United States: Health Insurance Exchanges: State Of The States - Apr 10th, 2015

Last Updated: April 28 2016
Article by Cindy Gillespie

Once again, there were few notable federal developments this week and as a result, we are starting off with an interesting report from Avalere. This week, Avalere released an analysis showing that the Federally-facilitated Marketplace (FFM) retained more consumers in private health coverage from Open Enrollment 1 to Open Enrollment 2 than many State-based Marketplaces (SBM). On average, the FFM retained 78 percent of 2014 enrollees, while SBMs retained 69 percent of enrollees. Although Avalere’s report does not present any formal conclusions about why FFM states fared better than SBMs at holding onto their enrollees, it speculates that some persons in private coverage may have transitioned to Medicaid during Open Enrollment 2. As part of its report, Avalere includes an anecdote that Covered California shifted over 200,000 enrollees from private insurance to Medicaid between Open Enrollment 1 and Open Enrollment 2.

Moving into the states, after CMS reported last week that 36,000 persons had taken advantage of the tax season Special Enrollment Period (SEP) to sign up for 2015 coverage, Covered California reported this week that so far 18,000 persons have used its tax season SEP to sign up. However, despite the strong signup number, it's important to keep in mind that Covered California’s requirements to qualify for an SEP are significantly less stringent than the requirements used by the FFM. Specifically, Covered California only requires that individuals attest that they were unaware of the tax penalty for not having coverage in 2014, while to qualify for an SEP on the FFM, applicants must also attest that they owe the "shared responsibility payment" when they file their 2014 taxes.

Also in California this week, the Covered California Plan Management Advisory Group met to discuss various health insurance proposals developed by Covered California’s staff in consultation with stakeholders. Of the proposals discussed, additional details emerged on Covered California intentions regarding how insurers would cover specialty tier drugs. In the proposal, Covered California recommends modifying the 2016 Standard Benefit Designs to put a "maximum ceiling on the consumers' share of cost per prescription fill" for specialty tier drugs. Those maximum ceilings range from US$200 per script up to US$500 per script, depending on the metal level of the QHP. While some consumer advocacy groups said that US$500 per drug was still a significant amount of money for consumers in this income bracket, considering that some enrollees take multiple specialty tier drugs, there appeared to be consensus that this was a step in the right direction toward lower out-of-pocket prescription drug costs for consumers. Additionally, the Advisory Group discussed a proposed update to current regulations that allow carriers to have a second hospital tier that is non-primary, where the carrier has cost-sharing requirements that are different than the standard benefit plan designs.

Moving into the south, this week the Arkansas Health Insurance Marketplace awarded a US$5.8 million two-year contract to Arkansas-based Cranford Johnson Robinson Woods to perform marketing and outreach services for the Marketplace. The Marketplace’s board also approved a measure to accept US$22 million in federal exchange grant funding that had previously been awarded to the Arkansas Insurance Department, pending CMS’s approval of the transfer of funds. The Arkansas Marketplace will use that funding to continue its transition to a State-based Marketplace and according to staff, the Marketplace has until June 30, 2016 to expend the federal grant funding.

Staying on financial issues, there were a few notable developments this week by State-based Marketplaces as they continue to refine their budgets and revenue sources for next year. Earlier this week at Your Health Idaho’s Finance Committee meeting, the Committee approved a recommendation to raise the assessment levied on carriers selling plans on the Marketplace from 1.5 percent to 1.9 percent beginning in Plan Year 2016. The assessment recommendation will likely be discussed at the next Your Health Idaho board meeting on April 17. Also in the west, the Connect for Health Colorado (C4HC) Finance Committee met this week to review cost drivers that have increased the Marketplace's operating costs, and potential sources for additional revenue. A variety of revenue scenarios were presented and discussed by the Committee, including raising the administrative fee charged to insurers selling plans on C4HC from 1.4 percent to about 3.5 percent. Expect to hear more about Connect for Health Colorado’s revenue and budget options at Monday’s board meeting.

Finally, looking forward to next week, documentation for the Silver State Health Insurance Exchange’s (SSHIX) April 15 board meeting has already been posted. Of note, the SSHIX reports that effectuated coverage as of April 2015 has hit 58,459 in QHPs and 7,091 in QDPs. Compared to enrollment statistics from May 3, 2014, QHP enrollments increased over the 34,820 persons enrolled in a health plan, but the number of dental enrollments declined, with the SSHIX reporting 29,770 SADP members. The Marketplace also reports that it has reached an agreement with the attorneys involved in the Basich and Casale class action lawsuits and is no longer a party, though the plaintiffs retain the right to bring the SSHIX back into the lawsuit. These lawsuits were filed in 2014 after some Nevada Health Link enrollees complained that after signing up for coverage and paying premiums, they still lacked health insurance coverage. While most of the documentation for the SSHIX April board meeting has been posted, there may yet be a very good reason to tune in. The Executive Director’s summary mentions that the SSHIX sent a delegation to CMS this week to discuss “sustainability and associated concerns” regarding Nevada being a Supported State-based Marketplace, so exchange watchers may get lucky and hear an update on their meeting with CMS.

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