HHOLDING OLDING PPLANS LANS AACCOUNTABLE IN CCOUNTABLE IN HHEALTH EALTH
RREFORMEFORM
JJOSHUAOSHUA D. G D. GOLDBERGOLDBERGNational Association of Insurance CommissionersNational Association of Insurance Commissioners
August 4, 2010August 4, 2010State Coverage Initiatives Summer MeetingState Coverage Initiatives Summer Meeting
Minneapolis, MinnesotaMinneapolis, Minnesota
Reform TimelineReform Timeline
2010 2011 2012 2013 2014 2015 2016 2017Temporary High Risk Pool Program
Immediate Reforms:•No Lifetime Limits•Restricted Annual Limits•Restrictions on Rescission•First Dollar Coverage of Preventive Services
Medical Loss Ratios with Rebates
2010 2011 2012 2013 2014 2015 2016 2017
Exchanges
Subsidies
Individual/Employer Mandates
Market Reforms•Guaranteed Issue•No Pre-Existing Condition Exclusions for Adults•Rating Rules•Essential Benefits Plans•No Annual Limits for Essential Benefits
Risk Adjustment
•Extended Dependent Coverage•Internal/External Review•No Pre-Existing Conditions for Children•Disclosure of Justifications for Premium Increases
Individual Market Reinsurance Program &Risk Corridors
Temporary Early Retiree Reinsurance Program
Co-Op Plans & Multistate Plans
Preemption
Nothing in this title shall be construed to preempt any State law that does not prevent the application of the provisions of this title.
PPACA §1321(d)
Provisions of PPACA will potentially preempt state laws.
Similar to HIPAA:
Exceptions:Mandated benefits: States must cover cost of mandated benefits beyond essential benefits package.Grandfathered plans: States may not require grandfathered plans to be pooled with post-reform plans.
Rate ReviewRate Review
Federal review of “unreasonable” rate increases.
No federal authority to deny rate increase.• May recommend exclusion from state-run
Exchange• May exclude from federally-run Exchange
$250 million in grants to states to support rate review.
Medical Loss Medical Loss RatiosRatios
Clinical Care Costs + Health Quality Improvement
Premiums - Taxes & Regulatory Fees
• 85% in large group market• 80% in small group and individual markets• HHS has authority to reduce to prevent
individual market instability.
Rating RulesRating Rules
Adjusted community rating• No health status• Limited age (3:1 max)• Limited tobacco (3:1 max)• Geography
Single risk pool requirements• Individual and small group markets• Grandfathered plans excluded
ME
NY
PA
NH
CT
VT
MA
NJ
VA
NC
SC
GA
FL
WV
KY
ALMS
MIWI
MN
IA
HI
AK
KS
NE
ND
SD
MO
IL IN
TX
MT
ID
NVUT
WY
CO
NMAZ
CA
OR
WA
LA
AROK
OH
MD
DE
RI
DC
Community Rating
25.1:1 or greater
Adjusted Community Rating
Rating Band Variability:
No Rating Structure
19.1:1 – 25:1
13.1:1 – 19:113:1 or less
*Note: Michigan HMOs and Blue Cross/Blue Shield are restricted to 3.12:1 maximum variation. All others may use 3.96 maximum variation
TN
Small Group Small Group VariationVariation
ME
NY
PA
NH
CT
VTMA
NJ
VA
NC
SC
GA
FL
WV
KY
TN
ALMS
MIWI
MN
IA
HI
AK
KS
NE
ND
SD
MO
IL IN
TX
MT
ID
NVUT
WY
CO
NMAZ
CA
OR
WA
LA
AROK
OH
MD
DE
RI
Rating BandsHybridMichigan Blue Cross/Blue Shield must use community rating. There is no rating structure for other carriers.
DC
Adjusted Community Rating
Community RatingNo Rating Structure
Individual Market Individual Market RatingRating
ME
NY
PA
NH
CT
VTMA
NJ
VA
NC
SC
GA
FL
WV
KY
TN
ALMS
MIWI
MN
IA
HI
AK
KS
NE
ND
SD
MO
IL IN
TX
MT
ID
NVUT
WY
CO
NMAZ
CA
OR
WA
LA
AROK
OH
MD
DE
RI
Rating BandsHybridMichigan Blue Cross/Blue Shield must use community rating. There is no rating structure for other carriers.
DC
Adjusted Community Rating
Community RatingNo Rating Structure
Reformed Rating RulesReformed Rating Rules
Reporting Reporting RequirementsRequirements
• All plans must report to Secretary, State Insurance Commissioner and the Public:– Claims payment policies and practices– Financial disclosures– Data on enrollment and disenrollment– Data on claims denials– Data on rating practices– Information on cost-sharing for out-of-network providers– Information on enrollee and participant rights under
PPACA– Other information specified by the Secretary
TransparencyTransparency
• Disclosure of premium justifications• Uniform definitions of insurance terms• Uniform summary of benefits• Coverage facts labels• Exchanges• Reporting requirements
Complaints and Complaints and Appeals Appeals
• Internal review– Equivalent to DoL Regulations– Required for rescissions
• External review– Equivalent to NAIC Model– Extended to self-insured plans
• Consumer Assistance Grants
EnforcementEnforcement
• Immediate Reforms• Form review process• States have not had opportunity to change
laws• Fallback enforcement may be tricky
•2014 Reforms• NAIC will develop models meeting federal
minimum standards