HHS finalizes Medicaid rule
Source: https://www.benefitspro.com
By Kathryn Mayer
Health officials on Friday issued a final rule guaranteeing 100 percent funding for new Medicaid beneficiaries as part of the Patient Protection and Affordable Care Act.
Health reform authorizes states to expand Medicaid to adult Americans under age 65 with income of up to 133 percent of the federal poverty level—about $15,000 for a single adult in 2012—and provides unprecedented federal funding for these states.
Under the new regulations, the federal government will pay all of the cost of certain newly eligible adult Medicaid beneficiaries through 2016, phasing down to a permanent 90 percent matching rate by 2020. It will remain there permanently.
The rule, issued by the U.S. Department of Health and Human Services, will take effect in January of next year.
“This is a great deal for states and great news for Americans,” HHS Secretary Kathleen Sebelius said. “Thanks to the Affordable Care Act, more Americans will have access to health coverage and the federal government will cover a vast majority of the cost. Treating people who don’t have insurance coverage raises health care costs for hospitals, people with insurance, and state budgets.”
HHS said the rule builds on several years of work that the department has done to support and provide flexibility to states’ Medicaid programs ahead of the 2014 expansion. The rule also offers more collaboration with states on audits that track down fraud and outlines ways states can make Medicaid improvements without going through a waiver process, HHS said in comments.
The administration will take comments from interested parties and the public for 60 days. The full text of the rule can be found here.
5 things on Americans’ 2013 health policy agenda
Source: https://eba.benefitnews.com
By Gillian Roberts
With the 113th Congress up and running and the president’s policy schedule filling up by the day, a recent poll by the Kaiser Family Foundation and Harvard School of Public Health identified five things Americans would like the government to set as top health care priorities this year:
1. State exchanges. Fifty-five percent of respondents say state-based health insurance exchanges are a top priority for their lawmakers. With only 18 states and Washington, D.C., declaring they will create state exchanges, more information is needed on how federally run exchanges will operate in the remaining states. “This is the year of the health insurance exchange,” said David Colby of the Robert Wood Johnson Foundation at a luncheon held Thursday at the Kaiser Family Foundation. The panelists, including Drew Altman, CEO of KFF, noted that governors are still split along partisan lines about the creation of exchanges.
2. PPACA opposition. Fifty-two percent, including 78% of Republicans, say the Patient Protection and Affordable Care Act opponents in Congress should continue trying to overturn the law. When asked why, a majority of respondents cited overturning the law for “less impact on taxpayers, employers and health care providers.”
3. PPACA complacency. Forty percent think that PPACA opponents in Congress should “accept that it is now the law of the land,” and move on to focus on implementation.
4. Premiums. Increasing state regulation of health insurance premiums should be a priority for lawmakers, 37% of respondents say.
5. Women’s health care. One-fifth of respondents believe lawmakers should limit women’s family planning, reproductive health and other services. A timely topic as PPACA’s birth control mandate seems poised to head to the Supreme Court later this year, according to the Associated Press.
Top 5 issues facing physicians, patients in 2013
Source: https://www.benefitspro.com
By Kathryn Mayer
As health reform continues to changes the landscape of our country’s health system, what’s to watch in this new year? A lot, industry insiders say.
Lou Goodman, president of The Physicians Foundation and CEO of the Texas Medical Association, says 2013 will be “a watershed year” for the U.S. health care system. Most of those changes will have a big impact on both patients and the physicians caring for them.
“It’s clear that lawmakers need to work closely with physicians to ensure we're well prepared to meet the demands of 30 million new patients in the health care system and to effectively address the impending doctor shortage and growing patient access crisis.”
The Physicians Foundation identified five issues that are likely to have a significant impact on patients and physicians in 2013.
1. Ongoing uncertainty over PPACA
Despite the Supreme Court decision upholding most of the provisions in the Patient Protection and Affordable Care Act and the re-election of President Obama, considerable uncertainty persists among patients and physicians regarding actual implementation of the act. Much of the law has yet to be fully defined and a number of key areas within PPACA—including accountable care organizations, health insurance exchanges, Medicare physician fee schedule and the independent payment advisory board—remain nebulous, the foundation says. Their research found that uncertainty surrounding health reform was among the key factors contributing to 77 percent of physicians being pessimistic about the future of medicine. In 2013, physicians will need to closely monitor developments around the implementation of these critical provisions, to understand how they will directly affect their patients and ability to practice medicine.
