This past year brought increased flexibility for states related to both public health care programs and commercial health plans, with the Federal administration announcing numerous policies to give states more control over the design / regulation of the coverage offered to consumers. We saw first-of-their-kind waivers approved at the Federal level, including community engagement / work requirement Medicaid waivers in states across the country and Medicaid drug cost control measures in Oklahoma, as well as a flurry of late-breaking activity related to Section 1332 State Innovation / State Relief and Empowerment Waivers that is likely to spur further activity in 2019. We saw regulatory changes designed to increase the types of health insurance plans that can be sold and we expect to see continued state activity in response in the new year. We also tracked key court decisions and regulatory proposals that could impact our health insurance markets and Medicaid programs, and which will continue to play out in 2019. Overall, PCG’s Health Policy News covered a broad range of topics this past year, and we will continue to be a source for all things health policy in the upcoming year.
Health Policy News brought you coverage of the major health care developments in 2018, many of which we followed throughout the year as they developed and evolved. The significant topics that we followed closely and of which we provided in-depth analysis for readers included key changes to the Medicaid program, trends in Medicaid waivers and the consideration of Medicaid buy-in options; Federal regulations that increased options for states in terms of health insurance offerings that are not compliant with the Affordable Care Act (ACA); and drug cost containment. We provide more details on each of those topics below. However, this recap just scratches the surface of our coverage this past year. To review all of our coverage from 2018, click here.
Medicaid Regulatory Developments
2018 started with the re-authorization of the Children’s Health Insurance Program (CHIP), summarized by Health Policy News last January. Shortly following the renewal of CHIP, the Centers for Medicare and Medicaid Services (CMS) issued a proposal to make Medicaid Access to Care Requirements more flexible. Health Policy News provided summary of that regulatory proposal for states as they considered submitting comments.
Just last month, CMS published a proposed rule making changes to the Medicaid and Children’s Health Insurance Program (CHIP) Managed Care regulations. As a reminder to states, comments are due January 14, 2019, and Health Policy News produced a brief summary of the proposed rule for use by states.
In addition to regulatory changes, there continues to be significant activity around Medicaid waivers. Early in 2018, CMS provided guidance related to work and community engagement requirements—which Health Policy News summarized—and since then, five such waivers have been approved, with more on the horizon. Just last month we published an article highlighting early experiences with, and considerations for implementing, these requirements.
Additionally, last month CMS released a letter to State Medicaid directors outlining a wide range of opportunities for states to design innovative delivery systems for adults and children with serious mental health conditions—with more insights for states available here.
Medicaid Buy-In Options
Many of our readers attended our roundtable discussion and webinar about Medicaid Buy-In Options, during which experts in the field presented on the many options available to states under the auspice of “buy-ins” to public health care programs. If you missed this topic and would like to read our report of state activity related to buy-ins, as well as the slides we prepared for the webinar, click here. As noted below, this is another topic regarding which we expect to see continued action.
Non-ACA Compliant Health Offerings
At the outset of 2018, the Federal administration released the much-anticipated proposed rule on Association Health Plans (AHPs). That was followed almost immediately by a proposed rule on Short-Term Limited-Duration Insurance (STLDI), and both rules were finalized over the summer. In order to assist State policymakers, Health Policy News released fact sheets on both the AHP final rule and the STLDI final rule. As implementation began this fall, we took a broad look at initial state responses to the new rules and, as mentioned below, our coverage of this topic continues this month.
Prescription Drug Costs
Our coverage of state drug cost containment efforts included a report and legislative tracking tool, which we plan to revisit in 2019 as more states look to tackle the ever-growing problem of prescription drug pricing. In addition to those topics, we wrote about and tracked Medicaid drug cost containment efforts and touched on the opioid epidemic. Links links to more Health Policy News articles on the topic of drug policy and drug costs are below:
- An update on recent 1115 Waiver Decisions that include Medicaid Drug Cost containment provisions
- Bipartisan Bill to Tackle the Opioid Epidemic Signed into Law
- Movement on drug cost containment at both the state and federal level
Forecasting the big topics for 2019
While 2019 will no doubt bring unexpected twists and turns, there are some proposals, actions and decisions on the horizon that we will be on the watch for in the coming year. Below, we have listed five categories of expected activity.
Legal Challenges to the ACA
The year is ending with a bang with the recent decision in Texas vs. U.S., the most recent case broadly challenging the validity of the ACA based on the “zeroing out” of the shared responsibility penalty linked to the individual mandate. We include an overview of this decision and next steps in this month’s edition.
Though the decision sent reverberations throughout the health industry and health policy world, we will not actually know the full outcome and impact until 2019 or beyond. State Attorneys General have already announced that they will appeal the case, and the judge is considering whether to “stay” his decision pending appeal. As such, the ACA remains the law as 2018 comes to an end, and we will continue watching the ongoing proceedings in the District Court, appeal(s) and future decisions into 2019 and possibly beyond—both of this case and the companion suit filed by the Attorney General of Maryland against the Federal administration, regarding its failure to defend against the Texas suit and asking that the zeroing out of the penalty be found unconstitutional. It is likely that this issue will again end up at the Supreme Court.
