Blue Cross Blue Shield of Minnesota Contracting Under Obamacare

Blue Cross and Blue Shield of Minnesota members with individual and family plans are facing major policy shifts in the coming year, after the insurer decided to decrease its presence on its state-run Obamacare exchange.

Minnesota’s largest health insurer is minimizing its individual plan offerings, so much so that all family and individual preferred provider organization, or PPO, plans no longer will be in effect after Dec. 31. Restricting its presence in the individual market solely to Blue Plus HMO.

Ed Haislmaier, a senior research fellow at The Heritage Foundation, told The Daily Signal, “They are not exiting the individual market entirely,” but simply shifting to narrow network plans that reimburse only for specific doctors and hospitals.

“Blue Plus will continue to offer Accountable Care Organization (ACO) plans for individuals and families,” Blue Cross and Blue Shield of Minnesota said in a statement provided to The Daily Signal. “These plans include partnerships with Minnesota’s health care systems to better manage patient care and currently serve approximately 13,000 members.”

“Blue Cross Blue Shield’s decision to leave the individual market is symptomatic of conditions in the national health insurance marketplace.” @GovMarkDayton

Because the Blue Plus HMO plan restricts members to coverage solely at certain health care providers, issues could arise in rural communities where covered care is not offered in the immediate area.

Haislmaier said these transitions are “increasingly problematic” for rural residents on HMO plans under the Affordable Care Act, popularly known as Obamacare.

According to Blue Cross, group policies through employers and state programs will not be affected as “the change affects approximately 103,000 Minnesotans who have purchased Blue Cross coverage on their own, through an agent or broker, or on MNsure,” the state-run Obamacare exchange.

Blue Cross and Blue Shield of Minnesota added:

The individual market remains in transition and we look forward to working toward a more stable path with policy leaders here in Minnesota and at the national level. Shifts and changes in health plan participation and market segments have contributed to a volatile individual market, where costs and prices have been escalating at unprecedented levels. Based on current medical claim trends, Blue Cross is projecting a total loss of more than $500 million in the individual segment over three years.

Minnesota Gov. Mark Dayton, a Democrat, said in a statement, “Minnesota employers and public health insurance programs provide the vast majority of our citizens with quality, affordable health coverage. This creates a serious and unintended challenge for the individual market: the Minnesotans who seek coverage there tend to have greater, more expensive health care needs than the general population. Blue Cross Blue Shield’s decision to leave the individual market is symptomatic of conditions in the national health insurance marketplace.”

But this change isn’t the first of its kind for the Blues.

Blue Cross Blue Shield of Texas, Arizona, and Illinois all made changes to their individual market plan offerings in the Obamacare exchange for 2016, converting their individual program to only providing new health maintenance organization, or HMO, plans.

Haislmaier told the Daily Signal:

The problem that insurers face is controlling claims costs under new ACA [Affordable Care Act] changes. One of the tools they are reaching for is to limit patient access to providers. While that might be an acceptable trade off for heavily subsidized patients, it’s not going to be viewed favorably by people who are buying these plans without the benefit of subsidies.

“It is likely to exacerbate the already significant unpopularity of the ACA among middle-class voters,” Haislmaier said.

Blue Cross Blue Shield isn’t the only health care insurance company making drastic changes to its coverage in the coming year.

UnitedHealthcare has announced it will leave 26 of the 34 Obamacare exchanges it offered plans in last year. Humana, another leading insurer, has mentioned possibly needing to leave existing Obamacare exchanges after significant financial losses.

The post Blue Cross Blue Shield of Minnesota Contracting Under Obamacare appeared first on The Daily Signal.

Blue Cross Blue Shield of Minnesota Contracting Under Obamacare

Blue Cross and Blue Shield of Minnesota members with individual and family plans are facing major policy shifts in the coming year, after the insurer decided to decrease its presence on its state-run Obamacare exchange.

Minnesota’s largest health insurer is minimizing its individual plan offerings, so much so that all family and individual preferred provider organization, or PPO, plans no longer will be in effect after Dec. 31. Restricting its presence in the individual market solely to Blue Plus HMO.

Ed Haislmaier, a senior research fellow at The Heritage Foundation, told The Daily Signal, “They are not exiting the individual market entirely,” but simply shifting to narrow network plans that reimburse only for specific doctors and hospitals.

“Blue Plus will continue to offer Accountable Care Organization (ACO) plans for individuals and families,” Blue Cross and Blue Shield of Minnesota said in a statement provided to The Daily Signal. “These plans include partnerships with Minnesota’s health care systems to better manage patient care and currently serve approximately 13,000 members.”

