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Reform Update: Automatic ACA re-enrollment carries caveats


By Virgil Dickson
Posted: September 4, 2014 - 3:45 pm ET
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HHS is moving forward with a policy (PDF) that will allow consumers who got health insurance through the state and federal exchanges to be automatically re-enrolled for 2015, even though some have warned that enrollees could be unwittingly shifted to other plans if their insurers decide to cancel their current coverage.

Consumer advocates with Families USA have generally praised the Obama administration's decision to facilitate re-enrollment, which they say should mitigate problems that arise when patients' benefits and provider networks fluctuate as they shift from one plan to another.

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The aim of the policy is to prevent care disruption for the 8 million consumers who got coverage through exchange plans during the Patient Protection and Affordable Care Act's first enrollment period, and to avoid losing a large number of them while the administration works to extend coverage to most of the nation's uninsured.

But easing the path to re-enrollment could mean some of those consumers lose tax credits or pay higher premiums. If an insurer has decided to discontinue a particular plan, the carrier has the leeway to automatically enroll its members in a plan deemed similar, even though it could have a higher or lower actuarial value (represented by the metal tiers bronze, silver and gold). Carriers also could enroll those members in an ACA-compliant plan that's not sold on an insurance exchange.

The CMS received several comment letters on the proposed policy noting that enrolling an individual for any coverage other than an identical plan would cause confusion and unforeseen consequences. Some letters warned that enrollees might lose access to cost-sharing reductions they received under a silver plan if they are re-enrolled into a plan at a different metal tier, and they could become ineligible for cost-sharing and tax credits if they're shifted to a plan outside the exchange, according to the CMS' summary of the comments.

The agency countered that it expects there will be few people who will unable to return to their identical plan, and that the rule lays out a series of steps insurers must take to mitigate such problems.

However, the agency acknowledged some people could fall through the cracks. For instance, it said it would need to release future guidance on how a plan would ensure the continuity of cost-sharing provisions when consumers are transferred outside an exchange. The CMS also said it would need to release additional guidance that explains what insurers should do when its members move outside of their original plan's service area or age out of a parent's policy.

“We reiterate that enrollees have the opportunity to shop for a new plan during the open-enrollment period, regardless of whether they are automatically re-enrolled into a plan that does not meet their needs,” the CMS said in the final rule.

While the rule generally allows insurers to decide which plans qualify as similar substitutes, the CMS will allow state-based exchanges to make that call if they choose.

Groups that have been enrolled through outreach efforts applauded the administration's decision to finalize the policy.

“I'm glad that auto-enrollment is there for folks who are happy with what they chose,” said Ryan Baker, vice president for health policy at the Missouri Foundation for Health, which spearheaded an effort to get residents enrolled in that state.

Is the reform law pushing workers into part-time jobs?

Critics of the Patient Protection and Affordable Care Act have been adamant in saying the law would cause small employers to hire fewer full-time workers and even switch some workers to part-time work to avoid complying with the employer insurance mandate. A new report from the Robert Wood Johnson Foundation and the Urban Institute says that has not been the case, however. “We find no evidence that the ACA had already started increasing part-time work before 2014,” the report notes. A small increase in part-time employment this year, according to the report, is not attributable to ACA.

Oregon to decide whether to cut the cord on its exchange

The board of Cover Oregon, the quasi-governmental corporation set up by the state to oversee its insurance marketplace, was scheduled to vote Thursday on whether to continue operating the online exchange, which has been plagued by technology issues. The state is currently suing Oracle, the former lead contractor for the troubled site, over problems with the exchange. Oracle, meanwhile, is suing the state for breach of contract and seeking $23 million in back pay for bills it submitted on the project.

Follow Virgil Dickson on Twitter: @MHvdickson


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