Health Insurance Trends, 2017

We asked friend of the company Louise Norris from Colorado Health Insurance Insider what she thinks some of the major changes in Health Insurance laws will be in 2017. Below are her thoughts along with my further research and example legislation to support each of her points.

Medicaid Waivers

We could see increased legislation calling for more creative Medicaid waivers. Louise maintains a page that describes what’s going on in each state’s Medicaid program. There are still 19 states that haven’t expanded Medicaid, although many of them have had ongoing legislative action on that for the last few years. With the Trump Administration taking over, it might be easier for states to get things like a work or job training/search requirement in place as part of a Medicaid waiver — that was proposed by several states but Centers for Medicare and Medicaid Services (CMS) rejected it under the Obama Administration.

There are currently 3 bills that pertain directly to medicaid waivers. CT HB6882 is an act concerning an integrated plan to combat addiction including applying for available federal Medicaid waivers which would expand the number of substance abuse treatment beds available to Medicaid enrollees. WA SB5368 seeks to limit the authority to seek medicaid waivers. WY HB113 would introduce a medicaid waiver program for military personnel. This bill would allow qualifying military service members to apply for dependent waiver services under the home and community based Medicaid waivers.

Capping Out-of-Pocket Costs

More states might focus on legislation to cap out-of-pocket costs for prescriptions, especially specialty drugs. Several states have already done so, although this remains a very controversial issue, since there are concerns that capping monthly OOP for drugs results in higher premiums.

HI SB1120 states it is in the “best interest of the State for every state citizen to have publicly provided, high quality, affordable health care”. The bill goes on to say many Hawaii residents are underinsured, unable to use their insurance properly, or even at all, because of increasingly expensive deductibles and out-of-pocket co-payments for outpatient visits, diagnostic tests and prescription drugs. Even well-insured Hawaiians experience problems with their insurers denying, or very reluctantly dispensing, expensive medicines and treatments. About half of all bankruptcies are due to extremely expensive, catastrophic illnesses that are not covered after a certain cap is reached in Hawaii.

OR HB2387 defines “excess cost” as when the average wholesale price of a prescription drug is greater than the foreign price cap, and is the difference between the average wholesale price and the foreign price cap. It states a health benefit plan may not require eligible employees and their family members to incur out-of-pocket costs that exceed the prescription drug cost cap. These caps are defined as $500 for bronze plans and $250 for silver, gold or platinum plans and are attributed to the costs for filling or refilling a covered prescription drug, copayments, deductibles and coinsurance.

MD HB666 would require drug corporations to disclose the basis for the prices of their prescription drugs and notify the public about substantial increases in prices. The thought behind this bill is doing this would create accountability on the part of drug manufacturers and help to stem the increase in health care costs. NJ A2337 requires health insurers to limit patient cost-sharing and provides appeal process concerning certain prescription drug coverage. NE LB324 is a bill to adopt the Pharmacy Benefit Fairness and Transparency Act.

State-Run Exchanges

There will probably continue to be legislative debates over the wisdom of keeping state-run exchanges in place. There are only 12 states that are running their own exchanges, and it’s been a controversial issue in some of them. The Trump Administration’s efforts to repeal the ACA (with a delayed implementation) might heighten Republicans’ push to move some of those states over to HealthCare.gov.

Connecticut has six bills ranging from requiring their health insurance exchange to: have prior legislative approval of and increases in assessments and user fees charged, require carriers to pay minimum commission to an insurance producer or broker who assists an individual or small employer in selecting a health insurance plan offered through the exchange, requires current and accurate provider network information and requires additional data from The Connecticut Health Insurance Exchange Board Of Directors.

CO SB003 proposes to repeal the Colorado Health Benefit Exchange Act. It aims to repeal the act, effective January 1, 2018, and allows the exchange to continue for one year for the purpose of “winding up its affairs”. The bill also requires the board to transfer any unencumbered money that remains in the exchange to the state treasurer on the last day of the wind-up period. Conversely, NJ SR23 establishes the “Senate Task Force on Health Insurance Exchange Implementation.” This bill explores the possibility of switching from HealthCare.gov (which they use now) to a state-run exchange.

Liens Against Assets

More states might consider legislation to protect people from liens against their assets if they’re enrolled in expanded Medicaid under the ACA. Minnesota enacted legislation for this last year. Bills that I found seem to be going the other direction, letting states do more to recoup costs.

We might see more states introducing legislation related to health insurance networks. New Jersey had quite a bit of legislative action last year relating to tiered networks, and there are complaints in some states that network directories aren’t accurate or up-to-date. This is an issue that’s also been addressed on the federal level (via HHS regulations), but Louise can see states stepping in to make sure that it gets taken care of on a local level this year.

To check out all of New Jersey’s eight bills relating to health insurance networks, go here.

Mid-Year Prescription Drug Formulary Changes

There might be states that work on legislation to protect consumers from mid-year prescription drug formulary changes (except for changes to add additional drugs to the formulary, or remove ones that are deemed unsafe by the FDA or discontinued by the manufacturer). Currently, the formulary can change as often as monthly, but consumers can’t change plans outside of open enrollment unless they have a “qualifying event”. A Qualifying Life Event (QLE) is a change in your situation — like getting married, having a baby, or losing health coverage — that can make you eligible for a Special Enrollment Period, allowing you to enroll in health insurance outside the yearly Open Enrollment Period.

FL Hoo95 would create consumer protection from non-medical changes to prescription drug formularies. The bill would bar insurance policies from removing a covered prescription drug from its list of covered drugs, reclassifying a drug to a more restrictive drug tier, increasing the amount that an insured must pay or reclassifying a drug to a higher cost-sharing tier during the policy year. This would apply at all times aside from an open enrollment period. 

MN HF747 states that once a formulary change has been established, a health plan company may, at any time during the enrollee’s contract year: (1) expand its formulary by adding drugs to the formulary; (2) reduce co-payments or coinsurance; or (3) move a drug to a benefit category that reduces an enrollee’s cost.

NM HB112 would prohibit reclassifying a drug to a higher tier of the formulary; reclassifying a drug from a preferred classification to a non-preferred classification (unless that reclassification results in the drug moving to a lower tier of the formulary); increasing the cost-sharing, copayment, deductible or coinsurance charges for a drug; removing a drug from the formulary; establishing a prior authorization requirement; imposing or modifying a drug’s quantity limit; or imposing a step-therapy restriction.

New York and Oregon also have bills pertaining to formulary changes.

Conclusion