While the Texas case is the furthest-reaching pending lawsuit around the ACA, we expect ongoing activity into 2019 on the other lawsuits that are also pending, including: various challenges to the administration’s rules on religious and moral exemptions to the contraceptive coverage mandate (including Pennsylvania vs U.S., which is currently pending at the Third Circuit Court of Appeals); and various challenges of the Federal administration’s halting of payments to insurers to reimburse for cost-sharing reductions (CSRs), as well as possible appeals of recent decisions for some insurers that filed suit. Though more limited, the outcomes of each of these lawsuits could impact the course of our current health policy.
The biggest news related to the Notice of Benefit and Payment Parameters for 2020, which dictates the rules governing plans to be offered on the Marketplaces in 2020, is that the proposal has not yet been released. As of the time of publishing this edition, those regulations remained in review by the Federal Office of Management and Budget (OMB). States will continue to be on the lookout for these annual regulations as we enter 2019. Among the major outstanding questions is whether states will be able to continue to allow insurers to “silver-load” the impact of the loss of CSR reimbursements rather than having to spread the cost of that loss across all plan levels.
States will also be on the lookout for the final Medicaid and CHIP Managed Care Regulations in 2019. While proposed changes to the rule are less sweeping than the most recent regulatory overhaul, states will no doubt be looking for final decisions regarding the reintroduction of capitation rate ranges, multi-year approval of directed expenditure arrangements, the expansion of the pass-through payment phase-out and increased flexibility relative to network adequacy, among other proposals. With comments due in January, the final rule should come out in 2019.
Finally, we are likely to see a new proposal relative to ACA Section 1557 Nondiscrimination provisions in 2019. That rule has been pending in OMB since April, and is expected to grapple with the fact that courts have increasingly ruled that discrimination based on gender identity is prohibited. In addition, states continue to await further proposed regulatory changes relative to Medicaid access standards and the final version of the rules proposed earlier this year.
Another topic likely to have increased scrutiny and developments this coming year is implementation of Section 1115 Medicaid Waivers with community engagement / work requirements. With a number of states slated to begin implementation of their community engagement / work requirements waivers in 2019, and several others seeking similar waivers, this is likely to continue to be a topic of significant analysis and discussion in the coming year. States working through waiver concepts or applications with community engagement requirements included should consult Health Policy News’ recent article, which includes lessons learned from early implementation states like Arkansas and key considerations for states seeking to implement these requirements.
We also may see movement toward Medicaid buy-in programs. As many readers are aware, a number of states, including New Mexico and Nevada, have studies related to buy-ins due to be released early in 2019. Health Policy news will be reporting on the impact analysis and movement on this topic in more depth in our January edition.
Continued Activity around Non-ACA Compliant Health Plans and other State Insurance Reform
States continue to explore and consider options for responding to the recent AHP and STLDI rules. With legislative sessions about to start across the nation, that activity is likely to continue well into 2019. In this month’s edition, you will find a new article taking a deeper dive into the divergent approaches of two states in response to the AHP Final Rule. This article includes considerations for states as they continue to debate and take action in response to the new guidance.
At the same time, all eyes are on two lawsuits that could change the course on these types of plans. In July, Attorneys General from 11 states and the District of Columbia filed a lawsuit challenging the AHP final rule. The suit alleges that the rules violate the ACA by undermining ACA market protections and, similarly, violate ERISA by redefining “employer” under the Act. The states also claim that the rule was promulgated in violation of the Administrative Procedures Act. Similarly, in September, a coalition of consumer advocacy organizations and safety net health plans filed suit challenging the SLTDI final rule on the basis that it is contrary to Congress’ intent in adopting the ACA because the plans do not have to comply with ACA standards and undermine the ACA-compliant market, the rule is inconsistent with longstanding policy, and that the process used violated the Administrative Procedure Act. Both of these suits are pending and we are awaiting action in the coming year.
Eyes are also on states as they consider whether to pursue Section 1332 State Innovation / State Relief and Empowerment Waivers following recent Federal guidance providing more flexibility in the consideration of “1332 guardrails” and examples of possible waivers. As states consider new options, activity around Section 1332 Waivers is likely to continue through 2019.
Uniform Prior Authorization
While more limited in scope than the categories above, we also expect to see states continuing to seek to chip away at more limited but meaningful policy changes. For example, a growing number of states are implementing uniform prior authorization forms to limit the amount of information that carriers may require to process prior authorization requests—and to create a standard form that providers can use for all such requests, rather than having to use a different form for each insurer. As states continue to find ways to improve the consumer experience with health insurance, a uniform prior authorization form, for drugs in particular, is one way states could reduce complexity for individuals attempting to utilize care.