Access to Health Insurance Regulation Update

Transcription

1 Health Care Compliance Association 2014 Puerto Rico Regional Annual Conference Access to Health Insurance Regulation Update Ángela Weyne Roig Commissioner of Insurance Office of the Commissioner of Insurance Health Insurance Code of Puerto Rico 2 Chapter 2 Chapter 4 Chapter 6 Chapter 8 Chapter 10 Chapter 12 Chapter 14 Chapter 16 Chapter 18 Chapter 20 Chapter 22 Chapter 24 Chapter 26 Chapter 28 Chapter 52 Chapter 54 Chapter 66 Chapter 72 General Provisions Prescription Drug Benefit Management Audit of Claims filed to Health Carriers Small and Medium Employer Health Insurance Availability (for its acronym in Spanish PYMES ) Individual Health Plans and Guaranteed Enrollment Discretionary Clause Prohibition Health Information Privacy Protection Limited Health Services Organization Health Care Professional or Entities Credentialing Verification Carrier Quality Assessment and Improvement Health Carrier Internal Grievance Procedures Utilization Review and Benefit Determinations Managed Care Plan Network Adequacy Health Carrier External Review Off Label Drug Use Newborn, Recently Adopted, or Placed for Adoption Child Coverage Long Term Care Insurance Unfair Discrimination Against Victims of Abuse 1

2 3 Legislation in Process Third Party Administrators: House Bill Health Plans Insurers Association: Currently under review an amendment to Section of the Health Insurance Code- A bill has not been presented. Pharmacy Benefits Management: House Bill 1518 To repeal Section of the Health Insurance Code with respect to Incentives and Bonification Programs and establish such provisions under Law No , known as the Puerto Rico Pharmacy Act. 4 Applicability of ACA Provisions (ACA) Reform Element Puerto Rico U.S. Essential Health Benefits. Applies Applies Prohibition of using health status in premium rates and guaranteed issue regardless any health condition. Individual Mandate to maintain minimum health coverage or to pay an annual tax penalty between 1% and 25% of household income. Employers with 50 employees or more mandate to maintain minimum health coverage and the penalty of $2000 after the first 30 employees. Small employers will receive tax credits against general business tax to contribute at least 50% of the premium. Tax credit for individual taxpayers between 100% and 400% of the Federal Poverty Level (FPL) The estimates results in $2,700, an average of 32% of the health coverage cost (Kaiser FF Aug 2013). New federal subsidy funds between 100% and 90% to expand the Medicaid eligibility between 100% FPL and 133% FPL. Applies Does not Apply Does not Apply Does not Apply Does not Apply Does not Apply Applies Applies Applies Applies Applies Applies 2

3 5 Puerto Rico Improvements over ACA Guaranteed Issue Period Subject ACA HICPR Eligible Dependents- In some circumstances dependents older than 26 years are eligible. The Guaranteed Issue Period runs from October 15 thru December 7 each year. Carrier should provide dependent coverage to adult children up to age 26. Except on the first year, the Guaranteed Issue Period runs from October 1 thru December 31 each year. Carriers should provide dependent coverage for biological and adopted children, and child placed in the home of the covered person for the purpose of adoption. Essential Health Benefits include additional services. Established the minimum essential benefits that every health plan should include. Dependents older than 26 years are entitled to continue as eligible regardless of his/her age if is incapable of earning a living due to mental or physical disability existing before he/she has attained twenty-six (26) years of age. In addition to the minimum essential benefits, includes the Respiratory Sincitial Virus vaccine, certain oral and vision services for adults and bone, skin and cornea transplants and x-rays. Referrals Expansion of the federal provision and the HICPR provide for the selection of certain specialists as primary care providers. A plan may not require authorization or referral for obstetric or gynecological care from a participating provider. In addition to not requiring authorization or referral for obstetric or gynecological care from a participating provider, the obstetric or gynecological specialist can be appointed as a primary care provider. 6 Access to Health Insurance Essential Health Benefits Coverage For an individual or small group health plan to be considered to provide the Essential Health Benefits, it must provide at least the following: 1. Standardized coverage to include the following services: Outpatient medical-surgical services Emergency services Hospitalization Maternity and newborn care Mental health disorders and the use of controlled substances Laboratory services, X-rays and diagnostic tests Pediatric services, and RSV vaccines against cervical cancer, health and vision Prescription drugs Habilitation and rehabilitation Preventive and chronic disease management 3

