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Health plans - design

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Information Frictions and Adverse Selection: Policy Interventions in Health Insurance Markets
"[R]ecent evidence suggests that many consumers have information frictions that lead to suboptimal health plan choices.... In this paper we develop a general framework to study insurance market equilibrium and evaluate policy interventions in the presence of choice frictions.... [The authors] find that friction-reducing policies exacerbate adverse selection, essentially leading to the market fully unraveling, and reduce welfare. Risk-adjustment transfers are complementary, substantially mitigating the negative impact of friction-reducing policies, but having little effect in their absence." (National Bureau of Economic Research [NBER])
Americans' View on Government-Run Healthcare Is Changing
"A small majority (51%) of US adults now believe that the federal government has a responsibility to ensure all Americans have health insurance coverage ... This is the first time since 2008 that a majority has said this.... In 2009 ... Americans were evenly split on the matter before shifting to the viewpoint that the government was not responsible for healthcare coverage. However, in the year's leading up to the ACA, there was much stronger support from Americans who believed healthcare coverage was the government's responsibility." (American Journal of Managed Care)
No Surprises in the Final Rules Issued Under ACA
"To maintain grandfather status, the plan must include a statement that it is believed to be a grandfathered plan, and contact information for questions or complaints, in any summary of benefits provided to participants ... Self-funded or other group health plans that are not required to cover essential health benefits (EHB) but which cannot impose annual or lifetime dollar limits on EHBs that are covered can choose between the 51 EHB base-benchmark plans selected by a State or the District of Columbia and the FEHBP base benchmark plan." (Kilpatrick Townsend)
As HMOs Dominate, Alternatives Become More Expensive
"[An] analysis of costs in the three-dozen states selling policies through the federal website found a sharp difference in premium prices between plans that offer out-of-network care and those that do not. The analysis compared the monthly premiums for the least expensive silver-level plans -- the category that are the most popular purchases -- for a 40-year-old in each county. While the average premium for the least expensive closed network silver plan -- principally HMOs -- rose from $274 to $299, a 9 percent increase, the average premium for the least expensive PPO or other silver-level open access plan grew from $291 to $339, an 17 percent jump ... The cost variations hold true for any age." (Kaiser Health News)
House Committee Leaders Press Administration on Status of Remaining $1 Billion in Obamacare CO-OPs
"House Energy and Commerce Committee leaders are seeking answers from the Centers for Medicare and Medicaid Services (CMS) on the agency's plans for continued oversight of Obamacare's CO-OPs. To date, 12 of the original 23 CO-OPs have closed, bringing the total cost to taxpayers at more than $1.23 billion. The letter sent Tuesday follows up on a November 5th Oversight and Investigations Subcommittee hearing during which CMS Chief of Staff Mandy Cohen was unable to identify specific actions the agency would be taking to address problems the remaining 11 CO-OPs, which collectively received over $1 billion in federal loans, are facing." (Energy & Commerce Committee, U.S. House of Representatives)
[Guidance Overview] ACA Proposal Addresses Balance Billing and Narrow Networks
"Employers that purchase small group coverage that is federally regulated under the Affordable Care Act will have additional assurances that their plan members will not be balance billed in certain situations, under proposed rules issued in pre-publication form on Nov. 22. The rule also plans for the adoption of network adequacy provisions to compensate for narrower networks that are proliferating to control cost growth some observers say is being exacerbated by the health care reform law." (Thompson SmartHR Manager)
[Guidance Overview] The EEOC and Wellness Programs: The Other Shoe Drops (But It's Not That Bad)
"The GINA statute and the 2010 regulations have a broad definition of 'genetic information' that includes, not only 'true' genetic information like genotypes and DNA tests, but also medical history or examinations of the employee's family members.... It appears that the EEOC is now distinguishing 'true' genetic information (for example, genotypes and DNA tests) from medical history and medical examinations. Very strict rules apply to the former, but the rules relating to the latter are not as strict." (Constangy, Brooks, Smith & Prophete, LLP)
Health Insurance and Mobile Engagement: What's Working, What's New and What's Next
"Companies seeking to improve consumer engagement have one major ally: The rise of mobile technology. Phone and tablet-based applications allow insurers to reach consumers on the devices they use every day, providing services for their members with the simplicity of a tap or click.... [This report] examines the myriad ways insurers and other organizations engage consumers through mobile technology, assessing the benefits and challenges -- as well as what lies ahead." (FierceHealthPayer)
Clarity Sought as HHS Prepares for Innovation Waivers
"States can apply for the five-year renewable waivers that will begin Jan. 1, 2017. The waivers are an opportunity for states to waive major coverage provisions of the ACA in order to come up with their own innovative ways to expand coverage. The states can request waivers from provisions, including those related to benefits and subsidies, the exchanges and the individual and employer mandates. But states say they need specifics." (Bloomberg BNA)
National Association of Insurance Commissioners to Review Pharmacy Benefit Management in 2016
"[T]he National Association of Insurance Commissioners (NAIC) ... 2016 work plan for its Health Insurance and Managed Care (B) Committee ... [includes] among other things, 'review and, if necessary, consider revisions to the Health Carrier Prescription Drug Benefit Management Model Act (#22) -- adopted in 2003 -- to address issues related to: [1] transparency, accuracy and disclosure regarding prescription drug formularies and formulary changes during a policy year; [2] accessibility of prescription drug benefits using a variety of pharmacy options; and [3] tiered prescription drug formularies and discriminatory benefit design.' ... [C]ommittee members indicated support for soliciting initial public comments from interested stakeholders in January, and to begin periodic conference calls in February to consider changes to the model." (National Community Pharmacists Association [NCPA])
