The Effects of Medicaid Expansion under the ACA: Findings from a Literature Review — The Henry J. Kaiser Family Foundation

By on June 20, 2016

Research on the effects of Medicaid expansions under the Affordable Care Act (ACA) can help increase understanding of how the ACA has impacted coverage; access to care, utilization, and health outcomes; and various economic outcomes, including state budgets, the payer mix for hospitals and clinics, and the employment and labor market. These findings also may…

via The Effects of Medicaid Expansion under the ACA: Findings from a Literature Review — The Henry J. Kaiser Family Foundation

Filed under Affordable Care Act, Department of Health and Human Services, Medicaid, Uncategorized

New York Federal Court Issues First Interpretation of “Identified” Under the Affordable Care Act’s 60-Day Rule

By on August 26, 2015

In Kane v. Healthfirst, Inc. et al., a New York federal court became the first court to interpret when the clock starts running on the 60 days allowed to report and return an overpayment of Medicare and Medicaid funds under the Affordable Care Act. The Affordable Care Act requires a person who receives an overpayment of Medicare or Medicaid funds to report and return the overpayment within 60 days of the “date on which the overpayment was identified.” 42 U.S.C. § 1320a-7k(d)(2)(A). Any overpayment that is kept beyond the 60 days may be a reverse false claim under the False Claims Act, which imposes liability for any person who “knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government.” 31 U.S.C. § 3729(a)(1)(G).

Kane is significant for health care providers because the Affordable Care Act does not define the term “identified,” nor has the Centers for Medicare and Medicaid Services (CMS) defined this term in the Medicaid context. However, CMS has issued a final rule that applies to Medicare Advantage and the Medicare Part D Prescription Drug Program stating that an overpayment is identified when there is actual knowledge of the existence of an overpayment or if a person or entity acts in deliberate ignorance of, or with reckless disregard to the overpayment’s existence. 79 Fed. Reg. 29,844 (May 23, 2014). CMS has also issued a proposed rule applicable to Medicare providers and suppliers that adopts the same definition of “identified” that the agency adopted for Medicare Parts C and D. 77 Fed. Reg. 9,179 (Feb. 16, 2012). In this proposed rule, CMS noted that a provider or supplier may receive information about a potential overpayment that creates an obligation to inquire about whether or not there is an overpayment. If the inquiry reveals an overpayment, the 60-day deadline to report and return the overpayment runs from the date that the inquiry reveals the overpayment. CMS cautions that a failure to make a reasonable inquiry after receiving information about a potential overpayment could result in the provider knowingly retaining an overpayment. Id.

The Kane litigation arose out of a software glitch that mistakenly generated codes telling providers that they could seek additional payment from secondary payors such as Medicaid. The providers should have been told that they could not seek secondary payment for the services, except for co-payments from certain patients. As a result of this software glitch, three hospitals that were part of a network of non-profit hospitals incorrectly submitted claims to Medicaid.

Approximately 21 months after the hospitals began to bill improperly for Medicaid services, the New York State Comptroller’s office approached the hospitals with questions about the incorrect billing, ultimately revealing that there was a software problem. After the problem was discovered, an employee, relator Kane, was assigned to investigate what claims had been improperly billed to Medicaid. Five months after the Comptroller told the hospital network about the software problem, Kane informed management about 900 potential claims that contained the erroneous billing code. Kane indicated that further analysis would be needed to confirm his findings. The parties did not dispute that Kane’s listing of the incorrect billings was overly inclusive and included claims that were improperly billed as well as some claims that were billed appropriately.

Acknowledging that CMS’ rules do not technically apply in the context of Medicaid, the Kane court nonetheless adopted CMS’ interpretation of the term “identified” that the agency adopted for Medicare Parts C and D and proposed to adopt for Medicare suppliers and providers. Thus, the court concluded that Kane’s e-mail triggered the 60-day timeframe to report and return overpayments. The court reasoned that Kane had put the hospital network on notice of potential overpayments, rejecting the hospitals’ argument that the court should adopt a definition of “identified” that means “classified with certainty.”

As the first court to interpret the term “identified” under the 60-day rule, Kane is an important decision for health care providers. It is possible that other courts will also side with CMS’ interpretation of “identified.” Thus, absent further guidance from CMS or the courts, health care providers should proceed to investigate carefully and quickly all allegations of alleged overpayments and document their efforts, in order to defend against any possible violation of the 60-day rule.