“Blue Cross Blue Shield’s decision to leave the individual market is symptomatic of conditions in the national health insurance marketplace.” @GovMarkDayton

Because the Blue Plus HMO plan restricts members to coverage solely at certain health care providers, issues could arise in rural communities where covered care is not offered in the immediate area.

Haislmaier said these transitions are “increasingly problematic” for rural residents on HMO plans under the Affordable Care Act, popularly known as Obamacare.

According to Blue Cross, group policies through employers and state programs will not be affected as “the change affects approximately 103,000 Minnesotans who have purchased Blue Cross coverage on their own, through an agent or broker, or on MNsure,” the state-run Obamacare exchange.

Blue Cross and Blue Shield of Minnesota added:

The individual market remains in transition and we look forward to working toward a more stable path with policy leaders here in Minnesota and at the national level. Shifts and changes in health plan participation and market segments have contributed to a volatile individual market, where costs and prices have been escalating at unprecedented levels. Based on current medical claim trends, Blue Cross is projecting a total loss of more than $500 million in the individual segment over three years.

Minnesota Gov. Mark Dayton, a Democrat, said in a statement, “Minnesota employers and public health insurance programs provide the vast majority of our citizens with quality, affordable health coverage. This creates a serious and unintended challenge for the individual market: the Minnesotans who seek coverage there tend to have greater, more expensive health care needs than the general population. Blue Cross Blue Shield’s decision to leave the individual market is symptomatic of conditions in the national health insurance marketplace.”

But this change isn’t the first of its kind for the Blues.

Blue Cross Blue Shield of Texas, Arizona, and Illinois all made changes to their individual market plan offerings in the Obamacare exchange for 2016, converting their individual program to only providing new health maintenance organization, or HMO, plans.

Haislmaier told the Daily Signal:

The problem that insurers face is controlling claims costs under new ACA [Affordable Care Act] changes. One of the tools they are reaching for is to limit patient access to providers. While that might be an acceptable trade off for heavily subsidized patients, it’s not going to be viewed favorably by people who are buying these plans without the benefit of subsidies.

“It is likely to exacerbate the already significant unpopularity of the ACA among middle-class voters,” Haislmaier said.

Blue Cross Blue Shield isn’t the only health care insurance company making drastic changes to its coverage in the coming year.

UnitedHealthcare has announced it will leave 26 of the 34 Obamacare exchanges it offered plans in last year. Humana, another leading insurer, has mentioned possibly needing to leave existing Obamacare exchanges after significant financial losses.

The post Blue Cross Blue Shield of Minnesota Contracting Under Obamacare appeared first on The Daily Signal.

Ryan, House GOP Offer Plan to Repeal, Replace Obamacare

After more than six years of Republican pledges to repeal and replace Obamacare, House Speaker Paul Ryan today rolled out a plan to deliver on that promise by abolishing the 2010 law.

The 37-page Republican plan creates a blueprint for rolling back President Barack Obama’s more than 3,000-page marquee health care law. It’s the fifth of six planned installments in the GOP effort to prepare a conservative agenda for the next president and Congress to implement.

“Everyone knows Republicans are against Obamacare. We have got that part down,” Ryan, R-Wis., said on C-SPAN Monday, previewing the plan. “What people need to know is that we have good ideas for what we ought to replace it with.”

The plan meets both of those criteria, said Rep. Kevin Brady, R-Texas, who helped draft the proposal and is chairman of the tax-writing Ways and Means Committee.

“This shows the American public that they don’t have to settle for that horrible bill called Obamacare,” Brady told The Daily Signal, “and that we’re deadly serious about bringing them much more affordable, much more patient-driven health care that doesn’t drive up the budget or increase entitlements.”   

Among other provisions, the plan would:

  • End the “Cadillac tax” and otherwise equalize tax treatment of insurance plans.
  • Modernize Medicare for the elderly and reform Medicaid for the poor.
  • Loosen regulations on health savings accounts and encourage other innovations.
  • Protect doctors and nurses from being forced to perform abortions against their religious or moral convictions.

Dubbed “A Better Way to Fix Health Care,” the plan starts by abolishing the Affordable Care Act completely—repealing both the employer and individual mandates to purchase health insurance while tearing down the federal health insurance exchanges. The 2010 law, popularly called Obamacare, passed Congress without a single Republican vote.

Since taking control of the House after the 2010 elections, the GOP has voted several dozen times to abolish Obamacare. In response, Democrats have criticized Republicans for failing to offer an alternative.

