Wednesday, February 10, 2016

qotd: Changing provider networks when enrollment periods are closed

The Columbus Dispatch
February 10, 2016
InHealth customers mad about late notice dropping OhioHealth
By Ben Sutherly

Some central Ohio consumers say a Westerville-based health insurer
intended to keep quiet about its plan to drop OhioHealth hospitals and
doctors from its provider network until it was too late for many of its
enrollees to change their health plan.

In those complaints, the consumers, who mostly live in Franklin or
Delaware counties, expressed frustration over InHealth Mutual's
last-minute notice to consumers about its plan to drop most OhioHealth
providers as of March 1.

Many consumers said they were not notified of InHealth's plan to narrow
its provider network until last week, though some received robocalls on
Jan. 30, the day before the deadline to sign up for health insurance
through the federally run health-insurance marketplace.

During the first half of January, InHealth's leaders decided to drop
OhioHealth from the provider network. An official with the Ohio
Department of Insurance said that InHealth contacted the department late
on Jan. 15, triggering a required 15-day review period during which
department officials review documents to ensure that insurance companies
clearly explain provider-network changes to consumers.

However, an official with the Ohio Department of Insurance said nothing
stops insurers from starting the notification process during the 15-day
review period.

Ohioans who buy coverage through <>
typically cannot sign up for a different plan after the open-enrollment
period ends. There are some exceptions that allow for a special
enrollment period; among them, the loss of a job, a move or the birth of
a child. But an eleventh-hour change in an insurance company's provider
network isn't one of them.

The federal government will not create a special enrollment period for
people affected by InHealth's decision, said Andy Slavitt, acting
administrator for the Centers for Medicare & Medicaid Services, in a
conference call last week.


Comment by Don McCanne

One of the more important considerations in selecting plans offered
through the <> insurance exchanges
is whether or not an individual's physicians and hospitals are included
in the provider networks selected by the insurer. Although this is
supposed to place more control into the hands of the health care
consumer, in fact, the insurer is free to change the provider network at
any time, yet the patient is prohibited from changing insurers outside
of the open enrollment period. Patients lose their providers and can't
do anything about it until open enrollment for the next year.

The Affordable Care Act does allow special enrollment periods for
unavoidable circumstances wherein a person loses their coverage, but CMS
is reducing these special enrollments to prevent patients from
supposedly gaming the system. Apparently it is acceptable for insurers
to game the system through bait and switch of their provider networks,
but Andy Slavitt, the acting CMS administrator, stated that he will not
open up enrollment for these victims of bait and switch.

Really, is cracking down on special enrollment periods to the detriment
of the patient the type of incremental change we can expect going
forward? Great for the insurers, terrible for the patients.

What is wrong here? It is that the model of health care financing that
has been foisted on us is one that is designed to take good care of the
insurers while treating patients as a necessary nuisance since insurers
otherwise would not have a business without them.

Yesterday the citizens of New Hampshire had something to say about a
government that takes good care of the wealthy but makes middle- and
low-income individuals second class citizens. We have a crying need for
a single payer national health program, so it has to be up to us to
select politicians who will bring it to us. Most of those currently in
office are not going to do it.

/Physicians for a National Health Program (PNHP) is a nonpartisan
educational organization. It neither supports nor opposes any candidates
for public office./

Tuesday, February 9, 2016

qotd: wants to become an active purchaser?

Kaiser Health News
February 9, 2016
Will Get A California Makeover?
By Pauline Bartolone

Experts say the California exchange uses more of its powers as an
"active purchaser" than the vast majority of other states. That means it
can decide which insurers can join the exchange, what plans and benefits
are available and at what price.

The federal government — in pending proposed rules for 2017 — has
signaled it too wants to have more of a hand in crafting plans. would be forging ahead on a path California already
paved, swapping variety for simplicity in plan design.

"Not letting [health] plans define what's right for consumers, but
defining it on behalf of consumers … is a better model for the market,"
said Peter Lee, executive director of Covered California.

"We want to make sure every consumer has good choice but not infinite
choice," said Lee.