Filed under Affordable Care Act, Centers for Medicare and Medicaid Services, False Claims Act, Medicaid, Medicare

Well, This Changes Things: King v. Burwell and the New(?) Chevron Doctrine

By on June 26, 2015

I first flagged this all the way back in 2013. As everyone reading this probably knows, the Supreme Court had its final say on the matter earlier today. Long story short: The administration won. Insurance exchange subsidies under the Affordable Care Act are available on state and federal exchanges.

My colleague Knicole Emanuel has a piece up about the decision here. I’m a little less skeptical of the majority opinion in general. I think it’s pretty clear that the subsidies were intended by Congress to be available on the federal exchange, and while we should be wary about reading unambiguous laws as we think they were intended to function, and not as their wording indicates they should function, I think Chief Justice Roberts has a fair-enough point that the seemingly unambiguous language in question isn’t so clear cut when one reads it in the context of the law as a whole.

But that’s not the most interesting part to me. The most interesting part is what this decision may well do to the Chevron doctrine. Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., for those who don’t know, is perhaps the most cited Supreme Court case in history (hat tip to my former admin law professor, Cass Sunstein). The Chevron opinion basically says that when a federal agency is confronted with a potentially ambiguous statute, and that agency promulgates formal rules or regulations interpreting the statute, the agency’s interpretation will be upheld provided that (1) the intent of Congress on the issue in question is not clear (i.e., the statute is silent or ambiguous), and (2) the agency’s interpretation is “permissible.”

Law professors and courts have debated what this means and how it should be applied literally for decades. (For example, what does “permissible” even mean?) But those days may be over due to King. From the outset of the case – or, at least, the certiorari grant – there was a good deal of speculation that the Supreme Court would endorse the administration’s interpretation of the subsidy issue on Chevron grounds. This would be important because it would mean that the next Republican administration could reverse that interpretation just as easily. (That’s the whole point of Chevron!)

Uh, not so fast. In his King majority opinion, Chief Justice Roberts expressly decided not to go this route. He explained:

When analyzing an agency’s interpretation of a statute, we often apply the two-step framework announced in Chevron, 467 U. S. 837. Under that framework, we ask whether the statute is ambiguous and, if so, whether the agency’s interpretation is reasonable. Id., at 842–843. This approach “is premised on the theory that a statute’s ambiguity constitutes an implicit delegation from Congress to the agency to fill in the statutory gaps.” FDA v. Brown & Williamson Tobacco Corp., 529 U. S. 120, 159 (2000). “In extraordinary cases, however, there may be reason to hesitate before concluding that Congress has intended such an implicit delegation.” Ibid.

This is one of those cases. The tax credits are among the Act’s key reforms, involving billions of dollars in spending each year and affecting the price of health insurance for millions of people. Whether those credits are available on Federal Exchanges is thus a question of deep “economic and political significance” that is central to this statutory scheme; had Congress wished to assign that question to an agency, it surely would have done so expressly. Utility Air Regulatory Group v. EPA, 573 U. S. ___, ___ (2014) (slip op., at 19) (quoting Brown & Williamson, 529 U. S., at 160). It is especially unlikely that Congress would have delegated this decision to the IRS, which has no expertise in crafting health insurance policy of this sort. See Gonzales v. Oregon, 546 U.S. 243, 266–267 (2006). This is not a case for the IRS.

In other words, Chief Justice Roberts just added some teeth to the previously vague – and essentially inapplicable – language from Brown & Williamson. Now, Chevron will not apply to an agency’s interpretation of “question[s] of deep ‘economic and political significance.’” And what’s more, King seems to have given us some indication of what this might mean – if the issue in question is “central” to the legislation at issue, then Chevron appears to be inapplicable.

On the one hand, this may seem somewhat limited at first blush. After all, how many questions put in front of an agency involve those sorts of deeply significant issues? On the other hand, that kind of misses the point. A litigant can always argue that the agency interpretation at issue involves such a question. And a court inclined to disagree with a particular agency interpretation now has an out – it can always classify the statutory language being interpreted as involving a question of deep economic and/or political significance.