2. More consolidation
Consolidation means bigger, but is bigger better? Large hospital systems and medical groups continue to acquire smaller/solo private practices at a steady rate. According to the foundation's report pertaining to the future of U.S. medical practices, many physicians are seeking employment with hospital systems for income security and relief from administrative burdens. But increased consolidation may potentially lead to monopolistic concerns, raise cost of care, and reduce the viability and competitiveness of solo/private practice. As the trend toward greater medical consolidation continues across 2013, it will be vital to monitor for possible unintended consequences related to patient access and overall cost of care.
3. A scramble to fix the doctor shortage
In 2014, PPACA will introduce more than 30 million new patients to the U.S. health care system, a provision that has considerable implications relative to patient access to care and physician shortages. According to the Foundation’s Biennial Physician Survey, Americans are likely to experience significant challenges in accessing care if current physician practice patterns continue. If physicians continue to work fewer hours, more than 47,000 full-time-equivalent physicians will be lost from the workforce in the next four years. Moreover, 52 percent of physicians have limited the access of Medicare patients to their practices or are planning to do so. As the 12-month countdown to 30 million continues across 2013, physicians and policy makers will need to identify measures to help ensure a sufficient number of doctors are available to treat these millions of new patients – while also ensuring the quality of care provided to all patients is in no way compromised.
4. Erosion of physician autonomy
The Physicians Foundation believes that physician autonomy – particularly related to a doctor’s ability to exercise independent medical judgments without non-clinical personnel interfering with these decisions – is markedly deteriorating. Many of the factors contributing to a loss of physician autonomy include problematic and decreasing reimbursements, liability/defensive medicine pressures and an increasingly burdensome regulatory environment. In 2013, physicians will need to identify ways to streamline these processes and challenges, to help maintain the autonomy required to make the clinical decisions that are best for their patients.
5. Growing administrative burdens
Increasing administrative and government regulations were cited as one of the chief factors contributing to pervasive physician discontentment, according to the Foundation’s 2012 Biennial Physician Survey. Excessive “red tape” regulations are forcing many physicians to decrease their time spent with patients in order to deal with non-clinical paper work and other administrative burdens. In 2013, physicians and policy makers will need to work closely together to determine steps that will effectively reduce gratuitous regulations that negatively affect physician–patient relationships. According to a recent Foundation report, the creation of a Federal Commission for Administrative Simplification in Medicine could help reduce these regulations by evaluating and reducing cumbersome physician reporting requirements that do not result in cost savings or measurable reductions in patient risk.
Cheat Sheet: What employers need to know about the Affordable Care Act
Source: https://www.insidecounsel.com
By: Alanna Byrne, Mary Swanton
President Obama’s Election Day victory ends, or at least postpones, Republican promises to overhaul or repeal the Patient Protection and Affordable Care Act (PPACA), a hallmark piece of legislation from the president’s first term. This means that, starting on Jan. 1, 2014, employers with more than 50 full-time equivalent employees must either provide health care coverage for their workers or pay a penalty.
In the November feature “Pay or Play,” InsideCounsel provides a look at the key factors that companies should consider when deciding whether to comply with the law—or face a stiff fine for failing to do so.
Does the size of a business matter?
The PPACA applies to all companies with more than 50-full time employees. Employers can choose not to provide coverage, but will pay $2,000 for every worker they do not insure, excluding the first 30 employees.
A General Accounting Office review of several studies on the subject found that larger employers are less likely to drop health care coverage when the new reforms take effect, largely to remain competitive in attracting the best employees. Smaller companies with less than 100 workers, on the other hand, could face a disadvantage on the health care market, as they often can’t get the same deals on insurance as their larger counterparts, so paying the penalty may make sense to them.
How are part-time and full-time workers affected?
Currently, many employers offer benefits only to full-time employees, generally defined as those working 35 or more hours a week. The PPACA, however, has lowered the standard for full-time employment from 35 to 30 hours, leaving companies that rely on part-time employees with a difficult choice to make.
“The problem arises when you have a workforce where your criteria [for receiving health benefits] was 35 hours per week, and now the threshold is 30,” says Patricia Cain, a partner at Neal, Gerber & Eisenberg. “If you have a lot of employees working 30-plus hours but less than 35, your choices are to cut them back to under 30 hours, pay the penalty tax or offer coverage.”
What industries will be most affected by the new reforms?
Unsurprisingly, the hardest-hit industries are likely to be those that have not provided health coverage—or have provided very minimal insurance—to workers in the past, while offering insurance to executives. These include restaurant chains, retail outlets and other businesses in the service sector. A nondiscrimination clause in the PPACA now requires that companies provide the same coverage to all employees at all levels, or face a $3,000 per employee penalty.
