State Innovation Waiver Policy Forum: Health Connector Non-Group - - PowerPoint PPT Presentation

State Innovation Waiver Policy Forum:

Health Connector Non-Group & Subsidized Coverage

AMANDA CASSEL KRAFT - Chief of Staff, MassHealth, EOHHS ALISON KIRCHGASSER - Director of Federal Policy Implementation, MassHealth, EOHHS MARISSA WOLTMANN - Associate Director of Policy and ACA Implementation Specialist, Health Connector EMILY BRICE - Senior Advisor on State Innovation Waivers, Health Connector October 30, 2015

Overview: Section 1332 Flexibility

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ACA Topic & Citation Examples of Provisions That May Be Waived (see handout)

Benefits and Exchange Subsidies (Title 1, Subtitle D, Part 2) (Title 1, Subtitle E, Section 1401/ 36B of the IRC and Section 1402)

• Essential Health Benefits
• Cost-sharing limitations
• Metallic tiers
• Individual and group market definitions
• Premium tax credits and cost-sharing reduction subsidies

Exchanges and Qualified Health Plans (Title 1, Subtitle D, Part 1)

• Exchange structure and role
• Eligibility for Qualified Health Plans
• Criteria for Qualified Health Plans

Individual and Employer Shared Responsibility (Mandate) (Title 1, Subtitle E, Section 1501/ 5000A of IRC) (Title 1, Subtitle E, Section 1513/4980H of IRC)

• Minimum essential coverage requirement
• Tax penalty for individuals who fail to maintain coverage
• Tax penalty for employers who fail to maintain coverage for their full-time employees

Overview: Policy Exploration Process

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Date Topic

Open discussion # 1 Friday, Oct. 16, 9-11 AM

• Individual mandate
• Employer mandate

Open discussion # 2 Friday, Oct. 23, 9-11 AM

• Exchange and qualified health plan structure
• Individual and group market structure
• Essential health benefits

Open discussion # 3 Friday, Oct. 30, 9-11 AM

• Exchange subsidies
• Exchange eligibility
• Other aspects of Exchange coverage

Roll-up and next steps Friday, Nov. 6, 9:30-11 AM

• Roll-up of discussion to date
• Revisit timeline for application, including topics for in-depth sessions

In-depth discussion # 1 Friday, Nov. 13, 9-11 AM

• Topic TBD based on earlier sessions

In-depth discussion # 2 Friday, Nov. 20, 9-11 AM

• Topic TBD based on earlier sessions

In-depth discussion # 3 Wed., Nov. 25, 9-11 AM

• Topic TBD based on earlier sessions

State decision on whether to aim for 1/1/17 start date

• r later start date

Topics for Discussion

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 Eligibility considerations − Commonwealth Care approach − ACA approach, including differences in MAGI  Affordability considerations − Commonwealth Care approach − ACA approach, as supplemented by ConnectorCare  Continuity considerations − Commonwealth Care approach − ACA approach  Open public comment

Eligibility

Preliminary Considerations

Historically: Comm Care Eligibility

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Under Chap. 58 and related laws:  Commonwealth Care subsidized coverage for uninsured up to 300% FPL  Eligibility: − Up to 300% FPL − Massachusetts resident − US citizen, US national, lawfully present immigrant (qualified and special status) or PRUCOL − Not eligible for MassHealth, Medicare, or other public programs, including SHIPs − Uninsured − Not incarcerated − Not eligible for employer-sponsored insurance (ESI), if employer subsidized 33% of the premium for individuals or 20% for families  Household composition, income counting, and income timing rules aligned with MassHealth

Status Quo: ACA Eligibility

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ACA introduced new eligibility standards for Health Connector:

 Eligibility to purchase Qualified Health Plans (QHP) through Health Connector: − Massachusetts resident − US citizen, US national, or lawfully present immigrant (including qualified within 5-year bar, but not including PRUCOL) − Not incarcerated (except if pending disposition of charges) − Not enrolled in Medicare  Additional eligibility to receive federal subsidies: − Eligible tax-filing status − Income:

• Between 100-400% FPL for premium tax credits (and under 100% for

qualified immigrants in 5-year bar)