All of this is deeply problematic for one simple reason – under an expansive reading of King, the state of the Chevron doctrine is now up in the air. Heck, it’s unclear to me that the question at issue in Chevron itself – the definition of a “pollution source” under the Clean Air Act – would have been sufficiently unimportant or insignificant to invoke Chevron deference. In other words, it’s not settled to me that under the exception announced in King that the Chevron doctrine would have been appropriate to apply in the Chevron case itself. At the very least, this is going to spark a lot of litigation.

Filed under Affordable Care Act, Chevron Doctrine

CMS Announces Electronic Staffing Data Submission System for Nursing Homes

By on May 22, 2015

The Centers for Medicare and Medicaid Services (CMS) announced the development of a reporting system, known as the Payroll-Based Journal or PBJ, that nursing homes must use to submit staffing and census data as required by Section 6106 of the Affordable Care Act. This provision of the Affordable Care Act requires nursing homes to submit electronically direct care staffing information based on payroll and other auditable data. CMS plans to collect staffing data on a voluntary basis beginning October 1, 2015 and on a mandatory basis beginning July 1, 2016. Registration for voluntary reporting begins in August 2015. Nursing homes should check the CMS website for updates on the PBJ data collection system.

CMS has posted a draft PBJ policy manual on its website. According to the draft manual, staffing and census data will be collected for each quarter. Data can either be submitted manually and/or uploaded from an automated payroll or time and attendance system. Finally, CMS notes that it will conduct audits to assess the accuracy and completeness of the data. Facilities will be subject to enforcement activity for inaccurate and incomplete data.

Filed under Affordable Care Act, Centers for Medicare and Medicaid Services, Payroll-Based Journal, PBJ

A Lot of Home Health Business? That’s a Lot of Home Health Claims for Medicare and Medicaid to Suspend

By on March 3, 2015

I’ve been thinking a good bit about home health care lately.  A lot of that is the concerted effort in the Affordable Care Act to promote home health in lieu of placement in a skilled nursing facility.  It seems like every other long term care provider out there – including most of the big ones – is trying to expand its home health presence as quickly as possible.  Some of that may be my recent experience with my grandmother’s end-of-life care over the past six or seven months, which was spent in a skilled nursing facility (first), an assisted living facility (second), and at her home receiving home-based hospice care (last).  Her last few weeks at home left me with a positive impression of home health care.

Anyway, I hate to be a stick in the mud, but one thing does concern me.  As this blog shows, I write a lot about Medicaid fraud-based temporary suspensions.  The same remedy (technically suspension, effectively termination) exists under Medicare.  As that regulation and Medicaid counterpart show, it’s a broad power.  The applicable federal or state agency need only show a “credible allegation of fraud,” at which point it can withhold all payments owed to the provider – including those that have nothing to do with the alleged fraud, and even when the provider can show that the vast majority of claims are legitimate.  Indeed, after the ACA, federal and state regulators are now told that they must have good cause to release any of the owed claims, and they can only do so under a limited set of circumstances.  As one colleague recently put it to me, “temporary suspension” is really code for “lazy man’s termination.”

So what does that have to do with home health care?  Regulators have long recognized that home health care carries an increased risk of fraud.  It makes sense, of course.  There is no direct supervision when a home health caregiver provides care in the home of a recipient.  Usually, the only way to know what the caregiver did, and for how long, is the say so of the caregiver and the recipient.  The opportunity for collusion is more-or-less unchecked.  Add in lower level managers responsible for scheduling and supervising the caregiver (inasmuch as supervision is possible), and it becomes very difficult to police fraud.  And indeed, from 2010 to 2014, OIG has identified over one billion dollars associated with fraudulent home health claims – and that’s without looking.  The real amount likely is a multiple of that.

That should cast the rapid expansion of the home health care industry in an ominous light.  The sorts of institutional providers looking to increase their home health presence quickly undoubtedly will be able to garner a large share of the market quickly.  And that’s a good thing for the most part.  But a lot of business means a lot of opportunities for fraud.  It’s a lot of caregivers, a lot of lower level managers, and a lot of recipients – which means a lot of risk that some small number of them might (for example) collude to record care for services not provided, and then split the proceeds.

