Monday, August 30, 2010

FDA clarifies menu labeling laws that are effective now

The U.S Food and Drug Administration (FDA) has issued guidance with regard to exactly which provisions of the Affordable Care Act (ACA) governing nutrition labeling requirements are effective now, and which are not required to be followed until final regulations have been issued. The guidance explains that chain retail restaurants are required to disclose the number of calories in each standard menu item, written nutrition information must be given to customers upon request, the availability of that written information must be explained to customers on menus and menu boards, and, for self-service items and food on display, calorie information must be provided on a sign adjacent to each food item.

So far, final regulations have not been issued on either requirements established by the FDA for a menu statement putting calorie information in the context of a total daily caloric intake, or on standards for determining and disclosing the nutrient content for standard menu items that come in different flavors, varieties, or combinations, but which are listed as a single menu item.

The ACA labeling requirements generally only cover restaurants with 20 or more locations doing business under the same name. Restaurants with fewer locations would still be subject to their state or local government's nutrition labeling laws. Restaurants that are subject to the ACA's rules are effectively only answerable to the ACA's provisions, since, under ACA Sec. 4205, state and local governments cannot impose nutrition labeling requirements that are not identical to the ACA's provisions. It should be noted that restaurants with fewer than 20 locations can opt to participate in the ACA nutrition labeling program, and those restaurants would then be exempt from their state and local governments' nutrition labeling laws.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Friday, August 27, 2010

Find Health Coverage Options With HealthCare.gov’s New Web Tool

Consumers and small employers now have a new web tool to search for health insurance coverage options in their geographic regions. This new tool is available through HealthCare.gov, a service of the U.S. Department of Health and Human Services. The Insurance Finder “widget” allows anyone with a website or blog to embed a tool on their site and begin to search for public and private health coverage options.

The tool asks users two initial questions: “select a state” and “which best describes you.” The descriptions among which consumers may select include family/children, healthy individual, individual with medical condition, pregnant woman, person with disability, senior, young adult (under 26), and small employer/self employed.

After clicking on “next steps,” users are rerouted to a HealthCare.gov page to continue the insurance finder process. Based on the consumer’s answers, the coverage finder produces a menu of personalized potential coverage choices.

For example, a small employer that is interested in new coverage available in a specific state, will enter the applicable zip code to obtain a list of insurance carriers and health care plans available in that geographic area. With information for each plan offered each carrier may include links to services it provides, its provider network, and drug coverage under the plan. Price estimates for each option are scheduled to be posted on the site in October.

Here’s the link to the Insurance Finder widget.

And here’s comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on up-to-date resources on health reform and other developments in employee benefits.

Wednesday, August 25, 2010

Self-Funded Health Plans Get Claims Review Guidance

New guidance from the three major federal agencies responsible for implementing the Patient Protection Act provides that plans and insurers that are not subject to an applicable state process for external review of adverse claims determinations must implement such a process. The IRS, and the Departments of the Labor and Health and Human Services are releasing the guidance in the August 26 Federal Register. This relase also includes model notices that plans and health insurers may use to satisfy the disclosure requirements of related interim final regulations for effective claims review and appeals processes that the DOL posts on its website.

The internal and external adverse claims review and appeals requirements are intended to protect consumers’ rights to a fair hearing and determination of their health insurance claims.

In July, interim final regulations provided guidance requiring group health plans and insurers to comply with existing DOL claims procedure regulations and imposing specified additional standards for internal claims review and appeals. This new release from the DOL’s Employee Benefits Secuity Administration (EBSA), Technical Release No. 2010-01, provides an interim enforcement safe harbor for non-grandfathered (that is, plans that are not excepted from compliance with the Affordable Care Act requirements) self-insured group health plans that, because they are not subject to a state external review process, are therefore subject to the federal review process. (In the case of an insured group health plan, the insurer has primary responsibility to comply with the July 2010 interim final regulations.)

This interim enforcement safe harbor applies for plan years beginning on or after Sept. 23, 2010, until it is superseded by pending future guidance on the federal external review process. While this interim enforcement safe harbor is in effect, the DOL and the IRS specify that they will not take any enforcement action against a self-insured group health plan that complies with either the procedures outlined in Technical Release 2010-01 or voluntarily complies with its state external review processes: The procedures in Technical Release 2010-01 are based on the Uniform Health Carrier External Review Model Act developed by the National Association of Insurance Commissioners (NAIC Model Act) on July 23, 2010.

HHS says that before July 1, 2011, it will issue further guidance about which state external review laws have been determined to satisfy the minimum standards of the NAIC Model Act.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on up-to-date resources on health reform and other developments in employee benefits, just click here.

