Manatt on Health Reform: Weekly Highlights

This week’s highlights include movement in states’ Marketplace and Medicaid leadership positions; Idaho takes a hard look at Medicaid expansion, and federal officials help Marketplace enrollees prepare for the 2014 tax season.

FEDERAL NEWS:

HHS Begins to Prepare Consumers for Tax Season

The U.S. Departments of Health and Human Services and Treasury announced the first in a series of consumer-friendly resources to help marketplace enrollees complete new tax forms related to their 2014 marketplace coverage and for those seeking an exemption from the personal responsibility fee. Soon after the announcement, CMS conducted a webinar for navigators and assisters that provided an in-depth review of the 1095-A Form, which CMS has begun distributing to all 2014 marketplace enrollees for use when completing new tax forms.

Researchers Predict Significant Enrollment Reductions and Premium Increases If Federal Marketplace Subsidies Struck Down

When the U.S. Supreme Court hears King v. Burwell later this year, it will decide whether to strike down subsidies on the Federally-facilitated Marketplace (FFM). Researchers recently released two reports estimating the impacts of eliminating subsidies; according to RAND Corporation research, individual market (on and off the FFM) enrollment will drop by 9.6 million people and premiums will increase by 47% in FFM states. A Robert Wood Johnson Foundation and Urban Institute brief estimated a similar decrease in enrollment in FFM states, and projected an increase in the overall uninsurance rate in FFM states by 44%, from 18.4 million to 26.6 million.

House Passes Bill to Relax ACA’s Employer Mandate

The U.S. House of Representatives passed the Save American Workers Act, which would modify the ACA’s definition of full-time work from 30 or more hours per week to 40 for purposes of determining penalties under the employer mandate. The Congressional Budget Office and the Joint Committee on Taxation estimated the bill could increase budget deficits by $18 billion by 2020, decrease the number of employees receiving employer-based coverage by 1 million, and increase Medicaid/CHIP enrollment by 500,000. President Obama has stated he will veto the bill if passed by the Senate.

STATE HEALTH REFORM NEWS:

Idaho: Governor Advises Lawmakers to Hold Hearing on Medicaid Expansion Alternatives

In a departure from his historic opposition to Medicaid expansion, Governor C. L. "Butch" Otter (R) encouraged legislators in his “State of the State” to hold a hearing on the alternative Medicaid expansion strategies put forth by the Governor’s Workgroup on Medicaid Redesign, according to the Associated Press. The Workgroup’s latest proposal described two options for alternative expansions, one of which includes providing new adults with incomes 100-138% of the federal poverty level premium assistance to purchase qualified health plans on the State’s Marketplace.

Kentucky: Medicaid Commissioner Resigns, Deputy Commissioner Tapped as Successor

Kentucky's Medicaid Commissioner Lawrence Kissner, who oversaw the State’s Medicaid expansion, will resign on February 1, according to a Kentucky NPR affiliate, to move to an out-of-state private sector role. Current Deputy Commissioner Lisa Lee has been appointed by the Cabinet for Health and Family Services Secretary to succeed Kissner.

Massachusetts: Marketplace Executive Director To Step Down

The Massachusetts Health Connector announced that Executive Director Jean Yang will step down on January 16. Maydad Cohen, Special Assistant to the Governor on the Health Connector, MassHealth, and MassIT, will be named Interim Executive Director until the newly inaugurated Governor Charlie Baker (R) names a permanent replacement. Yang was Executive Director since January 2013 and previously served as the Health Connector's Chief Financial Officer.

Montana: Legislature Amends RuleThat Could Impact Medicaid Expansion Legislation

Leaders in the Montana House agreed to a change in House rules that will make it easier for up to six bills from each Party to be moved from Committee to consideration by the full House. The rule change allows these “silver bullet” bills to be moved from Committee to the floor with a vote of the majority of the full House (51 votes), rather than the standard three-fifths vote (60 votes). Representative Chuck Hunter (D), the House Minority Leader, noted that Medicaid expansion is likely to be one of these bills for House Democrats. However, Republican-controlled committees maintain the ability to issue an “adverse report” on these bills, in which case 60 votes would still be required to push the bill out of committee.

New Mexico: Medicaid Director Resigns to Accept Job with Medicaid Contractor

Julie Weinberg will step down as State Medicaid Director, effective January 16, to accept a position at a division of Optum, reports the Santa Fe New Mexican. Weinberg served as Medicaid Director for four years, during which time she supervised the State's expansion of Medicaid under the Affordable Care Act.

Tennessee: Governor Reveals Further Details of Medicaid Expansion Plan

Governor Bill Haslam (R) released a draft waiver request for his Insure Tennessee program, which would expand the State’s Medicaid program to cover approximately 200,000 newly eligible adults through an amendment to the State’s existing TennCare II waiver. As reported initially by the State, Insure Tennessee would offer two plan options to eligible individuals: the “Healthy Incentives Plan” and the “Volunteer Plan.” Individuals enrolled in the Healthy Incentives Plan would be covered by a managed care organization and would receive a health reimbursement-like account called a Healthy Incentives for Tennesseans account. The Volunteer Plan would provide individuals who have access to cost-effective employer-sponsored insurance (ESI) with a “defined contribution” via premium assistance to purchase a private plan offered by their employer. The State is seeking a number of waivers to implement Insure Tennessee as proposed, some of which would go beyond what has been approved in other expansion waivers. Provisions would include:

  • Waive Medicaid limits on cost sharing for individuals enrolled in the Volunteer Plan
  • Waive the Medicaid requirement to “wrap” benefits that are not covered by ESI, including non-emergency transportation, for the Volunteer Plan
  • Permit Volunteer Plan members to only file benefits appeals through their ESI’s process
  • Institute premiums set at 2% of income for Health Incentives Plan members with incomes between 100% and 138% of the federal poverty level
  • Continue its TennCare II waiver of the Medicaid requirement to provide retroactive coverage.

The Insure Tennessee waiver amendment is now undergoing a 30-day public comment period, after which it will be submitted to CMS.

Washington: Exchange Moves to End Premium Aggregation

The Advisory Committee of the Washington Health Benefit Exchange, the only State-based Marketplace conducting premium aggregation without a Third Party Administrator, decided to eliminate this functionality from the individual Exchange, saving the Exchange approximately $6 million over two years. Consumers will start paying and receiving invoices directly from carriers during the 2016 open enrollment period.

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