[Guidance Overview] IRS Health Care Tax Tip 2015-77: Understanding the Different Types of 2015 Transition Relief under the Employer Shared Responsibility Provisions
"The employer shared responsibility provisions were first effective on January 1, 2015, but transition relief from certain requirements is available for 2015 ... ALEs with fewer than 100 full-time employees, including full-time equivalent employees, won't be assessed an employer shared responsibility payment for 2015 ... ALEs are not required to offer coverage to full-time employees' dependents for the 2015 plan year, provided that they meet certain conditions ... [If] an ALE does not offer minimum essential coverage to at least 95 percent of its full-time employees and their dependents, it may owe an employer shared responsibility payment ... For 2015, 70 percent is substituted for 95 percent." (Internal Revenue Service [IRS])
FSA Rollover to Retirement Plan Proposal Introduced
"Under the measure, H.R. 4067, introduced by Rep. Ron Kind, D-Wis., employees could shift unused FSA funds -- $250 or the account balance, whichever is less -- to a retirement plan." (Business Insurance; free registration required)
[Guidance Overview] Interim No More, ACA Insurance Reforms Promoted
"[D]etermination of grandfather status applies separately with respect to each benefit package ... [T]he prohibition [on lifetime limits on coverage and annual limits on coverage for essential health benefits (EHB)] does not bar a plan or insurer from excluding all benefits for a condition if it does so regardless of when the condition arose, although other provisions of the ACA like the essential health benefits requirements may preclude such exclusion.... The Final rule allows plans and insurers not subject to EHB requirements to pick among any of the EHB benchmarks that apply in any of the 50 states or the District of Columbia or the three largest federal employee health benefit program plans available nationally." (Wolters Kluwer Law & Business)
[Guidance Overview] Proposed Benefits and Payment Rule Includes Standardized Plans, New Network Adequacy Standards
"The proposed rule would create six standard option plans ... at the 73 percent, 87 percent, and 94 percent actuarial-value levels -- available for individuals eligible for cost sharing reduction payments.... [S]tates in which the FFM is operating would be asked to select from a set of network adequacy metrics ... [I]nsurers offering QHPs in any marketplace would have to provide enrollees at least 10 days' notice prior to a procedure in an in-network facility if the enrollee might receive out-of-network services, for example from an out-of-network anesthesiologist or pathologist.... For 2017, the [premium adjustment] percentage would increase 5.1 percent over 2016, 13.3 percent over 2014. The annual maximum out-of-pocket limit would increase from $6,350 in 2014 to $7,150 for an individual for 2017." [A related article by the author addresses the proposed rule in more detail.] (Timothy Jost, in Health Affairs)
[Opinion] Reply Brief of Petitioner to Supreme Court Supporting Application of Vermont Health Care Database Law to TPA of Self-Insured ERISA Plan (PDF)
32 pages. "To do their jobs effectively, regulators and policymakers need accurate information about health care expenditures. Those critical health care spending data are necessarily held by a wide range of payers, including federal and state government programs, private insurers, and third-party administrators of ERISA plans. Vermont's collection of claims data from all payers through a generally applicable health care law does not intrude on the areas that ERISA reserves to federal law." [Gobeille v. Liberty Mutual Ins. Co. (2d Cir. Feb. 4, 2014, cert. pet. granted June 29, 2015, brief submitted Nov. 12, 2015)] (SCOTUSblog)
[Guidance Overview] Text of CMS Fact Sheet: Proposed HHS Notice of Benefit and Payment Parameters for 2017 (PDF)
5 pages. "Some of the policies in today's proposed rule include: ... Risk Adjustment Model Recalibration ... Small Issuer Rule for Default Risk Adjustment Charge ... Default Risk Adjustment Charge ... FFM User Fee for 2017 ... Premium Adjustment Percentage ... Annual Limitation on Cost Sharing ... Student Health Insurance Plans ... Rate Review ... Standardized Options ... Improving Product Value ... Network Adequacy (Minimum Threshold) ... SHOP ... Direct Enrollment Enhancements, Agent and Broker Enforcement, and Standards for HHS-Approved Vendors of FFM Training for Agents and Brokers." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])
[Guidance Overview] CMS Proposes Improvements for the 2017 Marketplace
A press release issued by CMS: "To protect consumer access to health care providers and delivery organizations, the proposal asks states to establish a provider network adequacy standard for health plans in the federal Marketplace.... CMS is proposing to give issuers the choice of offering plans with standardized options such as cost-sharing.... CMS is seeking comment on a requirement that health plans in the federal Marketplace count certain out-of-pocket expenses on unexpected out-of-network services towards a policy holder's annual out-of-pocket maximum, if the service was performed at an in-network facility and advance notice was not provided.... The proposed rule would also increase options for employees in the federal Small Business Health Options Program (SHOP) for plan years beginning in 2017 and beyond." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])
[Official Guidance] Text of HHS Notice of Benefit and Payment Parameters for 2017
381 pages. "This proposed rule sets forth payment parameters and provisions related to the risk adjustment, reinsurance, and risk corridors programs; cost sharing parameters and cost-sharing reductions; and user fees for Federally-facilitated Exchanges. It also provides additional standards for the annual open enrollment period for the individual market for the 2017 benefit year; essential health benefits; cost-sharing requirements; qualified health plans; updated standards for Exchange consumer assistance programs; network adequacy; patient safety standards; the Small Business Health Options Program; stand-alone dental plans; acceptance of third-party payments by qualified health plans; the definitions of large employer and small employer; fair health insurance premiums; guaranteed availability; student health insurance coverage; the rate review program; the medical loss ratio program; eligibility and enrollment; exemptions and appeals; and other related topics....