Monday, August 23, 2010

Federal Agency Measures Health Care Quality

Among the Patient Protection and Affordable Care Act’s provisions are additions to the Public Health Service Act that focus on improving health care quality. As discussed in a previous post PHSA Secs. 2715 and 2717 require the federal government to develop uniform standards for plans' benefit summaries and explanations of coverage and guidelines for health insurers to report on their quality of care initiatives and programs.

The Agency for Healthcare Research and Quality, in the U.S. Department of Health and Human Services, has been addressing health care and health insurer quality issues since 1995 with its Consumer Assessment of Healthcare Providers and Systems (CAHPS) program, a public-private initiative to develop standardized surveys of patients' experiences. The AHRQ’s stated mission is to “foster health care research that helps the American health care system provide access to high-quality, cost effective services; be accountable and responsive to consumers and purchasers; and improve health status and quality of life.”

Most recently, the AHRQ published a Notice of Request for Measures to determine how well health plans and health providers address health plan enrollees' health literacy needs and how well they communicate with health plan enrollees.

The intent of the planned survey, the AHRQ says, is “to gain patients' perspective on how well health and health plan information is communicated to them by healthcare professionals and health plans.” Health plans, medical providers, and others may use the results of the survey to determine the quality of the health information they provide and the best methods to deliver that information to plan enrollees and to patients.

The issues that the measures would assess could include, for example, clarity and simplicity of provided health information related to preventive services (for example, risks and benefits of the service, explanation of screening results); health problems/concerns (such as information on how to stay healthy or prevent illness); treatment choices, instructions, or goals including pros and cons of each option; medications (for example, reason to take the prescribed medications, instructions on how to take the medications, and possible side effects); and care management/disease management.

Another subject that may be assessed is the quality of services that support delivery of health information, such as language access, including availability in other languages and timeliness of customer service and interpreter services and of forms and patient education materials, the quality and accessibility of member services, nurse advice lines, and health plan information on coverage, benefits, and billing information, health plan system navigation and health plan environment (language access and assistance in completing medical paperwork or forms, signage).

Since the CAHPS program started in 1995 it has expanded to include surveys and reports on individual medical services providers, group medical practices, kidney dialysis centers, nursing homes and hospitals. Most recently, AHRQ determined that the CAHPS should develop a survey to obtain the consumers' perspective on the quality of health information (another element of health reform).

Federal law gives the AHRQ the power to conduct and support research and distribute information on health care and on delivery systems including on the following elements: quality, effectiveness, efficiency, appropriateness and value of health care services; quality measurement and improvement; outcomes, cost, cost-effectiveness, use of health care services and access to such services; and health statistics, surveys, and database development.

So, in terms of health care quality assessment and improvement, one federal agency at least already is well established and moving forward to aid in health reform. Check out the AHRQ’s Website

Friday, August 20, 2010

Many states lack power to enforce health reform laws

Earlier this week, the Department of Health and Human Services (HHS) awarded states $46 million, in the first round of grants, to help them crack down on unreasonable health insurance premium hikes. Five states—Alaska, Georgia, Iowa, Minnesota, and Wyoming—did not apply for a grant under this HHS program.

The problem. Why is this money needed? There are gaps in states’ authority to regulate insurance rates as well as to enforce federal health reform’s consumer protections. In fact, currently, only 26 states and the District of Columbia have the authority to reject a proposed increase that is excessive, lacks justification or otherwise exceeds state standards. Even worse, many of the states that have the power to crack down on unreasonable premium increases lack resources to exercise it meaningfully.

Uses for grant money. States expect to use the HHS grants in one or more different ways, including:
  • Seeking additional legislative authority: 15 states and the District of Columbia will pursue additional legislative authority to create a more robust program for reviewing or requiring advanced approval of proposed health insurance premium increases to ensure that they are reasonable;
  • Expanding the scope of health insurance premium review: 21 states and the District of Columbia will expand the scope of their current health insurance review, for example, by reviewing and requiring pre-approval of rate increases for additional health insurance products in their state;
  • Improving the health insurance premium review process: All 46 state grantees will require insurance companies to report more extensive information through a new, standardized process to better evaluate proposed premium increases and increase transparency across the marketplace;
  • Making more information publicly available: 42 states and the District of Columbia will increase the transparency of the health insurance premium review process and provide easy-to-understand, consumer friendly information to the public about changes to their premiums; and
  • Developing and upgrading technology: All state grantees will develop and upgrade existing technology to streamline data sharing and put information in the hands of consumers more quickly.
For more information. For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Wednesday, August 18, 2010

Most large employers revising their health plans for 2011

Most (53%) large American employers plan to make changes to their health programs for next year, in light of health reform and expected large cost increases, according to a survey by the National Business Group on Health. The rest are either (1) scaling back planned changes, (2) making no changes, or (3) unsure of what they intend to do.

