Health and Human Services Department, Proposed Rule, January 17, 2019
This proposed rule sets forth payment parameters and provisions related to the risk adjustment and risk adjustment data validation programs; cost-sharing parameters; and user fees for Federally-facilitated Exchanges (FFEs) and State-based Exchanges on the Federal Platform (SBE-FPs). It proposes changes that would allow greater flexibility related to the duties and training requirements for the Navigator program and proposes changes that would provide greater flexibility for direct enrollment entities, while strengthening program integrity oversight over those entities. It proposes policies that are intended to reduce the costs of prescription drugs. It includes proposed changes to Exchange standards related to eligibility and enrollment; exemptions; and other related topics.
Unpublished rule – 331 pages:
This document is scheduled to be published in the Federal Register on 01/24/2019 and available online at:
Fact Sheet – 4 pages:
By Katie Keith
Health Affairs Blog
The 2020 Proposed Payment Notice, Part 1: Insurer And Exchange Provisions:
The 2020 Proposed Payment Notice, Part 2: Risk Adjustment:
Trump Proposals Could Increase Health Costs for Consumers
By Robert Pear
The New York Times, January 21, 2019
Consumers who use expensive brand-name prescription drugs when cheaper alternatives are available could face higher costs under a new policy being proposed by the Trump administration.
The proposal, to be published this week in the Federal Register, would apply to health insurance plans sold under the Affordable Care Act.
The administration is proposing several other changes that could increase costs for consumers.
Under the proposal, fewer people would qualify for federal subsidies, and those who qualify could be required to spend a larger share of their income on insurance premiums.
The Trump administration estimated that the changes would save the government $900 million annually in subsidies in 2020 and 2021 and $1 billion a year in 2022 and 2023. In addition, it predicted that 100,000 fewer people would have coverage through the insurance exchanges created under the Affordable Care Act.
The administration said that some of the 100,000 people might buy short-term insurance policies, which do not have to cover pre-existing conditions or provide all the benefits required by the health law. But, it said, most are “likely to become uninsured.”
Either way, the administration said, “these individuals will be bearing a larger share of the costs of their own health care consumption.”
Senator Ron Wyden of Oregon, the senior Democrat on the Finance Committee, described the new proposed rule as “Trump’s latest attempt to sabotage health care.”
By Don McCanne, M.D.
The federal process of making arcane rules is somewhat elaborate, requiring publication of the proposed rule in the Federal Register to provide an opportunity for public comment. Since none of us read the rules, the process favors the vested interests that do provide input. More importantly, it is used by the administration to change the rules so that they are more com[pliant with their ideological preferences.
Although the title of this particular rule indicates that it is about benefit and payment parameters under ACA, you really should quickly skim-read the four-page fact sheet if you want to get an idea of the extent of the rule changes. If you want to better understand some of the rule changes, the two articles in the Health Affairs Blog by Katie Keith can be helpful, though they are heavy on academic rhetoric. We’ll mention only two topics here.
One of the major defects of the Affordable Care Act is that it relies heavily on private health insurance plans. Thus the risk pool is split amongst the various insurers. The insurance industry is notorious for adopting policies that manipulate the risk pool to improve their bottom lines. Thus risk adjustment has become essential to transfer funds from insurers that had healthier patients and thus paid out less in health benefits to insurers that had to pay out more because of greater “losses” because their clients had greater needs. Decades of experience have shown that the program administrators cannot get risk adjustment right. The proposed rule on “recalibrating the risk adjustment models using a blended average from 2017 MarketScan® data and 2016 and 2017 enrollee-level EDGE data” and on “Risk Adjustment Data Validation (RADV) Audits” may convince you that they will never get it right.
The obvious solution is that we need to get rid of the fragmented system of private insurers and establish one single risk pool that covers everyone. This, of course, is what a Single Payer Medicare for All program would do.
The other topic to be mentioned regards the prescription drug benefit. Without discussing here any of the specific proposals in the rule, Robert Pear, in his New York Times article writes, “fewer people would qualify for federal subsidies, and those who qualify could be required to spend a larger share of their income on insurance premiums.” Also, most of the 100,000 who would lose their ACA coverage are “likely to become uninsured.” Pear also reports that Senator Ron Wyden described the new proposed rule as “Trump’s latest attempt to sabotage health care,” and it does.
There would certainly be rule-making under Single Payer Medicare for All, but the rules would be designed to benefit patients rather than designed to satisfy the whims of the right-wing, anti-government ideologues who are also rewarding their friends in the health care corporate world with our tax funds.
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