On April 18, 2019, the Centers for Medicare and Medicaid Services (CMS) issued final regulations and related guidance on a number of Affordable Care Act (ACA) provisions and related health care topics including out-of-pocket (OOP) maximums, Essential Health Benefits (EHBs), the opioid epidemic, and Exchange updates and reforms. These regulations are generally effective for plan years beginning on and after Jan. 1, 2020.
2020 OOP maximums
The 2020 OOP maximums will increase to $8,150 for individual coverage and $16,300 for family coverage. These coverage limits apply to all non-grandfathered plans, regardless of size or funding type.
Prescription drug cost-sharing
Three prescription drug pricing-related provisions were included in the proposed rule issued on Jan. 17, 2019. Due to concerns submitted by commenters, CMS chose to only include one in the final rule. Beginning in 2020, plans are permitted, but not required, to exclude drug manufacturer coupons from counting toward a covered person’s annual OOP maximum if a medically appropriate generic drug is available. This applies to individual, small group, large group and self-funded plans, to the extent permitted by state laws.
Essential Health Benefits (EHBs)
Last year’s regulations gave states more flexibility in selecting EHB benchmark plans beginning with the 2020 plan year.
As a reminder, any health plan that covers EHBs must cover these benefits with no annual or lifetime dollar maximums. This includes both fully insured and self-funded employer-sponsored plans.
The regulations encourage states to explore future EHB benchmark plan modifications that would be helpful in addressing the opioid epidemic.
They also encourage but do not require insurers to cover all four Medication-Assisted Treatment (MAT) drugs for treatment of opioid use disorder. Furthermore, HHS requires that if a plan excludes MAT for opioid use treatment, but covers it for other conditions, the insurer must justify the exclusion and explain how the benefit design is not discriminatory.
The final rule also includes a number of provisions that impact the Health Insurance Exchanges effective Jan. 1, 2020. They include:
- Making a technical change in how subsidies are calculated, which is projected to raise premium costs for some customers and potentially reduce enrollment.
- Maintaining the practice of “silver loading,” which allows insurers to load premium increases into silver-level Exchange plans to make up for the loss of cost-sharing reduction (CSR) payments. Silver loading also increases subsidy amounts available to eligible enrollees in those plans. In the proposed rule, CMS asked for input on whether and how it should end the practice beginning in 2021.
- Creating a new special enrollment period for consumers who are enrolled in individual market coverage off-Exchange who become eligible for subsidies due to a mid-year decrease in income.
- Reducing the user fee for qualified health plan (QHP) issuers by 0.5% on the Federally Facilitated Exchange and state-based Exchanges using the Federal platform. Since this fee is typically included in premiums, this may result in small premium reductions.
- Providing greater flexibility related to Navigator duties, removing certain required functions and requiring fewer trainings.
- Introducing greater flexibility and more oversight for web brokers who facilitate direct enrollment in Exchange plans outside of HealthCare.gov.
- Updating the risk adjustment program for insurers with high-cost enrollees.
This document is for general informational purposes only. While we have attempted to provide current, accurate and clearly expressed information, this information is provided “as is” and Legacy Benefits makes no representations or warranties regarding its accuracy or completeness. The information provided should not be construed as legal or tax advice or as a recommendation of any kind.
Earlier this week, federal agencies released a proposed rule for Health Reimbursement Arrangements (HRAs) and updated guidance for Section 1332 State Innovation Waivers (now called State Relief and Empowerment Waivers). The Administration had indicated these changes are part of its ongoing efforts to increase choice and flexibility in the insurance market.
Proposed rule would allow HRAs to be used with individual coverage
On Oct. 23, 2018, the Departments of Treasury, Labor, and Health and Human Services (HHS) issued proposed rules that would allow employees to use the dollars in employer-funded Health Reimbursement Arrangements (HRAs, also called Health Reimbursement Accounts) to purchase individual coverage both on and off the public Marketplace (or Exchange). These proposed rules were released in response to the Oct. 2017 Executive Order, in which the Administration directed the tri-agencies to consider ways to expand the flexibility of HRAs.
Currently, employer-funded HRAs are used exclusively with employer-sponsored coverage to reimburse employees for health care expenses not reimbursed under their base medical plan (e.g., deductibles or coinsurance). Under the proposed rule:
- Employees would be able to use HRA funds to pay the premium for individual insurance coverage purchased either on or off the public Marketplace.
- Employers would be required to make the HRA available to entire “classes” of employees (e.g., full-time, part-time, or seasonal workers).
- Employers could offer either a group health plan or an HRA that could be used to purchase individual coverage, but not both.
- If an employer offers the HRA, employees would be able to opt out if they are eligible for premium tax credits on the public Marketplace.
In addition to offering HRAs that could be used to pay for individual coverage, the proposed rule would also allow employers that offer traditional group health coverage to offer HRAs of up to $1,800 per year to reimburse employees for certain medical expenses, including stand-alone dental or vision benefits or premiums for Short-Term Limited Duration Insurance (STLDI), which is short-term individual insurance that doesn’t have to comply with all Affordable Care Act (ACA) rules.
Tax treatment of HRAs would remain unchanged and the offering of an HRA for individual coverage would satisfy the employer mandate if it is considered “affordable.” The Treasury Department and Internal Revenue Service (IRS) are expected to release guidance in the near future on the employer mandate affordability test and potential safe harbors.
The proposed rule can be read in detail here. The tri-agencies are requesting comments by Dec. 28, 2018.