Most other states, including those in the federal exchange, haven't
subscribed to that idea so far. They have a clearinghouse model, in
which all health insurers and plan designs are accepted as long they
comply with the Affordable Care Act. That can mean the same insurer
offers multiple plans with slightly different premiums, deductibles and
copays. Even within one metal tier, say silver, the same insurer might
offer half a dozen slightly different plans.

Now, the federal government proposes to create standard cost-sharing
designs in various metal tiers and make them easily accessible on <>. And it's considering how to
improve "value" by being more selective about plans.

Covered California holds insurers to a higher bar than what's required
under the Affordable Care Act.

Covered California says it's the only exchange in the country that
requires all plans to be standardized (not just some, which the federal
government is proposing).

But one of two health insurance regulators in California, the state
Department of Insurance, said Covered California's strict guidelines may
not benefit consumers.

It has created a situation in which the exchange "has fewer carriers
than would otherwise be the case," said Janice Rocco, deputy
commissioner of the California Department of Insurance.

Health insurers on a national level are "strongly" opposed to an active
purchaser model for states served by
<>, including standardized benefits.

"It could discourage many from enrolling if they can't find a policy
that works best for them," said Clare Krusing from America's Health
Insurance Plans.

"Where there is competition and choice is where consumers benefit and
where health plans benefit," said Krusing.


Comment by Don McCanne

Covered California - one of the more successful state-operated ACA
insurance exchanges - has two features that are currently being
considered for the federally-operated ACA exchanges: standardized
cost-sharing designs and active purchasing of plans.

By creating standards for deductibles and other cost sharing, it makes
it easier for plan shoppers to compare plans since the out-of-pocket
expenses theoretically would be the same. After checking provider lists
to see if their physicians are in-network, and checking formularies to
see if their drugs are covered, shoppers can then select their plans
based on the premiums.

Of course there are still some uncertainties. It is not uncommon to
obtain care out of network, so another plan's network may have turned
out to be preferable. Also medical conditions change which might require
drugs that are not in the plan's formulary but may be covered by other

In contracting with plans for the exchanges, Covered California decided
to use active purchasing. In a non-transparent process, Covered
California negotiates with the plans in an attempt to gain the best
value for the plan beneficiaries. Under this process, not all plans are
accepted, thus the insurers are motivated to offer better value than
they might otherwise.

Active purchasing introduces more instability into the process. Plans
moving into or out of the exchanges may face unprecedented changes in
their administrative requirements which can be very disruptive to their
business model. Changes required by the instability of contracts
increase administrative expenses which are ultimately borne by the plan
beneficiaries, adding to costs when the intent was to decrease costs.
These disruptions apply not only to the private insurers but also to the
physicians and hospitals who are included in the networks. Since active
purchasing reduces the number of plans available, any change in plans
covered would have a greater impact on the contracted providers thereby
threatening insolvency.

To no surprise, the private insurers are not enthusiastic about either
standardization of the plans or active purchasing. With standardization,
the plans are less able to hide their innovations that improve the
profits and competitiveness of the plans (i.e., the plans can be more
competitive when the consumers do not know what they are buying). Active
purchasing drives plan revenues down and exposes them to greater risk
since the contract may not be renewed.

Clare Krusing of the insurance lobby organization, AHIP, says, "Where
there is competition and choice is where consumers benefit and where
health plans benefit." Instead of plans competing for contracts with the
ACA exchanges, they want to compete for individual patients. But the
patients lose because there is less plan oversight when there is no
active purchasing, and there is less transparency when the plans do not
have to comply with standardized cost-sharing.

Cost-sharing standardization and active purchasing are the types of
incremental reforms we can expect from those who say that we must build
on what we have. These will do almost nothing for the problems that face
us such as the 29 million uninsured, the tens of millions underinsured,
the loss of choice of health care providers, and the interminable
increase in health care spending.

We do have a better choice. Join the forces who are advocating for a
single payer national health program. With single payer, we would no
longer have to direct our health policies to maintaining a lucrative
private health insurance infrastructure. Instead we could direct our
health policies to taking care of patients, and that, of course, is what
reform should be all about.