Among the employers who are making specific health plan changes to comply with the new health reform law, the survey said that 70 percent indicated they will remove lifetime dollar limits on overall benefits while 37 percent reported they will make changes to annual or lifetime limits on specific benefits. About one in four (26%) will remove annual dollar limits on overall benefits while 13 percent will remove pre-existing condition exclusions for children.

"While the health reform law has forced employers to evaluate their health care benefit strategies and decide whether to comply with the law or lose grandfathered status, they haven't lost sight of the fact that controlling rising costs remains one of, if not, their highest priority. They have to foot the bill, not the government," said Helen Darling, president of the National Business Group on Health. "In fact, with cost increases expected to accelerate next year, many of the plan design changes employers are making are being done to help curb those increases, as they have to do every year."

Other findings. Among other things, the survey found that more employers plan to increase the percentage employees contribute to the premium next year, while more employers plan to raise out-of-pocket maximums next year compared with 36% this year.

With the health reform law making Medicare Part D benefits richer via the closing of the “doughnut hole," five percent of employers plan to drop retiree health coverage in 2011 while 60 percent are considering doing so in the future.

For more information. For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Monday, August 16, 2010

Confusion over health reform still reigns

It’s been nearly five months since the passage of health reform legislation and a surprising number of people remain confused over what the law says. According to a USA Today article, the “need for outreach became apparent in recent weeks following the release of three polls,” showing the extent of the public confusion and misinformation as to health reform.

For example, according to a Kaiser Family Foundation poll, more than 40 percent of respondents believe, incorrectly, that the new law contains a government panel to make end-of-life decisions for Medicare beneficiaries. A Harris Interactive poll found that more than a third of respondents, again incorrectly, believe that health reform included a public option that would compete with private insurers.

USA Today quotes Humphrey Taylor, chairman of the Harris Poll, as calling “the level of ignorance and misinformation” as “astounding.” Taylor suspects that the public is still “reacting to the rhetoric, not the substance” of what’s in the health reform legislation.

If people don’t know what’s in the new law, how can they use it to their benefit?

For more information. For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Wednesday, August 11, 2010

HHS Provides Help For Difficulties In Applying To The Early Retiree Reinsurance Program

The Department of Health and Human Services Plan has provided additional guidance regarding the application the Early Retiree Reinsurance Program (ERRP) to help the sponsors who submitted incorrect or incomplete applications.

In late June, HHS began accepting applications to the program. HHS now has provided three methods of correcting problems:

First, HHS notes in an update to its ERRP information that some plan sponsors may have submitted their Early Retiree Reinsurance Program applications on the official form, but before having had the chance to review the version of the Frequently Asked Questions (FAQs) document that was published on June 29, 2010.

Such sponsors should not submit another application. HHS is developing a process to identify applications that may include an incorrect or incomplete response as a result of the sponsor not having access to the additional FAQs that were posted on June 29, 2010. When such responses are identified, HHS will give sponsors a chance to submit additional information as an attachment to support the original application. The sponsor’s account manager will be contacted via telephone or email in these situations. Sponsors that may have already submitted a second application, after the June 29 FAQs were published, should not contact HHS. HHS is developing a process to respond to those situations.

Second, certain applicants were having difficulty with the on-line application that was posted early the morning of June 29, 2010. A revised copy of the application has been posted that accommodates the entering of numeric sequences that start with zeros in fields requiring numbers (e.g., EIN, phone numbers, etc.). If an applicant had this problem with the early version of the application, HHS will accept what was submitted and contact the sponsor if necessary to ascertain the correct data before making an application determination. Applicants who had completed and submitted the early version of the application but who did not experience a problem entering zeros, do not need to re-complete their application form.

Third, there has been some confusion about how applications should be submitted. Applications should be submitted through the U.S. Postal Service. However, if a sponsor submitted its application in another manner, the application will be accepted for processing, provided the application is otherwise acceptable for processing. However, for operational reasons, HHS prefers sponsors to use the United States Postal Service. If an applicant submitted an application via a carrier other than the United States Postal Service, and it was accepted at the address listed on the official application, do not re-submit the application. Sponsors that may have already submitted a second application, should not contact HHS. HHS is developing a process to respond to such situations.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Tuesday, August 10, 2010

How Many More Adult Children Will Be Covered Under Health Reform?