Complicating matters for these businesses, the coverage they offer must be affordable, which is defined as coverage that does not cost more than 9.5 percent of an employee’s yearly W-2 wages. “To get out of all penalties, you have to offer [coverage] at 9.5 percent of household income. That’s a pretty low threshold for servers or shift cooks,” says BakerHostetler Partner John McGowan. “The business will incur some meaningful costs it doesn’t have in the budget right now.”
Are there hidden costs?
Ideally, the health care reforms will reduce health care costs by providing affordable preventative care and putting new regulations on health care providers. But the future of health care costs remains murky, and if they continue to rise after 2014, employers may be more likely to drop coverage.
“[The PPACA] mandates certain types of coverage be provided and mandates preventative coverage be provided at no cost, all of which are good for employees. But it doesn’t appear to take an aggressive stand toward lowering costs, and that’s what troubles employers,” says Littler Mendelson Shareholder Steve Friedman.
What role will state-run health care exchanges play?
The PPACA requires everyone to have health insurance, meaning that those employees who don’t receive it from their companies likely will have to seek it on state-run health care exchanges. But officials in some states have signaled their unwillingness to establish and oversee these exchanges, leaving the task to the federal government. And even if states do implement exchanges, some employers, particularly those operating in multiple states, are concerned about the quality and consistency of the programs.
“The big unknown is whether the exchanges will be a viable alternative to employer coverage,” says Michael Tomasek, a partner at Freeborn & Peters. “How good will the quality be? Will they function well? Will they be administered well? We just don’t know that yet. Until we know what the alternative to employer coverage is, it’s impossible for employers to make a rational choice about pay or play.”
2012 Election: PPACA Is Here to Stay
The votes have been counted and the campaign signs are gone from yards and highway medians (at least most of them). Now, employers are evaluating what the election results will mean for their businesses in the coming years.
On the national level, Americans chose to keep the status quo with President Barack Obama's re-election and split party control of Congress. For employers, the most significant and immediate impact of the election will be the preservation and advancement of the Patient Protection and Affordable Care Act (PPACA), according to a Reuters report.
"There's sort of an immediate acceptance that this law will stay in place in some meaningful way," Chris Jennings, who served as an advisor to former President Bill Clinton, told Reuters. "It's sort of like a big barrier has been removed."
Although the survival of the law now seems all but certain, its final form has yet to take shape. A number of provisions still lack guidance from federal agencies, and employers should expect an "avalanche" of regulations in the coming months, Gretchen Young of the ERISA Industry Committee told Business Insurance.
For example, the details of the penalty ($2,000 per full-time employee) on some employers that don't offer adequate coverage remain sketchy. Also, employers are still waiting for full guidance on how much they will have to contribute to the federal reinsurance program that is mandated by the law, Business Insurance reports.
In the meantime, employers should focus on the immediate requirements that are known. Some of these include:
- Expanding first-dollar preventive care to include a number of women's services, including contraception, unless the plan is grandfathered
- Issuance of summaries of benefits and coverage (SBCs) to all health plan enrollees
- Reducing the maximum employee contribution to $2,500 if the employer sponsors a health flexible spending account (FSA), beginning with the 2013 plan year
- Providing information on the cost of coverage on each employee's 2012 W-2 if the employer issued 250 or more W-2s in 2011
- Calculating and paying the Patient Centered Outcomes Fee in July 2013 if the plan is self-funded (insurers are responsible for calculating and paying the fee for insured plans but will likely pass the cost on)
- Providing a notice about the upcoming health care exchanges to all eligible employees in March 2013
The issue of the exchanges -- marketplaces that will allow employees and employers to shop for health care coverage represents another question mark for employers. State leaders have until mid-February to decide whether they will set up their own exchange or let the federal government run the show in their state. Nearly a half-dozen Republican-controlled states have already stated they won't set up exchanges, and more may follow. Because the makeup of these exchanges will affect a wide range of employers, companies should keep an eye on what's happening in their state, UBA notes.
Of course, the law still faces dozens of lawsuits, including one aimed at overturning the requirement that church-affiliated organizations must cover contraceptives for their employees, Reuters reports. Yet the reality for employers seems clear: PPACA is here to stay.
"There is no way the law is going to be repealed in the next two years, and Republicans know that," Chantel Sheaks of Buck Consultants L.L.C. told Business Insurance.
Obama Now Faces New Urgent Task
President Barack Obama faces a new urgent task now that he has a second term, working with a status-quo Congress to address an impending financial crisis that economists say could plunge the country into further recession if not resolved.