"We propose to codify a new Exchange model -- the State-based Exchange on the Federal platform (SBE-FP). This model would enable State-based Exchanges (SBEs) to execute certain processes using the Federal eligibility and enrollment infrastructure.... We also propose a number of incremental amendments that we believe will improve the stability of the Exchanges while improving the choices available to consumers and supporting consumers' ability to make informed choices when purchasing health insurance. These include the introduction of 'standardized options' in the individual market, which will improve competition and consumer transparency....

"If any reinsurance contribution amounts remain after calculating reinsurance payments for the 2016 benefit year (including after HHS would increase the coinsurance rate to 100 percent for the 2016 benefit year), we propose to lower the 2016 attachment point of $90,000 to pay out any remaining contribution amounts for the 2016 benefit year. We also propose several changes to the risk corridors program for 2015 and 2016....

"For consumers purchasing coverage through the Small Business Health Options Program (SHOP), we propose a new 'vertical choice' model for Federally-facilitated SHOPs for plan years beginning on or after January 1, 2017, under which employers would be able to offer qualified employees a choice of all plans across all available levels of coverage from a single issuer." (Centers for Medicare & Medicaid Services [CMS], U.S. Department of Health and Human Services [HHS])

[Guidance Overview] HHS Regulatory Agenda, Fall 2015
A CMS item in the Final Rule stage is "Omnibus Group & Individual Insurance Market Reforms." An OCR item in the Prerule Stage is "HIPAA Enforcement: Distribution of a Percentage of Civil Money Penalties or Monetary Settlements to Harmed Individuals." An OCR item in the Proposed Rule stage is "Nondiscrimination Under the Patient Protection and Affordable Care Act." (U.S. Department of Health and Human Services [HHS])
[Guidance Overview] DOL Regulatory Agenda, Fall 2015
EBSA items in the Proposed Rule stage are: [1] Conflict of Interest Rule -- Investment Advice; [2] Amendment to Claims Procedure Regulation; [3] Revision of the Form 5500 Series, including Implementing Related Regulations Under ERISA; and [4] Savings Arrangements Established by States for Non-Governmental Employees.

EBSA items in the Final Rule stage are: [1] Amendment of Abandoned Plan Program; [2] Electronic Filing of Apprenticeship & Training Notices, and Top Hat Plan Statements; [3] Adoption of Amended and Restated Voluntary Fiduciary Correction Program; and [4] Final Rules under the Affordable Care Act for Grandfathered Plans, Preexisting Condition Exclusions, Lifetime and Annual Limits, Rescissions, Dependent Coverage, Appeals, and Patient Protections.

A Wage and Hour Division item in the Proposed Rule stage is: Establishing Paid Sick Leave for Contractors, Executive Order 13706.

(Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL])
Obamacare's Fate May Rest on Patience of Insurers Aetna, Anthem
"While UnitedHealth has a small share of that market, Anthem and Aetna are two of the biggest players. Like UnitedHealth, neither has had financial success there -- Aetna has said it's losing money, while Anthem is making less than it would like. They're both working to widen profit margins and have said their strategy is based on the expectation that covering people under the law will become more profitable." (Bloomberg)
[Opinion] The Feds Are Wrong: Lots of Wellness Programs Violate the ADA
"Workplace wellness programs discriminate. That's what they do.... The Affordable Care Act makes an exception, however, for wellness-based discrimination.... At the same time, the Americans with Disabilities Act ... says that employers can't conduct medical examinations, including medical histories, unless they're 'voluntary.' ... The question thus boils down to whether the EEOC can reasonably say that a health assessment is still 'voluntary' if there's a substantial financial penalty for refusing to take it. Notice that the ACA has no bearing on that inquiry. It's purely a question of the meaning of the ADA." (The Incidental Economist)
[Guidance Overview] EEOC Releases Proposed GINA Rule on Wellness Programs (PDF)
"[T]he Proposed Rule only provides guidance under Title II of GINA, which relates to employers. The Proposed Rule does not provide guidance under Title I of GINA, which relates to group health plans and is under the jurisdiction of the Departments of the Treasury, Labor, and Health and Human Services. There continues to be uncertainty regarding the level of inducements, if any, that may be provided with respect to spousal HRAs under Title I of GINA." (Groom Law Group)
An HSA Portal May Not Be the Right Hub for You
"Perhaps you have spent significant time, effort and resources to create an employer portal that focuses more broadly on areas like health, wealth and career. You view this as your employees' hub and there is no reason to direct your employees away from it. Why not include links to your favorite HSA/consumerism tools, calculators and educational materials right on your portal?" (Xerox HR Insights)
Employers Struggle to Engage Employees in Health Programs
"Driven by ongoing concerns over worker stress (75%), obesity (70%) and sedentary lifestyles (61%) ... a large majority (84%) of U.S. employers identify health and productivity improvement as essential or moderately important to their health strategies.... [O]ver three-quarters (77%) of U.S. employers expect their organization's commitment to increase or significantly increase over the next three years.... Only one-third [of employees] said the well-being initiatives offered by their employers encouraged them to live healthier lifestyles.... [N]early one-third (32%) said the initiatives offered by their employers don't meet their needs. Nearly half (46%) don't want their employers to have access to their personal health information ... and close to one-third (30%) don't trust their employers to be involved in their health and well-being." (Towers Watson)
With the Excise Tax in Their Sights, Employers Hold Health Benefits Cost Growth to 3.8% in 2015
"[T]otal health benefit cost per employee rose 3.8% in 2015, following a 3.9% increase in 2014. 23% of large employers are at risk of hitting excise tax cost threshold in 2018 based on their current premiums -- and 45% are at risk for 2022. 2016 costs predicted to rise by 4.3% after employers make changes to plans.... if they made no changes to their current plans, they estimate that cost would rise by an average of 6.3%. But about half of all employers indicated that they would make changes in 2016." (Mercer)
UnitedHealth Might Pull Out of ACA Market
"UnitedHealth ... said Thursday that it would pull back on the marketing of its exchange business, a few weeks after open enrollment for that coverage began nationwide. It also said that it will decide in the first half of next year 'to what extent it can continue to serve the public exchange markets in 2017.'... The company still plans to expand into more exchanges, but medical claims have come in higher than expected on the exchanges overall, and its business in particular has deteriorated." (
Fewer Employers Consider Dropping Coverage Due to Obamacare
"[J]ust 7 percent of employers with 50 to 499 employees now say they are 'very likely' or 'likely' to terminate coverage for their workers within the next five years. This is in sharp contrast to the early days of the health reform debate when employers worried the law would ad layers of bureaucracy and higher costs from various new rules and mandates. In 2013, one in five small employers, or 21 percent said they were 'very likely' or 'likely' to terminate their health plans ... And in 2014, the likelihood of employers dropping coverage fell to 15 percent of these smaller employers." (Forbes)
ACA Forces Businesses to Consider Growth's Costs
"For some business owners on the edge of the cutoff, the mandate is forcing them to weigh very carefully the price of growing bigger. 'There's kind of a deer-in-headlights moment for those who say, "I have this new potential client, but if I bring them on, I have to hire five additional people," ' said Philip P. Noftsinger, the payroll unit president at CBIZ ... 'They're really trying to assess how much the 50th employee is going to cost.' " (The New York Times; subscription may be required)
Evidence on Defined Contribution Health and Retirement Benefits: The Road Ahead (PDF)