There is reason to believe that government estimates of the dependent-child mandate underestimate the size of the population that might enroll in their parents' employment-based coverage, according to study published by the Employee Benefit Research Institute (EBRI).  In addition, according to the August 2010 EBRI Notes, the costs of the mandate are expected to increase health insurance premiums about 0.7% in 2011, 1% in 2012, and 1% in 2013, noted the study, published in the.

The Patient Protection and Affordable Care Act provision that requires group health plans and insurers to make dependent coverage available for children until they attain age 26 will increase employment-based coverage by estimates ranging from 680,000 to 2.12 million individuals, according to regulations issued in May.

The EBRI report identifies several shortcomings in regulatory assumptions that the 2.6 million 19 to 25 year-olds in states that already allow adult children to enroll in extended coverage are unlikely to enroll under the Affordable Care Act. It is largely impossible to factor in parents' decisions when it comes to enrolling their children, EBRI noted. Contrary to regulatory assumptions, about 3 million of the 7.5 million 25-year-olds with some other form of coverage (such as Medicaid or Tricare) will be eligible to enroll in the PPACA program; and more adult children are likely to become eligible as their parents gain employment.

"It is critical that group plans and insurers understand the size and characteristics of the 19 to 25 year-old population that might be eligible for their parents' health coverage in order to determine the impact that this provision of the Affordable Care Act may have on enrollment and costs of employment-based coverage" wrote Paul Fronstin, director of the EBRI health research and education program.

When compared with the population of workers with employment-based health coverage, the uninsured population age 19 to 25 is more likely to be male, older, Hispanic, and less physically and mentally healthy, the study said. The uninsured population also was determined to be less likely than the population with employment-based health coverage to use preventive health services, to exercise, and to be of normal weight. The uninsured are more likely to smoke and more likely to have asthma.

For more information, visit http://www.ebri.org.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Friday, August 6, 2010

Most Seniors Unaware Of Key Provisions Of The Affordable Care Act

The majority of the nation’s seniors do not understand the Patient Protection and Affordable Care Act, according to a recent poll from the National Council on Aging (NCOA). The survey found that only 17% of survey respondents could correctly answer half of the 12 questions asked about key provisions of the law. Furthermore, none of the 636 respondents answered all 12 questions correctly.

NCOA found that only 22% of seniors understood that the Affordable Care Act would not cut their basic Medicare benefits. Almost twice as many seniors (42%) held the incorrect view that the law would cut their basic Medicare benefits, while 37% said they did not know. Even among the older adults who said they considered themselves “very familiar” (9%) or “familiar” (12%) with the new law, 65% still got less than half of the answers right, according to the survey.

The Kaiser Family Foundation (KFF) found similar results in their July Health Tracking Poll. According to KFF, 52% of seniors were aware that the new law will result in premium increases for some higher income Medicare beneficiaries, and 50% knew that the new law will gradually close Medicare’s “doughnut hole.” However, only 33% are aware that the Affordable Care Act will eliminate Medicare’s copayments and deductibles for some preventive services.

On the other hand, KFF found that large shares of seniors mistakenly believe the law includes provisions that cut some previously universal Medicare benefits and creates “death panels.” Half of seniors said that the law will cut benefits that were previously provided to all people on Medicare, and 36% incorrectly believe the law will “allow a government panel to make decisions about end-of-life care for people on Medicare.”

For more information, visit http://www.kff.org or http://www.ncoa.org.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Wednesday, August 4, 2010

Public Opinion During Health Reform Process Was Not As Volatile As It Appeared

During the year-long debate on health reform, public opinion polls seemed to show a volatile and divided American population. However, a closer examination of these polls and other surveys shows well-established patterns in public opinion that played out in this debate as they have in other debates, according to the study, Liking the Pieces, Not the Package: Contradictions in Public Opinion During Health Reform, published in the June 2010 issue of Health Affairs.

The study showed that while there was majority support for reforming the health care system, opinions did fluctuate on various aspects of the legislation. This mainly happened when individuals recognized that they would be impacted in some way. As the government goes forward with implementation of the Patient Protection and Affordable Care Act, the public's judgment of the law is likely to be based less on political debate, and more on perceived impacts at the personal level as implementation proceeds, according to the researchers.

The study identified several long-standing attributes of public opinion and how they played out during the health reform debate, as follows:

Competing Issues. During the health reform debate, it was easy to forget that health reform is only one of the issues that the public cares about. Following the 2008 election, health care (43%) trailed the economy (73%) and terrorism (48%) as top priorities.