"You made your voice heard," Obama said in his acceptance speech, signaling that he believes the bulk of the country is behind his policies. It's a sticking point for House Republicans, sure to balk at that.
The same voters who gave Obama four more years in office also elected a divided Congress, sticking with the dynamic that has made it so hard for the president to advance his agenda. Democrats retained control of the Senate; Republicans kept their House majority.
House Speaker John Boehner, R-Ohio, spoke of a dual mandate. "If there is a mandate, it is a mandate for both parties to find common ground and take steps together to help our economy grow and create jobs," he said.
Senate Republican Leader Mitch McConnell of Kentucky had a more harsh assessment.
"The voters have not endorsed the failures or excesses of the president's first term," McConnell said. "They have simply given him more time to finish the job they asked him to do together" with a balanced Congress.
Obama's more narrow victory was nothing like the jubilant celebration in 2008, when his hope-and-change election as the nation's first black president captivated the world. This time, Obama ground it out with a stay-the-course pitch that essentially boiled down to a plea for more time to make things right and a hope that Congress will be more accommodating than in the past.
The most pressing challenges immediately ahead for the 44th president are all too familiar: an economy still baby-stepping its way toward full health; 23 million people out of work or in search of better jobs; civil war in Syria; a menacing standoff over Iran's nuclear program.
Sharp differences with Republicans in Congress on taxes, spending, deficit reduction, immigration and more await. While Republicans control the House, Democrats have at least 52 votes in the Senate and Republicans 45. One newly elected independent isn't saying which party he'll side with, and races in Montana and North Dakota were not yet called.
Votes also were being counted Wednesday in the Montana and Washington gubernatorial races.
Obama's list of promises to keep includes many holdovers he was unable to deliver on in his first term, such as rolling back tax cuts for upper-income people, overhauling immigration policy and reducing federal deficits. Six in 10 voters said in exit polls that taxes should be increased, and nearly half of voters said taxes should be increased on incomes over $250,000, as Obama has called for.
"It's very clear from the exit polling that a majority of Americans recognize that we need to share responsibility for reducing the deficit," Maryland Rep. Chris Van Hollen, the top Democrat on the House Budget Committee, told CNN. "That means asking higher-income earners to contribute more to reducing the deficit."
Even before Obama gets to his second inaugural on Jan. 20, he must deal with the threatened "fiscal cliff." A combination of automatic tax increases and steep across-the-board spending cuts are set to take effect in January if Washington doesn't quickly reach a budget deal. Experts have warned that the economy could tip back into recession without an agreement.
Newly elected Democrats signaled they want compromise the avoid the fiscal cliff.
Sen.-elect Tim Kaine, a former Virginia governor who defeated Republican George Allen, said on NBC's "Today" show that voters sent a message they want "cooperative government." But he also says the election results show that the public doesn't want "all the levers in one party's hands" on Capitol Hill.
From Massachusetts, Elizabeth Warren said on "CBS This Morning" that those who voted for her opponent, Republican Sen. Scott Brown, expressed a desire for lawmakers to work together. She says: "I heard that loud and clear."
Obama repeated his campaign slogan of moving "forward" repeatedly in a victory speech early Wednesday in his hometown of Chicago.
"We will disagree, sometimes fiercely, about how to get there," he said. "As it has for more than two centuries, progress will come in fits and starts. It's not always a straight line. It's not always a smooth path. By itself, the recognition that we have common hopes and dreams won't end all the gridlock, or solve all our problems, or substitute for the painstaking work of building consensus, and making the difficult compromises needed to move this country forward. But that common bond is where we must begin."
Former Obama adviser Anita Dunn told "CBS This Morning" that the president made it clear in his acceptance speech that he will be reaching out, and she warned GOP House leaders, representing Ohio, Virginia and Wisconsin, to keep in mind that their voters also wanted to keep Obama.
"Clearly there's a lot of momentum and a lot of incentive for people to work together to really find answers to the challenges," she said.
The vanquished Republican, former Massachusetts Gov. Mitt Romney, tried to set a more conciliatory tone on the way off the stage.
"At a time like this, we can't risk partisan bickering," Romney said after a campaign filled with it. "Our leaders have to reach across the aisle to do the people's work."
Obama won at least 303 electoral votes to 206 for Romney, with 270 needed for victory, and had a near-sweep of the nine most hotly contested states.
But the close breakdown in the popular vote showed Americans' differences over how best to meet the nation's challenges. With more than 90 percent of precincts reporting, the popular vote went 50 percent for Obama to 48.4 percent for Romney, a businessman-turned-politician. Romney had argued that Obama failed to turn around the economy and he said it was time for a new approach that combined lower taxes and a less intrusive government.