• Under 250% FPL for cost-sharing reductions (greater for certain AI/AN)

− Not eligible for/enrolled in other Minimum Essential Coverage (exception for employer-sponsored insurance that fails to meet minimum value and affordability standard)

Status Quo: ACA’s MAGI Standard

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Eligibility for federal subsidies measured by MAGI standard:

• ACA uses Modified Adjusted Gross Income standard to measure eligibility

for: premium tax credits, cost-sharing reductions, and certain MassHealth programs (e.g., CarePlus)

• MAGI is a federal tax law-based standard that turns on:

− The applicant’s tax-filing status − The applicant’s tax-filing household − The applicant’s household income:

• MAGI is used to convert household size/income to a FPL % standard
• MAGI for MassHealth is not identical to MAGI for the Health Connector

Adjusted Gross Income (gross income – deductions) Non-taxable SS benefits Tax-exempt interest Excluded foreign income MAGI

Status Quo: MAGI Comparison

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MAGI for MassHealth versus MAGI for the Health Connector:

Health Connector/QHP MassHealth

Household Composition

• Tax household – e.g., married couples

must file jointly (with few exceptions)

• Dependents may not receive a tax

credit on their own

• Tax household, but sometimes considers living

arrangements and relationships (hybrid with former Medicaid standards) – e.g., married couples who live together always counted in same household, even if do not file together Income Timing

• Projected annual income for the tax

year

• Point-in-time based on current monthly income (with
• ption to average over the calendar year or other period)

Income Counting

• Lump sums included in annual income
• Lump sums only in month received
• Special exclusions: certain educational income, certain

AI/AN income

• 5% income disregard

FPL Standard

• Switches to new FPL table at open

enrollment

• Switches to new FPL table on March 1

Preliminary Policy Considerations

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Examples of Section 1332-related options could include:

 Aligning MAGI rules for Health Connector and MassHealth, e.g., income timing standards  Modify Health Connector eligibility to include populations not otherwise eligible for coverage, e.g., certain immigrants  Modify premium tax credit eligibility to include populations not otherwise eligible, e.g., individuals whose total family costs of coverage are not considered in determining the affordability of an employer offer of coverage (a.k.a., “the family glitch)

All options must meet Section 1332 guardrails:

Scope of Coverage Must provide coverage to at least as many people as the ACA Comprehensiveness Must provide coverage at least as “comprehensive” as Exchange Affordability Must provide “coverage and cost- sharing protections against excessive

• ut-of-pocket”

spending at least as affordable as Exchange Federal Deficit Must not increase the federal deficit

Questions for Discussion

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Is there interest in modifying the status quo?

• Are there populations that remain ineligible for full-scope coverage or

subsidized coverage under MassHealth, Medicare, or the Health Connector? If these populations are eligible for other programs, such as the Health Safety Net, would they be better served through the Health Connector?

• Are there opportunities to modify the MAGI methodology for subsidized

coverage available through the Health Connector, in order to streamline the consumer experience or program administration?

*Is a Section 1332 waiver needed to achieve these goals? Are there policy goals related to a Basic Health Program or other waiver option to consider?

Affordability

Preliminary Considerations

Historically: Comm Care Subsidies

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Under Chap. 58 and related laws:  Commonwealth Care established a state-based subsidy program that bridged MassHealth and commercial coverage (<300% FPL)  Key features of approach: − Progressive, fixed dollar premium scale mirrored state individual mandate affordability schedule set by Health Connector Co-pays and deductibles limited through tiered plan design (Plan Types 1-3) − Annual income eligibility update tied to publication of federal FPL guidelines (same schedule as MassHealth) − Enrollees paid premiums to Health Connector, which bundled into capitated rate for MCOs − Health Connector had ability to permit exceptions (e.g., waiver of premium payments for hardships)

Status Quo: ACA Subsidies

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ACA offers two types of subsidies for plans in the Health Connector:  Premium tax credits (<400% FPL) can be taken in advance (APTC) or claimed at tax time − Based on projected income and reconciled at tax time − Amount of credit based on:  Cost-sharing reductions (<250% FPL) − Paid directly to the health plan to reduce out-of-pocket costs − Only available for silver level plans − 4 variants of CSRs, based on income (73%, 87%, 94% AV, zero-cost- sharing for certain AI/AN)