4 7 Access to Health Insurance Essential Health Benefits Coverage (cont.) For an individual or small group health plan to be considered to provide the Essential Health Benefits, it must provide at least the following: 2. The plan cannot require cost-sharing for preventive services. 3. The plan must be provided in at least one of the 4 metallic levels. 4. Any other required by mandate of federal or state law. 8 Access to Health Insurance Other provisions that promote access to health insurance: Prohibition to cancel. Guaranteed Renewability. Prohibition against discrimination because of preexisting conditions, quality of life, race, national origin, gender, sexual orientation, among others. Public disclosure of benefits and fees (SBC). Obligation to provide rebates to consumers if the percentage of premium expended in services is less than 80% for individual and small groups and less than 85% on large groups. 4

5 9 Access to Health Insurance The premium may only vary depending on the following criteria: Age Tobacco use Family composition Geographical area only 1 in Puerto Rico 10 Changes in Rate Regulations of the Health Plans in Compliance with ACA Prohibition of using health status in determining the rates. Age rate restrictions (3:1 maximum). Smoking rate restrictions (1.5:1 maximum). Regions for rate development (1 region). Development of the premium using each individual s age and smoker status. Single risk pool for individual market and single risk pool for small group market. Standardization of the rates methodologies. 5

6 11 How changes in rate regulation and the requirements of essential health benefits and the actuarial value model affect the Carriers All new rates must be submitted for the Commissioner s prior approval (Previously the OCI only evaluated HMO s rates). Insurers marketing health insurance coverage shall submit for prior approval of the OCI each increase in rates that exceeds 10% of the currents rates. (All HMO s rates increases must be submitted to the OCI). The carriers cannot use the health status in the underwriting process. Guarantee issue may affect adverse selection. PCORI fee and Health Insurer Fee are mandated. Compliance with the Federal MLR and return of premium if applicable (85% MLR for large groups and 80% of MLR for small group and individual market). 12 How changes in rates regulation and the requirements of essential health benefits and the actuarial value model affect the Consumers Consumers are able to request a health plan and the carriers are required to accept them, even with pre-existing conditions. Additional preventive services without cost-sharing and non-annual or lifetime monetary limits in the EHB. Additional mandated benefits (AMB), including prescription drugs and some dental and vision services may affect the rates. Development of the premiums using each individual s age may affect the family coverage rates. 6

7 13 ACA Market Reforms Consumer Protections 1. Prohibition of Pre-existing Condition Exclusion 2. Prohibition on Rescissions 3. Coverage of Preventive Health Services 4. Essential Health Benefits (EHBs) 5. No lifetime or Annual Limits on EHBs 6. Extension of Dependent Coverage 7. Patient Protection Provisions 8. Rate Reviews 9. Medical Loss Ratio (MLR) 10. Appeals and External Review 11. Summary of Benefits and Coverage (SBC) 14 ACA s most significant developments Since October, 2013 Early Renewals of Health Plans Early renewal of health plans was allowed if certain conditions were met. These conditions included, among others, the following: Early renewal could not be used as a strategy to avoid compliance of the ACA. Required written consent of the insured with evidence that he/she was made aware of the consequences of the early renewal. The new plan had to contain the same coverage and premium of the previous plan. Early renewal had to take place before January 1 st of Normative Letter CN AS regulates early renewals in the Commonwealth of Puerto Rico. 7

