February

Expanded Subsidies Help Grow California Exchange Enrollment

February 24, 2020

California’s health insurance exchange, Covered California, expanded enrollment by 1.6% year over year for 2020, according to preliminary results released on Feb. 18 — figures that were highly anticipated since the state was testing new policies this year aimed at encouraging additional insurance signups.

Indeed, California attributed its enrollment growth to its newly expanded subsidies and robust marketing efforts by the state and payers. California now offers premium subsidies to people earning up to 600% of the federal poverty level (FPL), as the result of legislation passed last year and approved by Gov. Gavin Newsom, a Democrat. Under the Affordable Care Act (ACA), such subsidies typically only apply to people earning up to 400% of the FPL, unless a state chooses to provide funding for an expanded population.

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As Health Care Costs Grow, Buyers Look ‘Beyond Markets’

February 24, 2020

A new study by the Health Care Cost Institute (HCCI) found that the cost of health care and spending on health care both increased dramatically between the start of 2014 and the end of 2018. According to the study, price increases for provider services are the main reason why.

Annual spending per person increased 18.4% over the five-year period, from $4,978 to $5,892, the study said. After figures are adjusted for inflation, the cost of care per person increased by $610 over those five years. While utilization did increase, growing by 3.1% across all billing categories including drug benefits, provider price increases drove about 75% of spending growth — an average of $453 per person — when inflation is taken into account.

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Pa. Moves Toward Independence From HealthCare.gov Platform

February 24, 2020

While Nevada is taking stock of its first Affordable Care Act (ACA) open enrollment period as a true state-based exchange (HPW 2/10/20, p. 4), Pennsylvania is gearing up to follow in the silver state’s footsteps and make its own break with HealthCare.gov.

Pennsylvania is one of three states — alongside New Jersey and New Mexico — that are planning an imminent transition from the federal health insurance enrollment platform to their own state-based exchange. Other states are reportedly considering similar moves now that the dust has long settled from some states’ botched exchange rollouts in the early years of the ACA.

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News Briefs

February 24, 2020

✦ The legal dispute between Cigna Corp. and Anthem, Inc. — concerning the $1.85 billion breakup fee tied to their failed attempt to combine — is not going to be resolved as soon as anticipated. Cigna Corp. CEO David Cordani said during the company’s recent fourth-quarter earnings call that he expected a court ruling by the end of February, but a Feb. 14 Securities and Exchange Commission filing from Cigna revealed that the court issued a letter requesting that the parties in the case submit supplemental briefings. “As a result, Cigna Corporation no longer expects the court to issue its post-trial decision in this litigation before the end of February 2020,” the filing states. It did not reveal when a decision now might be expected.

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For 2021, MAOs Face Small Pay Boost, ESRD Uncertainty

February 20, 2020

With an estimated pay boost just under 1% and the continued increase of encounter data used in determining Medicare Advantage plans’ risk scores, MA reimbursement in 2021 isn’t looking as robust as it has in recent years now that both parts of the Advance Notice have come out. Meanwhile, MA plans face new uncertainties as patients diagnosed with end-stage renal disease (ESRD) can begin enrolling in such plans on Jan. 1, 2021. And while some changes in Part II of the Advance Notice stand to lower rates for serving ESRD enrollees, CMS in a separate memo proposed a new methodology for setting maximum out-of-pocket (MOOP) cost limits that will partly account for ESRD costs starting in 2021.

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MA, Part D Rule Contains Many Highlights for Health Plans

February 20, 2020

In lieu of a draft Call Letter attached to its annual rate notice for the coming year (see story, above), CMS on Feb. 5 issued a 900-page proposed rule containing a slew of non-rate-related changes to the Medicare Advantage and Part D programs for contract years 2021 and 2022. While that rule (85 Fed. Reg. 9002, Feb. 18, 2020) seeks to codify numerous policy changes that were already made via statute and subregulatory guidance — including CMS’s expanded definition of “primarily health related” supplemental benefits and the entry of patients with end-stage renal disease (ESRD) into the MA program starting on Jan. 1, 2021 — it also features new and noteworthy proposals such as flexibility around network adequacy and medical loss ratio calculations, industry experts tell AIS Health.

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