Affordable Care Act and Emergency Rooms: Enrollment Opportunity and Visits

NPR and Kaiser Health News reported Tuesday that California hospitals are beginning to provide emergency room patients with information on signing up for health insurance plans, expanded Medicaid programs, and possible subsidies to lower the cost of health insurance for those who qualify. Hospitals such as O’Connor Hospital are hiring more staff dedicated to health benefits and insurance coverage to reach out to the 5,000 uninsured patients their emergency department treats each year.

Benefits coordinators Araceli Martinez reports more uninsured patients view health insurance as an affordable possibility after Martinez provides them with information on coverage options. However, most uninsured that pass through her door find the process of purchasing insurance on their own for the first time daunting and confusing. About half of poor uninsured adults are unaware that they would qualify for Medicaid.

There is an economic motivation for hospitals to sign patients up. Increasing the number of patients with private insurance increases reimbursement rates. This is especially appealing at a time when hospitals are facing Medicare cuts. The expansion of Medicaid allows hospitals to receive payment retroactively for medical treatments if the patient enrolls in Medicaid. The retroactive payments may be applied to treatment received up to three months prior to the patient’s enrollment.

Jim Dover, president and CEO of O’Connor Hospital, explains that dedicating resources to enrolling patients in healthcare insurance plans is also a worthy goal because the newly insured patients “don’t have to come to the ER for common problems.” This is a common argument for increasing Medicaid enrollment.

The argument came under fire recently when Science published a study that concluded emergency room visits increased with the expansion of Medicaid. The study found that people recently enrolled in Medicaid went to the emergency room 40-percent more frequently than others, even when the conditions could be treated less expensively in a doctor’s office.

"Increasing coverage and seeing people use more medical care isn't necessarily a bad thing," said Dr. Renee Hsia, an associate professor of emergency medicine at University of California San Francisco and a health policy researcher who wasn't involved in the study but reviewed it for Science. "The outcome that we desire is not that we don't have people going to see their doctors anymore. The outcome is that we have people who feel protected from (financial problems and) seeking care when they feel they need it."

Sources for this Blog:

Kaiser Health News, “Emergency Rooms Are Front Line for Enrolling New Obamacare Customers” 

NPR, “California Hospital Workers Pitch Obamacare to ER Patients” 

Kaiser Health News, “Medicaid Expansion Boosted Emergency Room Visits in Oregon, Study Finds”

Associated Press story in Seattle Times, “Study finds Medicaid expansion drove up ERvisits”

Health Insurance Rate Hikes in 9 States Deemed Excessive by HHS

Health and Human Services (HHS) Secretary Kathleen Sebelius announced that health insurance premium increases in nine states have been deemed “unreasonable” under the rate review authority granted by the Affordable Care Act.

"Thanks to the Affordable Care Act consumers are no longer in the dark about their health insurance premiums," said Secretary Sebelius. "Now, insurance companies are required to justify rate increases of 10 percent or higher. It’s time for these companies to immediately rescind these unreasonable rate hikes, issue refunds to consumers or publicly explain their refusal to do so."

Secretary Sebelius also released a new report showing that, six months after HHS began reviewing proposed health insurance rate increases, consumers are already seeing results. Since the rate review program took effect in 2011, health insurers have proposed fewer double-digit rate increases. Furthermore, more states have taken an active role in reducing rate increases, and consumers in all states are getting straight answers from their insurance companies when their rates are raised by 10 percent or more. As of March 10, 2012, the justifications and analysis of 186 double-digit rate increases for plans covering 1.3 million people have been posted at HealthCare.gov, resulting in a decline in rate increases. According to the report, in the last quarter of 2011 alone, states reported that premium increases dropped by 4.5 percent, and in states like Nevada, premiums actually declined.

HHS determined, after independent expert review, that two insurance companies have proposed unreasonable health insurance premium increases in nine states—Arizona, Idaho, Louisiana, Missouri, Montana, Nebraska, Virginia, Wisconsin, and Wyoming. The excessive rate hikes would affect over 42,000 residents across these nine states.

In these nine states, the insurers have requested rate increases as high as 24 percent. These increases were reviewed by independent experts to determine whether they are reasonable. In this case, HHS determined that the rate increases were unreasonable, because the insurer would be spending a low percentage of premium dollars on actual medical care and quality improvements, and because the justifications were based on unreasonable assumptions.
Most rates are reviewed by states and many states have the authority to reject unreasonable premium increases. Since the passage of the health care law, the number of states with this authority increased from 30 to 37, with several states extending existing “prior authority” to new markets.

The report released today shows that:
* States like Texas, Kentucky, Nevada and Indiana are reporting fewer requests for rate increases over 10 percent.
* States like California, New York, Oregon, and many others, have proactively lowered rate increases for their residents.
* The rate review program has made insurance companies explain their increases, and more than 180 have been posted publicly and are open for consumer comment on companyprofiles.healthcare.gov.

This initiative is one of many in the health care law to ensure that insurance companies play by the rules, prohibiting them from dropping coverage when a person gets sick, billing consumers into bankruptcy through annual or lifetime limits, and, soon, discriminating against anyone with a pre-existing condition.

Information on the specific determinations made today is available at: http://companyprofiles.healthcare.gov/

The rate review report released today is available at: http://www.healthcare.gov/law/resources/reports/rate-review03222012a.html
General information about rate review is available at: http://www.healthcare.gov/law/features/costs/rate-review/

Source: HHS News Release

Policies Give States Flexibility to Establish Affordable Insurance Exchanges

Health and Human Services Secretary Kathleen Sebelius announced policies to assist states in building Affordable Insurance Exchanges. Starting in 2014, these one-stop marketplaces will allow consumers and small businesses to choose a private health insurance plan and offer the public the same kinds of insurance choices as members of Congress.

