Illinois Municipal League 97 th Annual Conference

Transcription

1 Illinois Municipal League 97 th Annual Conference Health Care Reform Panel Jay Dee F. Shattuck, CAE Shattuck & Associates Consulting, Inc Shattuck & Associates Consulting, Inc., 600 Phone:

2 Federal requirements effective September 23, 2010 Pre existing condition exclusions prohibited for children up to age 19 see HHS Interim Final Regulation of June 21, 2010 Rescissions prohibited (except for fraud or intentional misrepresentation) see HHS Interim Final Regulation of June 21, 2010 Internal and external appeals processes for enrollees see HHS Interim Final Regulation of July 23, 2010 Coverage of dependents up to age 26 without applying any criteria other than age or familial relationship see current Illinois law & HHS Final Interim Rule of May 13, 2010) No lifetime benefit limits. Restrictions on allowable annual benefit limits determined by HHS under its Interim Rule of June 21, 2010 $750,000 for plan years beginning 9/23/2010 9/23/2011 $1.25 million for plan years beginning 9/23/2011 9/23/2012 $2 million for plan years beginning 9/23/ /31/2013 Not applicable to grandfathered plans or flexible spending arrangements Benefits for preventive and wellness services required, with no cost sharing for in network services See HHS Interim Final Rule of July 7, 2010 Does not apply to grandfathered plans Coverage for emergency services at in network cost sharing level; no prior authorization requirements see HHS Interim Final rule of June 21, 2010 Does not apply to grandfathered plans May not discriminate in premiums against employees based on salary. Does not apply to self insured or grandfathered plans

3 Appeal Processes new health plans beginning on or after September 23, 2010 must have an internal appeals process that: Allows consumers to appeal when a health plan denies a claim for a covered service or rescinds coverage; Gives consumers detailed information about the grounds for the denial of claims or coverage; Requires plans to notify consumers about their right to appeal and instructs them on how to begin the appeals process; Ensures a full and fair review of the denial; and Provides consumers with an expedited appeals process in urgent cases.

4 Appeal Processes (continued) External appeal standards were established by the National Association of Insurance Commissioners (NAIC). States are encouraged to make changes in their external appeals laws to adopt these standards before July 1, The NAIC standards call for: External review of plan decisions to deny coverage for care based on medical necessity, appropriateness, health care setting, level of care, or effectiveness of a covered benefit. Clear information for consumers about their right to both internal and external appeals both in the standard plan materials, and at the time the company denies a claim. Expedited access to external review in some cases including emergency situations, or cases where their health plan did not follow the rules in the internal appeal. Health plans must pay the cost of the external appeal under State law, and States may not require consumers to pay more than a nominal fee. Review by an independent body assigned by the State. The State must also ensure that the reviewers meet certain standards, keep written records, and are not affected by conflicts of interest. Emergency processes for urgent claims, and a process for experimental or investigational treatment. Final decisions must be binding so, if the consumer wins, the health plan is expected to pay for the benefit that was previously denied. Illinois law (PA ) effective July 1, 2010 adopted these standards

5 Small Employer Coverage Requirements effective 2014 Small employers with 50 or fewer full time employees (FTEs) are not required to offer insurance and are not subject to penalties Part time workers (work less than 30 hours per week) are counted for purposes of determining number of FTEs: Add total number of hours worked by part time employees and divide by 120 to determine number of FTEs Example: 10 part time employees working total of 600 hours per month; = 5 additional FTEs. No employer is required to offer coverage to or pay penalties on part time workers.

6 Large Employer Coverage Requirements effective 2014 Employers with more than 50 full time employees must offer insurance meeting certain cost requirements or pay penalties: Large employers who do not offer insurance and whose employees receive public subsidies pay 1/12 of $2,000 per FTE per month, with a waiver for first 30 FTEs; Large employers who offer insurance but have employees who receive premium assistance because they cannot afford the insurance (affordability is 9.5% of income) pay the lesser of 1) 1/12 of $3,000 per FTE receiving subsidy per month, or 2) 1/12 of $2000 per month for the total number of full time employees with a waiver for first 30 FTEs Penalties calculated monthly based on number of applicable employees Employers with 200 or more workers who offer coverage must automatically enroll new employees and continue enrollment of current employees; employees may choose to opt out

7 Other Key Issues Group health plans in effect as of March 23, 2010, are grandfathered under the law and will be considered qualified coverage that meets the mandate to have health insurance that begins January Employees and dependents can be added to the policy without losing grandfather status. Insurers will continue to market private insurance plans but all new plans sold after March 23, 2010, must comply with new benefit provisions