8 15 ACA s most significant developments (cont.) Transition Extension Announced by President Obama on November 14, Applicable for plans in the individual or small group market that were in effect before October 1, 2013 and that are renewed for a policy year starting between January 1, 2014, and October 1, These plans will not be considered to be out of compliance with the market reforms that were delayed by HHS if they comply with certain conditions. The specified market reforms that were delayed by HHS for the transitional health plans are certain provisions of the PHS Act that were scheduled to take effect on or after January 1, These provisions include, among others: Premium rating based on age, plan composition (individual or family) or smoking (Section 2701) Coverage of the Essential Health Benefits (Section 2707) Coverage for individuals participating in approved clinical trials (Section 2709) 16 ACA s most significant developments (cont.) All of the other market reforms (that went into effect before January 1 st of 2014) are in effect in the transitional plans, including the following provisions: Prohibition on Annual and Lifetime Limits (Section 2711) Preventive Health Services Coverage (Section 2713) Extension of Dependent Coverage (Section 2714) Pre-existing Conditions Exclusions for Minors and Small Groups (Section 2704) Plan Cancellation Protections (Section 2712) In accordance with CCIIO, association health plans may continue as such until 2015 if they comply with the transition extension requirements. CMS requires that standard notice forms are sent to policyholders as a condition for the application of the transition extension. The OCI used translated versions of these forms and they were included in Normative Letter CN of November 26 of 2013 as the forms that must be used in Puerto Rico. Normative Letters CN D of November 18, 2013 and CN of November 26 of 2013 regulate the transition extension in the Commonwealth of P.R. 8

9 17 ACA s most significant developments (cont.) Final Regulations for Health Insurance Providers Fee (HIF) The HIF is imposed by Section 9010 of PPACA and is payable by insurance companies. Final regulations for the HIF were issued by the IRS on November 29, Insurance companies are liable for the HIF if their net written premiums for health insurance policies exceed $25 million. Federal law requires a specific aggregate amount for the HIF per year that must be collected between all the health insurance companies of the States and the territories, including Medicare Advantage companies. The amount to be paid by health insurers in the year 2014 is $8 billion and it increases in the following years. 18 ACA s most significant developments (cont.) Final Regulations for Health Insurance Providers Fee (HIF) The IRS will calculate an insurer s share of the fee based on the ratio of its net written premiums for health insurance to the total net written premiums taken into account for all health insurers in the States and the territories. Payment of the HIF begins this year 2014 and the exact amount to be paid by each insurer will be determined by the IRS on or before August 31 st of each year. The fee must be paid by September 30 th of each year. A preliminary analysis from our Office suggests that the amount that insurers will have to pay for the HIF in the year 2014 for the Puerto Rico market may be $128 million approximately. HHS allows that the HIF is passed on to consumers and it has been estimated that the fee will cause a premium increase between 1.5% and 2.5%. 9

10 19 ACA s most significant developments (cont.) Final Regulations for Health Insurance Providers Fee (HIF) The purpose of the HIF has not been specifically identified in the law or regulations. However, a Report from the Congressional Research Service indicates the following purpose for the fee: The ACA premium tax is not occurring in isolation, however, but as part of the ACA s broad series of taxes and fees, and consumer and business insurance subsidies, and other health delivery reforms designed to expand the number of Americans with insurance and slow the rate of government and private market health care spending. Congressional Research Service Report No. R43225, Patient Protection and Affordable Care Act: Annual Fee on Health Insurers, page 9, Suzanne M. Kirchhoff, (December 12, 2013). PCORI Fee The PCORI Fee is imposed by the PPACA and is payable by insurance companies and self-funded health plans. The assessed fees are contributed to the Patient-Centered Outcomes Research Trust Fund (PCORTF) that will fund comparative effectiveness research. The research will evaluate and compare health outcomes and the clinical effectiveness, risks, and benefits of two or more medical treatments and/or services. Fee: $2 per covered life for 2013/2014 = $6m May be passed to Consumers 20 Rates for Health Coverage before ACA Market Individual Market (Does NOT include prescription drugs, vision or dental services. Annual or lifetime limits can apply. Copayments and coinsurance can be applied to preventive services) Premium Ranges $ $ Small Group Market (Does NOT include prescription drugs, vision or dental services. Annual or lifetime limits can apply. Copayments and coinsurance can be applied to preventive services) $ $