Obama's re-election means his signature health care overhaul will endure, as will the Wall Street overhaul enacted after the economic meltdown. The drawdown of troops in Afghanistan will continue apace. With an aging roster of justices, the president probably will have at least one more nomination to the Supreme Court.
A second term is sure to produce turnover in his Cabinet. Treasury Secretary Timothy Geithner has made it clear he wants to leave at the end of Obama's first term but is expected to remain in the post until a successor is confirmed. Secretary of State Hillary Rodham Clinton, Obama's rival for the presidency four years ago, is ready to leave. Defense Secretary Leon Panetta isn't expected to stay on.
Obama won even though exit polls showed that only about 4 in 10 voters thought the economy is getting better, just one-quarter thought they're better off financially than four years ago and a little more than half think the country is on the wrong track.
But even now, four years after George W. Bush left office, voters were more likely to blame Bush than Obama for the fix they're in.
Some Americans were hopeful for progress in Obama's second term.
"He may not have done a great job in my mind but I kinda trust him," Jerry Shul said Wednesday morning in Times Square. "And I feel like he's gonna keep trying and I feel like when people keep trying in you favor things work out. I have faith in him, I have faith he will get with the Republicans and get something done."
Elsewhere on the ballot, voters in Maine and Maryland became the first to approve same-sex marriage by popular vote while Washington state and Colorado legalized recreational use of marijuana.
The most expensive presidential campaign in history, at $2 billion plus, targeted people in the nine states that determined the outcome, and the two sides drenched voters there with more than a million ads, the overwhelming share of them negative.
Obama claimed at least seven of those states, most notably Ohio, seen as the big prize. He also prevailed in Iowa, New Hampshire, Colorado, Nevada, Virginia and Wisconsin. Romney got North Carolina.
Florida was too close to call Wednesday morning. The unofficial count had Obama with a 46,000-vote lead, but Florida historically has left as many as 5 percent of its votes uncounted until after Election Day.
Overall, Obama won 25 states and the District of Columbia. Romney won 24 states.
It was a more measured victory than four years ago, when Obama claimed 365 electoral votes to Arizona Sen. John McCain's 173, and won 53 percent of the popular vote.
Preliminary figures indicate fewer people participated this time. Associated Press figures showed that about 118 million people had voted in the White House race, but that number will rise as more votes are counted. In 2008, 131 million people voted, according to the Federal Election Commission.
What Does the Election Mean for Employers and PPACA
Maintenance of the status quo in Washington, D.C. (the re-election of Barack Obama, with a Republican majority in the House of Representatives and a Democratic majority in the Senate) means that implementation of the Patient Protection and Affordable Care Act (PPACA) will move forward largely as the law was passed in 2010.
The law left the task of working out many of the details to the regulatory agencies (the Department of Labor, the IRS and the Department of Health and Human Services), and with many questions remaining unanswered, employers can expect that an enormous number of regulations and other types of guidance will be issued between now and the end of 2013.
Of greatest interest to many employers is the employer shared-responsibility ("play or pay") requirement. As of Jan. 1, 2014, employers who have 50 or more full-time or full-time equivalent employees must offer "minimum essential" (basic) medical coverage for their full-time (30 or more hours per week) employees or pay a penalty of $2,000 per full-time employee, excluding the first 30 employees. Employers who offer some coverage but whose coverage is either not "affordable" or fails to provide "minimum value" must pay a penalty of $3,000 for each employee who receives a premium tax credit. (Coverage is not "affordable" if the employee's cost of single coverage is more than 9.5 percent of income. Coverage does not provide minimum value if it is expected to pay less than 60 percent of anticipated claims. Regulations are still needed to provide details on how the penalty will be determined and collected for employers who do not provide health coverage to their full-time employees, what exactly is the "minimum value" coverage that must be provided to avoid the penalties, and when dependent coverage is "affordable.")
The health insurance exchanges are also scheduled to begin operation in January 2014. (While PPACA is a federal law, the health insurance exchanges were designed to be operated by the states.) A number of states have delayed work on the exchanges pending the outcome of this election, while a few have affirmatively decided not to create a state exchange. If a state is unable or chooses not to create an exchange, the federal government will run the exchange on the state's behalf.
