boutin essential benefits
TRANSCRIPT
The National Health Council’s Essential Health Benefits
Marc BoutinExecutive Vice President & COO
National Health Council
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The mission of the National Health Council is to provide a united voice for people with chronic diseases and disabilities.
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ACA: Minimum Essential Benefits The ACA creates 10 categories of essential benefits that plans must cover
beginning in 2014:
» Ambulatory patient services» Emergency services» Hospitalization» Mental health and substance
abuse services» Rehabilitative and habilitative
services and devices
» Prescription drugs» Laboratory services» Preventive and wellness services
and chronic disease management» Maternity and newborn care» Pediatric services
The essential benefits requirements also places limits on patient costs» Limits out-of-pocket costs to Health Savings Account (HSA) levels (in
2011, $5,950 for individuals)» Limits deductibles for small group plans to $2,000 for individuals and
$4,000 for families
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Essential Health Benefits – Value StatementsGoal: Ensure that people with chronic conditions have access to affordable and high-quality services and treatments necessary for prevention, diagnosis and management of their health condition
Domain Value
Process Transparency
• Create processes for meaningful patient input at all stages of defining essential health benefits
• Put safeguards in place to protect patients from discriminatory practices • Develop periodic evaluation processes to review the adequacy of the essential
health benefits package• Define the interaction of federal essential health benefits with existing state
mandates
Criteria to Define “Essential” Benefits
• Ensure that access to essential health benefits by individual patients is not impeded by financial barriers
• Promote flexibility to accommodate technological advances and evolving evidence• Include benefits from a variety of care settings and providers to meet all patient
needs
Recourse in Decision-making
• Permit the public to request reconsiderations of the essential health benefits package by the Secretary of HHS
• Allow enrollees to challenge a health plan’s interpretation of essential health benefits and rationale for the inclusion or exclusion of individual services
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Potential Approaches to Developing the Essential Health Benefits Package
1 2 3
Define benefits narrowly
Medicare Part B program
Define categories of benefits broadly and establish process-oriented requirements as a ‘check’ on plans
Medicare Part D program
Define categories of benefits broadly, granting plans the flexibility to develop coverage policies within each category
FEHBP plan
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Essential Health Benefits Landscape
IOM DOL HHS+ State Exchanges
Health Plans
Informing Regulations Developing Regulations Implementing Regulations
Continue to endorse NHC’s values on EHB
Ensure that any limitations to DOL’s database are addressed
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Timeline for Engagements: Essential Health Benefits
March 2011 May July September November January 2012
Proposed Rule Anticipated from HHS
IOM Committee Meeting
IOM Recommendations Expected
DOL data expected in “Spring”
Third and fourth IOM Committee meetings
Develop essential health benefits package using FEHB plan as foundation in consultation with NHC members
Develop ideal approach for HHS/State regulatory oversight
Vet regulatory approaches with NHC members
Share regulatory approach with HHS
Commission actuarial analysis of the affordability of NHC’s essential health benefits package and discuss implications among membership
Craft regulatory language that HHS could adopt and review with NHC membership
Craft regulatory language
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Development of Policy Recommendations
EHB White Paper
• This report established baseline knowledge and considered the approaches HHS may take in defining the EHB package
EHB Cost Analysis
• This analysis examined the cost of a comprehensive health benefits package, using the Federal Employees Health Benefits Package as a model
EHB Policy Recommendations
• This report will articulate NHC’s recommendations and proposed solutions and will be shared with key policymakers and stakeholders
Commissioned Actuarial Analysis
Create a baseline benefit package Use FEHBP BCBS Standard Option as a foundation (minus dental/vision
benefits)
Price the baseline benefit package
Calculate actuarial value (AV) Platinum (90% of covered charges are paid by the plan)
Gold (80% of covered charges are paid by the plan)
Silver (70% of covered charges are paid by the plan)
Bronze (60% of covered charges are paid by the plan)
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Plan Premium Costs
PlanEstimated
Annual Premium—Individual*
OOP Maximums Total Cost
BCBS Model $5,032
Platinum $5,205 $1,500 $6,705
Gold $4,627 $5,950 $10,577
Silver $4,048 $5,950 $9,998
Bronze $3,470 $5,950 $9,420
*The estimated premiums and the reduced OOP max for the platinum plan are actuarial estimates from ARC.
Room in Household Budget for Health Care?