The policies released will help states in designing their Exchanges to best meet the needs of their consumers. They offer states substantial flexibility as they design a marketplace that works for their residents.

“These policies give states the flexibility they need to design an Exchange that works for them,” said HHS Secretary Kathleen Sebelius. “These new marketplaces will offer Americans one-stop shopping for health insurance, where insurers will compete for your business. More competition will drive down costs and Exchanges will give individuals and small businesses the same purchasing power big businesses have today.”

The policies provide states with the guidance and certainty they need as they continue to work to build these marketplaces for their residents for operation in 2014. The policies offer guidance about the options on how to structure Exchanges in two key areas:
- Setting standards for establishing Exchanges, setting up a Small Business Health Options Program (SHOP), performing the basic functions of an Exchange, and certifying health plans for participation in the Exchange;
- Establishing a streamlined, web-based system for consumers to apply for and enroll in qualified health plans and insurance affordability programs.

The final rule builds on the flexibility and resources provided by HHS already to build state-based Exchanges. A majority of states have taken significant steps in building Exchanges. Previously, HHS awarded 49 states and the District of Columbia $50 million to begin planning their Exchanges, and as announced recently, 33 states and the District of Columbia have received over $667 million in Establishment Grants to begin building their Exchanges.

The announcement builds on over two years’ worth of work with states, small businesses, consumers, and health insurance plans. The administration examined models of Exchanges; convened numerous meetings and regional listening sessions across the country with stakeholders; and consulted closely with state leaders, consumer advocates, employers and insurers. To finalize the rules announced today, HHS accepted public comment over 75 days to learn from states, consumers, and other stakeholders on how the rules could be improved, and HHS modified the proposals based on feedback from the American people.

For more information, visit:
http://www.healthcare.gov/news/factsheets/2011/07/exchanges07112011a.html

For more information on Exchanges, including fact sheets, visit http://www.healthcare.gov/exchanges.

Source: HHS News Release

NeHC CEO Discusses National HIE Evolution

National eHealth Collaborative (NeHC) CEO Kate Berry was recently interviewed by FierceEMR about her views on the changing national HIE landscape. The article, written by contributing editor Marla Durben Hirsch, provided a summary of the recent NeHC University roundtable Implications of a Shifting National HIE Architecture and shared Berry's views the topic.

Click here to read the article.

Source: NeHC News Release

Policies Give States More Flexibility to Establish Affordable Insurance Exchanges

Health and Human Services Secretary Kathleen Sebelius announced policies to assist States in building Affordable Insurance Exchanges. Starting in 2014, these one-stop marketplaces will allow consumers and small businesses to choose a private health insurance plan and offer the public the same kinds of insurance choices as members of Congress.

The policies released will help States in designing their Exchanges to best meet the needs of their consumers. They offer States substantial flexibility as they design a marketplace that works for their residents.

“These policies give States the flexibility they need to design an Exchange that works for them,” said HHS Secretary Kathleen Sebelius. “These new marketplaces will offer Americans one-stop shopping for health insurance, where insurers will compete for your business. More competition will drive down costs and Exchanges will give individuals and small businesses the same purchasing power big businesses have today.”

The policies provide States with the guidance and certainty they need as they continue to work to build these marketplaces for their residents for operation in 2014. The policies offer guidance about the options on how to structure Exchanges in two key areas:
-Setting standards for establishing Exchanges, setting up a Small Business Health Options Program (SHOP), performing the basic functions of an Exchange, and certifying health plans for participation in the Exchange;
-Establishing a streamlined, web-based system for consumers to apply for and enroll in qualified health plans and insurance affordability programs.

The final rule builds on the flexibility and resources provided by HHS already to build State-based Exchanges. A majority of States have taken significant steps in building Exchanges. Previously, HHS awarded 49 States and the District of Columbia $50 million to begin planning their Exchanges, and as announced recently, 33 States and the District of Columbia have received over $667 million in Establishment Grants to begin building their Exchanges.

The announcement builds on over two years’ worth of work with States, small businesses, consumers, and health insurance plans. The administration examined models of Exchanges; convened numerous meetings and regional listening sessions across the country with stakeholders; and consulted closely with State leaders, consumer advocates, employers and insurers. To finalize the rules , HHS accepted public comment over 75 days to learn from States, consumers, and other stakeholders on how the rules could be improved, and HHS modified the proposals based on feedback from the American people.

For more information on the announcement, visit:
http://www.healthcare.gov/news/factsheets/2011/07/exchanges07112011a.html
For more information on Exchanges, including fact sheets, visit http://www.healthcare.gov/exchanges.

Source: HHS News Release

Medicare Redesigns Claims and Benefits Statement

As part of National Consumer Protection Week, the Acting Administrator of the Centers for Medicare & Medicaid Services (CMS), Marilyn Tavenner, announced the redesign of the statement that informs Medicare beneficiaries about their claims for Medicare services and benefits. The redesigned statement, known as the Medicare Summary Notice (MSN), will be available online and, starting in 2013, mailed out quarterly to beneficiaries.

This MSN redesign is part of a new initiative, “Your Medicare Information: Clearer, Simpler, At Your Fingertips,” which aims to make Medicare information clearer, more accessible, and easier for beneficiaries and their caregivers to understand. CMS will take additional actions this year to make information about benefits, providers, and claims more accessible and easier to understand for seniors and people with disabilities who have Medicare. This MSN redesign reflects more than 18 months of research and feedback from beneficiaries to provide enhanced customer service and respond to suggestions and input.

