PA-NABIP Pulse January 2024

PA-NABIP Pulse January 2024

The Facts of the Month

Here is something to mention when discussing coverage trends in the month ahead.

New research released by the Kaiser Family Foundation provides key demographic details about people who do not have health insurance coverage. In 2022, nearly three-quarters (73.3%) of non-elderly uninsured people had at least one full-time worker in their family. An additional 10.9% had a part-time worker in their family. More than eight in ten (80.8%) uninsured people were in families with incomes below 400% FPL and nearly half (46.6%) had incomes below 200% FPL. In addition, people of color made up 45.7% of the nonelderly U.S. population but accounted for 62.3% of the total nonelderly uninsured population. Hispanic and White people comprised the largest shares of the nonelderly uninsured population at 40.0% and 37.7%,). Most uninsured individuals (75.6%) were U.S. citizens while 24.4% were noncitizens in 2022. Nearly three-quarters of the uninsured population live in the South and Western parts of the United States.

Source: Tolbert, Jennifer; Drake, Patrick; and Damico, Anthony. “Key Facts about the Uninsured Population.” Kaiser Family Foundation. December 18, 2023.

The Big Three

Each month PA-NABIP identifies three top public policy or legal developments that could impact our members and clients. Here are this month’s big three!

  1. Pennie Deadline Extended to January 19th

Pennsylvania residents will have a few more days to enroll in individual health insurance coverage offered through Pennie, the Commonwealth’s health insurance exchange marketplace. Instead of open enrollment ending on January 15, 2024, the deadline has been extended to January 19, 2024. Individuals who enroll by then will have coverage effective February 1, 2024.

After Pennie’s 2024 enrollment window ends on January 19, 2024, individuals will need to either wait until the 2025 open enrollment period begins on November 1, 2024, or qualify for a special enrollment period due to a qualifying life event.

The monthly cost for health coverage through Pennie is based on income, since those with family incomes between 100-400% of the federal poverty level are eligible for a federal premium tax credit to subsidize their costs. Currently, nine out of ten enrollees qualify and save over $500 a month on average. The availability of subsidies and end of continuous enrollment in Medicaid has led to more consumers looking for coverage on state and national marketplaces.

The result is record-breaking enrollment numbers for Pennie. As of the end of December 2023, 405,000 Pennsylvanians had enrolled in exchange-based coverage. Nationally, enrollment is up 33 percent.

  1. Pennsylvania Insurance Department Launches Independent External Review Program

On January 1 2024, the Pennsylvania Insurance Department began operating a state-administered independent appeal process for Pennsylvania-based fully-insured group health plans. This new program allows Pennsylvanians with fully-insured group coverage to request an independent claims review if they believe their insurer has wrongly denied their coverage.

To be eligible to participate, consumers must complete their health issuer’s internal appeal process first. However, if the claims issue remains unresolved, then they may submit an online request to the PA Insurance Department (PID). Completing this form will trigger an independent external review of the claim for eligible consumers. There is no cost for consumers to submit an independent review request.

If the consumer is eligible, a certified independent review organization, staffed by experienced doctors and health care professionals, will go over the consumer’s case and medical records and make a determination about the validity of the claim. Independent review decisions are final and binding, so if the review entity finds in favor of the plan participant, then the group insurer must pay the claim as specified by the review entity.

The PID oversees the eligibility determination process and assigns cases to approved independent review organizations. Once a consumer submits an online request to the PID, then they decide if the claim qualifies for independent review within five days.

If eligible for an independent review, consumers are given 15 business days to submit additional medical records or documentation to the third-party reviewer. The review organization then has 45 calendar days to make a final decision. Put another way, it should take less than 60 days for an eligible individual to get their claims issue resolved.

By assuming control of the external review process for group health insurers in the state, the PID hopes it will be able to detect problematic patterns in claims denials and address systemic issues on an upfront basis moving forward.

  1. New Proposed Rule Would Rescind Prior Association Health Plan Regulation

Last month, the federal Department of Labor issued a proposed rule rescinding association health plan (AHP) regulations issued in 2018. The 2018 measure, which was promulgated by the Trump Administration, created a whole new type of AHP, known as “tier two” AHPs, and the Biden Administration’s proposal would eliminate that new type of AHP.

Before the 2018 rule, creating an AHP required a “bona fide” association of employers with a genuine organizational relationship and an ability to control the association. Bona fide associations are able to bring multiple employers together to form a single large group health plan. The 2018 AHP regulations preserved this type of AHP, but also allowed a second tier of AHPs with a more flexible “commonality of interest” test, making it much easier for an unrelated group of employers to form an AHP. The 2018 rule also permitted working owners without common-law employees to participate in an AHP. However, in 2019, a federal district court vacated key portions of 2018 rules, creating legal uncertainty for existing AHPs built on the new rules and limiting the ability to establish new ones.

AHPs and other multi-employer welfare associations (MEWAs) are not just regulated by the federal Department of Labor, but also the individual states. In Pennsylvania, state law allows for the creation of AHPs and other MEWAs, but since they are regulated very similarly to health insurance carriers at the state-level, they are generally not established. Pennsylvania state law standards on what constitutes an appropriate association also made it virtually impossible to create a “tier two” AHP in the Commonwealth, even before the 2019 court decision. While some state legislators have tried since 2018 to repeal the state restrictions on AHPs, this legislation has never gained much traction and is not supported by the Pennsylvania Insurance Department or the Shapiro Administration.

The Biden Administration’s proposal to repeal the track two AHPs completely would “resolve and mitigate any uncertainty” regarding their status. The DOL is accepting comments on this proposal through February 18, 2024, and NABIP will be submitting comments on behalf of all members. After reviewing public comments, the Biden Administration is expected to finalize the rescission this spring.

Check This Out!

If you want to expand your health policy knowledge beyond this newsletter, here is a resource to check out!

The National Academy for State Health Policy’s Hospital Cost Tool dashboard provides analytical insights into how much hospitals spend on patient care services, and how such costs relate to the hospital charges (list prices) and actual prices paid by health

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