It's Friday and health care reform primer time again. Today, we step forward into the Patient Protection and Affordable Care Act's Title I, Subtitle D, Part IV -- State Flexibility To Establish Alternative Programs.
Basic Health Programs for Low-Income Individuals
The federal Department of Health and Human Services must create a basic health program under which a state can contract to offer one or more plans that provide at minimum the essential health benefits to certain individuals instead of offering them coverage through the state exchange. An individual's premium for a plan cannot exceed what his cost would be for the second-lowest cost silver plan offered through the exchange, and the plan's cost-sharing cannot exceed that required under the exchange's gold plan (or platinum plan, in the case of households with incomes equal to 150 percent or less of the federal poverty line.) The insured's required premium and cost-sharing will be reduced by any applicable premium credits and sharing reductions for the plan. Plans offered by health insurance carriers must have medical loss ratios of at least 85 percent.
To qualify for coverage under this program, a person must:
- Be ineligible for Medicaid
- Have a household income between 133 percent and 200 percent of the poverty line for the family size involved (less than 133 percent for legal immigrants who are ineligible for Medicaid)
- Be ineligible for minimum essential coverage or be eligible for employer-sponsored coverage that is not affordable, and
- Be under age 65 at the beginning of the plan year.
If a person is eligible for coverage under this program, he cannot use the state exchange.
States that choose to contract with these plans must establish a competitive bidding process that includes negotiations of premiums, cost-sharing, and benefits beyond the essential health benefits. The competitive bid proces must include:
- Negotiations for the plan to include innovative features like care coordination and care management for enrollees ("especially for those with chronic health conditions"), incentives for use of preventive services, and creation of patient-provider relationships that maximize patient involvement in decision-making and that provide incentives for appropriate use of plan benefits.
- Consideration of and allowances for differences in the health care needs of various enrollees, and differences in local availability of and access to health care providers.
- As many attributes of managed care as feasible in the local market
- Creating specific performance measures that focus on quality of care and improved outcomes; requiring plans to report their results to the state; and making the results available to enrollees in a useful form.
To the extent feasible, states must seek to make multiple plans available. At their option, they can permit HMO's, health insurance carriers, and provider networks to offer plans. They also have the option of forming regional compacts with other states in which eligible individuals can enroll in any of the plans offered in the member states. To maximize efficiency and improve continuity of care, states must coordinate administration and benefits offered through this program with their Medicaid programs, the state child health plan, and any other state-administered health plans.
States that meet the program's requirements are eligible for grants from HHS equal to 95 percent of the premium tax credits and cost-sharing reductions that enrollees in the program would have received if they had bought coverage through an exchange. They must use these funds to reduce plan premiums and cost-sharing or to provide additional benefits for enrollees. HHS will calculate the amount due to a state on a "per enrollee" basis, taking into account an enrollee's agen and income, whether coverage was for an individual or for a family, geographic differences in health care spending, and other factors. An actuary must certify that the calculation is correct. If HHS makes an error in the calculation, it must make an adjustment to correct for it the following fiscal year.
Lastly, HHS must review each state plan annually for compliance with eligibility verification requirements, requirements for use of federal funds, and achievement of quality and performance standards.
Next time, we'll look at what states can do to get waivers from the PPACA's requirements.
Comments