“Consumer protection starts with making sure consumers not only get timely and accurate information, but that they understand what services they’re receiving from Medicare,” said Acting Administrator Tavenner. “The new Medicare Summary Notice empowers Medicare’s seniors and people with disabilities. The statement is easier to understand and navigate, and makes clear what information to check and how to report potential fraud. The new MSN also makes it easier for people with Medicare to understand their benefits and file appeals if a claim is denied.”

To see a side-by-side comparison of the former and redesigned MSNs, please visit: http://www.cms.gov/apps/files/msn_changes.pdf

The redesign of the MSN includes several features not currently available to Medicare beneficiaries with the current MSN:
· A clear notice on how to check the form for important facts and potential fraud;
· Clearer language, including consumer-friendly descriptions for medical procedures;
· Definitions of all terms used in the form;
· Larger fonts throughout to make it easier to read;

The redesigned MSN will be available to beneficiaries on mymedicare.gov, Medicare’s secure online service for personalized information regarding Medicare benefits and services; and, in early 2013, paper copies of the redesigned MSN will start to replace the current version being mailed.

Source: CMS News Release

Health Reform Law Provides Coverage for Nearly 50,000 Americans With Pre-existing Conditions

U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that the new health care law’s Pre-Existing Condition Insurance Plan (PCIP) program is providing insurance to nearly 50,000 people with high-risk pre-existing conditions nationwide.

The Department released a new report demonstrating how PCIP is helping to fill a void in the insurance market for consumers with pre-existing conditions who are denied insurance coverage and are ineligible for Medicare or Medicaid coverage.

“For too long, Americans with pre-existing conditions were locked out of the health care system and their health suffered,” said HHS Secretary Kathleen Sebelius. “Thanks to health reform, our most vulnerable Americans across the country have the care they need.”

Under the Affordable Care Act, in 2014, insurers will be prohibited from denying coverage to any American with a pre-existing condition. Until then, the PCIP program will continue to provide enrollees with affordable insurance coverage.

In many cases, PCIP participants have been diagnosed with and need treatment for serious health care conditions such as cancer, ischemic heart disease, degenerative bone diseases and hemophilia. As a result of the new law, PCIP enrollees are receiving health services for their conditions on the first day their insurance coverage begins. Their critical need for treatment, combined with their lack of prior health coverage has led to higher overall per-member claims costs in state-based PCIPs of approximately $29,000 per year, which is more than double the per member cost that traditional State High Risk Pools have experienced in recent years.
Enrollment in PCIP has seen a nearly 400 percent increase from November 2010 to November 2011. PCIP enrollment is anticipated to trend upwards of 50,000 enrollees within the coming month.

People who enroll in the PCIP program are not charged a higher premium because of their medical condition. Program participants pay comparable premium rates to healthy people in the individual insurance market. By law, premiums may vary only on the basis of age, geographic area and tobacco use.

PCIP provides comprehensive health coverage, including primary and specialty care, hospital care, prescription drugs, home health and hospice care, skilled nursing care, preventive health and maternity care. The program is available in 50 states and the District of Columbia and open to U.S. citizens and people who reside in the U.S. legally (regardless of income) who have been without insurance coverage for at least six months, and have a pre-existing condition, or have been denied health insurance coverage because of a health condition.

The Affordable Care Act directed the Secretary of HHS to carry out PCIP either directly or through a contract with a state or nonprofit entity. In 27 states, a state or nonprofit entity elected to administer PCIP, while HHS operates the program in the remaining 23 states and the District of Columbia.

The new report can be found at: http://www.cciio.cms.gov/resources/files/Files2/02242012/pcip-annual-report.pdf

For more information, including eligibility, plan benefits and rates, as well as information on how to apply, visit www.pcip.gov and click on “Find Your State.” Then select your state from a map of the United States or from the drop-down menu.

The PCIP call center is open from 8 a.m. to 11 p.m. Eastern Time. Call toll-free 1-866-717-5826 (TTY 1-866-561-1604).

Source: HHS News Release

Health Reform to Require Insurers to Use Plain Language in Describing Health Plan Benefits, Coverage

People in the market for health insurance will soon have clear, understandable and straightforward information on what health plans will cover, what limitations or conditions will apply, and what they will pay for services thanks to the Affordable Care Act – the health reform law – according to final regulations published.

The marketing materials that insurers use can sometimes make it difficult for consumers to understand exactly what they are buying. The new rules, published jointly by the Departments of Health and Human Services, Labor and Treasury, require health insurers and group health plans to provide concise and comprehensible information about health plan benefits and coverage to the millions of Americans with private health coverage. The new rules will also make it easier for people and employers to directly compare one plan to another.

“All consumers, for the first time, will really be able to clearly comprehend the sometimes confusing language insurance plans often use in marketing,” said HHS Secretary Kathleen Sebelius. “This will give them a new edge in deciding which plan will best suit their needs and those of their families or employees.”

Under the rule, health insurers must provide consumers with clear, consistent and comparable summary information about their health plan benefits and coverage. The new explanations, which will be available beginning, or soon after, September 23, 2012 will be a critical resource for the roughly 150 million Americans with private health insurance today.

Specifically, these rules will ensure consumers have access to two key documents that will help them understand and evaluate their health insurance choices:
- A short, easy-to-understand Summary of Benefits and Coverage ( or “SBC”); and
- A uniform glossary of terms commonly used in health insurance coverage, such as “deductible” and “co-payment.”

All health plans and insurers will provide an SBC to shoppers and enrollees at important points in the enrollment process, such as upon application and at renewal.