"For more than a quarter-century now, most private-sector American workers who have a retirement plan at work have funded it primarily through their own contributions -- and do not have a traditional pension funded exclusively by the employer.... While the majority of private-sector health benefit costs historically have been paid by employers, that may be starting to change with the advent of 'defined contribution' health plans that cap employers' health costs. These trends have major implications for the American work force, the U.S. health care system, and even economic security in the nation." (Employee Benefit Research Institute [EBRI])
New Jersey Lawmakers Tackle Those Surprise 'Out of Network' Medical Bills
"Doctors and hospitals would be required to disclose whether their services are not covered by a person's insurance network before treatment occurs under the latest version of a proposed bill aimed at curbing 'surprise' bills.... Hospital officials and physician office administrators would be legally obligated to explain up front who is covered and not covered, and how much more would a person pay for an out-of-network provider, according to the legislation." (
[Guidance Overview] Grandfathered Plan and Patient Protection Guidance Finalized
"According to a 2014 survey, 37 percent of plans are grandfathered plans and 26 percent of employees in ERISA-covered plans are in a grandfathered plan ... In its prohibition of pre-existing condition exclusions, the rule finalizes guidance that was in ACA FAQs Part V to clarify this is not the same as excluding a category of benefits. If the exclusion does not depend on when a beneficiary developed the condition, it is a permissible exclusion of a category." (Thompson SmartHR Manager)
Out-of-Network Coverage by ACA Marketplace Plans in 2016
"Across the states using, 59 percent of 2016 ACA plans do not have out-of-network coverage, except when the enrollee has a medical emergency or obtains prior authorization from the plan before receiving out-of-network healthcare. In three states (New Jersey, New Mexico, and South Dakota), every 2016 ACA plan lacks out-of-network coverage." (HealthPocket)
[Guidance Overview] EEOC Issues Proposed Rule on GINA and Wellness Programs
"While inducements in exchange for information about a spouse's health status are permitted, the proposed rule does not permit inducements in exchange for current or past health status information about an employee's children, either biological or adopted. According to the EEOC, the possibility that an employee may be discriminated against based on genetic information is greater when the employer has access to information about the health status of the employee's children versus the employee's spouse. However, employers may offer health or genetic services, including participation in a wellness program, to an employee's children on a voluntary basis and may ask questions about a child's current or past health status as part of providing such services." (Littler)
Supreme Court Will Hear Seven Challenges to Contraceptive Mandate
"The challenges seek a decision from the Supreme Court overturning the ACA requirement that non-profit groups take action to opt out of the mandate, allowing them to benefit from the blanket exclusion granted to churches and other religious institutions." (Wolters Kluwer Law & Business)
[Guidance Overview] EEOC Q&A Clarifies Proposed GINA Wellness Program Rule, Calculation of 30-Percent Incentive Cap
"[T]he EEOC has posted on its website a list of questions and answers about the proposed rule and a fact sheet on how it would affect small businesses. The Q&A is particularly helpful because it provides an example of how to calculate the 30-percent cap on incentives that employers may offer to employees and their spouses to participate in a wellness program that collects information about current or past health status." (Wolters Kluwer Law & Business)
[Opinion] The Pre-existing Condition: Innovative Solutions to America's Thorniest Healthcare Challenge
"The ACA expands access to care by particular groups of individuals and for particular medical services. But the act does little to expand the supply of healthcare resources or, despite lip service in that direction, to improve the efficiency of delivery.... With the public and policymakers focused almost exclusively on the distribution of care, healthcare technology policy has meandered counterproductively in the shadows." (Altarum Institute)
New Health Plans Offer Discounts for Diabetes Care
"Offered by Aetna in four regions next year, the gold-level plans are tailored for the needs of people with diabetes. They feature $10 copays for the specialists diabetics need such as endocrinologists, ophthalmologists and podiatrists, and offer free blood sugar test strips, glucose monitors and other diabetic supplies. A care management program with online tools and coaching helps people manage their condition day-to-day. The plans also offer financial incentives, including a $50 gift card for getting an A1c blood test twice a year to measure blood sugar levels and a $25 card for hooking up a glucometer or biometric tracker to the Aetna site." (Kaiser Health News)
Is the U.S. Healthcare System Trustworthy? Most Think Not
"Only 37% of the U.S. adult population has confidence in the U.S. medical system. From 1999 to 2006, America's least trusted institutions were health maintenance organizations (ranging from 15-18%) ... Only 8% of consumers trust their health insurers as a source for health and wellness and just 10% trust their employers.... 22% of the public is optimistic about its future of the U.S. health system but 53% are pessimistic." (Paul Keckley)