According to the Kaiser Family Foundation, as of Sept. 27, 2012, the following have established exchanges: California, Colorado, Connecticut, District of Columbia, Hawaii, Kentucky, Maryland, Massachusetts, Nevada, New York, Oregon, Rhode Island, Utah, Vermont, Washington and West Virginia. Arkansas, Delaware and Illinois were planning for a partnership exchange with the federal government. Alaska, Florida, Louisiana, Maine, New Hampshire, South Carolina and South Dakota have stated that they will not create an exchange (meaning the federal government will run the exchange on the state's behalf). The remaining states are studying their options but could well end up with a federally run exchange at least for 2014 as the deadline to submit the state's plan for implementing an exchange is next week (Nov. 16).
It remains to be seen whether the federal government will be able implement so many exchanges on behalf of the states by the 2014 target date. It also remains to be seen whether a change of governor, insurance commissioner or control of a state legislature or political realities, will change a state's stance on the exchanges. Because employees may choose to obtain coverage through the exchange even if they have access to coverage through their employer and because the exchanges likely will request information from employers when determining eligibility for premium tax credits, all employers will want to have an understanding of the status of their state's exchange.
In addition to deciding whether to "play" (provide health coverage) or "pay" (the penalties), employers (including those with fewer than 50 employees) have a number of compliance obligations between now and 2014, including:
- Expanding first-dollar preventive care to include a number of women's services, including contraception, unless the plan is grandfathered
- Distributing medical loss ratio rebates if any were received from the insurer
- Issuance of summaries of benefits and coverage (SBCs) to all enrollees
- Reducing the maximum employee contribution to $2,500, if the employer sponsors a health flexible spending account (FSA), beginning with the 2013 plan year
- Withholding an extra 0.9 percent FICA on those earning more than $200,000 beginning in 2013
- Providing information on the cost of coverage on each employee's 2012 W-2 if the employer issued 250 or more W-2s in 2011
- Providing a notice about the upcoming exchanges to all eligible employees in March 2013
- Calculating and paying the Patient Centered Outcomes Fee in July 2013 if the plan is self-funded (insurers are responsible for calculating and paying the fee for insured plans but will likely pass the cost on)
- Working with the exchanges to identify those employees eligible for premium tax credits
- Removing annual limits on essential health benefits and pre-existing condition limitations for all individuals, beginning with the 2014 plan year
- Limiting eligibility waiting periods to 90 days, beginning with the 2014 plan year
- Reporting to the IRS on coverage offered and available (the first reports are actually due in 2015 based on 2014 benefits)
If you have questions or would like additional information about your options and obligations under PPACA, please contact us.
The Future of Health Care in Obama’s Second Term
Source: thehealthcareblog.com
By: JOANNE CONROY, MD
Although members of the Obama team are now celebrating their election victory, the next four years will not be smooth sailing. Ignoring the campaign rhetoric, there is still much more work to be done in order to reshape our health care system; the effect on academic medical centers and teaching hospitals will be significant.
The political conscience is still being driven by the fear of the fiscal cliff, which dominates most Washington conversations. Both political parties agree that health care is a significant contributor to our present and future deficit and that we have to figure out how to deliver more care at a lower cost. But, they argue about what to call it, who gets credit, and whether the solution is bigger government involvement or a dominant private market?The potential cuts to NIH funding and graduate medical education support do not go away with another four Obama years. We anticipate that the president will reform the tax code and transform how we deliver health care. The latter will be his lasting legacy.
However, in all this chaos, there are opportunities. While we no longer hope for a bipartisan middle ground on health care — and rancor will certainly escalate if President Obama is reelected — to many people, the Affordable Care Act is starting to look like a tangible business opportunity. Every insurer is looking at the 30 million uninsured people who will receive coverage through a mix of subsidized private insurance for middle-class households and expanded Medicaid for low-income people. These new markets could be worth $50 billion to $60 billion in premiums in 2014, and as much as $230 billion annually within seven years. The structure and implementation of these programs present specific challenges for AMCs.
Medicaid:
Academic medical centers currently deliver 28 percent of inpatient care for Medicaid recipients and 40 percent of uninsured care in the United States — in only 6 percent of the acute care facilities. We have the Medicaid specialty care market cornered — because no one else will accept these patients. The expansion of Medicaid will create stress in our historical access points: emergency rooms and primary care offices. We will be overwhelmed if we do not dramatically reengineer where we deliver care and rethink who should deliver care for what conditions. We will experience costs that quickly spiral out of control if we just expand our current system.
Obama’s re-election removes the indecision about whether to opt in or opt out for many state governors. Most insurers are betting on the fact that dual eligibles (patients who are disabled or poor enough to qualify for both Medicaid and Medicare) will be moved into the managed Medicaid plans. This will require active care management, better EHRs, geomapping of resource utilization, and a greater understanding of the impact of social determinants of health on this population. It will be interesting to see if the role of the insurer really expands to manage the outcome instead of just the cost.