Monday, February 8, 2016

qotd: Deloitte update of ACA Section 1332 state innovation waivers

Health Policy Brief
State health coverage innovation and Section 1332 waivers: Implications
for states
By Anne Phelps

Executive summary

Although states and the federal government have implemented most
Affordable Care Act (ACA) provisions, a few are scheduled to go into
effect in the coming years. One such provision is Section 1332 State
Innovation Waivers, (1332) which allows states to pursue alternative and
innovative strategies for ensuring that residents have access to
high-quality, affordable health insurance as long as they meet certain
requirements. Within the constraints of Section 1332, states have
numerous options for revamping their current approaches to providing
health coverage to individuals and families. If approved, the waivers
can go into effect beginning January 1, 2017. To implement reforms next
year and take advantage of realizing innovative alternatives for health
care coverage, states should consider acting now.

New guidance from the US Departments of Health and Human Services (HHS)
and Treasury released at the end of 2015 indicates that waiver proposals
from states using the federally facilitated health insurance exchange
might not be considered feasible at this time because "the Federal
platform cannot accommodate different rules for different states."
Instead, these states may want to consider establishing their own
exchange platform and then apply for a 1332 waiver.

This health policy brief presents a number of potential
waiver-associated coverage alternatives, including those being discussed
by some states. While some options are mutually exclusive, states may
include multiple innovative concepts in their applications. It is
important to note that, even with the new HHS and Treasury guidance, the
analysis required to support a 1332 waiver application may require
states to leverage actuarial, policy, technology, and data expertise.

A final consideration

As the United States moves closer to the next presidential election, the
health care landscape will continue to shift and evolve. Beginning in
2017, an Administration other
than the Obama Administration will have stewardship over the ACA and its
various provisions, including Section 1332 State Innovation Waivers, for
the first time. States should be aware that – depending on where they
are in the application process at the start of 2017 – approvals may
depend on the goals of the new Administration.

PDF of report (8 pages):


Comment by Don McCanne

Section 1332 of the Affordable Care Act allows states to pursue waivers
allowing alternative approaches to implementation of the Act as long as
they comply with certain minimal requirements. In December, HHS released
an advisory which gives guidance to what sort of innovations might be
approved. This Deloitte health policy brief includes this guidance in
updating the description of Section 1332 waivers and how the states may
use them.

A few points:

* Section 1332 does allow innovations that can improve access and
equity and thus should be considered by state activists who wish to
improve their health care systems, though the innovations are quite limited.

* Section 1332 does allow innovations that might rely more heavily on
market dynamics and thus could threaten the social insurance gains of
ACA, though those innovations are also quite limited, but state
activists should be on guard to help protect what gains have been made.

* States with federally facilitated health insurance exchanges will not
be able to receive waivers because of the administrative complexity:
"the Federal platform cannot accommodate different rules for different

* States that have not accepted federal funds to expand their Medicaid
programs may find that the political climate may inhibit any efforts to
improve their systems through waivers.

* The December 2015 advisory indicates that HHS will be quite rigid in
the interpretation of what innovations would be allowed. This will
protect states from efforts to dismantle the gains of ACA, but it will
also prevent states from using Section 1332 to establish a state-based
single payer system. Nevertheless, improvements such as all-payer
systems may be allowed, although the administrative requirements may be

* The Deloitte report emphasizes the importance of politics: "Beginning
in 2017, an Administration other than the Obama Administration will have
stewardship over the ACA and its various provisions, including Section
1332 State Innovation Waivers, for the first time. States should be
aware that – depending on where they are in the application process at
the start of 2017 – approvals may depend on the goals of the new

So this report does further confirm the fact that states can improve
their health systems through Section 1332 waivers. Until we can enact a
single payer national health program, state efforts should be pursued.

This report also confirms that state efforts alone are grossly
inadequate and that federal legislation for a national health program is
an imperative.

This year, single payer is back in the political arena. Although state
reform efforts are encouraged, we cannot allow these efforts to displace
or even dilute the drive for national single payer. Even if it is
difficult to see the political path to immediate enactment, at a
minimum, through education, grassroots and coalition efforts we can move
much closer to the political threshold required to make single payer

Read the Deloitte policy brief, give thought as to how far short Section
1332 waivers will leave us, and then join the national political
movement that will finally bring health care justice to all.