To Insure or Not to Insure

To Insure or Not to Insure Opportunities for Tribes in the New Health Insurance Exchanges Presented by: Elliott Milhollin National Tribal Health Reform Implementation Summit April 19, 2011

Health Insurance Exchanges in thePatient Protection and Affordable Care Act • One major goal of the PPACA is to make health insurance available to the more than 40 - 50 million people in the United States who are currently uninsured • In 2008, uninsured Americans received $116 billion in health care • These costs were estimated to increase annual premiums by $1017 for family coverage and $368 for individual coverage • Source: Hidden Health Tax: Americans Pay a Premium, Families USA, May 2009, at www.familiesusa.org

Health Insurance Exchanges in thePatient Protection and Affordable Care Act • The PPACA requires that everyone have health insurance -- either through a federal or state program, through employer insurance, or through individually purchased insurance • Beginning in 2014, there is a penalty imposed on individuals without health insurance -- ACA Sec. 1501 (adding Sec. 5000A to the Internal Revenue Code) • Members of Indian Tribes are exempt from the penalty for non-compliance with the requirement to obtain health insurance -- ACA Sec. 1501(b); IRC Sec. 5000A(e)(3)

What is a Health Insurance Exchange? • PPACA creates Health Insurance Exchanges to make it easier for individuals to comply with the insurance mandate • Only individuals without insurance and small businesses are eligible to purchase health insurance through an Exchange • Health Insurance Exchanges are State-designed and operated • Run by State governments or non-profits set up by the State • States have the option not to create Exchanges, in which case the federal government will operate an exchange for the residents of the state • Multi-state Exchanges are optional • Exchanges must be operational beginning January 1, 2014 • Many States are developing them now

What is a Health Insurance Exchange? • Website where consumers can compare health insurance plans with different levels of benefits and premiums, and purchase insurance • Health insurance plans must provide certain information and a minimum level of benefits in order to participate in an Exchange as a Qualified Plan • Websites will allow consumers to conduct detailed comparisons of different plans, which will be rated by the government or non-profit running the exchange • The functions of the Exchange website will also be accessible through a toll-free telephone line

Opportunities for Tribes in Exchanges • A Tribe may elect to purchase insurance for IHS beneficiaries who do not have another form of insurance • Many Indians will be eligible for low-income subsidies that are available only through Exchanges • Tribe may elect to pay all or part of the unsubsidized part of the premium for its beneficiaries • Provide new revenue for Indian Health Programs • Allow billing of insurance for the Indian Health Program services • Reduce Contract Health Services expenditures by allowing billing of insurance plans for services supplied by CHS providers

Who is Eligible to Purchase Insurance on an Exchange? • Uninsured individuals and small businesses (SHOP Exchange) • Individuals who have other forms of insurance such as Medicare, Medicaid, Children’s Health Insurance Program, TRICARE, VA Benefits, or Employer Insurance (with some limits) will be screened out -- ACA Sec. 1413 • Individuals must be citizens of the United States and residents of the State in which the Exchange is located -- ACA Sec. 1312(f).

Exchange Benefits • Competitively priced health insurance • Insurance purchased for qualified IHS beneficiaries could increase third party collections by Indian Health programs • Federal premium subsidies are available for low-income individuals on sliding scale up to 400% of the Federal Poverty Level (FPL) • 400% FPL for family of 4: $88,200 • Indians enrolled in Exchange plans would be exempt from all cost sharing when served by an I/T/U or CHS provider • Indian enrollees with incomes up to 300% FPL who receive services outside of the I/T/U system would be exempt from premiums • 300% FPL for family of 4: $66,150

Federal Subsidies • Sliding scale premium tax credits available to individuals with incomes at or below 400% federal poverty level (FPL) who purchase insurance within an exchange plan • Tax credit subsidies make the premiums you pay based on your income. • Payments range from 2 percent of income at 133 percent FPL to 9.5 percent of income at 400 percent FPL -- ACA Sec. 1401(a)

Indian cost sharing exemption • AI/AN enrolled in an Exchange plan have no cost sharing requirement if services provided by an I/T/U or through CHS program • AI/AN enrolled in an Exchange with income at or below 300% FPL have no cost sharing requirement for services provided by anyone • ACA Sec. 1402(d)

Considerations for Tribes • Assess population with potential to access Exchange plan insurance • How many uninsured beneficiaries do you have? • How many uninsured beneficiaries would qualify for premium subsidies and/or cost sharing exemptions? • Determine whether the Tribe would be willing to pay the unsubsidized portion of Exchange plan premiums for their IHS beneficiaries • Tribes can use federal funds to pay premiums. IHCIA Sec. 402, 25 U.S.C. §1642 • Premiums paid for tribal members are not taxable income to the individual member. ACA Sec. 9021. • Compare the premium costs with the expected reimbursements from insurance • Establish criteria Tribe will use to determine which beneficiaries qualify for tribal payment of exchange plan premiums

Considerations for Tribes • Create a plan to encourage members to enroll in Exchange plans • Assign staff to conduct outreach and education • Create a tribal communication plan on the benefits of enrolling in Exchange plans • Tribal payment of premiums and cost sharing exemption • Potential increased revenue for Indian Health Programs • All applicants will be screened for Medicaid eligibility • Work with States to ensure Tribes and IHS beneficiaries can fully participate in Exchange plans • Many states currently developing exchange plans • Required to consult with stakeholders, including Tribes • Ensure that I/T/U can participate as in-network providers for exchange plans

Implementation Issues • Sponsorship of Exchange Premiums • Indian Health Program provider participation in Exchange Network

Indian Sponsorship Model • Indian Sponsorship Model developed by tribal advocates working with NIHB • T/Us develop their own criteria as to who to sponsor and any limit on premium assistance to provide • T/Us conduct outreach and assessment • T/Us provide assistance in signing beneficiaries up for exchange plans • T/Us negotiate a mechanism with Exchange plan to provide the T/U sponsor with a master bill on a periodic basis so that the sponsor can collectively pay all premiums with a single payment

Indian Sponsorship Model • Center for Consumer Information and Insurance Oversight (CCIIO) developing regulations to assist states in establishing Exchanges • Tribal advocates have made proposal to require state Exchanges to allow T/U sponsorship of premiums

Access to Provider Networks of Exchange Plans • Tribes may have to negotiate to become network providers for plans listed on the Exchange in their state • Section 206 of the IHCIA gives Indian health providers the right to collect reimbursement from 3rd party insurers even without a network contract with an Exchange plan • Section 206 provides that Indian health providers have the right to receive reasonable charges, or, if higher, the highest amount a plan would pay for the same care delivered by other providers • A network contract is more favorable, as it allows for reimbursement without having to assert rights under Section 206 on a case-by-case basis, and may provide other benefits such as better access to specialty providers

Access to Provider Networks • Provider networks of Exchange Plans must include “Essential Community Providers” – those providers that serve predominately low-income, medically-underserved individuals (ACA Sec. 1311) • Tribes seeking ECP designation for all I/T/Us in regulations being developed by CCIIO. • ECP designation will allow I/T/Us to avoid having to assert their right to full reimbursement under Section 206 of the IHCIA on a case by case basis • Without ECP status, Tribes will have far less incentive to purchase insurance coverage for their members

Questions?

To Insure or Not to Insure