RISE looks at the latest regulatory news related to health plans on HealthCare.gov, Medicare Advantage, fraud and abuse, and cost-sharing reduction subsidies.
CMS: Expect lower premiums, more plan choices on HealthCare.gov
Consumers will see lower premiums on HealthCare.gov and have a greater choice of plans for the second year in a row, according to the Centers for Medicare & Medicaid Services (CMS).
The average premium for the second lowest cost silver plan on HealthCare.gov for a 27-year-old will drop by 4 percent for the 2020 coverage year, CMS announced. In addition, 20 more issuers will participate in states that use the Federal Health Insurance Exchange platform, bringing the total to 175 issuers compared to 132 in 2018, delivering more choice and competition for consumers.
Furthermore, CMS reported that six states experienced drops of double-digit percentages in average second-lowest cost silver plan premiums for 27-year-olds. Those states include Delaware (20 percent), Nebraska (15 percent), North Dakota (15 percent), Montana (14 percent), Oklahoma (14 percent), and Utah (10 percent). CMS has used its authority to approve reinsurance waivers in three of these states, including Delaware, North Dakota and Montana, contributing to the decline in premiums.
Despite these positive developments in the individual market, CMS said that average premiums are still too high and health insurance remains unaffordable for people who do not qualify for a tax credit and must pay the entire premium themselves. A recent CMS report shows that 2.5 million people who didn’t receive federal premium tax credits left the individual market from 2016 to 2018. This represents a 40 percent drop in just two years.
Medicare Advantage plans continue to grow, offer more supplementary benefits
A new policy brief from the Kaiser Family Foundation (KFF) finds that 3,148 Medicare Advantage plans will be available for individual enrollment for the 2020 plan year–an increase of 414 plans since 2019. This means that the average beneficiary will be able to choose among 28 plans in 2020, up from 24 in 2019. The number of Special Needs Plans (SNPs) will also increase from 717 plans in 2019 to 855 plans in 2020.
Most beneficiaries (97 percent) will have access to a Medicare Advantage plan that offers dental, fitness, vision, and hearing benefits, which are not covered by traditional Medicare. They will also have access to transportation assistance (92 percent) and a meal benefit (96 percent). The KFF brief also notes that some benefits are less available, such as in-home support (54 percent), bathroom safety (49 percent), telemonitoring services (29 percent), and support for caregivers of enrollees (12 percent).
Feds owe health insurers $1.6 billion in unpaid subsidies, judge rules
A federal judge has ruled that the Department of Health & Human Services owes $1.6 billion in cost-sharing reduction (CSR) payments to more than 90 payers that offer plans in the Affordable Care Act exchanges. Chief Judge Margaret Sweeney of the U.S. Court of Federal Claims ordered HHS to pay insurers for the unpaid CSRs for 2017 and 2018.
In the class-action suit, Common Ground Healthcare Cooperative argued that the federal government ceased to make the payments in violation of Section 1402 of the health care reform law. The subsidies were meant to help low-income Americans pay for health insurance coverage, but the Trump administration stopped the payments in October 2017, one of several actions taken to destabilize the health insurance exchange market.
The government is likely to appeal the decision as it has previously appealed similar cases brought by other insurers.
CMS reveals 5-prong plan to tackle Medicare fraud, waste, and abuse
CMS Administrator Seema Verma has announced the agency will take “aggressive actions to eliminate fraud, waste and abuse” in response to President Trump’s recent Executive Order that CMS propose changes that address fraud in the Medicare program.
In 2018, improper payments accounted for 5 percent of the total $616.8 billion of Medicare's net costs. To combat improper payments, CMS has developed a five-point plan to ensure program integrity:
- Stop bad actors by working with law enforcement agencies to identify and act on those who defraud the Medicare program. CMS will work with the Office of the Inspector General, Department of Justice, and Unified Program Integrity Contractors to discuss potential health care fraud cases, quickly direct them to law enforcement, and take appropriate administrative action such as payment suspensions and revocations. Once these bad actors are identified, CMS will:
- Prevent fraud by making system changes to avoid similar fraudulent activities and identify potential problem areas. CMS will then work with law enforcement partners to develop policies, regulations, and processes to prevent vulnerabilities in the system.
- Mitigate emerging programmatic risks by being more vigilant in monitoring new and emerging areas of risk. For example, new payment models are beneficial but have the potential to cause new challenges in identifying improper payments, beneficiary safety issues, and other program integrity concerns.
- Reduce provider burden. CMS said it doesn’t want to create unnecessary time and cost burden on providers, so it has increased efforts to educate providers in CMS program rules and regulations and remedy onerous processes to assist rather than punish providers who make good faith claim errors. CMS is also looking at ways to centralize screening and continuous monitoring for all payers.
- Leverage new technology. CMS said it is seeking new, innovative strategies and technologies, such as artificial intelligence and/or machine learning, which are more cost effective and less burdensome to both providers, suppliers, and the Medicare program. This new technology could allow the Medicare program to review compliance on more claims with less burden on providers and less cost to taxpayers.