September 13, 2012 Maryland Health Benefit Exchange Update for
the Middle Atlantic Actuarial Club 2012 Annual Meeting
Slide 2
- 1 - The Patient Protection and Affordable Care Act (ACA)
Signature legislation of the Obama Administration making health
insurance coverage a central focus Relies on the private insurance
market and public programs (Medicaid) to address the issue of
access to care Key Components must work together: Guaranteed Issue
Minimum Essential Health Benefits Individual Mandate Federal
Subsidies Risk Adjustment State-based Health Insurance Exchanges
are the focal point for implementing market changes
Slide 3
- 2 - Basic Exchange Functions Creates a new Health Insurance
Marketplace for Individuals and Small Groups (SHOP) Establish
policies and procedures for certifying Qualified Health Plan (QHPs)
from commercial insurance carriers Makes eligibility determinations
for government assistance for health insurance Provides Consumer
Support through Navigators, Brokers and Agents, and Online Web
Portal Enrolls Consumers into affordable health care options
Consolidated Billing and Collections in the Small Group Market
Slide 4
- 3 - The Affordable Care Act and Maryland Code of Federal
Regulations (CFR) 45 Part 155 Exchange Establishment Standards and
Other Related Standards Under the Affordable Care Act defines
requirements for state-based Exchanges Maryland has embraced the
ACA and committed itself to create a state- based Exchange Health
Benefit Exchange Act of 2011 April 12, 2011: Governor OMalley
signed the Maryland Health Benefit Exchange Act to establish
Marylands exchange as a public corporate and independent unit of
state government June 3, 2011: Exchange Board held its first
meeting Health Benefit Exchange Act of 2012 Senate Bill 238 and
House Bill 443: Maryland General Assembly recently passed (April 5,
2012) legislation that outlines the implementation policies and
procedures for operating the exchange
Slide 5
- 4 - Key Federal and Maryland State Agencies Implementing
Health Care Reform and Exchanges Federal Center for Consumer
Information and Insurance Oversight (CMS/CCIIO) Center for Medicaid
and CHIP Services (CMS/CMCS) Internal Revenue Service (IRS)
Maryland Governors Health Care Reform Coordinating Council Maryland
Health Benefit Exchange Board of Trustees Staff Maryland Insurance
Administration (MIA) Maryland Health Care Commission (MHCC)
Department of Health and Mental Hygiene (DHMH) Department of Human
Resources (DHR)
Slide 6
- 5 - Seven Guiding Principles the Maryland Exchange 1.
Accessibility. The Exchange should reduce the number of Marylanders
without health insurance and improve access for all Marylanders. 2.
Affordability. The affordability of coverage, within the Exchange
and within the state, is essential to improving Marylands health
care system and economy. 3. Sustainability. The Exchange will need
to be sustainable in order to succeed in the long run. 4.
Stability. The Exchange should promote solutions that respect
existing strengths of our states health care system and promote
stability within the Exchange. 5. Health Equity. The Exchange
should work to address longstanding, unjust disparities in health
access and health outcomes in Maryland. 6. Flexibility. The
Exchange should be nimble and flexible in responding to the quickly
changing insurance market, health care delivery system, and general
economic conditions in Maryland, while being sensitive and
responsive to consumer demands. 7. Transparency. The Exchange is
accountable to the public, and its activities should be
transparent, its services easily available, and its information
easily understandable by the populations it assists.
Slide 7
- 6 - Marylands High Level Implementation Approach Establish a
consolidated strategy for Health Care Reform implementation Phase I
Modified Adjusted Gross Income (MAGI) Eligibility Determinations
for Medicaid and Advance Premium Tax Credits and Cost Sharing
Subsidies (by 2014) Phase II All Medicaid programs (by 2015) Phase
III All Maryland Social Service programs (by 2015) Secure Federal
Establishment Grants CCIIO: Planning, Early Innovator, Level One
Establishment, Level Two Establishment CMCS: Matching Funds
Establish Policies and Regulations Stakeholder Advisory Committees
Legislative and Regulatory Processes Set-up Exchange IT and
Operations First Exchange Open Enrollment Period October 2013
Self-Sufficient by 2015
Slide 8
- 7 - Federal Funding - $157M Planning Grant ($1 million):
Initial Planning and Research Early Innovator Grant ($6 million) IT
Model Sharing resources with other states Level One Establishment
Grant ($27 million) IT Development Operations Planning/
Administration Level Two Establishment Grant ($123 million) IT
Implementation Operations/ Administration Consumer Assistance
Outreach & Education
Slide 9
- 8 - Maryland Exchange IT Systems The system is designed as an
integration of Commercially Off the Shelf (COTS) products, that are
being integrated and configured to meet Federal and State
requirements. This diagram indicates the key building blocks of the
solution: Cram is a software product that has existing and planned
features to support requirements for Eligibility and Enrollment.
Connecture is a software product that has existing and planned
features that support requirements for Plan Presentment and
Enrollment. Noridian is leading the integration of the COTS
solutions based on the EXACT Service Oriented Architecture (SOA)
integration product.