Reported Income (%
poverty level)Necessities Necessities +
Premium
Necessities + Premium + Median
OOP Cost
Necessities + Premium + 90th Percentile OOP
Cost
<Poverty 17.30% 17.30% 17.30% 17.30%101–150 7.50% 8.40% 8.50% 10.80%151–200 3.70% 7.60% 9.00% 17.50%201–250 3.00% 5.70% 8.80% 26.20%251–300 1.10% 5.30% 6.90% 24.20%301–350 0.70% 4.20% 5.30% 17.50%351–400 1.20% 3.50% 3.90% 12.50%401–450 0.50% 2.70% 3.70% 15.30%451–500 0.40% 3.60% 4.70% 12.00%
>500 0.20% 0.60% 0.60% 2.50%
(c) Jonathan Gruber and Ian Perry, The Commonwealth Fund
At 250% FPL: Family of Four, One Person with Kidney Disease
Annual Income (Gross) $55,875Median Necessities*(at 71%) – $39,671
$16,204
Maximum Premiums** – $4,500
$11,704
OOP Maximum*** – $5,950
$5,754
Per Month ÷ 12
~ $480
Subtract the cost of taxes, child care, food, housing, transportation, and miscellaneous expenses of 10%
Subtract ACA-defined maximum premium for family at 250% FPL
(compared to ~$8,000 for a silver plan with no subsidy)
Subtract reduced out-of-pocket maximum due to 250% FPL
(compared to $11,900 with no subsidy)
Divide by 12 for estimate of remaining funds in monthly budget
Actuarial analysis performed for NHC byActuarial Research Corporation and Avalere Health
At 450% FPL: Individual with Rheumatoid Arthritis
Annual Income (Gross) $49,005Median Necessities*(at 63%) – $30,873
$18,132
Platinum Premiums** – $5,205
$12,927
OOP Maximum*** – $5,950
$6,977
Per Month ÷ 12
~ $580
Subtract cost of taxes, child care, food, housing, transportation,
and miscellaneous expenses
Subtract cost of premiumfor a platinum plan
Subtract out-of-pocket maximum set by the ACA
Divide by 12 for estimateof remaining funds in monthly
budget
Actuarial analysis performed for NHC byActuarial Research Corporation and Avalere Health
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Regulatory Opportunities
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Non-Discriminatory Utilization Management
Recommendation HHS Regulatory Opportunity
EHB regulation should provide for oversight of plan benefit design to avoid discrimination caused by unfair utilization management techniques
Outline oversight mechanisms for states to use in reviewing plan utilization management policies
States should establish oversight mechanisms to review plan processes
HHS should continue to monitor state oversight programs to guarantee that plans are meeting federal requirements
MODEL PROGRAM: The Medicare Part D Formulary Review process analyzes the use of practices such as prior authorization, step therapy, and quantity limits and compares practices to industry standards, guidelines, and other Part D plans.
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Continuity of Care Protections
Recommendation HHS Regulatory Opportunity
EHB regulation should include patient protections to ensure plan cooperation and coordination when people switch enrollment between plans
Include protections for patients switching enrollment (among qualified health plans and to and from Medicaid) so patients do not have to re-establish the necessity of treatment protocols already in place
Require plans to provide written notice of the right to transfer treatment protocols
Require Navigator education programs to provide information about the potential implications of switching between plans
MODEL PROGRAM: Medicare Part D Auto and Facilitated Enrollment processes ensure beneficiaries with limited income remain enrolled in Part D plans that have reduced costs.
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Cost-Sharing Protections
Recommendation HHS Regulatory Opportunity
EHB regulation should require plans to have non-discriminatory cost-sharing policies across benefit categories.
Exchanges should allow creative benefit design to encourage plans to develop novel approaches to cost- sharing
Require plans to disclose the deductible, co-payment, and co-insurance amounts applicable to covered services prior to enrollment
Prohibit specialty tiers
Offer protection from high out-of-pocket costs on prescription drugs and allow tiering exceptions
Create oversight mechanisms to ensure that states are reviewing plan benefit design to ensure cost-sharing is neither unfair nor discriminatory
MODEL PROGRAM: The Maryland Comprehensive Standard Health Benefit Plan* specifies cost-sharing requirements for certain services and includes some service limits to offer an extra level of patient protection for enrollees in these plans.
