Cost and Financing

In Moda Health Plan v. United States the Supreme Court will decide whether Congress may enact appropriations riders restricting the sources of funding available to pay health insurers for losses incurred that were supposed to be paid per federal law.

The Affordable Care Act’s (ACA) risk corridor program provided that if a health insurance plan participating in the exchange lost money between 2014-2016 it would receive a payment from the federal government based on a formula defined in the statute. If it made money the plan had to pay the federal government based on a formula. The purpose of the program was to induce health insurance companies to offer plans on the exchange despite the fact they didn’t have reliable data to price the plans.

The Government Accountability Office (GAO) identified a particular funding source the federal government could use to make payments. Congress passed appropriations riders for all three years disallowing that funding source to be used to make risk corridor payments.

CSG Midwest
When a health consumer receives care outside of an insurer’s network of providers, he or she may receive a surprisingly high medical bill, and face the prospects of paying unexpectedly high out-of-pocket costs. 
These situations are not uncommon, and often not the fault of the health consumer — for example, he or she requires immediate emergency care, or an out-of-network provider is part of a larger team of physicians providing complex medical treatment.
As evidenced in recent polling data and new state laws, “surprise billing” has become a widespread concern among health care consumers and policymakers alike. In a poll conducted last year by the Kaiser Family Foundation, two-thirds of Americans said they were either “very worried” or “somewhat worried” about being able to afford their own or a family member’s unexpected medical bills.
The Commonwealth Fund, meanwhile, has been tracking the spread of laws to protect individuals from certain types of “surprise billing.” By the end of 2018, the number of states with such laws had reached 25: nine with comprehensive laws (including Illinois in the Midwest) and 16 with “partial protections” (including Indiana, Iowa and Minnesota).

The cost of nursing home/assisted living care has continued to rise. The average daily cost of nursing home care in the United States is $235, with a high of $800 per day in Alaska, and a low of $147 in Oklahoma. The increasing cost of care for loved ones has placed burden on the federal and state governments, as well as the American people searching for cheaper alternatives.

Recent polls record the American public’s concern about health care costs—and analysis documents the increase in out of pocket costs, up 11 percent on average in 2017. Policymakers worry that national health care spending—reaching $3.3 trillion or $10,348 per person in 2016 according to the official federal estimate and accounting for 17.9 percent of gross domestic product—is unsustainable.

At a recent meeting I attended in Washington, D.C., a group of researchers and health care industry officials addressed the question “Why are Healthcare Prices So High, and What can be Done About Them?”

My biggest take aways were slides showing that 50 percent of healthcare cost increases are driven by the prices charged and that Medicare and Medicaid have been able to hold healthcare prices steady while private insurance has seen a 70% increase since 1996.

Both chambers in Wisconsin have passed a $200 million reinsurance plan that would provide funds to insurers for high-cost patients’ expenses to prevent ACA marketplace premium increases in 2019. The Governor has come out in support of the program and is expected to sign the bill, according to the Journal Sentinel.

CSG South

Part I of this SLC Special Series Report detailed many of the broader concerns that long-term care poses for Southern states, including challenging demographic shifts, deteriorating health status among key segments of the population and prohibitively high costs of various LTC services. Part II outlines the role that insurance plays in financing long-term care and reviews potential insurance-related solutions that could create more affordable care in the future for states and LTC recipients.

In Coventry Health Care of Missouri v. Nevils the State and Local Legal Center (SLLC) asked the Supreme Court in its amicus brief to rule that Chevron deference does not apply when an agency is construing the scope of a statute’s preemption provision, absent Congress’s assent. The Court didn’t rule on (or even discuss) this issue in its brief, unanimous opinion.

The Court held that the Federal Employees Health Benefits Act (FEHBA) preemption clause overrides state laws prohibiting subrogation and reimbursement and that the preemption clause is consistent with the Supremacy Clause.    

A new study out of Michigan concludes that the state’s Medicaid expansion is to the state’s financial advantage.

When the legislature approved the expansion in 2013, it required that Michigan achieve other health care savings and revenue to offset the state match required starting Jan. 1, 2017 – or the state would reverse its expansion.

In 2016, five states enacted legislation designed to mitigate a controversial health insurance procedure known as step therapy, which requires patients to try less expensive, often generic medications before being approved for costlier treatments. With the growing availability of generics step therapy, alongside prior authorization and benefit tiers, has emerged as a popular cost savings tool for private insurers, as well as Medicaid and Medicare programs.

Insurance companies and...

More than 20 legislators from 16 states--many of them in key leadership positions on health or budget committees that deal with Medicaid in their home states--attended a CSG policy academy in Washington D.C. on September 21-23, 2016, to learn how states are making reforms in their Medicaid program that pursue the health "triple aim": improving the quality of care for individuals, improving the health of populations, and reducing per capita costs of health care.

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