Update on State Exchange Progress from NAHU

Region 1

In late May, the Senate passed legislation strengthening the exchange’s ability to negotiate with insurers. Connecticut is already an “active purchaser” state, but the exchange said it wouldn’t use its authority in 2014 to negotiate with insurers. The Senate bill is now awaiting action in the House.

Anthem Blue Cross and Blue Shield won a key approval from the state Bureau of Insurance for the insurer’s plan to partner with MaineHealth on the new health insurance exchange. The decision by the Bureau to approve the Anthem-MaineHealth network is a blow to Central Maine HealthCare, which is not included in the plan. The proposed Anthem-MaineHealth pact would include 32 of the state’s 38 hospitals and would exclude the three hospitals owned by Central Maine Healthcare of Lewiston, as well as Parkview Adventist in Brunswick, York Hospital in York and Mercy Hospital in Portland.

Only the Anthem and Maine Community Health Options, a nonprofit co-op insurance plan, have applied to compete on the exchange in Maine. The plans offered by Maine Community Health Options would cover the entire state. Central Maine HealthCare is concerned with their exclusion from the exchange because they believe that the Anthem network would fail to provide reasonable access to care for its subscribers.

Final insurance rates for the individual insurance market are expected to be submitted by the end of the summer. In July, the Massachusetts Legislature approved a measure requiring the state to seek a CMS waiver to keep its rating rules in place, warning that PPACA would cause some serious premium shock for the small group market. Massachusetts has already received a temporary phase-in, but lawmakers are seeking a much more comprehensive pass from federal rating requirements.

New Hampshire
State lawmakers couldn’t agree on the Medicaid expansion before adjourning this summer, but a new work group they created to study the issue has started to meet. The group has three months to turn in its recommendations.

New York
Governor Andrew Cuomo announced in July that individual insurance premium rates in the state of New York are set to drop 50% or more in 2014 for some individuals participating in the state exchange; however, because New York insurance premiums are already much above the national average, critics are expecting that 2014 premium rates in New York may still be higher than the country’s average.

Rhode Island
In July, the Rhode Island exchange announced a new name and logo: HealthSource RI. The release of the new name and logo are part of the marketplace’s summer outreach plan.

Region 2

District of Columbia
NAHU was awarded a contract to be the official training and certification provider for D.C.’s broker training program in the marketplace. With D.C. consolidating the individual and small group markets into the SHOP exchange, this will require that all brokers with D.C. clients become exchange certified to place business in the marketplace.

Maryland Insurance Commissioner Therese Goldsmith approved carriers’ individual policy rates in the Maryland Health Connection marketplace. Many of the proposed rates that were posted in May were reduced by as much as 50% through the Maryland Insurance Administration’s power to regulate proposed insurance rates. The SHOP rates will be posted in the coming months, as Maryland opted to delay their small business marketplace by three months, with plans effective April 1, 2014. As a result of the rate approval process, at least one carrier opted to exit the Maryland Exchange marketplace.

New Jersey
The legislature in New Jersey has not taken any further action in advance of 2014. It is continuing to explore several issues, including how to address participation issues and how new federal requirements for the small group market can mix with existing state law. NJAHU believes a legislative fix will be necessary to prevent major unraveling of small group participation levels in the outside market.

Pennsylvania’s navigator regulation legislation, H.B. 1522, is continuing to progress through the state House. The legislature is also continuing to consider Medicaid expansion in the state despite Governor Tom Corbett’s statement in June that the state will not be expanding the program for 2014. Future expansion has not been ruled out, but is unlikely given Corbett’s statements.

Virginia’s commission to study the proposed Medicaid expansion is continuing to consider options. Regardless of the committee’s recommendations, the gubernatorial election this November will likely have a greater significance on whether the state decides to expand. Polls show the candidates, former DNC Chairman Terry McAuliffe and Attorney General Ken Cuccinelli, as statistically tied, indicating a close election can be expected.

Region 3

Illinois’ navigator legislation, S.B. 1194, was sent to the governor on June 26, 2013. He has 60 days to act on the bill or it will automatically become law.

Illinois’ Director of the Illinois Health Insurance Marketplace, Jennifer Koehler, reported at the July Illinois Health Care Reform Implementation Council Meeting that 165 plans were submitted to the Department of Insurance for rate review to be on the exchange. She did not specify how many insurance companies had submitted the 165 plans. The results of the state’s review were due to be sent to HHS by July 31. She also noted that jobs for in-person counselors will be posted on the Department of Employment Security website.

The Kentucky administration is spending a lot of time in court. Suits challenging the state’s authority to expand Medicaid and establish the state’s exchange are ongoing.

The Office of the Kentucky Health Benefit Exchange (OKHBE) has issued an Agent Request to Participate form. It is available on the OKHBE website.