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State Navigator Programs
Recommendation HHS Regulatory Opportunity
EHB regulation should contain specific mechanisms to assist patients in identifying an appropriate plan and navigating enrollment and other key plan processes
Include resources to educate enrollees about their plan rights and responsibilities
Prohibit educational materials and programs from steering or attempting to steer people into a plan or type of plan
Navigator programs should coordinate with other consumer assistance programs in the state
MODEL PROGRAM: The State Health Insurance Assistance Programs (SHIPs) are an often cited example of what a Navigator program could resemble. SHIPs provide assistance to Medicare beneficiaries and help them with their Medicare benefits.
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Care Coordination & Management Activities
Recommendation HHS Regulatory Opportunity
EHB regulation should require proven effective care coordination and management activities to improve outcomes and reduce total healthcare costs
Require care coordination activities as an essential health benefit
Create pathways for plans to develop innovative strategies to compensate providers for effective care coordination
Encourage state IT programs to include information about the care coordination policies of plans on state Exchange websites
MODEL PROGRAM: Medicare Advantage coordinated care plans are required to have quality improvement and chronic care improvement programs as well as monitor and evaluate these activities and outcomes.
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Medical Necessity Decision Making & Appeals ProcessesRecommendation HHS Regulatory Opportunity
EHB regulation should outline clear, understandable standards for plan medical necessity determinations and should include a process for appealing adverse plan determinations
Require plans to use medical necessity criteria that are objective, clinically valid, and compatible with generally accepted principles of care
Plan denials based on lack of medical necessity should explain, in clear language, the criteria used to make the determination
Create uniform exceptions and appeals process for items and services that do not meet definition of medical necessity
Navigator programs should be available to guide patients through the complexities of plan appeal processes
MODEL PROGRAM: Medicare Part D offers an example of a federally regulated, nationwide program that has set requirements of participating plans for exceptions and appeals processes.
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State Exchange Requirements
Recommendation HHS Regulatory Opportunity
HHS Exchange regulation should include federal and state oversight to ensure that plans offered on state exchanges meet all appropriate and necessary criteria (including network adequacy standards)
Require Exchanges to monitor and seek to improve quality of care
Plans may not exclude eligible individuals from coverage
Plans utilizing a provider network shall be required to demonstrate an adequate number of in-network providers in various specialties corresponding to the EHB categories of services
MODEL PROGRAM: The Massachusetts Health Connector’s Commonwealth Choice program offers a variety of plans with different benefit packages. The Health Connector reviews and approves each plan offered in Commonwealth Choice. Of the two operational health insurance exchanges (MA and UT), the program in Massachusetts provides more oversight and patient protections than the exchange in Utah.
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Alignment of IOM & NHC on Essential Health Benefits
NHC Value IOM Report Alignment
Bar Discrimination in Utilization Management Minimal alignment
Ensure Continuity of Care Not Addressed
Require Cost-Sharing Protections Not Addressed
Provide Education and Coordination through Navigators Not Addressed
Cover Care Coordination and Management Activities Not Addressed
Include “Medical Necessity” Decision Making and Appeals Processes Moderate alignment
Ensure Access to Essential Health Benefits through Exchanges Minimal alignment
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Limitations of IOM’s Recommendations:Inclusion Criteria
IOM Recommendation Limitation
Of the four inclusion criteria for EHB, items and services must have demonstrated evidence that the item or service is:
Likely to enhance patient outcomes when compared to available alternatives
Cost-effective to justify the health gain
The data and research both on patient outcomes and cost-effectiveness are limited and conflicting
Much existing research is based on the population at-large and not on subpopulations
There is no consensus on application of these research methods to coverage criteria
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Limitations of IOM’s Recommendations:Balancing Affordability and Coverage
IOM Recommendation Limitation
On the issue of balancing affordability with effective coverage, the IOM falls squarely on the side of affordability
With the balance shifting towards cost, more people, including those with complex chronic conditions, may have access to coverage
However, the coverage available may not be comprehensive or effective, in light of specific health care needs
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National Health Council Resources
EHB Policy Recommendations (2011): http://www.nationalhealthcouncil.org/NHC_Files/files/EHB_UnitedPatientVoice.pdf
EHB Actuarial Analysis (2011): http://www.nationalhealthcouncil.org/NHC_Files/files/EHB_ActuarialAnalysis.pdf
EHB White Paper (2010): http://www.nationalhealthcouncil.org/NHC_Files/files/EHB_WhitePaper.pdf
Marc BoutinExecutive Vice President & COO
National Health [email protected]