Cost of benchmark plan available to each household member Expected premium contribution (sliding scale based on FPL) Premium Tax Credit (difference between cost of benchmark and expected contribution)

Status Quo: ConnectorCare Subsidies

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ConnectorCare “wraps” federal subsidies using state funds  Continues progressive premium scale that links to affordability schedule set by Health Connector  Annual update now tied to Seal of Approval process  Enrollees pay premiums to Health Connector, which aggregates premiums and transmits to insurer  Enrollees still subject to reconciliation and other tax interactions  Funding from: − State sources, e.g. cigarette tax, individual mandate penalties, employer assessment − 50% federal match for premium wrap (for eligible populations) through 1115 Medicaid Demonstration waiver

Preliminary Policy Considerations

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Examples of Section 1332-related options could include:

 Streamline subsidy structure, e.g., Health Connector could serve as intermediary on APTC: receiving all APTCs, redistributing to enrollees, and bearing responsibility for verification and reconciliation risk  Expand ConnectorCare to address affordability concerns for particular populations, e.g., expanding ConnectorCare wrap of federal subsidies to include those up to 400% FPL  Streamlined subsidy structure or process for certain populations, e.g., smooth subsidy process for “mixed households”

All options must meet Section 1332 guardrails:

Scope of Coverage Must provide coverage to at least as many people as the ACA Comprehensiveness Must provide coverage at least as “comprehensive” as Exchange Affordability Must provide “coverage and cost- sharing protections against excessive

• ut-of-pocket”

spending at least as affordable as Exchange Federal Deficit Must not increase the federal deficit

Questions for Discussion

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Is there interest in modifying the status quo?*

• Are there populations not receiving the level or nature of subsidy needed to

promote access to coverage and care? How might the Commonwealth approach the needs of these populations?

• Are there approaches to subsidizing coverage that are preferable to the

Affordable Care Act’s structure of premium tax credits and cost-sharing reductions? For example, are there elements of the Commonwealth Care approach under Chap. 58 that would add value?

*Is a Section 1332 waiver needed to achieve these goals? Are there policy goals related to a Basic Health Program or other waiver option to consider?

Continuity of Coverage & Care

Preliminary Considerations

Historically: CommCare Enrollment

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Under Chap. 58 and related laws:  Coverage available in monthly increments: − Coverage began 1st of the month after eligibility determination, plan selection and premium payment − Premium due monthly on the 25th, with 60 day grace period permitted − Coverage gap could occur when individual “churned up” from MassHealth into Commonwealth Care, if previous coverage ended mid-month– but individuals determined eligible were also eligible for time-limited Health Safety Net coverage  Verification aligned with MassHealth: − Proof at application and regular data checks − No eligibility prior to verifications being received and processed  Commonwealth Care MCOs were similar, but not identical to, MassHealth MCOs

Status Quo: ACA Enrollment

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 Health Connector coverage still on monthly cycle: − Coverage begins 1st of the month after eligibility and payment − Premium due monthly on the 23rd, with 90 day grace period permitted for individuals receiving APTCs/ConnectorCare  Initial eligibility for QHPs (including ConnectorCare) based on: − Self-attestation for some factors (employer coverage) Electronic data verification for other factors (citizenship, income) − If data inconsistencies, eligibility approved with 90 day period to resolve (subject to reconciliation)  Post-eligibility verification handled through tax reconciliation  Efforts to align with MassHealth (including automated renewals and streamlined renewals for mixed households) underway  Some differences in issuer choices (and provider networks) among ConnectorCare, MassHealth, and QHPs for those above 300% FPL

Preliminary Policy Considerations

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Examples of Section 1332-related options could include:

 Align MassHealth and Connector post-eligibility program integrity requirements, e.g. waive premium tax credit reconciliation process in lieu of state verification process  Revise timing of coverage renewals to promote continuity  Further align issuer choices, benefits, provider networks, or enrollee rights to smooth coverage transitions between MassHealth and ConnectorCare

All options must meet Section 1332 guardrails:

Scope of Coverage Must provide coverage to at least as many people as the ACA Comprehensiveness Must provide coverage at least as “comprehensive” as Exchange Affordability Must provide “coverage and cost- sharing protections against excessive

• ut-of-pocket”

spending at least as affordable as Exchange Federal Deficit Must not increase the federal deficit

Questions for Discussion

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Is there interest in modifying the status quo?*

• Are there key factors that impact continuity of care when enrollees

transition between programs, such as specific benefit differences or enrollee rights?