11 21 Rates for Health Coverage in Compliance with ACA Premium Ranges Metallic Level Individual Market (This includes prescription drugs and some dental and vision services. Copayments and coinsurance cannot be applied to preventive services) Small Group Market (This includes prescription drugs and some dental and vision services. Copayments and coinsurance cannot be applied to preventive services) Bronze Level $ $ $ $ Silver Level $ $ $ $ Gold Level $ $ $ $ Platinum Level $ $ $ $ Catastrophic Coverage $ $ N/A 22 Catastrophic Plans Only one carrier is offering a catastrophic plan in Puerto Rico. No other carrier has shown interest to market this type of coverage. Characteristics of the Only Catastrophic Coverage Available in Puerto Rico: PPO Model Affordable model similar to a Bronze Plan Only one copay structure: Annual deductible $6,350 individual -$12,700 couple or family Only individuals under the age of 30 are eligible to enroll in a catastrophic plan Families can purchase catastrophic plans but only if each individual enrolled in the coverage meets the eligibility requirements for enrollment in a catastrophic plan The rates for the only catastrophic plan available in the market are 34.3% more affordable than its comparable bronze plan. 11

12 23 Health Coverage marketed by Organizations Excepted from the OCI Jurisdiction Health Coverage Excepted Entity PROSSAM - Programa de Servicios de Salud de la Asociación de Maestros de Puerto Rico Asociación de Maestros de PR Plan de Socios del Hospital Auxilio Mutuo Hospital Auxilio Mutuo Impact of the Guaranteed Issue Period on the Uninsured Population of Puerto Rico (Mandate is not applicable) 24 Population Year 2013 Uninsured Population Year 2013 % Uninsured Population Year 2013 Population that has obtained health coverage during the guaranteed issue period 3,674, , % 30,421 1 As of March,

13 25 Guarantee Issue Period Statistics - Individual 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 Number of Contracts - 23,038 Number of Covered Persons - 27,710 Previous Uninsured/Covered Persons - 15,815 2,000 0 First Medical Health Plan, Inc. Humana Health Plan MCS Life Insurance Plan de Salud Triple-S Salud Plan de Salud Menonita Bella Vista 26 Guarantee Issue Period Statistics Small Group 1,600 1,400 1,200 Number of Contracts - 1,198 1, Number of Covered Persons - 2, Previous Uninsured/Covered Persons First Medical Health Plan, Inc. Humana Health Plan Humana Insurance MCS Life Insurance MAPFRE Life Insurance Plan de Salud Triple-S Salud Menonita 13

14 27 Guarantee Issue Period-Statistics by Metallic Level Individual Market 1.77% 2.51% 16.64% 79.08% Bronze Silver Gold Platinum 28 Guarantee Issue Period-Statistics by Metallic Level Small Group 0.0% - Bronze 0.60% 1.09% 98.31% Bronze Silver Gold Platinum 14

15 Private Exchanges Since 2006 our Insurance Code considered the sale of insurance via Internet. In December 2007, our Office issued Ruling Letter AV, establishing the parameters for the sale and marketing over the Internet. Large Groups Small Groups Individuals Health Trends AM Best 30 Direct to Consumer Marketing Private Exchange Model Narrow Networks High Performance Network Cooperation & Collaboration Between Insurers & Providers Rising Trend in Partnering & Provider Consolidation International Expansion 15

16 Health Care Compliance Association 2014 Puerto Rico Regional Annual Conference Thanks Thank You 16