Legislators continue to debate Medicaid expansion. A committee passed a Medicaid expansion bill on July 31. The bill moves to the full Senate which has adjourned for the summer. The Senate will reconvene at the end of August; passage is uncertain.

Consumer advocates have been vocal during the rules writing process for Ohio’s navigator law. They are calling for more exemptions from the law beyond the licensed healthcare providers or hospitals registered with the Department of Health; federally qualified health centers; and look-alikes and nonprofit organizations that primarily distribute food, donated goods or purchased goods in their communities specifically exempted from the law.

Ohio’s Department of Insurance (ODI) announced that individual health insurance purchasers in the exchange for Ohio will pay an average of 41% more than they did in 2013. The ODI confirmed that their calculations also show that insurance companies will see their costs to provide individual health insurance increase significantly. Ohio is House Speaker John Boehner’s home state, ensuring that exchange rates will continue to be a topic of heated debate in Washington D.C.

Region 4

Hearings for Iowa’s proposed Medicaid expansion program were held late last month. The plan is modeled after both the Arkansas and Wisconsin Medicaid plans, which would provide private insurance coverage to individuals between 100% and 138% of the poverty level with federal matching funds from the Medicaid expansion program. Individuals earning less than 100% of poverty would be eligible for traditional Medicaid. The proposal was approved by the state in June and is awaiting federal approval.

The Minnesota Association of Health Underwriters was approved by MNSure, the state’s marketplace, to provide continuing education courses to producers to become certified to sell in the marketplace. The three-part, web-based certification course will cover a maximum of six hours of CE credit.

The Minnesota Department of Commerce sent a bulletin on July 26 in response to a 2009 law that required that proposed insurance rates remain secret until they are active. The bulletin, addressed to the state’ carriers, requested that rates become public on September 6, ahead of the October 1 open enrollment date.

Wisconsin is beginning its steps to close down its high risk pool and transfer the beneficiaries into the state’s marketplace beginning in 2014. A significant portion of the 26,000 high risk beneficiaries are above the 400% federal poverty level (FPL) threshold and will need to be transitioned to unsubsidized plans. The state is also preparing to move an estimated 84,000 individuals into the state’s Medicaid program, BadgerCare, while it also shifts those earning between 100-138% FPL into the exchange under subsidized plans.

Region 5

Alabama should have no counties without coverage within the federally facilitated marketplace. Three companies have proposed insurance plans and two of the companies want to cover the entire state. Blue Cross Blue Shield of Alabama and United Healthcare have filed proposals for statewide coverage. Humana is offering a plan covering 50 of Alabama’s 67 counties, according to the state Department of Insurance.

In a July 25 public hearing, executives for Florida Blue promised that the company’s plan to reorganize as a stock insurer under a mutual holding company would not impact executive compensation or negatively affect services to the approximately 4.2 million Floridians who hold policies. Florida Blue Chief Executive Pat Geraghty said the restructuring would position the company to respond to the changes coming with PPACA and give it the ability to offer products other than insurance. He acknowledged the possibility that stock would be sold to third parties but assured Florida Insurance Commissioner Kevin McCarty and other state officials that would not happen.

Governor Nathan Deal is reported to be reviewing options for an alternative approach to Medicaid expansion; giving hope to advocates who believed their effort to harness federal dollars to expand coverage was dead.

Humana has announced that it would offer exchange coverage in 36 counties that, until now, lacked a single offering in the exchange. That means there will be at least one option for an estimated 54,000 subsidy-eligible residents of those counties, according to the Center for Mississippi Health Policy.

Region 6

Public hearings were held at the beginning of July on the state’s unique Medicaid expansion plan. The hearings are part of the 1115 demonstration waiver process that Arkansas must complete before formally asking CMS permission to put the state’s expansion population into the exchange. Comments on the state’s proposed Medicaid waiver, which would sanction the so-called private option for Medicaid expansion, were due July 24. Nearly 300 pages of comments have already been filed — including statements from the Diocese of Little Rock, the Daughters of Charity Services of Arkansas, Mainline Health Systems and dozens of form letters opposing the waiver filed by Arkansas residents.

Directors of community health centers that serve some of the poorest Arkansans in the state’s mostly rural areas told legislators that they oppose a provision in a healthcare expansion plan that could lower their revenue. Lawmakers have disagreed about the severity of the revenue losses the centers may face when Arkansas extends coverage to 500,000 people under a private insurance option that will be funded under the state Medicaid program.