• Are there opportunities to minimize the impact of transitions in coverage

between: MassHealth and ConnectorCare? ConnectorCare and QHPs with APTCs? QHPs with APTCs and unsubsidized QHPs?

• If there are trade-offs between policy approaches to minimize churn at

various income levels, how should the Commonwealth consider these trade-offs?

• Are there opportunities to modify the Health Connector’s approach to

initial eligibility verification or redetermination to promote continuity of coverage while still maintaining maximum program integrity?

*Is a Section 1332 waiver needed to achieve these goals? Are there policy goals related to a Basic Health Program or other waiver option to consider?

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Questions? Ideas? Reactions?

Audrey Morse Gasteier Director of Policy & Outreach audrey.gasteier@state.ma.us 617-933-3094 Emily Brice Senior Advisor on State Innovation Waivers emily.brice@state.ma.us 617-933-3156

Supplemental Slides

Boundaries on State Flexibility

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 Section 1332 does not extend to other portions of the ACA, such as:

− Insurance market reforms, such as nondiscrimination − Rating factors applicable to merged market − Risk-spreading mechanisms, such as risk adjustment − Revenue provisions, such as the “Cadillac Tax”

 All Section 1332 waivers must meet four “guardrails”:

Scope of Coverage Must provide coverage to at least as many people as the ACA Comprehensiveness Must provide coverage at least as “comprehensive” as Exchange Affordability Must provide “coverage and cost- sharing protections against excessive

• ut-of-pocket”

spending at least as affordable as Exchange Federal Deficit Must not increase the federal deficit

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Steps in Waiver Process

State Planning

• Determine if waiver is

needed to achieve policy goals

• Obtain legislative authority

to apply for and implement a waiver

• Draft waiver application,

including:

• Rationale
• Actuarial and economic

analysis

• Implementation timeline
• 10-year budget
• Provide a meaningful

public notice and comment period, including:

• Pre-application hearings
• Consultation with tribes

HHS Approval

• Coordinate with Treasury
• Conduct a preliminary

review for application completeness within 45 days

• Conduct federal notice and

comment period

• Review and approve or

reject the application within 180 days of deeming complete (runs concurrent with federal notice and comment period)

Implementation

• Waiver may be

implemented starting in 2017 and can last 5 years, with option of renewal

• Waiver may be amended
• State must hold a public

forum within 6 months of implementation

• State must submit

quarterly and annual reports to HHS

• HHS must conduct

periodic evaluations

• Either state or HHS can

suspend or terminate waiver, with limited close-

• ut costs awarded to state

How to Be Involved

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To Participate and Comment:

 Add your name to the stakeholder distribution list, including language or disability accommodation requests  Request an individual meeting or discussion with your group  Submit written comments with your priorities, suggestions, and data/support (note: written comments will be posted) to StateInnovation@massmail.state.ma.us

To Stay Informed:

 Meeting information, materials and other information will be posted regularly to our dedicated State Innovation Process Website: www.MAhealthconnector.org/state-innovation-waiver

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Federal Guidance

 CCIIO 1332 Hub: www.cms.gov/CCIIO/Programs-and-Initiatives/State-Innovation- Waivers/Section_1332_state_Innovation_Waivers-.html  ACA Sec. 1332: www.gpo.gov/fdsys/granule/USCODE-2010-title42/USCODE-2010- title42-chap157-subchapIII-partD-sec18052  Final federal rules: www.gpo.gov/fdsys/pkg/FR-2012-02-27/pdf/2012-4395.pdf

Massachusetts Resources

 Health Connector 1332 Hub: www.MAhealthconnector.org/innovation-waiver  BCBS Foundation/Manatt White Paper: www.manatt.com/uploadedfiles/content/5_insights/white_papers/coverageoption sforma.pdf

Key Resources