Slide 10
- 9 - MD HIX Implementation Timeline The diagram below
articulates the timeline and development approach Maryland is
following in order to be prepared for CMS Certification and to
deliver the HIX Solution in time for production operations in Q4,
2013 Implementation & Test Implementation & Test 1 st QTR
12 2 nd QTR 12 3 rd QTR 12 4 th QTR 12 1 st QTR 13 2 nd QTR 13 3 rd
QTR 13 4 th QTR 13 Validate Planning & Rqmt Artifacts NFRD
Architecture Plan Knowledge Transfer COTS Demo Receive CMS
Certification (Conditional) Non-Functional / Technical Requirement
Development Non-Functional / Technical Requirement Development
Architecture Development Design Integrated Testing Deployment &
Disposition IT Vendor Starts Completed Tested System Start 2-path
Sprint Approach Complete all development Warranty / Maintenance
Complete Gap Analysis Start Enrollment End-to-End Testing,
including: Functional and Technical Testing Other Requirement
Development Sprint Execution for requirements required for CMS
Certification 1/1/13 Sprint Order Prioritize Rqmts & activities
required for Certificat ion on 1/1/13 Certification Process
Deployment to Production Training Fix any Production bugs, etc. Fix
any Production bugs, etc. DDR CMS ILC Gate Reviews FDDR PORRORR
Core Requirements Federal Requirements State Requirements SP1
SP2SP3SP4SP5 SP6SP7SP8 Test Planning Review Design Review Implement
Review CMS ELC Gate Reviews Key: DDR Detail Design Review; FDDR
Final Detail Design Review; PORR Preliminary Operational Readiness
Review; ORR Operation Readiness Review
Slide 11
- 10 - What the Exchange Means to Maryland Expands access to
health insurance for 740,000 Marylanders currently without health
insurance Provides federal subsidies and tax credits for
individuals up to 400% of FPL to pay for health insurance premiums
Provides $500 million in federal subsidies into the State of
Maryland NEW funds in the Maryland health care system Provides
individuals access to primary care physicians, preventive services
Lowers uncompensated care costs in the healthcare system resulting
in lower insurance premiums across the state
Slide 12
- 11 - Health Care Coverage Projections in Maryland due to the
Affordable Care Act * Hamid Fakhraei, Ph.D., Director of Economic
Analysis, The Hilltop Institute, University of Maryland, Baltimore
County (UMBC) *
Slide 13
- 12 - Carrier Impact and Qualified Health Plans (QHPs)
Market-wide Minimum Essential Health Benefits Minimum Medical Loss
Ratios Guaranteed Issue Community Rating Rating Variation
Limitations Risk Adjustment and Reinsurance Exchange Specific
Actuarial Value Metal Bands (Bronze, Silver, Gold, Platinum)
Network Adequacy and Essential Community Providers Quality and
Transparency Data QHP User Fees Active Purchasing (potential)
Slide 14
- 13 - Qualified Health Plans (QHPs) Contracting Step 1 Issuer
Contracting with the Exchange (Issuer Level) Maryland Market
RulesService Area RequirementsMarketing StandardsTransparency
StandardsQuality Data RequirementsTracking of RELICC DataReporting
Requirements Continuity of Care Requirements? 2014 or 2015? Broker
Compensation Step 2 MIA Review & Approval (Issuer & Plan
level) SERFFLicensureSolvencyBenefits, Rates & FormsEssential
Health BenefitsLimitations on Cost SharingActuarial Value/Metal
LevelsDiscriminatory Benefit Design Step 3 Exchange Final
Certification (Issuer & Plan level) HIX AccreditationNetwork
Adequacy Data Essential Community Provider Data Transparency Data
Step 4 MHCC Quality & RELICC Data (Issuer Level Year 1) Annual
Custom File HMO/PPO HEDIS ScoresHMO/PPO CAHPS ScoresDental Plan
CAHPS ScoresVision Plan CAHPS Scores RELICC Data (Internal use
only)
Slide 15
- 14 - Consumer Financial Assistance Eligibility Rules Based on
Modified Adjusted Gross Income (MAGI) in relation to Federal
Poverty Level (FPL) Calculating actual APTC depends on: MAGI in
relation to FPL 2 nd Lowest Priced Silver Plan Potential Issues:
Churn and Continuity of Care Price Stability under Guaranteed Issue
(High Risk Pools)
Slide 16
- 15 - Sample Monthly Premium Payments by Income Level
Slide 17
- 16 - Employer Sponsored Insurance Employer Group Size
Considerations Only small groups can purchase on the Exchange
through 2017 Maryland defines small group up to 50 employees
through 2016 Adopt federal definition of small group of up to 100
employees after 2016 Tax credits for small groups that purchase in
the Exchange starting in 2014 Penalty for larger groups that dont
offer minimum essential coverage to their employees Defined
Contribution / Employee Choice Model Opens up all plans on a metal
level to employees Minimum participation rate Employers make
defined contributions (minimum?) Rating by average age or
individual employee? Special enrollment Timing of account set-up
and contracting
Slide 18
- 17 - Consumer Assistance Marketing and Consumer Education Web
Portal Online Eligibility Determinations Plan Shopping, Comparison,
and Enrollment Several Classes of Assistors Navigators Exchange
Call Center DHMH / DHR Case Workers Brokers and Agents
Slide 19
- 18 - Navigator Program
Slide 20
- 19 - Third Party Benefit Administrators Current Market Role
Broker Training and Tools Plan Shopping and Enrollment Back-Office
Financial Administration (Billing, Collections, Reconciliation,
etc) Other Value Add Benefit Management Services (Life, Disability,
Payroll) Role in SHOP Exchange TPA Certification Program Use
Exchange systems Use their own systems Online Marketplace
Back-Office Financial Administration Performance Metrics and
Service Levels