And remember from above, if federal or state regulators believe that they have any credible allegation of fraud, they can suspend all payments owed to the company, not just those associated with the fraud.  Ouch.  Now, is it realistic that regulators would step in and turn the revenue spigot off entirely for a company providing home health services to thousands or even tens of thousands of recipients?  Probably not – at least not without a back-up provider lined up to step in.  But it’s certainly a lot of leverage on the part of Medicare and Medicaid, and there’s a strong likelihood that regulators might use that leverage to pressure institutional providers into favorable settlements (both financially and in terms of a going-forward corrective action plan).

So how should companies aspiring to a big share of the home health market protect themselves in such a perilous area?  That’s something I intend to address in the next few posts.

Filed under Affordable Care Act, Home Health Care, Medicaid, Medicare

Medicare Advantage Risk-Adjustment Fraud – Where’s the False Claim? (Part I)

By on August 11, 2014

I recently saw this article discussing a False Claims Act (FCA) case pending in federal district court in Florida.  The theory is an interesting one involving the Medicare Advantage program.  The full story is available here and here, but I’ll provide a brief synopsis.

In 2003, Congress passed the Medicare Prescription Drug, Improvement, and Modernization Act (MMA), which required the Centers for Medicare and Medicaid Services (CMS) to initiate the formal implementation of a fully risk-adjusted capitation reimbursement model for Medicare Advantage.  Essentially, a risk-adjusted model recognizes that many Medicare Advantage beneficiaries experience health conditions that can be very costly, to the point where a single hospitalization can wipe out the entire amount of premiums the Medicare Advantage managed care organization received over the course of the year.  Therefore, it pays higher premiums for those beneficiaries who have been diagnosed with conditions that make them more likely to use significant health care resources over the course of the year (e.g., diabetics, people suffering renal failure, etc.).

You can see the potential for fraud and abuse.  If Medicare Advantage plans get paid more for covering high-risk beneficiaries, then they’ll have an incentive to exaggerate the poor health of their beneficiaries.  Doctors will err on the side of diagnosing their patients with the more serious conditions in borderline (and perhaps not-so-borderline) cases.  That’s what the plaintiff alleges the provider did in the case linked above (I won’t name the company, but you can click through).  In related news, CMS recently announced that it intends to scrutinize Medicare Advantage risk-adjustment data submitted by plans to ensure its accuracy, primarily in an attempt to deter this potential practice.

But there’s a problem from the government’s point of view.  Where’s the claim?  The FCA only covers false claims submitted to the government for payment, or false records or statements material to false claims.  It is not a general HC BLOG_HHSfraud statute.  And it is at least debatable whether a trumped up diagnosis submitted for risk-adjustment purposes falls within the “false claim” category.  Now, it’s probably inarguable that if a Medicare Advantage plan knowingly included false or exaggerated diagnosis data when it submitted its capitated reimbursement request, that conduct would be a false claim.  But that’s unlikely to happen.  Instead, the plans normally will just aggregate the data they receive from their doctors without investigating its accuracy (which would be impossible on any large scale).  And in the absence of any direct connection between the receipt of false data and the submission of the reimbursement request, it’s hard to cite any specific false claim.

Now, it’s important to note that the Department of Health and Human Services (HHS) rejects this analysis.  It takes the position that the FCA encompasses risk-adjustment fraud (see note 12 for FCA actions brought by HHS).  But all of the matters involving this theory have settled before a court can opine on the issue, so we have no judicial pronouncement on whether HHS’s interpretation is a viable one.

And there’s one more thing.  The Medicare Advantage program seems to be growing, despite cuts made in the Affordable Care Act (ACA).  (It is only used by 30 percent of the population eligible for Medicare, tallying about 15.7 million beneficiaries.)  But it is not the only federal health care program that uses a risk-adjustment model.  In fact, the ACA contains a virtually identical concept to help offset insurance plans that cover high-risk individuals through the state and federal insurance exchanges.  These plans theoretically will have the same incentive as the Medicare Advantage plans to exaggerate – or even lie about – their enrollees’ health conditions.  There is an important difference between the two risk-adjustment approaches though – how Congress has decided to treat them for FCA purposes.  That difference may be crucial to the question of whether and how false or exaggerated risk-adjustment data is covered by the ACA.  More on that in my next post.

