Academy Activities

Al Schmitz testified on behalf of the Academy at a March 17 U.S. House Energy and Commerce Subcommittee on Health hearing on the Community Living Assistance Supports and Services (CLASS) Act. Schmitz said that, despite a requirement that the program be actuarially sound over a 75-year period, it would be difficult to achieve that under the current design.

The Academy’s CO-OP Subgroup submitted a letter on March 4 in response to a Department of Health and Human Services request for comments on the planning and establishment of consumer operated and oriented plan programs (CO-OPs).

Members of the Academy’s Health Practice Council and Federal Health Committee visited with 30 congressional offices, government agencies, and external organizations on Feb. 28 and March 1. Twenty-three Academy volunteers responded to questions on a wide variety of issues, most of which related to aspects of the Patient Protection and Affordable Care Act of 2010 (ACA). These included the CLASS Act, essential benefits and actuarial value, large employers’ response to the ACA, alternatives to the individual mandate, the effect of the ACA on premiums, payment reform, Medicare, and Medicaid.

Legislative and Regulatory Updates

Reps. John Barrow (D-Ga.) and Mike Rogers (R-Mich.) introduced the Access to Professional Health Insurance Advisors Act of 2011 (H.R. 1206) on March 17. The bill would amend the ACA by excluding agent compensation from the new medical loss ratio (MLR) formula. Under the ACA, no more than 20 percent (for individual and small groups) or 15 percent (for large groups) of premiums can go to “non-claims costs.” The MLR regulations currently classify agent compensation as a non-claims cost and include it in the MLR formula.

The departments of Health and Human Services and the Treasury on March 10 proposed rules outlining the steps states should follow to receive a state innovation waiver under the ACA. According to the proposed rules, states can implement policies that differ from the ACA as long as they:

• Provide coverage that is at least as comprehensive as the coverage offered through health insurance exchanges;

• Make coverage as affordable, or more affordable, than it would have been through the exchanges;

• Provide coverage to as many or more residents as otherwise would have been covered under the ACA; and

• Provide coverage that does not increase the federal deficit.

Under the ACA, state innovation waivers will be available in 2017. President Obama supports bipartisan legislation introduced by Sen. Ron Wyden (D-Ore.) and Sen. Scott Brown (R-Mass.) that would make waivers available to states beginning in 2014.

On March 10, the Centers for Medicare and Medicaid Services published proposed consumer disclosure notices that insurers would be required to complete and report electronically when they propose rate increases over 10 percent. The notices would help consumers know what their insurance companies are proposing while rate increase requests are being reviewed. These proposed notices are related to the ACA premium rate review regulation issued by the Department of Health and Human Services in December 2010.

In The News/Media Activities

The Academy Health Practice Council’s Capitol Hill visits in early March were briefly discussed in Politico‘s Pulse e-Newsletter on March 2. The actuaries discussed their meetings with policymakers on alternatives to the individual health insurance coverage mandate contained within the ACA. Another topic covered during their meetings was whether employers were opting to discontinue offering coverage to their employees. The actuaries told policymakers that “prudent employers” would not decide on this until 2016 or 2017, after the exchanges have been through a few renewal cycles. The Academy’s discussions on alternatives to the individual coverage mandate also were mentioned in an article published in Politico on March 14.

Academy Health Practice Council Vice President Tom Wildsmith was the featured guest expert on the Hartford Courant‘s March 3 live Web chat. Wildsmith took questions from participants on how insurance companies determine insurance premiums and how health care reform may affect health insurance markets and premium costs.

National Underwriter Life & Health previewed on March 15 a congressional subcommittee hearing on the CLASS Act and cited the Academy’s FAQ on the federal long-term care program. Actuary Al Schmitz’s testimony on behalf of the Academy during the March 17 hearing was discussed in follow-up reports by BestWire that ran that same day and in the Bureau of National Affairs on March 18. A video of Schmitz’s testimony is available in the Academy Newsroom’s video gallery section. His remarks begin at 1:56:00.

News links are to external websites. The Academy is not responsible for the content of these websites.

Upcoming Health Care Reform Events

Innovations in Prospective Utilization Management

Conference:	March 30 (free)
Sponsor:	America’s Health Insurance Plans (AHIP)

For a complete listing of upcoming and recent health care reform events click here.