Minimum Creditable Coverage Regulations October 17, 2008

1. Minimum Creditable Coverage Regulations October 17, 2008

2. Agenda • Overview of Proposed Revisions to MCC • Preventive Care • HDHP/HSA • Broad Range of Medical Benefits • Actuarial Equivalence • Collectively-Bargained Plans • Technical Corrections • Parking Lot Issues • Next Steps

3. Context • Establish floor for “real” coverage • Protect consumers • Minimize # of tax-payers penalized, despite having “real” coverage • Minimize ERISA concerns • Consider enforcement ability • Learn as we go and “pace” rate of change • Recognize DOI’s complementary role

4. Preventive Care(effective 1/1/2009) • Add definition of what constitutes “preventive care” • Amend regulations to allow plans to meet pre-deductible preventive care requirement if benefits are comparable to preventive care guidelines adopted by MHQP or if plan covers 3/6 preventive care visits pre-deductible

5. HDHP/HSA(effective 1/1/2010) • Underlying health benefit plan must include broad range of medical benefits and pre-deductible preventive care requirements • Deductible and out-of-pocket maximums based on federal regulations • Plan sponsor or carrier must provide access to health savings account (HSA)

6. 1/1/2009 Preventive and Primary care Emergency services Hospitalization Ambulatory services Rx Mental health and substance abuse 1/1/2010 Diagnostic imaging and screening Maternity and newborn care Medical/surgical care Radiation therapy and chemotherapy Broad Range of Medical Benefits

7. Broad Range of Medical Benefits(effective 1/1/2010) • Benefit limits may be applied, but plan will not meet MCC standards if: • Limitations are clearly inconsistent with standard employer-sponsored coverage; and • Limitations do not represent innovative ways to improve quality or manage the utilization or cost of services delivered

8. Actuarial Equivalence(effective 1/1/2009) • For “near misses,” carrier or plan sponsor may request Connector certification of MCC compliance if: • Health benefit plan covers core services and broad range of medical benefits; • Benefit limitations are consistent with MCC requirements; and • Plan of benefits has an actuarial value equal to or greater than Connector’s Bronze-level offering

9. Collectively-Bargained Plans(effective 1/1/2009) • Connector may, at its discretion, determine that a collectively-bargained plan -- in force as of 1/1/2009 -- is compliant with MCC for up to one year following the expiration of the collectively-bargained agreement • Add definition for “multi-employer health benefit plan”

10. Technical Corrections(effective 1/1/2009) • Clarify that a health benefit plan may not include an overall limit on core services, individually or collectively, per year or per illness • Clarify that separate prescription drug deductible is an option, not a requirement, and that drugs may be included under global deductible • Eliminate regulatory language regarding alternative Rx design

11. Technical Corrections(effective 1/1/2009) • Out-of-pocket maximum intended to include “covered services,” not just “core services” • Clarify that out-of-pocket maximum includes the amount of the deductible, even if plan documents indicate O-O-P max does not include deductible • Clarify regulatory language pertaining to indemnity fee schedule

12. Technical Corrections(effective 1/1/2009) • Clarify that a plan sponsor may use a health reimbursement account (HRA) to cover the gap between a health plan’s deductible and MCC’s deductible limits • Clarify that aggregation of multiple benefit plans (e.g., Rx carve out, MH-SA carve out) may be used to meet MCC

13. 1/1/2009 Preventive care Actuarial equivalence Collectively-bargained plans Technical corrections 1/1/2010 Expansion of broad range of medical benefits Benefits limits standards HDHP/HSA Summary of Effective Dates

14. Parking Lot Issues • Set floor for plans with lifetime benefits maximum • Expand list of core services • Require an out-of-pocket maximum for all health benefit plans, not just those with overall deductible and/or co-insurance on core services • Set specific minimum limits on broad range of medical benefits • Other?

15. Next Steps