A key feature of the SBC is a new, standardized plan comparison tool called “coverage examples,” similar to the Nutrition Facts label required for packaged foods. The coverage examples will illustrate sample medical situations and describe how much coverage the plan would provide in an event such as having a baby (normal delivery) or managing Type II diabetes (routine maintenance, well-controlled) These examples will help consumers understand and compare what they would have to pay under each plan they are considering.

The rules finalize the proposed rules issued in August 2011. Input was received from such stakeholders as the National Association of Insurance Commissioners (NAIC) and a working group composed of health insurance-related consumer advocacy organizations, health insurers, health care professionals, patient advocates including those representing people with limited English proficiency, and others. The final rules aim to ensure strong consumer information while minimizing paperwork and cost.

To view the template for the Summary of Benefits and Coverage and the glossary, visit: http://cciio.cms.gov/resources/other/index.html#sbcug

To view the Final Rule, visit: http://www.ofr.gov/inspection.aspx

For more information on the rules announced today, visit: http://www.healthcare.gov/news/factsheets/2011/08/labels08172011a.html

Source: HHS News Release

HHS Says Consumers Get Better Value for Their Health Insurance Dollar

Health and Human Services Secretary Kathleen Sebelius announced that consumers will soon begin receiving unprecedented information on the value of their health insurance coverage, and some will receive rebates from insurance companies that spend less than 80 percent of their premium dollars on health care.

The Affordable Care Act requires that insurance companies this year begin notifying customers how much of their premiums they have spent on medical care and quality improvement. Beginning in 2011, insurers were required to spend at least 80 percent of total premium dollars they collect on medical care and quality improvement. Insurance companies that do not meet the 80/20 standard (also known as the Medical Loss Ratio) are required to pay rebates to their customers this year.

"Before the Affordable Care Act, insurance companies could spend your premium dollars on administrative red tape and marketing," said Secretary Sebelius. "With today's notice, we're taking a big step toward making insurers accountable to consumers. Some of these insurance companies have already changed their behavior by lowering premiums or spending more on medical care and quality improvement, while the remainder will need to refund this money to their customers this year."

The proposed consumer notices about whether their insurance company has met the new standard have been posted on HealthCare.gov, and HHS is seeking public comment to help ensure the notices are useful transparency tools for consumers.

In the individual market, the Affordable Care Act allows the Secretary to adjust the medical loss ratio standard for a state if it is determined that meeting that standard may destabilize the state’s individual insurance market. HHS has concluded its review of 18 state requests for adjustments to the medical loss ratio rule. As a result of HHS’ decision to deny insurance companies the ability to spend more premium dollars on administrative overhead costs rather than on medical claims, consumers will receive up to $323 million in rebates this year compared to what would have been owed if all state adjustment requests were fully granted, according to data from state regulators and issuer reports.

These adjustment request determinations were made as a result of a transparent and data-driven process, and the documentation related to each state’s request has been publicly posted.

In total, HHS determined that no adjustment was necessary in ten states, approved an altered adjustment in six states, and approved the request sought by one state. This includes a denied adjustment for Wisconsin, and an altered adjustment for North Carolina.

The announcement is part of the Obama Administration’s effort to increase transparency in the health insurance marketplace. The notification will let consumers know if their insurer did not meet the 80/20 standard -- and that they or their employer will receive a rebate. HHS is also considering requiring insurers notify consumers if their insurer did meet the 80/20 standard.

For the text of these proposed notifications, please visit: http://cciio.cms.gov/resources/other/index.html#mlr

For more information on the MLR provision in the Affordable Care Act, please visit: http://www.healthcare.gov/news/factsheets/2010/11/medical-loss-ratio.html

For documentation of state requests for MLR adjustments, including specific information on rebates saved by HHS’ MLR adjustment determinations, visit: http://cciio.cms.gov/programs/marketreforms/mlr/index.html

For more information on how the Affordable Care Act is creating a transparent market for health insurance, visit: http://www.healthcare.gov/news/factsheets/2010/12/increasing-transparency.html

Source: HHS News Release

Weigh In: WSJ Discussion on Patient Unique IDs

A robust debate has begun in the Wall Street Journal regarding Should Every Patient Have a Unique ID Number for All Medical Records?

NAHAM members are encouraged to weigh in.

Source: WSJ Article

Health Care Reform Law's Rate Review Provision Holding Insurance Rates Down

Health insurance premium increases in five states have been deemed “unreasonable” by the U.S. Department of Health and Human Services, HHS Secretary Kathleen Sebelius announced .

After independent expert review, HHS determined that Trustmark Life Insurance Company has proposed unreasonable health insurance premium increases in five states—Alabama, Arizona, Pennsylvania, Virginia, and Wyoming. The excessive rate hikes would affect nearly 10,000 residents across these five states.

To make these determinations, HHS used its “rate review” authority from the Affordable Care Act (the health care reform law of 2010) to determine whether premium increases of over 10 percent are reasonable.

"Before the Affordable Care Act, consumers were in the dark about their health insurance premiums because there was no nationwide transparency or accountability," said Secretary Kathleen Sebelius. "Now, insurance companies are required to disclose rate increases over 10 percent and justify these increases. It’s time for Trustmark to immediately rescind the rates, issue refunds to consumers or publicly explain their refusal to do so."

In these five states, Trustmark has raised rates by 13 percent. For small businesses in Alabama and Arizona, when combined with other rate hikes made over the last 12 months, rates have increased by 27.2 percent and 18.1 percent, respectively. These increases were reviewed by independent experts to determine whether they are reasonable. In this case, HHS determined that the rate increases were unreasonable because the insurer would be spending a low percent of premium dollars on actual medical care and quality improvements, and because the justifications were based on unreasonable assumptions.

In addition to the review of rate increases, many states have the authority to reject unreasonable premium increases. Since the passage of the health care reform law, the number of states with this authority increased from 30 to 37, with several states extending existing “prior authority” to new markets.