This time it’s different, the Ryan leadership team argues, because they’re finally offering an official replacement package—one that Brady said draws heavily from ideas put forward by the conservative House Freedom Caucus and the much larger Republican Study Committee.

The plan includes many GOP health policy mainstays that Republicans predict will provide more coverage for lower premiums.

To bolster employee-sponsored health insurance, the GOP blueprint repeals the “Cadillac tax,” which levied a penalty on high-cost insurance plans and provides a large share of Obamacare’s funding.

In its place, the Republican plan caps the employer tax exclusion for health insurance. Currently, most Americans receive employer-sponsored insurance on a pretax basis that many conservatives consider an indirect government subsidy.

Capping the exclusion would encourage employers, Republicans argue, to pay employees more in wages rather than in pretax health benefits.

For Americans unable to receive insurance through work or Medicaid and Medicare, the plan creates “a universal advanceable, refundable tax credit.”

Brady described that move as “unlocking” current tax incentives and allowing Americans to choose the health plan they prefer.

The Republican plan also rolls out a grab bag of long-proposed reforms. In particular, it loosens regulations on health savings accounts, allows consumers to cross state lines to buy insurance, and permits groups to form high-risk insurance pools.   

To preserve Medicaid, the Republican plan aims to transform it completely. By 2020, the eligibility age for Medicare would rise from 65 to 67, to match that for full Social Security benefits.

The Republican vision, according to the blueprint, would redesign Medicare “into a fully competitive market-based model—known as premium support.” A refurbished version of Ryan’s earlier Medicare plans, the new model allows seniors to spend the premium support on their choice of private plans.

For the Medicaid program for the poor, the Republican plan would kick control back to the states, where “governors and state legislators are closer to patients.” To design their programs, states would take a lump sum from the federal government in the form of either a block grant or a per capita payment.

Criticizing Obamacare’s expansion of Medicaid for “discouraging work,” the blueprint would allow states to develop work requirements for able-bodied adults. To receive Medicaid benefits, states could require able-bodied adults to prove they’re searching for a job or enrolled in a comparable education program.

The Republican overhaul would retain some of Obamacare’s more popular provisions, though.

Insurance companies still couldn’t turn away patients with preexisting conditions, but only if those persons had maintained “continuous coverage.” But if individuals allowed a lapse in coverage, insurers could consider the patient’s medical history in determining higher premiums.  

And young people, just like under Obamacare, could stay on their parents’ insurance plan until they turn 26.

The Republican plan would enact conscience provisions such as the Weldon Amendment, protecting doctors and nurses from being forced to perform abortions or other procedures that violate their religious or moral beliefs under the authority of federal, state, or local government. The blueprint also would beef up enforcement of the Hyde Amendment, which prohibits federal taxpayer funding of most abortions.

A blueprint rather than a bill, the Republican plan isn’t designed as a piece of legislation. It does not contain cost estimates or prepackaged legislative proposals. And it’s not supposed to, Brady said.

Instead, the plan provides rough building blocks that individual congressional committees will shape into a final product later.

“We’re not doing one big bill,” Brady told The Daily Signal. “In fact, we’re going to break this up into bite-sized legislation so the American public can understand what changes we’re proposing for them.”

The post Ryan, House GOP Offer Plan to Repeal, Replace Obamacare appeared first on The Daily Signal.

California Could Become the First State to Expand Coverage to Illegal Immigrants Under Obamacare

California state lawmakers are one step closer to expanding coverage under Obamacare to illegal immigrants, sending a bill to Gov. Jerry Brown’s desk that would allow those living in the state illegally to buy health insurance on the exchange with their own money.

The California Legislature passed a bill last week setting in motion a process to eventually allow illegal immigrants living in the state to purchase private health insurance through its state-run exchange, Covered California.

Illegal immigrants cannot and would not qualify for federal subsidies available to lower-income Americans under Obamacare.

The bill requires the state to request permission from the federal government to waive a provision of the Affordable Care Act prohibiting illegal immigrants from participating in Obamacare’s exchanges.

If Brown, a Democrat, decides to sign the legislation and receives the government’s blessing, California would become the first state to offer health insurance to illegal immigrants through Obamacare.

Though the health care law prohibits illegal immigrants from participating in Obamacare’s exchanges, California officials can seek approval from the Department of Health and Human Services through a Section 1332 “State Innovation Waiver” to bypass that prohibition.

California’s bill instructs the state to pursue a State Innovation Waiver from the federal government. Section 1332 of the health care law allow states to request five-year waivers from key aspects of the Affordable Care Act, including the individual and employer mandates, beginning next year.

