The New York Health Benefit Exchange

1. The New York Health Benefit Exchange Cara Henley Associate Director, Insurance & Managed Care August 23, 2013

2. Health Insurance Exchanges • An organized marketplace where consumers can easily compare health plan options and enroll in qualified health coverage • Seeks to increase competition while providing benefit standardization and potentially lower costs • Public and private exchanges may co-exist

3. Public Exchanges Private Exchanges Individual SHOP • Federally mandated for January 2014 • Individual exchange will target uninsured and self-insured population • SHOP (Small Business Health Options Program) will target small group employers early on; may incorporate large group employers in 2017 • Community adjusted premiums with limited risk adjustment • Small business tax credits and individual subsidies will be offered • Will not exist in all states • Targeted to large and mid-size employers • Less regulated than public exchanges • Will support defined contribution models • May facilitate shift to self-insured products

4. Coverage Requirements • An exchange must offer a plan choice in each category • A participating payor must offer at least one gold or one platinum • plan • The plans must provide the 10 EHB categories; states can require • higher level of benefits

5. Individual Requirement The penalty is pro-rated by the number of months without coverage, though there is no penalty for a single gap in coverage of less than 3 months in a year. The penalty cannot be greater than the national average premium for Bronze level coverage in an Exchange. After 2016, penalty amounts are increased annually by the cost of living.

6. Employer Coverage Fewer than 25 Employees Businesses with fewer than 25 FTEs and an average annual wage of less than $50K that pay at least 50% of the cost of health coverage are eligible for a tax credit. Fewer than 50 Employees Businesses with fewer than 50 FTEs are not eligible for a tax credit and are exempt from penalties faced by larger employers that do not offer coverage.

7. Employer Requirement - Delayed Large Group Employers Larger employers that do not provide coverage will be assessed a penalty beginning 2014 if any one worker receives a tax credit when buying insurance on their own in the Exchange. The employer penalty is equal to $2,000 multiplied by the number of workers in the business in excess of 30 workers (with the penalty increasing over time). Large employers that offer coverage may also be subject to penalties. If the coverage offered does not have an actuarial value of at least 60% or the premium for coverage exceeds 9.5% of the worker’s income, then the worker is eligible to purchase insurance on the Exchange and any available tax credits. For each worker receiving a tax credit, the employer will pay a minimum penalty of $3,000 per worker that receives a tax credit and a maximum penalty of $2,000 multiplied by the number of workers in excess of 30 workers.

8. Comparing the Maps

10. Federal Repositioning? • Basic Health Program – delayed • Federal SHOP – delayed • Employer Mandate – delayed

11. New York’s Investment • Committed by Executive Order to create a state-based Exchange • Received $368 million in federal grant awards • Retained several consultants to conduct more than 15 policy studies • In the process of hiring individuals to staff the Exchange

12. Projected Enrollment • The State of New York anticipates that about 1.1 million individuals will participate in the Health Benefit Exchange statewide by 2017: • 615,000 in the individual, non-group market, and • 450,000 in the Small Business Health Options (SHOP) market.

13. Health Benefit Exchange Timeline

14. Essential Health Benefits Outpatient Services PCP Office Visits Specialty Visits Outpatient Facility Fee Outpatient Surgery Hospice Services Home Health Care Services Preventive, Wellness & Chronic Disease Management Preventive Care/Screening Immunization Gym Membership Prenatal and Postnatal Care Mental Health and Substance Abuse Disorder Services MH Outpatient and Inpatient Services Substance Use Disorder Outpatient and Inpatient Services Hospitalization Inpatient Hospital Services Inpatient Physician and Surgical Services Skilled Nursing Facility Delivery and All Inpatient Services for Maternity Care Emergency Services Emergency Room Services Urgent Care Centers or Facilities Emergency Transportation/Ambulance

15. Essential Health Benefits Prescription Drugs Generic Drugs Preferred Brand Drugs Non-Preferred Brand Drugs Specialty Drugs Off Label Cancer Drugs Rehabilitative and Habilitative Services and Devices Inpatient Rehabilitation Services Outpatient Rehabilitation Services Habilitation Services Chiropractic Care Durable Medical Equipment Hearing Aids Prosthetic Devices Laboratory and Imaging Services Diagnostic Tests Imaging

16. Essential Health Benefits Other • Pediatric Dental • Emergency Dental Care • Checkup for Children • Basic Dental Care • Major Dental Care • Orthodontia • Pediatric Vision • Vision examinations • Prescription Lenses • Frames • Contact Lenses • Infertility Treatment • Family Planning • Chemotherapy • Mastectomy Care/Breast reconstructive surgery • Diabetic equipment, supplies, education and self-management • Reconstructive and Corrective Surgery • Surgical Second Opinion • Autism Spectrum Disorder • Bariatric Surgery • Transplants • Oral Surgery

17. Enrollment in Public Programs

18. Other Changes Family Health Plus Healthy New York • Repealed December 31, 2014 • Nearly all FHP enrollees are subsumed under the new Medicaid adult category • Buy-In Program is repealed December 31, 2014 • No new applications will be taken after December 31, 2013 • FHP enrollees between 133% and 150% of FPL who enroll in commercial Exchange coverage will have their premiums paid by the State • Repealed December 31, 2014, in time for beneficiaries to enroll in qualified health plans offered on the Exchange

