TAH Newsletter Spring 2016

shutterstock_431846173CMS Data Match Questionnaires

Over the past couple of weeks we’ve noticed a huge up-tick in the number of data match requests clients have received from CMS. Why are they requesting the information and what do you need to do?

First off, understand that the data match requests are the result of a project carried out by CMS to enforce Medicare Secondary Payer rules. These rules essentially coordinate the payment of benefits between Medicare and employer-sponsored benefits when an individual has coverage through both their employer (or their spouse’s employer) and Medicare. In order to coordinate who is primary and who is secondary in terms of claim payment, Medicare is requesting information from employers because the rules determine who pays first based on group size and the number of employees. Once they have this information they can properly coordinate the payment of claims for those individuals.

In the past, these requests from CMS were relatively simple and straightforward. Today, the requests are now more detailed and most commonly sent and submitted electronically. As a result, we can no longer formally submit the request on a client’s behalf, however we can assist with the completion of the information in the request, or at a minimum, walk a client through the process of completing the information prior to submission.

The attached information sheet provides more detail as to the background of the CMS data match questionnaire, as well as ways to request a reporting extension and more. The main point we want to convey is that if you receive a request from CMS for this information, do NOT disregard it. The penalties for failing to respond can be substantial. We are able and willing to assist. Please contact us if you receive one of these requests or you have additional questions.

Sample Employer Notices for Employees Receiving Individual Subsidy

Recently, the Department of Health & Human Services released a sample notice (attached) that the federally facilitated marketplace will send to an employer when one of their employees has received a premium subsidy via the individual insurance marketplace. What this means to each employer differs based on whether or not they are considered an Applicable Large Employer (ALE) under the Affordable Care Act (ACA), and if so, whether they did or did not offer affordable, minimum value coverage for the year in question. The letter is nothing more than an informational notice to the employer, but employers should hang onto their copies for recordkeeping purposes in the event that penalties or the possibility of penalties are ever in question. Additionally, if an employer believes that an employee has received a subsidy in error, there are procedures they can follow to contest that employee’s subsidy determination. If you find yourself in this situation and need assistance or have general questions about the notice please let us know.

New Products – Old ideas with new applications

As we mentioned back in February, the natural offspring of the Affordable Care Act (ACA) is the development of new products, or the new application of existing products, to the changed world of benefits. There is a wide variety of ideas and approaches in the market, but the two of late that are getting a lot of talk are MEWA’s (Multiple Employer Welfare Arrangements) and models that utilize referenced-based pricing.

MEWA’s are not a new concept to the benefits world. As recently as a decade ago, MEWA’s were an attractive option to some employers because they provided a way to pool risk among various employer groups and they were not as heavily regulated as a typical insurance product. That lack of similar regulation and oversight helped provide a more cost-competitive product, but in the end it also served as the eventual downfall of nearly all MEWA’s, as almost all failed as a result of inadequate claims reserves and the inability, or fear of the inability, to pay claims. Today, because of their history, MEWA’s are heavily regulated by the Department of Insurance in Ohio, and as a result several have sprung up in response to healthcare reform and the stringent rating practices that are forced upon small groups (< 50 employees) under the ACA. Most notably, Anthem just released their MEWA product through the Southern Ohio Chamber Alliance (SOCA) for small groups effective May 1st (see attachment). Medical Mutual of Ohio is expected to have a product released within the year as well. Another MEWA product already on the market is limited to physician practices in Ohio through the Ohio State Medical Association (OSMA). These MEWA arrangements limit which agents have access to their plans, and in the case of all of these, we are fortunate to be one of those agencies.

Another approach that is somewhat new – at least to the Midwest but that has been gaining new traction across other parts of the country – is known as referenced-based pricing. Referenced-based pricing doesn’t necessarily involve a new type of insurance or a new funding arrangement for claims but rather is an approach of negotiating payment arrangements with providers for large claims outside of an established, pre-arranged provider contract. In essence, when a member anticipates a large medical service such as an inpatient stay or a surgery, referenced-based pricing models have intermediaries who contact providers directly in advance of a service and work to negotiate a fee that is usually based off of a percentage of what Medicare has contracted to pay. If the provider accepts the negotiated fee, then the services is performed at that location by that provider. If it is not accepted, then depending on the type of program, the member either has the option to pay the difference between what is charged and what is negotiated, or the intermediary may shop around for a provider who will accept the negotiated rate, in which case no balance billing issue occurs to the member. Because this “shopping” for healthcare is so different from what we are accustomed to, the market for plans using a referenced-based pricing model have been slow to emerge, but there are a few. Recently, CareWorks Comp, the largest workers comp administrator in the state, has partnered with a third-party administrator and four agents throughout the state (of which TAH Benefits is one) to offer a plan based on this concept. Because the approach is a departure from the current hands-off nature of health insurance, we expect it to take some time and additional refinement of the products before they will garner serious attention as an alternative to the current models. But with their ability to truly “bend the cost curve” by changing not how benefits are paid but instead the actual amount that is paid, as cost pressures continue to build these models are likely to offer viable alternatives in the future.

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