[Guidance Overview] Recent EEOC Activity on Wellness Programs
48 presentation slides. Topics: [1] Brief overview of wellness program regulation to date, including history of EEOC activity; [2] Refresher on EEOC's proposed ADA regulations regarding wellness programs generally; and [3] Overview of EEOC's proposed GINA Title II regulation regarding spousal HRAs. (Groom Law Group, for American Benefits Council)
Five Telemedicine Trends Transforming Health Care in 2016
"It is expected that the global telemedicine market will expand at a compound annual growth rate of 14.3 percent through 2020, eventually reaching $36.2 billion, as compared to $14.3 billion in 2014.... These five trends will drive telemedicine's continued growth and transformation of health care delivery in 2016: [1] Expanding Reimbursement and Payment Opportunities ... [2] Uptick in International Arrangements ... [3] Continued Momentum at the State Level ... [4] Retail Clinics and Employer Onsite Health Centers on the Rise ... [5] More ACOs Using Technology to Improve Care and Cut Costs." (Foley & Lardner LLP)
It's About Time: Effects of the ACA Dependent Coverage Mandate on Time Use
"[T]he ACA's dependent coverage provision has reduced job-lock, as well as the duration of the average doctor's visit, including time spent waiting for and receiving medical care, among persons ages 19-25. The latter effect is consistent with a substitution from hospital ER utilization to greater routine physician care. The extra time has gone into socializing, and to a lesser extent, into education and job search. Availability of insurance and change in work time appear to have increased young adults' subjective well-being, enabling them to spend time on activities they view as more meaningful than those they did before insurance became available." (National Bureau of Economic Research [NBER])
U.S. Employee Wellness Programs and Access to Obesity Treatment in Employer-Sponsored Health Insurance
"Respondents were asked whether their employer [1] requires participation in a wellness program to receive full health benefits, [2] sets goals for weight and other health indicators, and [3] includes coverage for evidence-based obesity treatment in their health plan.... The study found 16% of employers required participation in wellness programs to receive full health benefits. Most programs set targets for weight and related health indicators, but they did not typically provide coverage for evidence-based obesity treatments." (American Journal of Managed Care)
[Opinion] How the ACA Inadvertently Threatens the Financial Health of Small Businesses, and What States Should Do About It
"By financing their own health care plans, [companies] stay exempt from the community rating requirements ... [and] from the federal and state taxes on most health care premiums that are paid to traditional insurers.... One possible improvement would be for state regulators to require that every stop-loss reinsurer under its jurisdiction provide small firms with advance notice of three months before canceling a stop-loss policy or materially raising its premiums. The notice would give the employer a bit of leeway to figure out an alternative. Another idea would be to expand and enhance the role of the brokers that small companies hire to handle their reinsurance needs.... A final possibility would be to extend the reach of the new health insurance exchanges operating under the Small Business Health Options Program, or SHOP." (Robert C. Pozen, via The Brookings Institution)
[Guidance Overview] Administration Finalizes Regs Implementing Array of ACA Insurance Reforms
"The final rules make ... virtually no changes in the interim rules as interpreted by current guidance. What the final rules do in many instances, however, is to incorporate existing guidance into final rule form. As guidance is not as legally authoritative as are regulations, this clarifies the legal status of existing interpretations of the rules. The finalization of these rules also makes it more difficult for a future administration to change them as the Obama administration nears its final year. The final rule will go into effect on January 1, 2017[.]" (Timothy Jost, in Health Affairs)
Many Say High Deductibles Make Their Marketplace Insurance All But Useless
"Sara Rosenbaum, a professor of health law and policy at George Washington University ... said the rising deductibles were part of a trend that she described as the 'degradation of health insurance.' ... [A]fter reviewing the available plans, [a 29-year-old Houston consumer] concluded: 'The deductibles are ridiculously high. I will never be able to go over the deductible unless something catastrophic happened to me. I'm better off not purchasing that insurance and saving the money in case something bad happens.' " (The New York Times; subscription may be required)
[Official Guidance] Text of Agency Final Rules For Grandfathered Plans, Preexisting Condition Exclusions, Lifetime and Annual Limits, Rescissions, Dependent Coverage, Appeals, and Patient Protections Under the ACA
379 pages. "This document contains final regulations regarding grandfathered health plans, preexisting condition exclusions, lifetime and annual dollar limits on benefits, rescissions, coverage of dependent children to age 26, internal claims and appeal and external review processes, and patient protections under the Affordable Care Act. It finalizes changes to the proposed and interim final rules based on comments and incorporates subregulatory guidance issued since publication of the proposed and interim final rules....