19. Potential Churning

20. Individual and Small Group Premium Rates • The Department of Financial Services (DFS) has approved 2014 individual and small group premium rates for products offered on the Exchange • Rates have been released based on seven different rating regions: • Albany, Buffalo, Mid Hudson, New York, Rochester, Syracuse, Utica, and Long Island

21. Decreased Rates. . .But Unanswered Questions • Individual premium rates are approximately 50% lower than the average cost of available plans today • Premiums did not drop as steeply in the small group market compared to the individual market • Details on provider networks, out-of-network coverage, and patient financial responsibility are not yet available

22. Rebranding and Marketing

24. Open Enrollment • Initial open enrollment period: October 1, 2013 - March 31, 2014 • If enrolled on or before Dec. 15, coverage effective Jan. 1  • If enrolled Dec. 16 to Jan. 15, coverage effective Feb. 1  • If enrolled Jan. 16 to Feb. 15, coverage effective March 1  • If enrolled Feb. 16 to March 15, coverage effective April 1  • If enrolled March 16 to March 31, coverage effective May 1 • For future years (2015 and beyond) annual open enrollment period: October 15 – December 7 • Coverage effective January 1

25. Triggering Events for Special Enrollment • The special enrollment period will be 60 days from the date of a triggering event

26. Certified Application Counselors • CMS established CACs as a type of assistance available to provide information and to help facilitate enrollment into qualified health plans available on the Exchange, in addition to Medicaid and Child Health Plus coverage. • CACs will complement the existing Navigator/In-Person Assistor program. • No grant funding for CACs; the CAC program is intended to dovetail with existing enrollment activities.

27. Grace Period Coverage • A QHP must provide a grace period of three consecutive months if an enrollee receiving advance payments of the premium tax credit has previously paid at least one full month's premium during the benefit year. • During the grace period, the QHP must: • Pay all appropriate claims for services rendered to the enrollee during the first month of the grace period and may pend claims for services rendered to the enrollee in the second and third months of the grace period; • Notify HHS of such non-payment; and, • Notify providers of the possibility for denied claims when an enrollee is in the second and third months of the grace period

28. Basic Health ProgramDelayed Until 2015 • ACA allows states to offer one or more “Basic Health” insurance plans to low- to moderate-income individuals • Plans must provide at least the essential health benefits, and individual premiums may be no greater than the second least expensive Silver plan offered on the Exchange • In a state that offers Basic Health, residents under age 65 with income above 133% and up to 200% of the FPL would be eligible, as well as lawfully present aliens with income below 133% and ineligible for Medicaid • Moreover, in a state electing the Basic Health Program, eligible individuals may not purchase other available coverage through the Exchange

29. Basic Health ProgramDelayed Until 2015 • The federal government will give states 95% of what would have been spent on advance premium tax credits for eligible individuals in the Exchange • The state is examining two approaches to provider reimbursement • Current Family Health Plus rates • Family Health Plus rates plus 25%

30. Strategic Considerations

31. Strategic Considerations

32. Provider Financial Impact Existing Insured Commercial Patients Shift to Exchange Plans Small Employers With No Insurance Coverage Join Exchange Uninsured Individuals Join Medicaid Self-Pay Individuals Join Exchange Plans ECG Management Consultants

33. Balancing Threats and Opportunities

34. Private Exchanges

35. SHOP Exchange Implications

37. Medicaid Managed Care update

38. Medicaid Managed Care • New York State is moving toward “Care Management for All” • Care Management for All enrollment will rise from 77% to 95% of the Medicaid population • Fee-for-service spending will drop to only 4% of Medicaid spending

39. Transition from Medicaid to Managed Care • Long Term Care population • Behavioral Health population

40. Current MLTC Enrollment • 45 Managed Long Term Care (MLTC) plans • Over 111,000 enrollees statewide • Over 101,000 in New York City • Increasing enrollment outside of the city Source: http://www.health.ny.gov/health_care/managed_care/reports/enrollment/monthly/

41. Community Based Long Term Care • July 2012 – began enrollment in NYC • Mandatory Population: Dual eligibles, 21 and older, requiring more than 120 days of community based LTC services • Voluntary Population: • Dual eligibles, 18-21, requiring more than 120 days • Non-duals, 18 and older, nursing home eligible

42. Community Based Long Term Care • January 2013 – Nassau, Suffolk, and Westchester counties • August 2013 – Orange and Rockland counties (pending CMS approval) • December 2013 –Albany, Erie, Monroe and Onondaga counties • April 2014 – other counties with capacity

43. Facility Based Long Term Care • October 2013 — permanent nursing home benefit carved in (MMC) • DOH Proposal — new permanently placed nursing home residents age 21 and older required to enroll in managed care plan (MMC or MLTC) • January 2014 —NYC, Westchester, Nassau, Suffolk • April 2014 — Rest of State • Residents already permanently placed by mandatory dates can remain in FFS

44. Behavioral Health Transition • January 2012: regional BHOs began working with providers to monitor and review inpatient behavioral health services and discharge plans for stays not "covered" under the state's various Medicaid Managed Care plans. • The state is delaying the transition of behavioral health services into managed care until January 1, 2015. • The state continues to develop the model and is also awaiting federal approval for the new services and design.

45. Behavioral Health Transition • The revised implementation dates are: • January 1, 2015: Behavioral health adults in New York City; (HARP and Non-HARP) • July 1, 2015: Behavioral health adults in the rest of the state; (HARP and Non HARP) and • January 1, 2016: Behavioral health children statewide.

47. Questions? Cara Henley (518) 431-7827 chenley@hanys.org