The AIDS Institute

1. The Impact of • Essential Health Benefits • on People Living with HIV/AIDS • Carl Schmid • Deputy Executive Director • ADAP Advocacy Association Annual Conference • Washington DC • July 8, 2013 The AIDS Institute

2. Outline • Essential Health Benefits • Overview • Private plans • Expanded Medicaid • Current Status • Implementation The AIDS Institute

3. The AIDS Institute Essential Health Benefits • Established by ACA as core services health plans required to cover beginning 2014 • Applies to: • Plans in the individual and small group markets (inside and outside the Exchanges/Marketplaces) • “grandfathered” plans exempt • Medicaid Expansion plans (Alternative Benefit Plans) • Basic Health Plans • Estimated to impact 68 million people

4. Essentials Health Benefits (EHB) Law outlines 10 broad categories of services that must be covered, leaves to Secretary of HHS to define: • Ambulatory patient services • Emergency services • Hospitalization • Maternity and newborn care • Mental health and substance use • Prescription drugs • Rehabilitative and habilitative services • Laboratory services • Preventive/wellness services; chronic disease management • Pediatric services, including oral and vision care The AIDS Institute

5. The AIDS Institute EHB & the Private Market • CCIIO released bulletin outlining approach for defining EHB • (December 2011) • We expected Secretary to explicitly define the 10 categories • Instead, a benchmark approach • States chose benchmark from: • 3 largest small group plans in the state • 3 largest state employee plans in the state • 3 largest federal employee plans • Largest HMO in the state’s commercial market • Default: Largest small group plan in the state

6. The AIDS Institute EHB & the Private Market • Drug benefit: • Only one drug in each class covered by benchmark • Would be unworkable for certain conditions, such as HIV that require a full formulary • Strong patient community opposition • Concerns with: • Benchmark approach • Drug benefit

7. The AIDS Institute EHB Final Rule: Private Plans • Released February 2013 • Maintains commitment to benchmark approach • Moves away from one drug per class: • Proposes the greater of: • 1) One drug per US Pharmacopeia (USP) category & class; or • 2) Same number of drugs in each category & class as benchmark • Much better than initial proposal

8. The AIDS Institute

9. The AIDS Institute EHB Final Rule: Private Plans • Plans in a significant majority of states will have to cover all medicines in two of the HIV/AIDS classes • Plans in 48 states (including DC) will be required to cover all Protease Inhibitors • Plans in 7 states would be permitted to cover fewer than 75% of therapies in the class of “other ARVs” (or antiretrovirals with different mechanisms of action that are currently not classified based on the USP classification system). • ARV coverage in NM and WI especially concerning, other states with poor hepatitis drug coverage

10. The AIDS Institute State Example: Florida • FL selected its largest small group product • Blue Cross and Blue Shield of Florida (PPO): BlueOptions 5462 • Benchmark antiretroviral and hepatitis drug coverage by class (out of all FDA approved): • Total HIV/AIDS Drugs (28/35) • Non-nucleoside Reverse Transcriptase Inhibitors (5/6) • Nucleoside & Nucleotide Reverse Transcriptase Inhibitors (11/12) • Protease Inhibitors (9/11) • Anti-HIV Agents, Other (3/6) • Anti-hepatitis Agents (12)

11. The AIDS Institute Problems with EHB: Private Plans • Did not address what to do with new drugs coming to market during plan year • Concerns about using USP system to classify drugs: • Updated only every 3 years • Combination products not recognized • Very broad • Requires that plans have procedures to allow access to clinically appropriate drugs not covered by the health plan • But no guidance on specific requirements • Contains language allowing insurers to “appropriately utilizing reasonable medical management technique(s)”

12. The AIDS Institute Medicaid • Proposed Rule - January 2013 • Utilizes benchmark process • Must contain all 10 benefit categories • Applies to all enrolled through Medicaid Expansion • States permitted to adopt separate benchmarks for special populations • “Medically frail” can enroll in traditional Medicaid

13. The AIDS Institute EHB Proposed Rule: Medicaid

14. The AIDS Institute EHB Proposed Rule: Medicaid • Two step process: • State selects alternative benefit plan (ABP) from existing Medicaid benchmark: • Standard FEHBPBCBS • State employee plan • Largest commercial HMO plan in the state • A Secretary approved plan (including traditional Medicaid) • If ABP not a EHB option in private market, state selects a private EHB to backfill benefits missing from benchmark

15. The AIDS Institute EHB Proposed Rule: Medicaid • Drug benefit • Must cover all drugs made by companies participating in Medicaid drug rebate program • States may incentivize use of generics and adopt utilization management techniques, including quantity limits • Allows differential cost-sharing for preferred vs. non drugs • Proposed co-pays: $8 for each non-preferred drug/$4 preferred • Can deter usage/adherence

16. The AIDS Institute Current Status • Waiting on Medicaid EHB final rule • Coverage begins January 1 • Do not know what benchmark states will use • CMS and states reviewing adequacy of private plans • Will not know what drugs covered until October 1 • Will see an uneven coverage from state to state • Patient costs also unknown

17. The AIDS Institute Implementation • Enrollment for private plans begins October 1 • Beneficiary should review plan for • Drug adequacy and costs • Use of quantity limits, tiers, prior authorizations, etc. • Appeals process for medical necessity purposes • If not working for patients with HIV/AIDS can appeal to CMS to change process or legislation • CMS committed to this process for first two years • HIV/AIDS Community needs to monitor • Ryan White Program can provide coverage completion services

18. Resources • Rules and Guidance • EHB Final Rule (Private Plans): http://www.gpo.gov/fdsys/pkg/FR-2013-02-25/pdf/2013-04084.pdf • EHB Proposed rule (Medicaid): https://www.federalregister.gov/articles/2013/01/22/2013-00659/medicaid-childrens-health-insurance-programs-and-exchanges-essential-health-benefits-in-alternative • Essential Health Benefits Coalition Responses to Rulemaking: • Proposed Rule (Private Plans): http://www.theaidsinstitute.org/sites/default/files/attachments/coalition%20comments%20on%20nprm%20ehb%20FINAL.pdf • Proposed Rule (Medicaid): • http://www.theaidsinstitute.org/sites/default/files/attachments/coalition%20comments%20on%20nprm%20ehb%20medicaid%20FINAL.pdf • Other • State benchmark EHB coverage summaries (incl. drug): http://www.cms.gov/CCIIO/Resources/Data-Resources/ehb.html • Where states stand with benchmark selection: http://kff.org/health-reform/state-indicator/ehb-benchmark-plans/ The AIDS Institute

19. THANK YOU Carl Schmid - cschmid@theaidsinstitute.org 202-462-3042 www.theaidsinstitute.org The AIDS Institute