"[T]hese final regulations clarify that, to maintain status as a grandfathered health plan, a group health plan, or health insurance coverage, must include a statement that the plan or health insurance coverage believes it is a grandfathered health plan in any summary of benefits provided under the plan. It must also provide contact information for questions and complaints. These final regulations also retain the model disclosure language.... These final regulations continue to provide that the elimination of all or substantially all benefits to diagnose or treat a particular condition will cause a group health plan or health insurance coverage to relinquish its grandfathered status and contain an example ... [T]hese final regulations provide that an insured group health plan that is a grandfathered health plan will not relinquish its grandfather status immediately based on a change in the employer contribution rate if, upon renewal, an issuer requires a plan sponsor to make a representation regarding its contribution rate for the plan year covered by the renewal, as well as its contribution rate on March 23, 2010 (if the issuer does not already have it).... [T]he final regulations retain the rules regarding loss of grandfathered status based on imposition of annual dollar limits to allow issuers of grandfathered individual health insurance coverage to analyze grandfathered status.... These final regulations adopt the clarification outlined in the FAQs that a plan or coverage will cease to be a grandfathered health plan when an amendment to plan terms that exceeds the thresholds described in paragraph (g)(1) of these final regulations becomes effective -- regardless of when the amendment is adopted. Once grandfather status is lost there is no opportunity to cure the loss of grandfather status....

