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 October 27, 2014

The Department of Health and Human Services (HHS) announced last week that $840 million will be awarded in grants to applicants who work directly with medical providers to rethink and redesign their practices, moving from systems driven by quantity of care to coordinated health care systems focused on patients’ health outcomes. Through the Transforming Clinical Practice Initiative, HHS will invest $840 million to support 150,000 clinicians with a combination of incentives, tools and information. The initiative will encourage doctors to team with their peers and others to move to value-based, patient-centered and coordinated health care services. Encouraging greater development of accountable care models is one of the goals of the Affordable Care Act (ACA).


The Centers for Medicare and Medicaid Services (CMS) announced last week that $29 million will be awarded to three states (Rhode Island, Virginia and Massachusetts) to further develop their insurance exchanges and other activities in 2015. The ACA requires state marketplaces to be self-sustaining as of Jan. 1, 2015. The states are not allowed to use the funds for operational expenses or running of the marketplace.

CMS has issued a proposed guideline for awarding funds in 2016 to states for establishing voluntary Basic Health Programs under the ACA. The goal of the program is to provide insurance coverage outside the exchanges to individuals with incomes between 133 percent and 200 percent of the federal poverty level. Participating states will receive federal money equal to 95 percent of the amount of premium tax credits and cost-sharing subsidies associated with gaining coverage through the exchange. CMS will finalize the payment notice by February.


MASSACHUSETTS: The Center for Health Information and Analysis (CHIA) has issued a report that provides an analysis of enrollment trends in public and private plans in the state from December 2013 through July 2014. The report, Massachusetts Healthcare Coverage: Enrollment Trends October 2104, found that enrollment in the public programs grew at a rate of nearly 27 percent while commercial market enrollment remained virtually at the same level. From December 2013 to July 2014, as key provisions of the ACA were implemented, enrollment in Massachusetts commercial and public health insurance programs increased by 292,656 members.

NEW JERSEY: The Department of Banking & Insurance (DOBI) issued a proposed rule to the minimum loss ratio for specified disease and critical illness coverage. The proposal modifies the definition of “association” and increases the minimum loss ratio from 60 percent to 65 percent. The revised proposal recognizes the higher administrative and marketing costs linked to individual and group association-sponsored policies. DOBI suggests these amendments will enable more accurate pricing among insurers, thereby enhancing greater competition with individual policies in the market. The 60-day comment period on the proposal closes December 19.

In legislative news, the General Assembly Financial Institutions and Insurance Committee held its second hearing in a three-part series on the issue of high health care charges by out-of-network facilities and physicians. The committee heard testimony from consumer advocates, trade unions and the state’s largest public employee union on consumer exposure to unanticipated, exorbitant bills on top of higher overall medical costs. A third hearing is expected to occur in mid-November.

NEW YORK: The United Hospital Fund awarded $75,000 grants to the Community Service Society of New York (CSSNY) and to the national group Young Invincibles. The CSSNY grant will explore policy options for providing affordable health insurance coverage to undocumented immigrants. An estimated 400,000 undocumented adult immigrants remain ineligible for most public programs and cannot purchase health insurance through the state’s exchange. The $75,000 grant for the Young Invincibles will be used to research barriers to coverage and access to health care services for undocumented young adult immigrants in New York City, and to produce a report on the findings for policymakers and stakeholders. UHF notes that 37,000 young immigrants in the city have been granted relief from deportation under the federal Deferred Action for Childhood program. While not eligible for federally subsidized health coverage, they are eligible for coverage from New York State.

OHIO: Governor John Kasich found himself clarifying his position on the ACA last week after offering support for the law’s Medicaid expansion provision. The Republican incumbent’s comments came in response to an Associated Press article on GOP governors' positions on the health care law, in which he was quoted. The governor staunchly denied support for the ACA but said that he doesn't see the Medicaid expansion policy "as really connected to Obamacare." Governor Kasich sought to clarify that he believes the ACA should be repealed and replaced but that he does not believe Medicaid expansion will be repealed. Ohio Democratic Party Chairman Chris Redfern accused the governor of "(debating) himself on health care policy."

UTAH: Ending months of speculation, Governor Gary Herbert announced last week that he would not call a special session to address Medicaid expansion. Legislators instead will take up the issue during the regular 2015 session, which begins on January 26. The governor and the state’s Medicaid leadership have been conducting extensive negotiations with HHS to craft a flexible approach to increasing coverage. The centerpiece of Herbert’s Healthy Utah plan is a pilot state program that can be modified over several years to accommodate new ideas for assisting the underserved population and include the offer of job training. The details are still being worked out, but Michael Hales, Director of Medicaid and Health Financing, advised the Joint Legislative Health Care Reform Task Force that his department is working on a memorandum of understanding that would detail the state’s approach.


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