Health Reform Implementation

-- Federal Regulations -- Presentation to the

NIHB Annual Consumer Conference

September 28, 2011

Doneg McDonoughTechnical Advisor

to the National Indian Health Board(DMcDonough@NIHB.org)

Update on NIHB regulation work

At the moment --

health reform = issuance of Federal regulations

From HHS, CMS, CCIIO*, IHS, IRS

* Center for Consumer Information and Insurance Oversight

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Value of AI/AN Cost-Sharing Protection (HHS Indian Offset)

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Value of premium and cost-sharing assistance in an Exchange

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

Minimum Employer Qualifying Coverage (ACA) Family (of 3) in Exchange at 250%

FPL (ACA)

$5,371 $8,141

$4,349

$3,685

$5,378$3,630

Comparison of Premium and Cost-Sharing Costs: Illustration of Minimum Employer-Sponsored Coverage versus Exchange Coverage

(Family of 3 at 250% FPL)

Enrollee cost-sharing

Employee/enrollee premium

Employer/sponsor premium

Total: $15,098 Total: $15,456

Update on NIHB regulation work

In reviewing and commenting on these Federal regulations, a primary focus is to ensure that American Indians and Alaska Natives will have timely access to a full range of needed health care services from the AI/AN’s providers of choice.With health reform implementation at the Federal an State levels, we need to be able to make the “pitch” for our issues to individuals and organizations new to AI/AN issues.

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Our Pitch / Framework for Comments

Federal Trust Responsibility Federal government has a unique obligation to AI/AN There is a unique government-to-government

relationship between the Federal government and Tribes

In the ACA, Congress added a new mechanism to carry out the Federal Trust Responsibility In addition to Indian health programs (I/T/U providers)

supported by direct appropriations In addition to Medicare, Medicaid and CHIP ACA created subsidized insurance through

Exchanges

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Our Pitch / Framework for Comments

The Federal government as well as AI/AN and Tribes benefit if the Exchange plans provide a real option for AI/AN Potential to bring additional resources for health care

services to tribal communities… thereby furthering Trust Responsibility

Potential to lessen demands on Federal appropriation to IHS Potential to expand health care services readily available to

AI/AN and increase I/T/U integration with other providers Opportunity to access full AI/AN cost-sharing protections and

general premium assistance if enroll through Exchange But AI/AN need to know that they can access their providers

of choice if they enroll in an Exchange plan

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Our Pitch / Framework (continued)

There is tension in two elements of implementation Obama Administration’s desire to provide maximum

flexibility to States in implementing health reform For Indian-specific provisions, efficient and effective

implementation requires standardization

To carry-out the Congressional intent in the ACA, we need CMS to direct States on a limited set of issues, such as -- Require Exchange plans to offer to contract with I/T/U Require Exchange plans to use Indian Addendum

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Our Pitch / Framework (continued)

Two general provisions in the ACA support our request that Exchange plans be required to offer to include I/T/U providers in Exchange plan networks ACA section 1311(c)(1)(B): Network adequacy

(“ensure a sufficient choice of providers”) ACA section 1311(c)(1)(C): Essential

community providers (“providers that serve predominantly low-income, medically-underserved individuals”)

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Our Pitch / Framework (continued)

Two Indian-specific provisions in the IHCIA (and ACA) support our request that Exchange plans be required to offer to include I/T/U providers in Exchange plan networks IHCIA section 206: Established a “right of

recovery” for services rendered by I/T/U to AI/AN IHCIA section 408: Established that “a Federal

health care program must accept an [I/T/U] as a provider eligible to receive payment under the program for health care services furnished to [AI/AN]…

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Our Pitch / Framework (continued)

Taken together, these provisions – Establish a requirement (most directly through IHCIA

section 408) that Exchange plans offer to contract with I/T/U

The requirement to “offer to contract” does not dictate the rate at which I/T/U are to be paid

– Section 408 establishes a floor of “payment… on the same basis as any other provider…”