To attain a State Innovation Waiver, a state must “pursue innovative strategies” to provide residents with health insurance, according to the Centers for Medicare and Medicaid Services. The plan must not only ensure residents have access to “comprehensive and affordable” health care, but it also must provide coverage to either the same number of or more people covered under Obamacare.

Last, for the Section 1332 to be granted, the state’s strategy cannot add to the federal deficit.

The legislation, sponsored by state Sen. Ricardo Lara, a Democrat, was passed last week, and groups opposing illegal immigration are sounding off against the measure.

“With a legislature writing bills for people in our state illegally, this is incentive for the world to come to California illegally,” Robin Hvidston, executive director of the California grassroots group We the People Rising, told The Daily Signal. “California is in the United States of America, and our legislators should be focused on legislating for our U.S. citizens.”

Though illegal immigrants aren’t eligible for subsidies under Lara’s bill, Hvidston worries that in the future, more changes to the law will come.

“It is historically a progression in our state where the bill starts at a certain level, then increases the next year with a new benefit, and on and on,” she said.

Like Hvidston, the Federation for American Immigration Reform, or FAIR, too believes the legislation on Brown’s desk is simply a first step.

“This follows a pattern in California. [The bill] is kind of being framed innocuously as ‘We’re not going to subsidize illegal immigrants and just give them an opportunity to buy insurance through the exchanges,’” Ira Mehlman, a spokesman for FAIR, told The Daily Signal. “Of course, there are few who are going to be able to buy coverage without subsidies. This is the first step in the process.

“First, you make it possible for them to buy policies through the exchange, and when nobody can do that because it’s too expensive, you say we have to give them subsidies.”

Regardless of how California’s policy could progress in the future, groups in favor of the bill argue the state should be working to ensure all Californians have access to quality coverage.

“People who have different viewpoints on immigration policy can come together in recognition that it is everyone’s interest to connect as many Californians with coverage, and prevent the health and financial issues for not just uninsured families, but the community as a whole,” Anthony Wright, executive director of Health Access California, told the Washington Examiner.

The group did not return The Daily Signal’s request for comment.

California has the largest population of illegal immigrants—2.6 million—in the country. Covered California puts expected enrollment in private health insurance coverage through the exchange at 50,000 enrollees.

Other estimates place the number of illegal immigrants who would be able to head to the exchange at 390,000.

Lara proposed the legislation initially in 2014, and it recently earned a nod of support of Covered California board members.

According to the Los Angeles Times, the Democratic lawmaker is hoping the state sends the waiver to the Department of Health and Human Services for consideration while President Barack Obama is still in office.

If Brown signs the bill, the departments of Health and Human Services and Treasury can take up to 225 days to respond to the waiver.

Because the decision to determine if Lara’s bill qualifies for a Section 1332 waiver, which outlines specific provisions for proposals that pass muster, would ultimately fall to the federal government, Ed Haislmaier, a Heritage Foundation senior fellow in health policy studies, said it’s likely the legislation amounts to an “empty gesture,” in part because of the high cost of unsubsidized health care on the exchanges.

“I think it’s more symbolic than anything else because to the extent that people in the U.S. illegally are being treated, they’re either paying out of pocket, which some probably are, or they’re relying on charitable and publicly funded providers such as hospitals and federally qualified health centers to obtain their care,” he said.

“Given that the government is having difficulty getting legal, U.S. citizens in the same demographic to actually buy insurance even though it’s heavily subsidized, I don’t know how much success they’ll have,” Haislmaier continued.

However, Mehlman with FAIR, said the Obama administration’s actions regarding illegal immigration indicate they would be in favor of granting the waiver.

“Given the inclinations of this administration and the policies they’ve carried out over the past seven and a half years, you have to suspect they would really want to do this,” he said. “Whether they will do it, I don’t know. I suspect that if the opportunity presented itself and they thought it wouldn’t harm them and their party politically, they probably would do it.”

During a speech before a joint session of Congress in 2009, Obama attempted to debunk claims that under Obamacare, illegal immigrants would receive health insurance, which prompted a now-infamous “You lie,” from Rep. Joe Wilson, R-S.C.

“There are also those who claim that our reform efforts would insure illegal immigrants,” he told lawmakers. “This, too, is false. The reforms that I’m proposing would not apply to those who are here illegally.”

Though California is the only state to consider a proposal expanding coverage to illegal immigrants under Obamacare, Colorado residents are considering a proposal that would require state officials to attain a Section 1332 waiver.

The proposal, which Colorado residents will vote on on the November ballot, would create a government-run health care plan in the Centennial State called ColoradoCare.