Examples of how states have used this authority include:
- In New Mexico, the state insurance division denied a request from Presbyterian Healthcare for a 9.7 percent rate hike, lowering it to 4.7 percent;
- In Connecticut, the state stopped Anthem Blue Cross Blue Shield, the state’s largest insurer, from hiking rates by a proposed 12.9 percent, instead limiting it to a 3.9 percent increase;
In Oregon, the state denied a proposed 22.1 percent rate hike by Regence, limiting it to 12.8 percent.
- In New York, the state denied rate increases from Emblem, Oxford, and Aetna that averaged 12.7 percent, instead holding them to an 8.2 percent increase.
- In Rhode Island, the state denied rate hikes from United Healthcare of New England ranging from 18 to 20.1 percent, instead seeing them cut to 9.6 to 10.6 percent.
- In Pennsylvania, the state held Highmark to rate hikes ranging from 4.9 to 8.3 percent, down from 9.9 percent.

HHS' announcement comes the same week that a report showed that health care spending has grown at remarkably low rates. According to an analysis done each year by the Centers for Medicare & Medicaid Services (CMS), U.S. health care spending experienced historically low rates of growth in 2009 and 2010. A recent study released by Mercer Consulting also showed a slow-down in the average employee health benefit cost to businesses.

The Affordable Care Act includes several policies, including rate review, to continue this slow growth. By fighting fraud, better coordinating care, preventing disease and illness before they happen and creating a new state-based insurance marketplace, it helps keep health care cost growth low.

For more information on the specific determinations made today, please visit http://companyprofiles.healthcare.gov/

For general information about rate review, visit: http://www.healthcare.gov/law/features/costs/rate-review/

Source: HHS News Release

New HHS Regs Streamline Health Electronic Funds Transfer; Cut Red Tape

New standards for electronic funds transfers in health care, required by the Affordable Care Act, will reduce up to $4.5 billion off administrative costs for doctors and hospitals, private health plans, states, and other government health plans, over the next ten years, according to estimates included in new rules published by the U.S. Department of Health and Human Services (HHS).

The standards build upon regulations published in 2011 that set industry-wide standards for how health providers use electronic systems to quickly and easily determine a patient’s eligibility for health coverage and check on the status of a health claim.

Together, the two regulations implementing the Administrative Simplification provisions of the Affordable Care Act and the Health Insurance Portability and Accountability Act (HIPAA) are projected to save the health care industry more than $16 billion over the next 10 years. These savings come from the adoption of electronic standards that will help eliminate inefficient manual processes and reduce costs.

“Thanks to the Affordable Care Act, health care professionals will spend less time filling out paperwork and more time focusing on delivering the best care for patients,” said HHS Secretary Kathleen Sebelius.

A May 2010 study in the journal Health Affairs found that physicians spend nearly 12 percent of every dollar they receive from patients to cover the costs of filling out forms and performing other excessively complex administrative tasks. The study found that simplifying these systems could save four hours per week of professional time per physician and five hours of support staff time every week – time that could be better spent on patient care.

“As a nurse, I know the importance of giving health care professionals time to focus on patient care,” said CMS Acting Administrator Marilyn Tavenner. “The less time a physician has to spend on paperwork is that much more time that can be devoted to patient care. Having standardized procedures across the health care industry can only lead to lower costs and greater efficiencies all around.”

The rule—the Adoption of Standards for Health Care Electronic Funds Transfers and Remittance Advice — adopts streamlined standards for the format and data content of the transmission a health plan sends to its bank when it wants to pay a claim to a provider electronically (through an electronic funds transfer) and to issue a Remittance Advice notice. Remittance Advice is a notice of payment sent to providers that may or may not accompany the payment the provider receives.

For example, currently when a provider submits a claim electronically for payment, a health plan often sends a Remittance Advice separately from the Electronic Funds Transfers payment. The disconnect between the two makes it difficult or sometimes impossible for the provider to match up the bill and the corresponding payment. The rule addresses this by requiring the use of a trace number that automatically matches the two. The new tracking system will allow health care providers to eliminate costly manual reconciliation that must currently be done.

Future administrative simplification rules will address adoption of:
- A standard unique identifier for health plans;
- A standard for claims attachments; and
- Requirements that health plans certify compliance with all HIPAA standards and operating rules.

The regulation is effective January 1, 2012. All health plans covered under HIPAA must comply by January 1, 2014.

To view the Interim Final Regulation with comment period, go to: http://www.regulations.gov

For more information on the June 2011 HIPAA Administrative regulation: Adoption of Operating Rules for Eligibility for a Health Plan and Health Care Claim Status, visit: http://www.hhs.gov/news/press/2011pres/06/20110630a.html

Source: HHS News Release

New Data Indicates Affordable Care Act Provision Has Given 2.5m Young Adults Health Insurance

The National Center for Health Statistics at the Centers for Disease Control and Prevention (CDC) released data illustrating that the Affordable Care Act continues to significantly increase the number of young adults who have health insurance.

Because of the health care law, young adults can stay on their parents' insurance plans through age 26. This policy took effect in September 2010. Data from the National Health Interview Survey (NHIS) shows that since September 2010, the percentage of adults aged 19-25 covered by a private health insurance plan increased significantly, with approximately 2.5 million more young adults with insurance coverage compared to the number of young adults who would have been insured without the law.

“Thanks to the Affordable Care Act, 2.5 million more young adults don’t have to live with the fear and uncertainty of going without health insurance,” said Secretary Kathleen Sebelius. “Moms and dads around the country can breathe a little easier knowing their children are covered.”

