Issue Briefs | Apr 12, 2012

Analysis of HHS Final Rules On Reinsurance, Risk Corridors And Risk Adjustment

Wakely Consulting Group – Ross Winkelman, FSA, MAAA, Julie Peper, FSA, MAAA, Patrick Holland, Syed Mehmud, ASA, MAAA, James Woolman

Under the Affordable Care Act (ACA) much of the expanded coverage will be provided through health insurers offering products on the new health benefit exchanges (exchanges). By compensating issuers for the risks related to the individuals they enroll, provisions related to reinsurance, risk corridors and risk adjustment are designed to lessen the financial risk issuers and exchanges will face under the ACA. These programs will mitigate the impact of adverse selection and encourage issuers to compete based on cost and quality, rather than attracting the healthiest, lowest-cost enrollees. On March 16, 2012, the U.S. Department of Health and Human Services (HHS) issued final rules, titled “Patient Protection and Affordable Care Act; Standards Related to Reinsurance, Risk Corridors and Risk Adjustment.” This research brief prepared by Wakely Consulting Group summarizes the final rules, highlights the changes from the proposed rules of July 11, 2011, and provides Wakely’s perspective on the implications. It is intended for policymakers and state officials familiar with the complexities underlying these issues.

Wakely Consulting Group has also prepared a Work Plan that serves as an outline for state officials on the decisions and actions necessary to implement the risk adjustment and reinsurance provisions of the ACA.

 


Expert Perspectives

June 16, 2022

Leveraging Section 1902(e)(14) Waiver Authority Amid Unwinding

The unwinding related section 1902(e)(14) strategies newly available to Medicaid and CHIP agencies can provide significant relief to states facing pending eligibility and enrollment actions and processing delays, workforce and systems limitations, and other operational challenges. Ensuring eligible individuals do not lose coverage for procedural or administrative reasons and supporting those who are ineligible for Medicaid/CHIP transition to Marketplace coverage will be paramount for all states as they begin to resume normal operations when the federal public health emergency (PHE) ends. This expert perspective outlines the time-limited targeted enrollment flexibilities that CMS has availed to states through section 1902(e)(14) waiver authority and discusses considerations beyond the strategies described in federal guidance and supplemental resources.

June 15, 2022

Using Marketplace Retroactive Coverage to Facilitate Continuous Enrollment in the Public Health Emergency Unwinding

Providing a retroactive coverage option in the Marketplace is one innovative strategy for eliminating coverage gaps between Medicaid and Marketplace coverage for people eligible to make that transition at the end of the public health emergency. Pennsylvania’s state-based Marketplace, Pennie, is considering an optional retroactive coverage policy. This expert perspective describes the retroactive coverage policy innovation and its benefits, and offers strategies for states to consider in their implementation that will maximize coverage continuity, minimize adverse selection, and address potential operational challenges.