Partisan Contradictions. Public opinion polls throughout the health reform debate show that American's views on health reform were sharply divided by party identification. A poll taken right before the legislation passed found that 75% of Democrats supported the bill, while 80% of Republicans opposed it. However, the study noted that these partisan divisions are nothing new. Polls taken during the 1993-94 health reform debate found that not only were Republicans the least likely to favor the Clinton plan, but they also were the least likely to believe that the health care system needed comprehensive reform.

Persistent Support For Health Reform. Historically, the study noted that Americans have favored addressing problems in the health care system since the mid-1980s. In October 1986, 66% of the public supported completely rebuilding or making major changes to the existing health care system. During the current debate, 54% of the public in January 2010 agreed that economic circumstances made it more important than ever to take on health reform.

Reform Components. The week of the final vote on the Affordable Care Act a poll found that 48% were opposed to the legislation as a whole, 37% were in favor, and 15% were still undecided. However, many were in favor of certain components of the law, such as health insurance reforms (76% said this was "extremely" or "very" important), tax credits for small businesses (72%), and helping close the Medicare drug coverage donut hole (71%).

Personal Impact. The study found that in both the Clinton and Obama health reform debates, Americans were unclear about how reform would affect their families. As the debate progressed, opponents tapped into fears and anxieties about how the proposed solutions might change the status quo, and people became increasingly negative about the perceived personal impact. During the Obama reform effort, those individuals not expecting that health reform would affect their family fell from 43% to 28% over the course of the debate, while those expecting to be harmed increased (from 11% to 32%), and those individuals who expected to benefit from the reforms hovered around 35%.

The study was based on more than fifty nationally representative public opinion polls that have been conducted since 1943. For more information, visit http://www.healthaffairs.org.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.

Monday, August 2, 2010

Interim Final Rule Addresses Eligibility, Premiums For Temporary High-Risk Program

On July 1, the Pre-Existing Condition Insurance Plan (PCIP) program, created under the Patient Protection and Affordable Care Act, went into effect. In the July 30 Federal Register, the Department of Health and Human Service's (HHS) Office of Consumer Information and Insurance Oversight (OCIIO) issued an interim final rule that addresses eligibility qualifications for participating in the program and the premiums that are allowed to be charged.

The Affordable Care Act requires the HHS to establish, either directly or through contracts with states or nonprofit entities, a temporary high risk health insurance pool program to provide affordable health insurance coverage to uninsured individuals with preexisting conditions. The HHS is directly running a PCIP in 21 states, while 29 states have decided to run their own PCIP. This program will continue until Jan. 1, 2014, when Health Insurance Exchanges will be available for these individuals to obtain health insurance coverage.

Eligibility. The interim final rule specifies that an individual eligible to enroll in a PCIP must be a citizen or lawfully present in the U.S., have not had creditable coverage during the six-month period prior to applying for coverage through the PCIP, and have a preexisting condition. An individual must prove that he or she has a preexisting condition. The interim rule states that a PCIP may determine that an individual has a preexisting condition if they satisfy any one of the following criteria:

1. the individual provides documented evidence that an insurer has refused, or has provided clear indication that it would refuse, to issue individual coverage on grounds related to the individual's health;

2. the individual provides documented evidence that he or she has been offered individual coverage but only with a rider that excludes coverage of benefits associated with a pre-existing condition; or

3. the individual provides documented evidence that he or she has a medical or health condition specified by the state and approved by the HHS.

Premiums. The interim final rule requires that premium rates for PCIPs must be at "a standard rate for the standard population." This refers to the premium rates offered in the individual market in the state where the PCIP operates. The OCIIO noted that existing state high risk pools' premiums typically average between 105% to 250% of the standard rate of the individual market. However, the Affordable Care Act requires that premiums in the PCIP program be at the standard rate, rather than at a higher proportion of that rate. In essence, PCIPs are not allowed to charge enrollees premiums at a rate that exceeds 100% of the standard individual market rate in the PCIP service area.

The OCIIO noted that the interim final rule does not mandate a specific formula for calculating this standard rate. Instead, a PCIP is allowed to calculate the standard rate using reasonable actuarial techniques.

The interim final rule is effective on July 30. Comments on the interim rules, which must be received by September 28, may be submitted through the federal eRulemaking Portal at http://www.regulations.gov. Comments should be identified by OCIIO-995-IFC.

For more information, contact Ariel Novick at (301) 492-4290.

For a comprehensive analysis of the Patient Protection and Affordable Care Act, and additional information on health reform and other developments in employee benefits, just click here.