The numbers show a continuation of the coverage gains due to the health care law as students graduate from high school and college in May and June and otherwise would have lost coverage.

The data is consistent with estimates from surveys released earlier in the year. Those surveys have shown an increase in the number and percentage of young adults 19 to 25 with health insurance coverage. Specifically, the Census Bureau and the Gallup-Healthways Well-Being Index Survey, as well as the NHIS release of data through March 2011, reported similar trends through early 2011.

The results, highlighted in an HHS issue brief, show that the initial gains from the health care law have continued to grow.

“The data announced today show that, because of the health care law, there is a continued and consistent pattern of improved health coverage among young adults,” said Sherry Glied, Ph.D., HHS assistant secretary for planning and evaluation. “The Affordable Care Act has helped literally millions of young adults get the health insurance they need so they can begin their careers with the peace of mind that they’re covered.”

For more information about this announcement, please see the HHS Issue Brief at http://aspe.hhs.gov/health/reports/2011/YoungAdultsACA/ib.shtml

For more information about the CDC NHIS data released today, please visit http://www.cdc.gov/nchs/data/nhis/earlyrelease/insur201112.pdf

Source: HHS News Release

CMS Issues Final Medical Loss Ratio Rule

The Centers for Medicare & Medicaid Services (CMS) issued a final regulation that will ensure health insurance companies spend at least 80 percent of consumers’ health insurance premiums on medical care, not income, overhead and marketing. Insurance companies that fail to meet the new standard are required to provide a rebate to consumers.

Known as the Medical Loss Ratio (MLR), this rule provides unprecedented transparency and accountability of health insurance companies for customers. Created by the Affordable Care Act, the MLR requirements provide protection and value to approximately 74.8 million insured Americans. Estimates from last year indicate that, starting in 2012, up to nine million Americans could receive rebates worth from $0.6 to $1.4 billion. However, early reports suggest insurers lowered premium growth rather than face the prospect of providing rebates – a win-win for consumers.

“Under the Affordable Care Act, consumers are already seeing better value from their health insurance companies,” said CMS Acting Administrator Marilyn Tavenner. “If your insurance company doesn’t spend enough of your premium dollars on medical care or quality improvement this year, they’ll have to give you rebates next year. This will bring costs down and give insurance companies the incentive to focus on what matters for patients – high quality health care.”

MLR rules took effect on January 1, 2011 but the final rule makes modifications and provides certainty to how the MLR is calculated. These modifications are based on public comments solicited in an earlier version of the rule published by CMS in the spring.

The modifications made in the new rule:
- Make the MLR rebate tax free: Rather than having insurers send checks that could be taxed, workers in group health plans can receive rebates in a way that is not taxable.
- Increase transparency: Consistent with comments from consumer groups, the new regulation proposes that all consumers receive a notice, showing not just the amount of any rebate, but what the insurer’s MLR means regardless of whether there is a rebate, and how the insurer’s MLR has improved under the new law. In addition, data on the special types of plans, mini-meds and ex-patriate plans, will be publicly posted in the Spring.
- Keep strong policies on how MLR is calculated: The final rule makes only a minor change to a quality improvement definition to promote insurer improvements in defining or coding of medical conditions for a limited window of time.
- Phase down the special circumstances adjustment for mini-med plans: In 2011, so-called mini-med plans received a special circumstances adjustment to their MLR in the form of a multiplier of 2.0 for 2011. The final rule phases it down from 1.75 in 2012 to 1.5 in 2013 to 1.25 in 2014. Mini-med plans will be banned by the prohibition on annual limits in the Affordable Care Act starting in 2014.
- Recognize circumstances of special types of plans: The final rule, after reviewing data, keeps the ex-patriate plan multiplier adjustment at 2.0 due to their unique structure. It also levels the playing field between non-profit and for-profit insurers in states with premium taxes.

For more information on the final rule, visit:
http://cciio.cms.gov/resources/factsheets/mlrfinalrule.html

Source: CMS News Release

HHS Awards Affordable Insurance Exchange Funds to States

The Department of Health and Human Services (HHS) awarded nearly $220 million in Affordable Insurance Exchange grants to 13 states to help them create Exchanges, giving these states more flexibility and resources to implement the Affordable Care Act. The health care reform law gives states the freedom to design Affordable Insurance Exchanges – one-stop marketplaces where consumers can choose a private health insurance plan that fits their health needs and have the same kinds of insurance choices as members of Congress.

The Department also released several Frequently Asked Questions providing answers to key questions states need to know as they work to set up these new marketplaces. Critical among these are that states that run Exchanges have more options than originally proposed when it comes to determining eligibility for tax credits and Medicaid. And states have more time to apply for “Level One” Exchange grants.

The awards bring to 29 the number of states that are making significant progress in creating Affordable Insurance Exchanges. States receiving funding today include: Alabama, Arizona, Delaware, Hawaii, Idaho, Iowa, Maine, Michigan, Nebraska, New Mexico, Rhode Island, Tennessee, and Vermont.

“We are committed to giving states the flexibility to implement the Affordable Care Act in the way that works for them,” HHS Secretary Kathleen Sebelius said. “Exchanges will give consumers more choices and make it easy to compare and shop for insurance plans.”
In the new Exchanges, insurers will provide new information such as an easy-to-understand summary of benefits and costs to consumers. The level of detail will sharpen competition between carriers which will drive costs down.

HHS also released a set of Frequently Asked Questions (FAQs) in anticipation of state legislative sessions beginning in January. Answers will help advance state policy development for Exchanges. For example, they clarify that Exchange grants can be used to build a state Exchange that is operational after 2014; that state-based Exchanges will not be charged for accessing Federal data needed to run Exchanges in 2014; and that state insurance rules and operations will continue even if the Federal government is facilitating an Exchange in the state. HHS will also allow greater flexibility in eligibility determinations, allowing, for example, a state-based Exchange to permit the Federal government to determine eligibility for premium tax credits.

