September 9 update: On September 8, 2015, the Centers for Medicare and Medicaid released two Frequently Asked Questions (FAQs) regarding the implementation of the Summary of Benefit and Coverage (SBC) amended rule released in June. The Rule required health insurers to include within the SBC an internet web address where the actual individual policy or group certificate could be found. These documents were supposed to be available for group health plans beginning on September 1, 2015 and individual plans for the plan year beginning on January 1, 2016.
Group health plans are often negotiated on an individual basis, and insurers have had a difficult time meeting the September 1 deadline for the many group plans they administer. The FAQ provides that HHS will not take enforcement action against insurers that fail to meet the September 1 deadline as long as they post the documents by November 1, 2015 and include within the SBC the web address where the document will be posted. The FAQ does not affect the individual market, where plan documents do not need to be posted until November 1, the first day of 2016 open enrollment. This is a Department of Health and Human Services (HHS) FAQ and is not binding on Treasury or the Internal Revenue Service (IRS). It is also presumably not binding on the states, which have primary responsibility for enforcing insurance laws in most states. Presumably other regulators, however, will follow the HHS approach.
The second FAQ provides that insurers that are required to provide a SBC with respect to coverage that the insurer has recently ceased marketing—and has thus become a closed block of business—may limit access to plan documents and policies to plan sponsors and individuals already enrolled in the closed block of business.
The National Association of Insurance Commissioners’ Consumer Information Subgroup has been very actively engaged in recent months in redrafting the SBC template for 2017. It has recently received the results of consumer testing of the template it has developed, and expects to make recommendations to the agencies in October.
On September 8, 2015, the Treasury Inspector General for Tax Administration released a report on the Affordable Care Act Coverage Data Repository: Risks with System Development and Deployment. The Coverage Data Repository (CDR) is one of six core data systems being developed by the IRS to implement the Affordable Care Ace (ACA). It provides income and family size data from tax returns to the marketplaces which the marketplaces use to determine eligibility for premium tax credits. The marketplaces then provide to the CDR on a monthly basis Exchange Periodic Data (EPD) reports, which the IRS uses ultimately to verify tax filings from individuals who have received premium tax credits. The CDR was implemented primarily during 2014, with full implementation scheduled for June 2015.
The report is quite critical of the implementation of the CDR. It asserts that testing of the system was not completed in the proper order and with proper coordination with the IRS’s ACA Program Office. The Report makes six recommendations with respect to the CDR and future ACA projects regarding proper staging of testing; communications with the ACA Program Office; evaluating and accepting risks; and ensuring the completion, testing, and implementation of an Application Audit Plan. The CDR handles sensitive tax information (although not medical information) thus security and prevention of unauthorized access to data is important.
The IRS management disagreed or partially disagreed with four of the recommendations regarding testing and communication with the ACA Program Office, asserting that proper procedures were followed under the circumstances. It agreed with the recommendations as to security risk acceptance and audit procedures, but said that it had either completed corrective action or would do so shortly.
The Report is part of an ongoing project evaluating IRS implementation of the ACA during 2014. It does not suggest that there have been any actual security breaches, but focuses rather on technical compliance.
Original Post
On September 8, 2015, the Centers for Medicare and Medicaid Services (CMS) released its second quarter 2015 effectuated enrollment data for the federal and state marketplaces. As of June 30, 2015, 9.9 million had effectuated marketplace coverage, 7.2 million in the 37 federally facilitated marketplace states, 2.7 million through the state-based marketplaces.
This is down slightly from 10.2 million effectuated enrollments at the end of March, but well within the target of 9.1 million effectuated enrollments that CMS had projected by the end of 2015. Some individuals, who are no longer enrolled, may have lost their coverage, but others have undoubtedly moved to employer coverage or Medicaid.
Premium Tax Credits
Approximate 84 percent (8.3 million) enrollees received premium tax credits averaging $270 per month. Average tax credits ranged from $534 per month in Alaska to $159 per month in Arizona. Fifty-six percent of enrollees receive cost-sharing reduction payments, which make actual health care as well as health insurance affordable to enrollees with incomes below 200 percent of the federal poverty level, but are being challenged in the House v. Burwell litigation.
Nationally, 1 percent of enrollees were enrolled in catastrophic plans, 21 percent in Bronze plans, 68 percent in silver plans, 7 percent in gold plans, and 3 percent in platinum plans.
Income Data Matching
During 2015, CMS is taking action on a monthly basis regarding the eligibility of applicants who have been unable to resolve data matching issues. Questions concerning citizenship or immigration status must be resolved within 95 days or the enrollee is removed from coverage. Questions regarding household income must be resolved within 90 days, or their premium tax credits and cost-sharing reduction payments will be revised based on available tax data.
As of June 30, CMS had terminated 2015 coverage for 423,000 consumers based on citizenship or immigration issues and adjusted financial assistance for about 967,000 others based on income data matching issues. Enrollees who have been terminated for data matching issues are not included in the effectuated enrollment totals.
The effectuated enrollment totals do include, however, the 950.000 enrollees who enrolled between the end of the 2015 open enrollment period in February and June 30, 2015.
Contraceptive Mandate
On September 3, 2015, a majority of the judges of the Tenth Circuit Court of Appeals declined to offer a rehearing en banc (by the whole court) of an earlier two-to-one decision of a three judge panel refusing to enjoin the enforcement of the most recent contraceptive mandate accommodation at the request of several religious organizations.
Five of the 12 Tenth Circuit judges dissented, contending that the religious beliefs of the organizations prohibited them from signing the forms that the accommodation requires them to sign to inform the government of their religious beliefs—not just from providing the contraceptives themselves—and that the accommodation substantially burdens this belief.
Therefore, the dissenters argued, the plaintiffs should have been granted a rehearing to determine if the accommodation met the other requirements of the Religious Freedom Restoration Act: was it the least restrictive means to serving a compelling governmental interest?
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