Must pass a conflict-of-interest check
o HIX can use establishment grants for funding in the 1st year
o Federally-run HIX → Not required
o Partnership HIX → Required
o State-run HIX → Optional
• Certified Application Counselor
o Required for all of the exchanges
o Training → 5-7 hours + test; materials open to all
o Cannot discriminate on assisting patients (E.g. HIV clinic
cannot limit help to HIV patients)
o No separate funding
o Additional details at www.cms.gov/cciio/resources/marketplace-grants/

Consumer Assistance
• Agents and Brokers
o State-by-state as allowed by the State
o Must show all QHPs offered and be knowledgeable
o Must take a test
• Consumer Assistance by Marketplace-Type
Type of
Marketplace Navigators
In-Person
Assistant
Certified
Application
Counselor
Agents
and
Brokers
State-based Yes Optional Yes Optional
Federal-State
Partnership
Yes Yes Yes Yes, if state
permits
Federal-run Yes No Yes Yes, if state
permits
Source: HRSA, ACA: Outreach, Education and
Enrollment Presentation, Aug. 6

Impact on Federal Budget – CBO
• ACA’s Coverage Provisions (May, 2013) → $1.4 Trillion over 2014-2023
• CBO Cost Impact Factors
o ↑ Number of Medicaid / CHIP enrollees → 13 Million
o ↓ Number of HIX enrollees because of Expansion = less subsidies
• CBO Impact of the delay in Employer Mandate → +$12 Billion
o Almost $10 Billion less in employer penalty payments
o Almost $3 Billion more in federal subsidies paid
• Estimated Uninsured in 2016 → 30 Million
o Majority not subject to Individual Mandate penalty tax → 18-19 Million
 Mostly unauthorized immigrants
 Rest → Indian tribes, Income too low to file tax return, premium exceeds
share of income
Source: Congressional Budget Office Reports

Projected Enrollment
Source: CBO Report on HIX, May 2013 Baseline

Provider Impact
• Challenges
o Health IT adoption and use
o Increased workforce shortages and
overburdened providers
o Health care reform value-based re-
imbursement models
o Quality and Transparency
o Enterprise-wide risk and liability
o Continuing Education
o Market Consolidation
o HIX Coverage “Gotcha”

Provider Impact
• Call to Action
o Patient-Centered Care
o Care Coordination
o Seamless financial, operational and clinical
information sharing through Health IT
 Must support organizations clinical AND business
requirements
 Must have Business Intelligence and Dashboards
 Must flawlessly integrate core organizational functions
 Must be secure and private
 Must engage the patient

Provider Impact
• What can you do today?
o Identify number of uninsured patients in your market
o Understanding what kind of Marketplace your state has
o Ask your Insurance Commissioners or Marketplace which QHPs are
participating
o Initiate contract negotiations with QHPs
o Educate QHPs about your organization and role in care delivery – Are you a ECP?
o Talk with patients about eligibility / enrollment options
o Refer patients to Healthcare.gov for more information
o Identify and refer patients to Consumer Assistance Programs in your state
o Additional details at www.cms.gov/cciio/resources/marketplace-grants/

QUESTIONS
CEUs available at:
webinars@successehs.com
Copies available on SlideShare or
www.SuccessEHS.com/webinars
Follow me on Twitter:
www.twitter.com/Adele_Allison
Added to The BRIEF or Questions:
adelea@successehs.com

The Marketplace - Insurance Exchanges and Providers

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