Health Exchanges:
The implementation of the exchanges poses challenges for states, because they are supposed to be self-sustaining by 2015. Their ability to achieve this comes down to demographics and the size of their insured pool. Small high-risk pools will need to be intensively managed (like the District of Columbia), in contrast to larger populations that can be more loosely managed as they develop state-wide infrastructure. For academic medicine, the exchanges will present specific challenges. Our services could be subject to higher deductibles, copays and even co-insurance if the exchanges choose to tier providers according to cost. As a result, our care could be inaccessible to many patients without means.
There has also been very little discussion about how to transition graduate medical education support into the exchange market. Currently Medicare, Medicaid, and other insurers support the educational mission through explicit or implicit support. Supporting the training of the health care workforce has been considered a public good that increases access and quality for patients. Medicare Advantage programs use a “carve out” to preserve this support, but this option has not yet been part of the exchange discussions.
Physician Shortages:
The Center for Workforce Studies at the AAMC estimates that the nation will face significant physician shortages by 2020. As the newly insured begin to seek care in 2014, and as we anticipate these shortages, one must wonder who will care for these patients? By 2017, the number of physician retirees will be close to the number of new medical school graduates. While medical schools as a whole have been expanding the number of students they admit, there may not be enough residency positions to accommodate them. The Obama team can ignore the growing physician shortage — but at their peril. Unfortunately, we also continue to debate within specialty societies about who should provide the services, rather than talking about how we can deliver care as a team more efficiently. Use of interprofessional teams holds great promise for improving the efficiency of the physician workforce, and we anticipate that the administration will continue to support innovative reforms in health care delivery.
Health care reform will continue to move forward, imperfect as it may be. I have great hopes for bipartisan solutions, but I won’t hold my breath. The really hard work is not over; it has just begun.
Obama Wins Re-election: Health Care Reform Law Here to Stay
After hard-fought campaigns by both candidates, President Barack Obama has been re-elected for a second term in office. Obama’s victory in the election, along with last summer’s Supreme Court decision upholding the health care reform law, cements the Democratic Party’s dedication to the legislation.
While opponents of the law have called for its repeal, health care reform’s supporters consider the legislation to be the major achievement of Obama’s first term. Obama’s re-election, along with continued Democratic control of the Senate, means that implementation of the law will now continue without additional roadblocks.
WHAT DO EMPLOYERS HAVE TO DO NEXT?
With the landscape of employer-provided health care potentially changing over the next few years, employers should consider their future plans related to their role in employee health care. They may have to make some big decisions about whether to continue providing coverage to their employees. The “pay or play” penalties provide some incentive for employers to continue coverage, since they will be at risk for significant penalties if they do not. However, employers may decide that paying the penalty is more cost-effective than continuing to pay the ever-increasing costs of health care for employees and their families.
On the other hand, uncertainty among employees about the quality and cost of individual health coverage continues to make employer-provided health coverage an attractive recruiting and retention tool. Because of these advantages, most employers plan to continue offering coverage for now. The additional uncertainty for employers, with compliance obligations hinging on court decisions and the political process, has made many companies hesitant to make any large-scale changes.
Whatever their future decisions may be, employers that will continue to sponsor group health plans for the near future must prepare for upcoming deadlines. Significant health care reform provisions with looming effective dates include:
Summary of Benefits and Coverage
Health plans and issuers must provide an SBC to participants and beneficiaries that includes information about health plan benefits and coverage in plain language. The deadline for providing the SBC to participants and beneficiaries who enroll or re-enroll during an open enrollment period is the first open enrollment period that begins on or after Sept. 23, 2012. The SBC also must be provided to participants and beneficiaries who enroll other than through an open enrollment period (including individuals who are newly eligible for coverage and special enrollees) effective for plan years beginning on or after Sept. 23, 2012.
60-Days’ Notice of Plan Changes
A health plan or issuer must provide 60 days’ advance notice of any material modifications to the plan that are not related to renewals of coverage. Notice can be provided in an updated SBC or a separate summary of material modifications. This 60-day notice requirement becomes effective when the SBC requirement goes into effect for a health plan.
$2,500 Limit on Health FSA Contributions
The health care law will limit the amount of salary reduction contributions to health flexible spending accounts to $2,500 per year for plan years beginning on or after Jan. 1, 2013.