Filed under Affordable Care Act, False Claims Act, Medicare Advantage Risk-Adjustment Fraud

A Butterfly Flaps Its Wings in Central Park and the Risk Corridors Need an Infusion of Billions of Dollars to Address a Shortfall

By on May 28, 2014

I saw this story a few days ago.  It involves the Centers for Medicare & Medicaid Services’ risk corridors program, which, as the article states, essentially is a regulatory mechanism designed to shift funds from insurers with a healthier population of insureds to those with an older or sicker base.  These programs – which will be in place from 2014 until the end of 2016 – have been the subject of intense criticism since last fall, though a lot of that tempered down when we started to get a good idea of what the overall policyholder demographics would be.  They require the insurance industry to contribute (on a per capita basis) $20 billion over the next three years; the federal government will match that to the tune of $5 billion, plus cover any cost overruns.

HC BLOG_exam roomWell, it turns out that there has been a recent development.  According to the Los Angeles Times article, it seems that the administration and the Department of Health & Human Services have “quietly” been reserving “billions” of dollars to cover potential shortfalls.  It suggests that one potential cause is the administration’s decision earlier in the spring to let old plans that are not Affordable Care Act-compliant stay in place for two more years.  Essentially, the story goes, healthy people with plans that are skimpier than required under the ACA elected to stay in those (cheaper) plans, while older or sick people fled to the new and more generous ACA-compliant policies.  Combine that with intense pressure by the administration on insurance companies not to implement drastic premium increases, and you have a situation where the insureds in ACA-compliant plans are older and sicker than expected, and premiums are underpriced.  For its part, the administration and CMS deny that they anticipate the funds will be needed, and instead say it’s a case of “better safe than sorry.”

My thought is that this is yet another example of how inter-related all of the different pieces of the ACA really are.  The biggest example, of course, is the relationship between Medicaid expansion and the individual insurance mandate.  Because the law was written to make everyone up to 138 percent of the modified adjusted gross income (MAGI) poverty line eligible for Medicaid, and everyone over that line required to buy insurance, the effect of U.S. Supreme Court Chief Justice John Roberts Jr.’s decision to make expansion optional created a gap in the MAGI line under which people in non-expanding states wouldn’t be eligible for Medicaid and they wouldn’t be covered by the individual mandate or (more importantly) the subsidies designed to help poorer (but not Medicaid-eligible) people purchase policies.

We’re seeing the same type of phenomenon with respect to the risk corridors.  As initially written, old ACA-noncompliant policies weren’t grandfathered in, and the young and old and sick and healthy were directed to the same exchanges.  Voila, problem solved!  But that’s not how it works anymore.  For whatever reason, the administration decided to backtrack and allow insureds on old (noncompliant) policies to keep them until 2016.  That decision – regardless of its motivations – has thrown yet another wrench in the works of a very complicated and carefully designed law.

Image courtesy of Flickr by Good Eye Might

Filed under Affordable Care Act, Medicaid, Medicare

More on the ACA’s Contraceptive Coverage Mandate – Exempt vs. Eligible or Accommodated Employers

By on January 8, 2014

This story from last week about the U.S. Supreme Court’s temporary stay of the Affordable Care Act contraceptive coverage mandate reminded me about an opinion issued by a federal judge in the Northern District of Indiana on Dec. 20, 2013, which reminded me that I should post an update to a post I did several weeks ago.  (Full disclosure: I clerked for the judge in the Indiana case, Chief Judge Philip P. Simon, and he’s definitely in the running for “World’s Best Boss.”)  To summarize one of the main points of that post:  I was curious as to why the Department of Health and Human Services was treating churches (and other houses of worship) differently than non-church religious organizations with respect to the ACA’s requirement that (most) employers provide health insurance policies with a contraceptive coverage benefit.  That seemed problematic to me.

It turns out that the situation is more complicated than I envisioned, though the basic point stands.  In fact, there are not just twoHC BLOG_birth control2 types of employers for ACA religious exemption purposes – there are three.  In addition to secular employers (that do not object to providing contraceptive coverage) and houses of worship (which are completely exempt from the coverage requirement), there are employers that are “eligible” or “accommodated.”  These are religious-themed or religious-oriented entities that are not churches or synagogues or the like – for example, religious universities such as Notre Dame (the plaintiff in the Indiana case), Catholic student organizations, or hospitals owned by religious groups.  According to the final federal regulations, these groups must (1) oppose providing coverage for some or all of the contraceptive services required to be covered under the ACA and the accompanying ERISA statutes; (2) be organized and operated as nonprofit entities; (3) hold themselves out as religious organizations; and (4) self-certify that they satisfy three additional criteria.