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Obamacare’s 13th Co-Op Is Closing. Why More Could Follow.

Obamacare’s 13th co-op announced it’s closing ahead of the 2017 open enrollment period, and more of the nonprofit insurers could follow suit in the coming months.

Ohio’s InHealth Mutual announced late last week it would be closing its doors after the state’s Department of Insurance requested to liquidate the insurer.

As insurers prepare to submit proposed rate changes to the government ahead of the next open enrollment period, it’s likely Ohio’s co-op won’t be the last to close its doors.

“I think there are a couple of reasons why the picture will be clearer later in the summer,” Ed Haislmaier, a Heritage Foundation senior research fellow in health policy, told The Daily Signal. “First, insurers are making decisions to participate in the exchange and submitting rates. The other is the risk adjustment formula will kick in for the last plan year, 2015, this summer.”

“Based on that, some companies may not make it. Some companies may decide to exit,” he continued.

InHealth Mutual enrolled nearly 22,000 consumers, with the majority selecting individual market plans. Customers now have 60 days to select a new plan on the federal exchange.

Ohio’s co-op, or consumer operated and oriented plan, is the 13th co-op created under the Affordable Care Act to close its doors. Twenty-four co-ops launched in 2013 with a total of $2.4 billion in start up and solvency loans awarded by the Centers for Medicare and Medicaid Services.

InHealth Mutual received $129.2 million in loans, according to the agency.

Collectively, the now 13 failed co-ops received more than $1.3 billion in loans and enrolled more than 730,000 consumers across the 14 states they served. Those consumers were forced to pick new plans on the exchanges.

The Centers for Medicare and Medicaid Services has not yet said definitively whether the co-ops will be able to repay the loans received. However, Centers for Medicare and Medicaid Services Acting Administrator Andy Slavitt told a congressional panel his agency is working with the Justice Department to recoup the money.

Many of the co-ops that closed their doors did so late last year and cited Obamacare’s risk corridor program as their reason for doing so.

160601_Obamacare-Co-Ops

Under the risk corridor program, insurers requesting money from it received just 12.6 percent of the total amount they each asked the government for. InHealth Mutual expected to receive $47 million from the risk corridor program, according to court filings.

Though the risk corridor program damaged the long-term viability of nearly half of the co-ops, Haislmaier said it’s likely Obamacare’s risk adjustment program could have a significant impact on the remaining 11 co-ops’ futures.

Under Obamacare’s risk adjustment program, money is transferred from insurers that enroll lower-risk populations to those that enroll higher-risk populations.

“The risk adjustment program is the one that seems to be damaging to small insurers, particularly co-ops,” Haislmaier said. “There’s a big problem with the risk adjustment program being erroneous, and it’s disproportionately hitting smaller insurers.”

Haislmaier said the Department of Health and Human Services is “trying to say it’s working, but the data is showing it’s much worse” than the Obama administration is letting on.

According to InHealth Mutual’s order of liquidation, issued May 26, the company paid $3.4 million to the government under the risk adjustment program, which hurt the nonprofit.

Additionally, two other smaller insurers not selling coverage on Obamacare’s exchanges—Health Plan Select in Georgia and Family Health Hawaii—announced their respective decisions to close.

According to The Oconee Enterprise, officials with Health Plan Select decided to close “rather than pay a surcharge into the federal exchange.”

Because Health Plan Select wasn’t sold on the exchange, Haislmaier said the surcharge was in reference to payments into the risk adjustment program.

“Smaller insurers have exited the market entirely or closed down—insurers that weren’t even on the exchanges—because they were hit with huge bills for risk adjustment,” he said.

The Department of Health and Human Services doesn’t have to allow all insurers to sell coverage on Obamacare’s exchanges and has in the past evaluated the long-term viability of the co-ops when deciding whether to allow them to participate in the marketplaces.

In November, Mandy Cohen, chief operating officer for the Centers for Medicare and Medicaid Services, told lawmakers only co-ops that were financially viable could sell coverage on the exchanges, avoiding “mid-year failure” for customers.

At the state level, insurance commissioners decide whether a co-op should enter into liquidation or not.

Because 13 co-ops have already shuttered, Haislmaier said it’s likely insurance commissioners are following the nonprofit insurers “more diligently.”

“The experience with the co-ops has probably made them heighten scrutiny a bit because I think the experience so far, there have already been a couple plans that have been shut down and liquidated as of May 6,” he said, referencing Hawaii and Georgia’s smaller insurers. “This is the kind of thing that’s going on under the radar.”

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