Health Plan Weekly

While Nevada is taking stock of its first Affordable Care Act (ACA) open enrollment period as a true state-based exchange (HPW 2/10/20, p. 4), Pennsylvania is gearing up to follow in the silver state’s footsteps and make its own break with HealthCare.gov.

Pennsylvania is one of three states — alongside New Jersey and New Mexico — that are planning an imminent transition from the federal health insurance enrollment platform to their own state-based exchange. Other states are reportedly considering similar moves now that the dust has long settled from some states’ botched exchange rollouts in the early years of the ACA.

A new study by the Health Care Cost Institute (HCCI) found that the cost of health care and spending on health care both increased dramatically between the start of 2014 and the end of 2018. According to the study, price increases for provider services are the main reason why.

Annual spending per person increased 18.4% over the five-year period, from $4,978 to $5,892, the study said. After figures are adjusted for inflation, the cost of care per person increased by $610 over those five years. While utilization did increase, growing by 3.1% across all billing categories including drug benefits, provider price increases drove about 75% of spending growth — an average of $453 per person — when inflation is taken into account.

California’s health insurance exchange, Covered California, expanded enrollment by 1.6% year over year for 2020, according to preliminary results released on Feb. 18 — figures that were highly anticipated since the state was testing new policies this year aimed at encouraging additional insurance signups.

Indeed, California attributed its enrollment growth to its newly expanded subsidies and robust marketing efforts by the state and payers. California now offers premium subsidies to people earning up to 600% of the federal poverty level (FPL), as the result of legislation passed last year and approved by Gov. Gavin Newsom, a Democrat. Under the Affordable Care Act (ACA), such subsidies typically only apply to people earning up to 400% of the FPL, unless a state chooses to provide funding for an expanded population.

A three-judge federal appeals court panel on Feb. 14 sided with a lower court and unanimously ruled that Arkansas’ Medicaid work requirements are unlawful because they don’t align with the chief objective of the Medicaid program — providing access to medical care to those who can’t afford it. The ruling is likely to have implications for states, Medicaid managed care companies and other stakeholders beyond Arkansas’ borders, policy and legal experts tell AIS Health.

“This certainly puts a damper on their plans,” says Joan Alker, a research professor and executive director of the Georgetown Center for Children and Families, referring to other states’ hopes to set up similar Medicaid waiver demonstrations. “This is a signature initiative of [CMS] Administrator [Seema] Verma, and the court decision could not have been more clear that this was an unacceptable overreach by the administration and that they had moved into territory where only Congress could go.”

✦ In public remarks made Feb. 11, CMS Administrator Seema Verma hinted at possible regulatory changes to prior authorization. Verma says CMS has received more than 2,000 comments on the subject of prior authorization, and held 35 “listening sessions” with stakeholders. On the legislative side, insurers have expressed concern about a bill that would standardize prior authorization in the Medicare Advantage program (HPW 9/30/19, p. 4). Read Verma’s remarks at https://go.cms.gov/2UOeXcx.

✦ In one of the largest investments to date in managing the social determinants of health, CVS Health Corp. invested $67 million in affordable housing over the course of 2019, according to a recent press release. Housing insecurity and other social factors have a well-documented effect on health outcomes and cost of care (HPW 1/20/20, p. 1). CVS said its investments helped to create more than 2,200 affordable homes with supportive services for people across 24 cities in six states. Read more at https://prn.to/39ALWW6.