These accommodated or eligible employers don’t have to provide insurance including contraceptive coverage to their employees.  They do, however, have to certify to DHHS that they will not provide that coverage.  At that point, the insurer or third-party administrator (TPA) must exclude contraception from the employer’s group policy, but then it must pay for the employees’ contraceptive services on its own without charging an additional fee or premium.  That may sound onerous, but the insurer or TPA is then permitted to deduct its federally facilitated exchange fees (i.e., the 3.5 percent fee paid by insurers to participate on the national insurance exchange).  In this way, the intent of the contraceptive coverage mandate is satisfied, but the eligible or accommodated employer isn’t spending its own money to provide objectionable coverage to its employees.

So then what’s the eligible or accommodated employers’ complaint?  That’s where it gets a little more abstract.  Remember, the accommodation process is kick-started by the employer’s self-certification that it’s an eligible entity.  Some employers argue that doing so effectively causes their employees to receive contraceptive coverage (albeit not paid for by the employers), which they believe to be immoral.  That’s the basis for their lawsuits.

And how have they fared?  That’s a mixed bag.  In the Northern District of Indiana case, Notre Dame lost.  Judge Simon essentially held that the act to which the school objected – providing contraceptive coverage to its employees – was being performed by another entity (the insurer or TPA), and thus Notre Dame was not suffering any burden.  He didn’t buy the argument that the physical act of submitting the required self-certification facilitated contraceptive coverage, thus violating Notre Dame’s deeply held religious or moral convictions.  This is at odds with Zubik v. Sebelius, a decision handed down Nov. 21, 2013, by the Western District of Pennsylvania, which reached a different result.  Judge Arthur J. Schwab held that being forced to provide information that would be used for a purportedly “immoral purpose” is, in fact, a burden to a religious organization.  He also relied on the seeming unfairness in treating houses of worship differently than what he called “good works (faith in action) employers.”

It’s beyond the scope of this blog to evaluate which opinion is more persuasive.  On the one hand, employers do a lot of things that theoretically might “facilitate” their employees’ use of contraception.  If Notre Dame pays its employees, for example, there’s always a chance that some of those individuals might take their hard-earned money and purchase birth control.  That looks an awful lot like “facilitation,” and it’s hard to see where you’d draw the line separating what’s allowed and what’s not.  On the other hand, the judge in the Western District of Pennsylvania has a good point that it’s a bit worrying that the government is distinguishing between houses of worship and other religious-affiliated entities – it’s almost like it’s classifying various organizations as “religious enough” (or not) to be exempted from the ACA contraception mandate altogether.  (In fairness, I think the thought process behind that distinction is that there are a lot more nonmember employees of religious hospitals and universities than churches.)

As I noted in my prior post, my guess is that this will be resolved in the next several months when the Supreme Court hands down its decision in Sebelius v. Hobby Lobby Stores.  I just wanted to elaborate a bit on the precise details of the regulatory regime that DHHS is using to determine who must provide contraceptive coverage and who is exempt from that mandate, and what the alternatives to coverage are.

Image courtesy of Flickr by Monik Markus 

Filed under Affordable Care Act

Yet Another Lawsuit Filed in Colorado Attacking the Affordable Care Act’s Contraception Mandate

By on December 4, 2013

This lawsuit was filed yesterday.  It is yet another action claiming that the Affordable Care Act’s contraception mandate is unconstitutional and violates the Religious Freedom Restoration Act.  This appears to be the fourth lawsuit filed in the District of Colorado alone.  Michael Norton and the Colorado branch of the Alliance Defense Fund really seem to be taking advantage of the Tenth Circuit’s Hobby Lobby decision, which held that the first two preliminary injunction requirements – likelihood of success and irreparable harm – were met with respect to a private business’s efforts to enjoin the ACA’s contraception mandate.

