Implementation of the ACA Provider Non-Discrimination Provision

1. Implementation of the ACA Provider Non-Discrimination Provision Thursday, July 24, 2014 Billy Wynne Partner, Thorn Run Partners CEO, Healthcare Lighthouse

2. Agenda • Refresh ACA Provider Non-Discrimination Text • HHS, DOL, Treasury, CMS FAQ • Provider Limitations • Access Issues • Next Steps

3. ACA Provider Non-Discrimination Clause Plans… “shall not discriminate with respect to participation under the plan or coverage against any health care provider who is acting within the scope of that provider’s licenseor certification under applicable state law.” - Section 2706 of the Public Health Service Act (PHSA) per the Affordable Care Act (ACA)

4. Intent of the Law Plans may not effectuate wholesale exclusions of certain classes of providers from their networks or otherwise disparately treat provider types. Congress intended to recognize state variations in licensing and ensure a patient’s right to access coverage from a full range of qualified providers.

5. HHS, CMS DOL, and Treasury FAQ Contradicts Statute “Until any further guidance is issued … [plans] are expected to implement the requirements of PHS Act section 2706(a) using a good faith, reasonable interpretation of the law.… “[A] plan or issuer shall not discriminate based on a provider's license or certification, to the extent the provider is acting within the scope of the provider's license or certification under applicable state law. “This provision does not require plans or issuers to accept all types of providers into a network. This provision also does not govern provider reimbursement rates, which may be subject to quality, performance, or market standards and considerations.” – ACA Implementation FAQ

6. FAQ Could Even Exacerbate Provider Reimbursement Discrimination The FAQ undermines reimbursement practices by component by allowing plans to establish rates based on “market standards and considerations,” adding a clause foreign to the statute’s text and intent. The FAQ interpretation would give plans broader discretion to deny payment, potentially to in-network providers but certainly to entire classes of providers, based on “market...considerations.”

7. FAQ Could Limit Access • Maternity and newborn care is a requisite element of the EHB package • Within scope of CPM • Substantial shortages in rural and underserved areas • Plans refusing to contract with CPMs for “market standards and considerations” could limit access for women who live in states that recognize CPMs

8. Cost Savings • States who recognize and utilize CPMs see savings • For example, Washington State alone saved almost $500,000 in cesarean section reductions alone over a two-year budget cycle with licensed midwives attending just two percent of the births

9. FAQ Could Limit Access – States that Recognize CPMs

10. Congress Weighed In The Senate Appropriations committee expressed concern (July 11, 2013 Senate Appropriations Committee Report 113-71)  over the potential impact of the FAQ to undermine a patient’s fundamental right of provider choice via the wholesale exclusion by plans of specific provider classes. This prompted the RFI from CMS.

11. CMS RFI • CMS requested input form stakeholders on provider non-discrimination and on June 10, 2014 • NACPM stressed that the FAQ guidance has the potential to jeopardize patients’ access to cost-effective, quality maternity care and urged the Departments to rectify the FAQ • The RFI garnered comments from 1,514 organizations and individuals

12. Moving Forward • Next step is formal proposal from CMS. • There will be another opportunity for comment. • Then a final rule.