Louisiana Governor Bobby Jindal offered a 1,300-word explanation of his decision to reject Medicaid expansion in an op-ed posted on July 24 to the Times-Picayune website. Jindal contended that Medicaid expansion would have forced as many as 171,000 Louisianans off of private healthcare and onto the public rolls. “The Obama administration has denied multiple requests to target expansion, impose stricter anti-crowd out policies, require more robust cost sharing, allow flexibility on benefit design or the use of premium assistance, or otherwise mitigate this unnecessary displacement from the private sector to the public sector,” he wrote.

Governor Jay Nixon signed legislation to license navigators on July 12. The legislation was supported by the Missouri Association of Health Underwriters, which had been advocating for navigator licensure since the introduction of this legislation in February.

Region 7

CoverColorado, Colorado’s pre-existing condition insurance program, is contacting all current subscribers informing them that CoverColorado coverage will be ceasing. An FAQ regarding the closure of the program states:

Q: When will I have to leave CoverColorado?

A: CoverColorado is ending all health care coverage on March 31, 2014. This means that if you are in a hospital or in the middle of treatment on March 31, 2014, CoverColorado will not pay for any expenses that you incur from April 1, 2014 forward. In order to ensure that your expenses are fully covered as of April 1, 2014, you must apply for new coverage, either through Connect for Health Colorado or through your personal broker, no later than February 15, 2014.

The letter to current subscribers urges them to shop for a new plan in October so that they can have new coverage effective on January 1, 2014. This is also an opportunity for brokers to contact any clients they may have assisted in obtaining this coverage.

Meanwhile, Connect for Health Colorado, the state’s health insurance exchange has begun online broker training. Classroom sessions are set to begin in mid-August.

Idaho continues to forge a new “exchange pathway” as a state-federally supported exchange. Idaho is planning for a state-based exchange but due to their late start they will need to use the federal architecture when the exchange opens in October. Idaho’s timeline called for switching to a fully state-based exchange in spring 2014. That timeline has been lengthened to late summer of 2014 to accommodate concerns from HHS about making significant changes when the initial open enrollment period will be closing in March 2014. Also, the late summer shift reflects a more realistic timeframe given the IT challenges facing the state’s exchange.

Avenue H, the state’s small business exchange that will serve as the state’s SHOP, has changed administrators. Task force meetings are ongoing to align Avenue H with SHOP requirements.

Region 8

California’s exchange is “full steam ahead.” Covered California selected the following health plans to participate in SHOP:

  • Blue Shield of California
  • Chinese Community Health Plan
  • Health Net
  • Kaiser Permanente
  • Sharp Health Plan
  • Western Health Advantage.

Broker training for Covered California, California’s exchange, is expected to be announced soon.

The legislature was out of session for July. CAHU has issued an action alert of S.B. 639, a bill which limits non-exchange individual plans by mandating that plans inside and outside the exchange be mirror images of each other. CAHU argues that passage of this legislation will eliminate health insurance consumer choice and competition in the market.

The Hawaii Prepaid Health Care Act is seen to “trump” PPACA – specific to the employer mandate. The exchange in Hawaii is likely to be most attractive to employees without access to employer coverage. It is expected that the exchange will have the most participation in Platinum and Gold level plans.

Nevada is dealing with a broker of record issue in their exchange. A broker can only be added during the open enrollment period. The dialogue has included questions of who “owns” the account.

Brokers will have to attend a four-hour training session that focuses on:

  • Use of the Nevada Health Link portal enrollment system
  • Medicaid and Nevada Check Up (CHIP) eligibility and enrollment
  • Enrollment of individuals in QHPs and APTC and cost-sharing reductions
  • Nevada Health Link’s privacy and security agreement.

Oregon’s insurance department has been aggressive in its rate review for exchange plans. Cuts to rates for the individual exchange were as high as 35%. Group plans were not immune to the rate cuts. Providence Health Plan’s proposed small group rate was cut by almost 12%. But, overall group rates were spared significant cuts. Two new co-ops were among the plans gaining approval for sale in CoverOregon, the state’s exchange.

Exchange training got underway in July. A pilot run for the training was criticized as focusing too much on ACA basics and not enough on CoverOregon specifics. Recent concern is whether there is sufficient robust material to justify eight hours of training by the state-hired trainers.

Washington’s small group market relies on health trusts; association type plans. A recent meeting with the insurance regulators confirmed that a majority of trusts will be required to classify their members’ coverage as small group. Also, pricing will be the same for products inside and outside of a trust. This decision is expected to have a significant impact on the future of the trust market in the state.

Insurance Commissioner Mike Kreidler announced that four health insurance companies will offer individual health plans in their state-based exchange. Most residents across the state will have a choice of as much as two dozen plans. The commissioner is still reviewing plans for sale outside the exchange with an announcement promised for September.

Several plans, including newcomers to the market, were not approved for the individual market, largely due to network capacity issues. Kaiser is expected to be the sole carrier on the SHOP exchange offering plans only in two counties, Clark and Cowlitz.