Health Reform Weekly

A weekly compilation from Aetna of health care-related developments in Washington, D.C. and state legislatures across the country.

Week of May 25, 2015

The typical American family that gets insurance through an employer pays nearly $25,000 a year for medical care, according to the 2015 Milliman Medical Index. The study shows that the annual cost of benefits through an employer-sponsored preferred provider organization (PPO) plan rose 6.3 percent, to $24,671 in 2015. Almost one-third of this year’s cost increase was due to increases in prescription drug costs.


The House Energy and Commerce Committee passed a 21st Century Cures bill by a vote of 51-0. The legislation would provide $550 million in mandatory funding to support implementation of the bill’s provisions, and an exemption from sequestration cuts for administrative expenses. One amendment includes a package of approximately $13 billion in budget offsets, including a proposal to delay Medicare Part D reinsurance payments.

The House Ways and Means Subcommittee on Oversight held a hearing last week on the use of administrative actions in the implementation of the Affordable Care Act (ACA). The hearing focused on, delay of the ACA’s employer responsibility requirements, the payment of premium assistance tax credits in the federal exchange, the payment of the ACA’s cost-sharing reduction subsidies without a congressional appropriation, and payments under the Medicare Advantage quality bonus demonstration program.

The Department of Health and Human Services (HHS) announced that roughly 147,000 people signed up for ACA coverage through during the March 15 - April 30 special enrollment period related to tax season. The six-week special enrollment period was intended for individuals who faced a penalty for not having 2014 coverage after regular enrollment ended. CMS has said the special enrollment period will not be implemented in subsequent years.

Senator Rob Portman (R-OH) announced that the Homeland Security and Governmental Affairs Permanent Subcommittee on Investigations is looking into concerns about the verification procedures surrounding subsidies paid through the ACA exchanges. Sen. Portman, who chairs the subcommittee, sent a letter to HHS Secretary Sylvia Burwell asking for clarification of verification procedures and related issues.


ARKANSAS: Insurance Commissioner Allen Kerr issued a bulletin related to data submission requirements under the Arkansas Healthcare Transparency Initiative Act of 2015. This law, adopted earlier this year, changes data submissions to the Arkansas All Payer Claims Database from voluntary to mandatory. The bulletin focuses primarily on the submission of data required by July 1, 2015 to support the Arkansas Health Reform Legislative Task Force, established to consider options for reforming the state’s Medicaid program.

CONNECTICUT: The State Senate passed a 91-page omnibus bill that contains many of the proposals from the so-called Hospital Roundtable chaired by Senate President Martin Looney and Senate Minority Leader Len Fasano. The bill would amend the current regulatory review and approval process for hospital and large group practice consolidations and would create a statewide health information exchange to be run by a not-for-profit organization. Other elements of the bill include new requirements for surprise bills, limitations on facility fees, cost and quality transparency requirements on carriers and providers, and permits for tiered network products.

HAWAII: Hawaii’s state-based exchange (the Hawaii Health Connector) is seeking an alternative arrangement for operations next year. The legislature recently appropriated $2 million for the Connector’s operations, much less than the $5.4 million requested by Connector officials. Facing other funding problems as well, the administration has submitted a draft plan to CMS that calls for a shutdown of the Connector. Any draft plan would have to be approved by CMS. Additional reports indicate that Connector officials are working to secure additional funding to avoid shutting down.

NEW HAMPSHIRE: Emergency room visits by uninsured patients fell 22 percent in the first three months of 2015 compared to same time period in 2014, a drop that New Hampshire hospitals attribute to Medicaid expansion. In a recent report, the New Hampshire Hospital Association also noted that inpatient admissions of the uninsured fell by 27 percent. The Hospital Association said the number of people seeking care in hospitals settings has remained nearly unchanged, which highlights the shift in the number of uninsured to the New Hampshire Health Protection Plan, the state’s Medicaid expansion model.

MAINE: The legislature’s Joint Insurance & Finance Services Committee gave unanimous approval to advance to the full legislature a bill designed to protect health insurance subsidies for the nearly 67,000 Mainers who receive coverage through the federally facilitated marketplace. Nearly 90 percent of Mainers who have purchased marketplace coverage received some kind of subsidy. The bill would create a state-based insurance exchange that uses the federal website The bill would essentially allow Mainers buying individual health insurance to continue to do so through the federal site, while meeting the legal definition of having a state-run exchange.

MISSOURI: The legislature has approved a bill requiring health plans to cover medically necessary services for the diagnosis and treatment of eating disorders. This new law will apply to all health benefit plans delivered, continued or renewed on or after January 1, 2017.

TEXAS: The current legislative session may finish its work, including a tax cut deal, by its scheduled adjournment on June 1. With the end of session looming, ongoing tensions between the House and Senate have thawed, and the two chambers reached agreement on the budget. Legislators also are finalizing a tax cut deal expected to be a compromise between House preferences for business tax cuts and the Senate’s preference for property tax cuts. The legislature is required to have a budget in place before the next biennium starts on August 1, 2015.

VIRGINIA: The State Corporation Commission (SCC) has issued an order to health carriers to present 2016 rate information for small group and individual health plans before the SCC by July 22 in Richmond. Virginia statute requires the SCC to review and approve rates prior to implementation in the market. The Bureau of Insurance, which is housed within the SCC, will provide the regulatory leadership for the presentations. The Bureau of Insurance is expected to release additional instructions to carriers in the coming weeks.

WISCONSIN: Legislation to establish a state-based exchange has been introduced in both the Assembly and Senate. Wisconsin currently uses a federally facilitated exchange to deliver subsidized coverage under the ACA to residents, but legislative leaders are promoting these measures in anticipation of the upcoming ruling by the U.S. Supreme Court in the King v. Burwell case. The Court could find that federal subsidies are only permissible on state-based exchanges. The new legislation would allow the Badger Health Benefit Authority to impose a surcharge on each insurer offering plans through the exchange. The Authority would be required to establish the exchange on or before January 1, 2016.


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