Of the 13 states awarded grants today, 12 are receiving Level One grants, which provide one year of funding to states that have already made progress using their Exchange planning grant. The 13th state, Rhode Island, is receiving the first Level Two grant, which provides multi-year funding to states further along in the planning process.

Forty-nine states and the District of Columbia have already received planning grants, and 45 states have consulted with consumer advocates and insurance companies. Thirteen states have passed legislation to create an Exchange.

States have many opportunities to apply for funding. To accommodate state legislative sessions and to give states more time to apply, HHS also announced a six-month extension for Level One establishment grant applications. Applications now will be accepted until June 29, 2012 (the original deadline was December 30, 2011).

For the FAQs, visit http://cciio.cms.gov/resources/regulations/index.html#hie.

For more information on Affordable Insurance Exchanges, visit http://www.HealthCare.gov/law/features/choices/exchanges/index.html

For more information on the states receiving grants, visit http://www.healthcare.gov/news/factsheets/2011/05/exchanges05232011a.html

Source: HHS News Release

HHS Releases Tool to Help Small Businesses Compare Insurance Plans

A greatly expanded website to give small business owners an unprecedented detailed review of their health insurance plan choices was announced by the U.S. Department of Health and Human Services (HHS).

Just in time for 2012, this powerful new tool allows small business owners to compare the benefits and costs of health plans and choose those that are best for their employees. For the first time ever, it will allow small businesses to research locally available products in an unbiased manner and foster a more transparent and competitive marketplace.

“This new information will help business owners navigate what has traditionally been a complicated and confusing decision,” said HHS Secretary Kathleen Sebelius. “Both owners and their employees can feel more confident that the plans offered will be the best to suit everyone’s needs.”

In addition to the market being difficult to analyze, small businesses do not fare as well large employers when negotiating health care prices, on average small businesses spend 18 percent more for the same health insurance coverage. This new tool brings needed transparency to the marketplace, which will help ensure insurance companies will compete for business on the basis of price and quality.

The tool is located on www.HealthCare.gov, which was created under requirements contained in the Affordable Care Act, the new health care law of 2010. The website is the first of its kind to bring information and links to health insurance plans to one place, and to make it easy for consumers to learn about and compare their insurance options. The Centers for Medicare & Medicaid Services worked to define and collect detailed benefits and premium rating information from insurers across the country to develop the site.

The new information added gives small business owners access to the following:
Insurance product choices for a given ZIP code, sorted by out-of-pocket limits, average cost per enrollee, or other factors.

A summary of cost and coverage for small group products that shows the available deductibles, range of co-pay options, included and excluded benefits, and benefits available for purchase at additional cost.

The ability to filter product selection based on whether the plans are Health Savings Account eligible, have prescription drug, mental health, or maternity coverage, or allow for domestic partner or same sex coverage.

More than 530 insurers have provided information for more than 2,700 coverage plans across all states and the District of Columbia.

“Tens of thousands of small businesses from across America have already logged-on to www.HealthCare.gov to see what health coverage options are available to them,” said Steve Larsen, director of the Center for Consumer Information and Insurance Oversight. “The new, unprecedented ability to search at this level of detail will bring the marketplace into better balance by giving insurance purchasers the power of information.”

In addition, the website provides extensive information about consumer rights, tips for how to navigate the market’s complexities, and details on how the Affordable Care Act provides new protections for beneficiaries.

To access the small business Insurance Finder, go to the home page of www.HealthCare.gov and click on the blue tab at the top of the page.

For more information, visit www.HealthCare.gov, or access the HHS Facebook page or Twitter account. To download a www.HealthCare.gov Insurance Finder widget visit www.HealthCare.gov/stay_connected.html.

Source: HHS News Release

PCPAN Coalition Urges Opposition to Merger of Two Large Pharmacy Benefit Chains

More than 50 consumers, small business owners and community pharmacists with Preserve Community Pharmacy Access NOW! (PCPAN) Coalition gathered in Washington, D.C. on November 4 to urge Congress and the Federal Trade Commission (FTC) to support patient care and oppose the planned merger between Express Scripts Inc. and Medco Health Solutions Inc, two of the nation’s largest pharmacy benefit management (PBM) companies.

Several Members of Congress attended the press conference to express their opposition to the merger.

“If allowed to go forward, this merger would have devastating effects on consumers and small businesses, alike,” said Congressman Joe Courtney (D-CT). “In an industry that already offers few choices, further market concentration would squeeze out the community pharmacies many of us have come to trust the most.”

“Right now, there is not a level playing field which is why I feel we need to act now,” said Congressman Thomas Marino (R-PA). “I supported community pharmacies when I sponsored a bill that sets out to level that playing field – and that would not cost the federal government or anyone else a penny. As a matter of fact, it would actually lower the prices for independent pharmacies and they, in turn, would pass it on to the consumer. I continue to support community pharmacies now.”

Pharmacy benefit managers (PBMs) manage prescription drug benefit programs for employers, unions, health plans and others. PBMs control the drug benefits of more than 200 million patients nationwide. This number includes a diverse group of Americans such as Medicare Part D beneficiaries, servicemen and veterans that are TRICARE beneficiaries, and more.

"[Dr]ugstores are lobbying against the merger, arguing that the deal, in which Express Scripts would acquire Medco for $29 billion, would put drugstores out of business and lead to higher consumer prices," reports Cq.com.