– Section 206 provides leverage in rate negotiations with Exchange and other health plans that if an I/T/U is not included in-network, the I/T/U can later demand payment at the higher of (a) the I/T/U’s reasonable charges billed or (b) the highest rates paid to other providers

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Our Pitch / Framework (finale)

Since Congress enacted provisions establishing that I/T/U have a right to participate in Exchange plan networks and to bill Exchange plans (whether in-network or not)And, since there are a range of Indian-specific provisions in various Federal laws that Exchange plans are obligated to adhere toIt is in the interest of the Federal government (and AI/AN) to -- Require Exchange plans to offer to contract with I/T/U Require the use of a standard Indian Addendum to the

Exchange contracts

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NIHB Regulatory Work

Twice a month, NIHB updates a report titled NIHB Regulation Review and Impact Analysis Report (RRIAR)The purpose of the RRIAR is to identify and summarize key regulations issued by CMS pertaining to Medicare, Medicaid, CHIP, and health reform that affect – (a) American Indians and Alaska Natives and/or (b) Indian Health Service, Indian Tribe and tribal organization, and urban Indian

organization providers. The RRIAR includes a summary of regulatory analyses prepared by NIHB and indicates the extent to which the recommendations made by NIHB were incorporated into any subsequent CMS actions. The analyses and recommendations include those made by NIHB, by the Tribal Technical Advisory Group to CMS (TTAG), and in some instances by individual Tribes.The RRIAR consists of three tables – Table A provides a status report on the RRIAR itself, listing the regulations included in the

RRIAR to date, and the components of the analysis provided under each. Table B lists key regulations issued by CMS, due dates for comments, a synopsis of the

CMS action, and a summary of the analysis, if any, prepared by NIHB. Table C identifies the recommendations made by NIHB pertaining to each regulation, if

any, and evaluates the extent to which the recommendations made by NIHB were incorporated into subsequent CMS actions.

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Numerous regulations under review

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Key Issues: (Tribal) employer responsibility

For larger employers subject to employer requirements under ACA (50+ FTE) –

Employers offering coverage pay into Exchange if Plan does not cover 60% of expected costs (60% actuarial

value), or Employee’s share of premium is more than 9.5% of income and Employee enrolls in plan through an Exchange Employer pays $3,000 per employee enrolling through

Exchange

Employers not offering coverage Pay $2,000 to Exchange for every full-time employee

beyond the first 30

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Acronyms

AI/AN: American Indian and Alaska Native I/T/U: Indian Health Service (IHS), Tribe and tribal organization, and urban Indian organizationHHS: Federal Department of Health and Human ServicesCMS: Center for Medicare and Medicaid Services, HHSCCIIO: Center for Consumer Information and Insurance Oversight at CMSIRS: Internal Revenue Service, Department of TreasuryIHCIA: Indian Health Care Improvement ActACA: Patient Protection and Affordable Care Act, including reconciliation act modifications (Pub. L. 111-148 and Pub. L. 111-152)

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Key Issues: Premiums and cost-sharing

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Enrollee cost-sharing protections (annual)

Income LevelActuarial Value

of Coverage Single Family

Maximum out-of-pocket (non-premium) costs*0 - 100% 100% nominal nominal101 - 150% 94% $1,980 $3,960151 - 200% 87% $1,980 $3,960201% - 250% 73% $3,000 $6,000251% - 400% 70% $3,960 $7,920400% + $5,950 $11,900

Average out-of-pocket (non-premium) costs**0 - 100% minimal minimal101 - 150% $282 $807151 - 200% $612 $1,748201% - 250% $1,271 $3,630251% - 400% $1,412 $4,034

* Maximum out-of-pocket costs are 2011 figures which will be increased annually by the average increase in premiums nationally for the prior year.

** Average out-of-pocket costs calculation is extrapolated from the cost of the average employer-sponsored health plan offered in 2010 as reported by the Kaiser Family Foundation.

Cost-Sharing Protections through an Exchange for Persons at or Below 400% of FPL