Analysis of HHS Proposed Rules On Reinsurance, Risk Corridors and Risk Adjustment
Wakely Consulting Group – Ross Winkelman, Julie Pepper, Patrick Holland, Syed Mehmud and 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 insurance exchanges. To ensure robust markets, exchanges must have in place processes for mitigating the financial risk to insurers associated with enrolling individuals with diverse health care needs. The intention is for issuers to compete for customers based on cost and quality, rather than attracting the healthiest, lowest-cost enrollees. The U.S. Department of Health and Human Services released its initial proposed rules on Standards Related to Reinsurance, Risk Corridors and Risk Adjustment on July 11, 2011. This issue brief prepared by Wakely Consulting Group summarizes the proposed rules and provides perspective on the implications for states as they integrate risk mitigation into the exchange implementation process. The brief highlights the application of the different risk mitigation programs (risk adjustment, reinsurance and risk corridors) to the various insurance marketplaces (individual and small group, both inside and outside the exchange) and includes next steps for states and insurers. The summary of these rules, as well as the authors’ analysis of their implications, is meant for policy-makers and state officials familiar with these complex issues.
Building on this proposed rules analysis, Wakely Consulting Group 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.
The unwinding of the Medicaid continuous coverage requirement represents the largest nationwide coverage transition since the Affordable Care Act, with significant health equity implications. Given the intense focus on coverage transitions during the unwinding, some states have initiated plans to publish a data dashboard to monitor progress. To date, the District of Columbia and 15 states have published unwinding data in a visual dashboard format (this does not include states with pre-existing enrollment dashboards that don’t specifically identify unwinding cohorts). This expert perspective now includes an interactive map with the links to all the dashboards and states publishing CMS unwinding reports. SHVS will continue to update the EP and map as more states publish their unwinding data.
The unwinding of the Medicaid continuous coverage requirement represents the largest nationwide coverage transition since the Affordable Care Act. This presents State-Based Marketplaces with an opportunity to target outreach efforts to those audiences who have recently lost Medicaid or CHIP to help eligible individuals retain access to affordable healthcare through the Marketplace. This expert perspective focuses on best practices for timing and strategy in consumer outreach to consumers that are no longer eligible for Medicaid to help states develop a consumer “chase campaign.”