HC BLOG_birth controlThe only real wrinkle in the most recent case is the organization bringing it.  The main plaintiff, the Fellowship of Catholic University Students, is not technically a church, organization of churches, or the like, so the religious employer exemption to the Affordable Care Act’s contraception mandate does not apply.  That doesn’t make a lot of sense.  Without opining on the ultimate issue of whether private employers generally should be able to refuse to provide insurance covering various ACA-required services on religious grounds (other than to say that I think the constitutional case is easy, but the RFRA case isn’t), it strikes me that insofar as the Department of Health and Human Services is exempting churches from the contraception mandate, it should also exempt explicitly religious – and especially sectarian – organizations as well.

Here’s what I don’t understand, though.  Why is the ADF bringing case after case in Colorado?  It’s not like we aren’t going to get a definitive answer on the constitutionality of the ACA contraception mandate in the near future.  Indeed, the Supreme Court agreed to hear the Hobby Lobby case just last week.  That almost certainly will resolve the issue once and for all.  Now, I suppose it’s possible that the Supreme Court could render a narrow decision that might allow FOCUS to distinguish itself from the purely commercial plaintiff in that case, but that seems exceedingly unlikely to me (though I should note that others have a different view).  But rather than tie up the busy federal courts with case after case that is likely to be mooted out by next June, why not just wait until then to see what happens?

I get that the owners and managers of these corporations probably don’t want to have to provide contraception coverage in the interim.  Given the existing Tenth Circuit precedent, DHHS really should consider postponing the contraceptive coverage mandate – at least for employers in Colorado, Oklahoma, New Mexico, Kansas, Utah and Wyoming – until the Supreme Court has its say.  And maybe I’m a bit biased because I experienced how much work it is for a federal judge and his or her chambers to handle a preliminary injunction request.  But this all just seems like a colossal – and pointless – waste of time for everyone involved.

Image courtesy of Flickr by Nate Grigg

Filed under Affordable Care Act

One Price for Denver, Another Price for Colorado Springs, and So On…

By on November 8, 2013

Hat tip to the Denver Post Daily Dose blog for this chart comparing the cost of Affordable Care Act silver-level individual policies by insurer and market.

I have a few thoughts about this.  First, that seems awfully cheap.  Many years ago in Chicago, my wife had a year (or so) period where she was too old to be on her dad’s insurance, and I was still a year away from employer-provided insurance, so we shopped for an individual policy for her.  If I remember correctly, the cheapest policy without maternity coverage was roughly $170/month – about 20 percent less that the cheapest Denver 27-year-old policy (and about 50 percent less than the most expensive one.  HC BLOG_pill bottleKeep in mind that she was only 25, the coverage was almost certainly skimpier, and this was more than a decade ago when health care inflation was between 2 percent and 4 percent. (Assuming an average rate of 3 percent, that means her $170/month policy should now be about $230/month, which is more than a lot of these policies.)

Second, the transparency is awesome.  Say what you want about the ACA, but the ability to compare comparable policies is hugely convenient, and it eliminates a lot of confusion provided the policies really are relatively comparable (more on that in a second).

Third, I’m a bit surprised at the variability between policies and geographic markets.  Yes, I know that not all silver-level policies have the exact same benefits, but the difference in Denver between the high and low for a 27-year-old is more than 80 percent.  For Grand Junction it’s close to 100 percent.  Either the benefits are way different between these policies (in which case, it reduces the helpfulness of the ACA level groupings), actuarial pricing is a lot less of an exact science than I thought, or maybe a bit of both.

Similarly, I’m surprised at the price differences between markets.  For the policies that can be issued in every market, the difference between the high and low prices are 105 percent, 66 percent, 26 percent, 65 percent, and 74 percent, respectively (using the pricing for a 27-year-old).  Some companies can sell the same policy in different parts of Colorado for a modest 20-odd percent premium, but others need to more than double the price.  That’s strange.  While there seems to be some general trends – the metro areas are cheaper than the nonmetros – the pricing within those bands is a more variable.  Sometimes Denver is less expensive than Boulder; sometimes it’s not.  That would lend some credence to the theory that pricing is much more flexible than you’d think.

I don’t have a clever conclusion or takeaway from this.  It’s just cool to be able to see pricing laid out in a simple chart.

Image courtesy of Flickr by Images Money

 

Filed under Affordable Care Act

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