Health Plan Weekly

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.

During a Feb. 12 presentation outlining its 2019 financial results, CVS Health Corp. touted a “successful first full year with Aetna,” saying the transaction produced “synergies above expectations” at approximately $500 million. And CVS’s Health Benefits segment — which houses its new insurance business — posted a “solid” fourth quarter, in the words of Citi Research securities analyst Ralph Giacobbe. Meanwhile, Molina Healthcare Inc., which posted its full-year and fourth-quarter 2019 earnings on Feb. 11, reported quarterly results that were “largely in line” with Wall Street’s consensus estimates, according to Jefferies analysts David Windley and David Styblo. But the analysts also highlighted an underwhelming performance from Molina’s Affordable Care Act (ACA) exchange business.

Across its enterprise in 2019, CVS delivered adjusted earnings per share (EPS) of $7.08 with total revenues of nearly $257 billion — a 32% year-over-year increase “reflecting a full year of Aetna’s operations and positive momentum across our enterprise,” CEO Larry Merlo told investors during the company’s earnings call, per a transcript of the call published by the Motley Fool.

Recently, medical records software vendor Epic Systems Corp. made headlines by threatening to sue HHS over its proposed regulations promoting interoperability and urging its clients to oppose the new requirements as well.

Epic is not the only health care player that may be put off by the Trump administration’s interoperability proposals, which it released last February in a bid to help patients share and obtain their health records more easily. Insurers would face a slew of new requirements to facilitate better data-sharing under one of the two proposed rules (HPW 2/25/19, p. 1).