Updated Section 1332 guidance increases state flexibility
On Oct. 22, 2018, the Centers for Medicare & Medicaid Services (CMS) issued updated guidance on Section 1332 waivers, which replaces guidance published in 2015. Under the ACA, states can apply to waive key ACA provisions in order to implement innovative, alternate health coverage rules or programs while retaining basic consumer protections. The five-year waivers were available beginning in 2017 and to date, eight states have received waivers.
The new guidance makes changes to the principles that CMS will use when reviewing and approving applications. While the original “guardrails” of ensuring comprehensiveness, affordability, scope of coverage, and deficit neutrality remain in place, CMS will interpret some of them differently to loosen restrictions. For example:
- 2015 guidance: Focused on the number of individuals estimated to receivecomprehensive and affordable coverage
- 2018 guidance: Focuses on the availability of comprehensive and affordable coverage
Beyond the basic guardrails, CMS has identified five new principles that future waiver requests should aim to achieve:
- Provide increased access to affordable private health plan coverage (including Association Health Plans and STLDI)
- Limit cost increases for consumers and the federal government
- Foster state innovation
- Support and empower those in need
- Promote consumer-driven health care
Changes were also made to streamline the state waiver application process. This guidance is effective for waivers submitted after Oct. 24, 2018, and has a 60-day comment period. Review the complete guidance or fact sheet for more information.
On October 24, 2018, the SUPPORT for Patients and Communities Act (SUPPORT Act) was signed into law. This comprehensive legislation addresses the U.S. opioid crisis and takes steps to augment and enhance the nationwide system for preventing and treating opioid addiction. The SUPPORT Act enjoyed tremendous bipartisan support, with a vote of 393-8 in the House and 98-1 in the Senate.
The SUPPORT Act makes changes to a variety of public health and law enforcement policies. Here’s an overview of some of the health care-related policy changes included in the law.
Medicaid Institutions for Mental Diseases (IMD) Exclusion: Amends the IMD exclusion to allow state Medicaid programs to receive federal reimbursement for covering certain IMD services up to a total of 30 days annually.
- Telehealth: Expands coverage of telehealth services under Medicare for the treatment of substance use disorders and co-occurring mental health disorders beginning July 1, 2019. Also directs the Secretary of Health and Human Services (HHS) to issue guidance regarding federal reimbursement for telehealth services and treatment for substance use disorders under Medicaid.
- Medicare and Medicare Advantage:
- Requires e-prescribing for coverage of Part D controlled substances starting in 2021.
- Requires HHS to establish prior authorization standards for electronic submissions starting in 2021.
- Requires physicians to screen for opioid use disorders during initial Medicare physical and annual wellness visits.
- Expands Medicare coverage and bundled payment for opioid addiction treatments.
- Requires drug management programs for at-risk beneficiaries be implemented by 2022 (currently voluntary).
- Addiction Treatment: Lifts restrictions on maintenance medications used to treat opioid addiction, allowing more types of health care providers to prescribe the drugs.
- Opioid Alternatives: Provides funding for research and development of non-addictive painkillers and allows the Food and Drug Administration to require that certain opioids be dispensed in packaging that encourages safe use (e.g., small blister packs).
- Prescription Drug Monitoring Programs (PDMPs): Gives authority to the HHS Secretary to issue guidelines specifying a uniform electronic format for the reporting, sharing, and disclosure of information for PDMPs. It also gives States the ability to share PDMP data with Medicaid managed care entities under certain parameters.
- Grant Funding: Includes new and reauthorized grant funding for a number of initiatives to address the crisis, including funding for Comprehensive Opioid Recovery Centers and reauthorizing funding from the 21st Century Cures Act to provide $500 million annually, in fiscal years 2019-2021, for State Opioid Response Grants. The following may also be of interest to employers and other community stakeholders:
- Career Act: Helps treatment or recovery services that partner with local employers, community organizations, and/or workforce development boards to support recovery, independent living, and participation in the workforce.
- Addressing Economic Impacts Pilot Program: Supports local workforce boards in areas with a high rate of substance use disorders to engage and assist employers in establishing job-training/transition services for those in recovery.
- Peer Support Communities: Supports recovery community organizations to develop, expand, and enhance services including fostering connections between such organizations and employers, behavioral care providers, primary care providers, schools, housing services, and child welfare agencies.
Medical record privacy rules update
Notably, after bipartisan negotiations between both chambers of Congress, a key provision aimed at changing medical record privacy rules did not make it into the final law. Under existing federal regulations (42 CFR Part 2), health care providers operating a Part 2 covered program are prohibited from disclosing a patient’s history with a substance use disorder unless they have the patient’s consent. The House’s opioid bill included a provision to align 42 CFR with existing Health Insurance Portability and Accountability Act (HIPAA) privacy requirements, but it is not included in the SUPPORT Act.
Legacy Benefits is excited to welcome Ray Loggins to our team.
Ray brings over ten years’ experience in insurance agency management and administration to our team. His insurance expertise extends across broad areas of practice including health, life, annuities and property. He is a published author on risk management.
He earned a Bachelor of Business Administration degree from Southern Methodist University and a Master of Arts degree in Business Management from Harvard University.
Humana announced they have signed a new agreement, effective June 1, 2017, that allows Humana commercial, Medicare Advantage, Medicaid, and individual exchange health plan members to receive in-network care at Tenet hospitals, hospital-affiliated outpatient centers, and with Tenet physicians.
They are currently in the process of loading Tenet providers to all applicable systems. There may be a delay in providers appearing in Physician Finder even though they are participating. For the best possible member experience, as always, they advise the member to check Physician Finder before seeking non-emergency care from a provider in order to help avoid any disruption in care or claims payment issues.
Humana is constantly evaluating its provider network, and they take seriously the responsibility to negotiate provider contracts that balance affordability and member access.