W-2 Reporting
Beginning with the 2012 tax year, employers that are required to issue 250 or more W-2 Forms must report the aggregate cost of employer-sponsored group health coverage on employees’ W-2 Forms. The cost must be reported beginning with the 2012 W-2 Forms, which are issued in January 2013.
Preventive Care for Women
Effective for plan years beginning on or after Aug. 1, 2012, non- grandfathered health plans must cover specific preventive care services for women without cost-sharing requirements. Calendar year plans must comply effective Jan. 1, 2013.
Employee Notice of Exchanges
Effective March 1, 2013, employers must provide a notice to employees regarding the availability of the health care reform insurance exchanges. HHS has indicated that it plans on issuing model exchange notices in the future for employers to use.
Additional Medicare Tax for High-wage Workers
In 2013, health care reform increases the hospital insurance tax rate by 0.9 percentage points on wages over $200,000 for an individual ($250,000 for married couples filing jointly). Employers will have to withhold additional amounts once employees earn over $200,000 in a year.
WHAT GUIDANCE WILL WE SEE?
Regulations on a number of issues remain outstanding. The regulatory agencies responsible for implementation and enforcement of the health care reform law—the Departments of Labor, Treasury and Health and Human Services— began issuing additional guidance once the Supreme Court upheld the law. Additional guidance is expected now that the election is over.
Issues that will likely be addressed in future guidance include:
Employer Pay or Play Mandate
The agencies are expected to, and have indicated that they will, issue more guidance for employers to help them determine how to comply with the shared responsibility provisions of the law.
Automatic Enrollment
The Department of Labor is required to issue regulations implementing the rule requiring large employers that offer health coverage to automatically enroll new employees in the health plan (and re-enroll current participants).
Nondiscrimination Rules for Fully-insured Plans
Under health care reform, non-grandfathered fully- insured plans will not be able to discriminate in favor of highly-compensated employees with respect to their health benefits. The IRS delayed the effective date of this rule for additional regulations, which have yet to be issued.
State governments may also take further steps to establish the health insurance exchanges required by the health care reform law. The federal government will step in and set up exchanges for states that fail to establish their own exchanges. Many states have delayed implementation and will need to accelerate their efforts if they want to run their own exchanges.
CHALLENGES FOR IMPLEMENTATION
As we get closer to full implementation of the health care reform law, questions linger about whether the framework is in place for all pieces to be operational by their deadlines. Insufficient staffing of the responsible agencies is one potential issue, along with employer and state government hesitation or inability to implement certain parts of the law. Compliance efforts are likely to pick up now that the election is over.
What is the real cost of free women’s health care?
By Marli D. Riggs
https://ebn.benefitnews.com
Although eight new prevention-related health care services for women included in the Patient Protection and Affordable Care Act are now available at no cost to female patients, many are left wondering about the real price tag.
Tanya Boyd, owner of Sunnyvale, Texas-based Tanya Boyd & Associates, believes the Department of Health and Human Services and the Obama administration should not tout the word “free” when talking about health care coverage. “It is completely misleading,” she says.
Free is more of a fallacy and should be replaced with the more appropriate word “covered,” when talking about health care services covered for women, adds Reid Rasmussen, owner of McKinney, Texas-based Benefit Brainstorm. “While many call these ‘free’ services, there is still a cost that’s being shared by Americans who are buying insurance,” he says.
As of Aug.1, the new rules in the health care law requiring coverage of these services take effect at most health insurance plans’ next renewal date.
The services are expected to cover 47 million women, and the total number of prevention-related health care services for women climbs to 22, rising from 14 that became effective in September 2010, according to the federal government. The eight new prevention-related services are based on recommendations from the Institute of Medicine, which polled independent physicians, nurses, scientists and other experts, as well as evidence-based research, to develop its recommendations.
Non-grandfathered group health plans offering group or individual health insurance coverage must provide coverage for preventive care without any cost-sharing requirements such as copayments, coinsurance or deductibles, as long as services are administered by physicians and other health care professionals who participate in the plan’s network.
Group health plans and issuers that have maintained grandfathered status are not required to cover these preventive services. In addition, certain nonprofit religious organizations, such as churches and schools, are also not required to cover these services.
Boyd claims that the services were already readily available to women who needed and wanted them. “Many women who put health care at the top of their priority list have always had the services done, whether they paid a copay, found a clinic that provided services for free, or paid 100% out of their pocket,” Boyd says. “Now insurance companies are forced to pay for these services, which will be reflected in the premiums we all pay.”
Putting it bluntly, Boyd says: “All of this ‘free’ stuff is going to be very expensive.”