"After issuance of regulations in 2010, the Departments also released Affordable Care Act Implementation FAQs Part V, Q6 32 to provide additional clarification on the prohibition of preexisting condition exclusions. These final regulations finalize the 2010 interim final regulations without substantial change and incorporate the clarifications issued to date in subregulatory guidance ...

"With respect to annual dollar limits, ... these final regulations adopt the 2010 interim final regulations without substantial change and incorporate certain pertinent clarifications issued thus far in subregulatory guidance ...

"The Departments clarify that the regulatory exception to the prohibition on rescission for failure to timely pay required premiums or contributions toward the cost of coverage also includes failure to timely pay required premiums towards the cost of COBRA continuation coverage. Accordingly, if a group health plan requires the payment of a COBRA premium to continue coverage after a qualifying event and that premium is not paid by the applicable deadline, the prohibition on rescission is not violated if the plan retroactively terminates coverage due to a failure to elect and pay for COBRA continuation coverage ...

"These final regulations provide that, to the extent such restrictions are applicable to dependent children up to age 26, eligibility restrictions under a plan or coverage that require individuals to work, live or reside in a service area violate PHS Act section 2714.... These final regulations also codify some of the enforcement safe harbors, transition relief, and clarifications set forth through subregulatory guidance."

(Employee Benefits Security Administration [EBSA], U.S. Department of Labor [DOL]; U.S. Department of Health and Human Services [HHS]; and Internal Revenue Service [IRS])
Employer Survey: 2015 Best Practices in Health Care
"Last year, only 31% of employers said they were making changes to avoid the tax, up from just 20% the year before. This year, 83% said they are giving it at least moderate attention, with the vast majority (58%) giving it great attention.... 96% expect to increase their focus on employee well-being, and 94% expect to develop or enhance a culture where employees are responsible for their health.... Tax-advantaged account-based health plans (ABHPs), an upstart idea at the millennium, are now omnipresent across every industry. Eighty-six percent of employers plan to offer them in 2016, up from 54% five years ago." (Towers Watson)
Data Driven Decisions in Private Exchanges
"[W]ith growing recognition that employee cost-shifting may well have reached a tipping point, current employer attention has shifted to healthcare consumerism, employee empowerment and the use of incentives. Yet despite sizeable employer investments in these approaches, substantial opportunities remain to improve appropriate consumer use of existing healthcare services.... Aggregated and integrated data from a broad array of sources represents the next step toward understanding and addressing the factors that contribute to poor compliance with evidence-based care." (Buck Consultants)
Highly Valued Startup Zenefits Runs Into Turbulence
"Since late summer, Zenefits has frozen hiring in certain departments as sales teams have repeatedly missed targets ... It has cut the pay of some employees and dozens of people, including at least eight executives, have left or been fired ... Founded in 2013, Zenefits calls itself a software firm, but its business is primarily health-insurance brokerage -- acting as a middleman between companies and health-insurance providers. Zenefits gives away its human-resources software -- which helps manage benefits and other tasks -- to small businesses so that it can sign up their employees for health benefits, collecting about $450 in commissions for each 'insured life,' including employees and their dependents." (The Wall Street Journal; subscription may be required)
[Guidance Overview] EEOC Proposed GINA Rule on Wellness Program Incentives Brings Progress But Also Perpetuates Errors
"[T]he EEOC continues to assert that it has the authority to define what a 'reasonably designed' wellness program is.... Introducing a 'similar' definition means that the EEOC intends to adopt a different standard than the one previously adopted by Congress in the ACA or the Departments of Labor, Treasury and HHS in the Tri-Agency Regulations. Moreover, by importing the 'reasonable design' requirement from 'health-contingent wellness program,' the GINA Proposed Rule (again as in the ADA Proposed Rule) imputes the burdens previously associated only with health-contingent wellness programs to all wellness programs, which exceeds what is required under the ACA and the Tri-Agency Regulations." (Seyfarth Shaw LLP)
How Do You Measure the Health of Health Care Markets?
"One of the challenges of reporting the results was that there are no simple overarching takeaways, nor is there the 'shock and awe' effect that we have seen in the many mainstream expos�s on unexplained variation in health care. The distribution of high and low prices did not fit any particular geographic pattern, and there were markets where inpatient prices were high and outpatient prices were low, and also markets where the reverse was true.... While it is possible to identify better- and worse-performing markets from these data, it was quickly evident that there was no way to 'rank' health markets on a single scale, as performance in the different domains did not fit together neatly." (Health Affairs)
Seventh Circuit Rules ERISA Does Not Preempt State Law Prohibiting Discretionary Clauses
"[T]he Seventh Circuit affirmed a ... holding that Illinois's ... regulation ... prohibiting discretionary clauses in insured employee benefits plans offered or issued in Illinois, was outside the scope of the preemption power of [ERISA].... The court rejected MetLife's 'hyper-technical' argument that 'the discretionary clause in this case is not actually in an insurance policy but in an ERISA plan document,' as it created an 'artificial distinction.' ... The Seventh Circuit clarified that the distinction between the discretionary clause not being inserted in the group policy by MetLife but rather by agreement with the employer did not change the fact that it was a policy provision purporting to reserve discretion[.]" [Fontaine v. Metropolitan Life Ins. Co., No. 14-1984 (7th Cir. Sept. 4, 2015)] (Bloomberg BNA)
[Guidance Overview] ACA Reporting Requirements for Carriers and Employers (Part 17 of 24): Reporting for Offers of Coverage and Auto-Enrollment
"Despite that auto-enrollment is no longer required under the ACA, some carriers are insisting on it as a precondition to offering their products. This approach lends itself to boosting enrollment in instances where coverage was not previously widely offered -- e.g., industries with large cohorts of variable and contingent workers -- and in which anticipated take-up rates are low and the expectation of adverse selection is high. This post explores the impact of carrier-required auto-enrollment on reporting." (Mintz Levin)
86% of Canadians Say Employers Are Responsible for Employee Health
"Health needs of employees are important for maintaining the employer-employee relationship, so the survey findings suggest that employers can no longer view such matters are optional. According to the survey, 84 percent think their employer is responsible for supporting physical health and 86 percent think employers should support psychological health. The results seem to vary between age groups." (Bel Marra Health)
2015 Records Lowest Rate of Increase in U.S. Health Care Costs in Nearly 20 Years
"After plan design changes and vendor negotiations, a recent analysis ... shows the average health care rate increase for mid-size and large companies was 3.2 percent in 2015, marking the lowest rate increase since Aon began tracking the data in 1996. Aon projects average premium increases will jump to 4.1 percent in 2016.... Despite the low rate of increase, the average amount that employees need to contribute toward their health care has increased more than 134 percent over the past decade.... [L]ow rate increases are prompting most employers to take a traditional 'managed trend' approach to mitigating health costs in the short term, though some non-traditional approaches are emerging." (Aon Hewitt)
[Guidance Overview] New Health Plan FAQs Address Preventive Services, Wellness Programs and Mental Health Parity
"The Departments provided a reminder that a reward may be financial, non-financial or in-kind. Consequently non-financial (or in-kind) incentives (e.g., gift cards, water bottles and sports gear) provided by a group health plan to participants satisfying a standard related to a health factor are rewards subject to the 2013 regulations.... The reason for any denial of reimbursement or payment for services with respect to mental health and substance use disorder benefits also must be made available to participants and beneficiaries.... [T]he Departments clarified that a health plan cannot refuse to disclose such information on the grounds that it is 'proprietary' or has 'commercial value.' " (Benefits Bryan Cave)
Why 43% of Employees Are Distracted 75% of the Day
"A decided 70 percent of respondents say their health habits have a noticeable impact on their ability to focus at work, according to the survey. Whether your workforce is diligently working away or struggling to stay on task, you can help by investing in employees' well-being -- support everyone will welcome with open arms. [An infographic explains] more about what's distracting employees at work and how healthy habits help keep them focused." (Employee Benefit News)
[Guidance Overview] EEOC Regs Provide Clarity But Complexity for Wellness Programs
"Employers may offer, as part of their health plans, an incentive when a spouse (a) is covered under the employee's health plan; (b) receives health or genetic services offered by the employer, including as part of a wellness program; and (c) provides information about his or her current or past health status as part of an HRA.... Employers may request genetic information as part of a wellness program only when the wellness program is reasonably designed to promote health or prevent disease." (Calfee, Halter & Griswold LLP)
Growth in HSA Enrollment Continues
"The number of enrollees with HSAs/HDHPs rose to nearly 19.7 million in January 2015, up from 17.4 million in January 2014. Most enrollment gains in the HSA/HDHP market were in large group plans. The share of HSA/HDHP lives enrolled in large group plans jumped from 68 percent in January 2013 to 74 percent in January 2014 and to 78 percent in January 2015. The gender distribution of people covered by HSAs/HDHPs in the individual market was evenly split -- 50 percent male and 50 percent female." (America's Health Insurance Plans [AHIP])

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