The House Judiciary Subcommittee on Intellectual Property, Competition and the Internet held a hearing on the merger on September 20. The Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights plans to hold a hearing on the merger in December.

Analysts: Debt Reduction Talks Stalling Hospital Expansion

Wall Street panelists at the Center for Studying Health System Change's (HSC) recent "Wall Street Comes to Washington" Conference say that expansions and construction of new hospitals aren't happening because of investor fears and over potential cuts that may be made by Congress to reduce the national debt.

"I think right now the biggest hurdle is planning," said Fitch Ratings analyst Jeff Schaub. "There are so many things that are unknown. And the planning cycle at acute care providers is five years, 10 years they’re looking out and there’s a big black hole starting 2013, 2014 and extending through 2017. So capital decisions that need to be made now, organizational decisions, affiliation decisions that really need to be made now are being made with a certain amount of contingency. Very often when I meet with hospitals they’re talking about...five, six, maybe even 20 different alternative views of the future and trying to quantify and make decisions among that entire array of possible outcomes."

Citigroup analyst Gary Taylor said that facilities that should be being built right now are probably not because investors do not know if how or if Congress will cost shift Medicare and Medicaid cuts to publicly-traded hospitals. “Since this debt ceiling debate took over and we’ve made commitments to reduce entitlement spending etcetera, publicly traded hospital stocks are down probably 40 percent on average, [and] nursing home stocks are down 70 and 80 percent on average,” Taylor said according to a report in CQHealthbeat (subscription required). “The collective wisdom of the market right now is that investing in . . . certain types of health care providers is extraordinarily risky because of the policy changes, primary reimbursement cuts, that are going to potentially come out of Congress.”

Source: CQ Healthbeat (subscription required); HSC Conference Transcript

Blue Cross Blue Shield Association Unveils Action Plan To Improve Healthcare Quality; Rein In Costs

The Blue Cross and Blue Shield Association (BCBSA) released a comprehensive, interconnected action plan that fundamentally transforms the healthcare system, moving it away from a fee-for-service model to a patient-centered model. The action plan, Building Tomorrow's Healthcare System: The Pathway to High-Quality, Affordable Care in America, provides specific recommendations to improve healthcare quality and tackle rising costs and is based on the experience of BCBSA's 39 Plans in all 50 states and federal territories, in every market and every zip code. An independent economic analysis of the recommendations shows that, if adopted, this action plan will achieve more than $300 billion in federal savings over the next 10 years.

"We believe that the healthcare system needs to fundamentally change so that people get the best, most affordable care possible. We need to put the patient back in the center of healthcare and this is going to take a significant collaborative effort between both public and private sectors," said Scott P. Serota, president and CEO of BCBSA. "It's time to stop the finger pointing and start working together to make our system the best for patients. In Building Tomorrow's Healthcare System, we make specific recommendations for what the government should do and show how Blue companies nationwide have been working with doctors, hospitals, consumers and policymakers to transform the healthcare system."

The proposal lays out specific, actionable steps the government should take in four key areas:
1.Reward Safety: National and local leadership along with new provider incentives are needed to eliminate preventable medical errors, infections and complications that harm hundreds of thousands of people each year and cost billions of dollars.
2.Do What Works: The incentives in our system must be changed to advance the best possible care and reward quality outcomes, instead of paying for more services that are ineffective or redundant and add unnecessary costs to the system.
3.Reinforce Front-Line Care: A higher value must be placed on primary care and on ensuring there is an adequate workforce of professionals to deliver necessary, timely and coordinated care that results in better outcomes and lower costs.
4.Inspire Healthy Living: With 75 percent of today's healthcare dollar spent on the treatment of chronic illnesses — many of which are preventable — consumers must be empowered and encouraged to make better choices, live healthier lives and better manage their health.

If adopted, the recommendations would save $319 billion over the next decade according to an economic analysis by Ken Thorpe, Ph.D., Robert W. Woodruff Professor and Chair Department of Health Policy & Management Rollins School of Public Health, Emory University.

"The BCBSA proposal reflects a clear understanding of the transformational approach needed to reform our prevention and healthcare delivery system," said Thorpe. "Building evidence-based approaches to coordinate care for Medicare and Medicaid patients that will improve the quality and reduce healthcare spending is a discussion we need to have. Rather than simply shifting federal costs to seniors, the states, or elsewhere, these proposals have the potential to reduce total healthcare spending."

The proposal contains several examples of Blue Cross and Blue Shield initiatives underway across the country that can work as models for improving care and reducing costs. One example is the Michigan Health and Hospital Association's Keystone: ICU Program, which has dramatically reduced central line-associated bloodstream infection rates and ventilator-assisted pneumonia rates in ICU patients. More than 70 Michigan hospitals participate in this program and over a six-year period the initiative has saved 1,830 lives, eliminated an estimated 140,700 avoidable hospital days for patients, and saved more than $300 million.

"This action plan recommends changes that will bring about real improvement for our fragmented healthcare system," said Daniel Loepp, president and CEO, Blue Cross Blue Shield of Michigan. "In Michigan, and in local communities across the country, the Blues are seeing first hand the difference that these types of programs can make for patients. That is why we're encouraging the government to work with the private sector to expand on efforts that improve the quality and affordability of care."

To read Building Tomorrow's Healthcare System: The Pathway to High-Quality, Affordable Care in America, please visit www.bcbs.com/pathway.

Source: BCBSA Press Release

Children's Hospitals Growing; Raises Questions About Spending

A news report by Kaiser Health News says that children's hospitals are growing and this growth spurt has led to questions about spending. The report says that the hospitals have hired lobbyists to obtain ensure special treatment by Congress and ensure that the highest insurance rates are paid to their facilities.

Source: Kaiser Health News Article