by Christoper E. Condeluci, Principal and sole shareholder of CC Law & Policy PLLC in Washington, D.C.
Medicaid Enrollment Is Up By 1.3 Million Since the Beginning of the Pandemic
- This number is LOWER than most analysts had predicted, and a surprise to many. I’m not so surprised. Why?
- Analysis: Okay, so you have heard me – and others – talk about the millions of people who lost their job due to the COVID pandemic, resulting in the loss of health coverage through their employer-sponsored plan. Actually, Kaiser released a report estimating that nearly 27 million people lost their employer plan due to the pandemic (note, this includes the employee and their dependents). Out of this 27 million, Kaiser estimated that 8.4 million of them would have income low enough to make them eligible for a government “subsidized” individual market ACA Exchange plan. HOWEVER – as I have reported last week – it appears that ONLY about 750,000 out of this 8.4 million actually enrolled in a “subsidized” Exchange plan during the COVID pandemic. Kaiser also estimated that 12.7 million people – out of this nearly 27 million – would be eligible for Medicaid. HOWEVER, it now appears that ONLY about 1.3 million out of this 27 million enrolled in Medicaid. I find it sooooo interesting that most of the media – and other policy analysts – have been fixated on the issue of people losing their job, and thus their employer health plan. And, I have found it even more interesting that most of the media – and other policy analysts – have been overly critical of COBRA coverage. BUT, one of the possible reasons for explaining why there is such LOW enrollment in Medicaid – and also in “subsidized” Exchange plans – is because many of the people who lost their employer plan elected COBRA coverage. OR, these unemployed people enrolled in their spouse’s employer health plan because their spouse was still employed. I also think there is another possible reason. And, it is consistent with something that I articulated when talking about the lower-than-expected enrollment numbers in a “subsidized” Exchange plan. Here is what I am thinking: I think a lot of Medicaid-eligible individuals who lost their job due to the pandemic said to themselves the following: “Wow, I just lost my job. And, even though my income will be reduced to $0, I really don’t want to ‘wait my turn’ at my local Medicaid office to sign up for Medicaid coverage because I think it’s like the DMV and it will take a very LONNNGGG time to get signed up. Sooooo, I am going to go WITHOUT coverage for a couple of months until I can figure out what my future looks like. Heck, maybe I will get my job back in relatively short-order, and I won’t have to worry about Medicaid at all. And, if I am going to ‘wait my turn’ for anything, I am going down to my State unemployment office to collect unemployment and the $600 unemployment benefit that is available to me due to the pandemic.” Also consistent with what I have said is this: I truly believe that a lot of people who lost their job due to the pandemic froze. And with their whole world getting turned-upside-down, enrolling in health coverage – while important – was not on their list of must-dos (rent, and food, and other life expenses took precedent). Actually, ensuring that they are signed up for unemployment benefits was paramount. NOW, will this change as we move closer to the end of the year? In the case of enrolling in a “subsidized” Exchange plan – as I mentioned last week – I think the answer is YES. That is, “open enrollment” starts Nov. 1st, and I think some people have now grounded themselves enough to start focusing on getting some type of health coverage, with Nov. 1st being the first time they can sign up for an individual market plan for the 2021 plan year. BUT, in the case of Medicaid, you can sign up for coverage any time you want. Soooo – at least to me – the dynamic for a Medicaid-eligible unemployed person is the NOT the same as the dynamic for a person who is premium subsidy-eligible. BUT, what I think is the same is this: I too think that a Medicaid-eligible unemployed individual – just like a subsidy-eligible person – will be more grounded near the end of the year, especially if Congress is able to extend the pandemic unemployment benefit at some level (probably not $600, but negotiations over a number are ongoing). As a result, if these Medicaid-eligible unemployed people can finally start thinking about “other” life needs like health insurance, maybe they will be willing to go through the involved process of enrolling in Medicaid. BUT, will this be a BIG number?? I say NO. Only hundreds of thousands.
Health Care Policy Update
The “4th Stimulus Package” and Health Care-Related Provisions: NO Surprise Medical Billing
- As you are aware, Senate Republicans released an initial version of the “4th Stimulus Package” at the beginning of last week. As you also know, whether Congress enacts a “4th Stimulus Package” is anything but certain. Actually, at least at this point, this entire exercise appears to be a mess.
- Analysis: Congress has until mid-August to come together on some sort of agreement on a “4th Stimulus Package” before they leave town. As we all know, Congress works best (kind of an oxymoron) when up against a scheduled recess (because everyone wants to go home). Sooooo, I would expect that both Republicans and Democrats will coalesce around at least something between now and then. In the meantime, what do we at least know right now? Weeellll, we know that policy priorities like surprise medical billing protections are NOT in the Senate Republicans version of the “4th Stimulus Package.” There is NOT even a blanket prohibition against surprise billing that leaves open-ended how insurance carriers and self-insured plans (i.e., payers) are to determine how much they owe medical providers when there are out-of-network charges. As you know, surprise billing has been a political quagmire for about 2 years now, and that theme continues. Is there a chance that surprise medical billing provisions get added to the “4th Stimulus Package” as negotiations between Republicans and Democrats ensue?? I do NOT think anyone knows at this point. There are reasonable arguments that surprise billing provisions will indeed make their way into the Package (e.g., for the savings it produces). BUT, there are also reasonable arguments that NO surprise billing provisions are added (e.g., the “politics” keeps them out). In my opinion, Speaker Pelosi is the wild-card here. What I mean is this: Senate Majority Leader McConnell has always been cool to surprise billing provisions. Senate Minority Leader Schumer is essentially siding with the New York hospitals, and is resistant to any surprise billing provisions that providers hate. The White House, on the other hand, is supportive of surprise billing protections, but the White House has NOT been prescriptive on how the payers and providers should figure out how much providers should be owed in out-of-network situations. Sooooo, that really leaves Speaker Pelosi. Speaker Pelosi’s staff has been on-again-off-again on pushing for surprise billing provisions. If staff is “on-again” – and if Speaker Pelosi feels strongly enough about surprise billing to make the inclusion of surprise billing provisions a House Democratic “ask” – then maybe we will see surprise billing make its way into the “4th Stimulus Package.” BUT – at least in my opinion – Democrats have a number of OTHER priorities that are on their list of “asks” that are much HIGHER priorities than surprise billing ever will be. As a result, I would find it hard to believe that the Speaker pushes hard for surprise billing provisions. Stay tuned…
The “4th Stimulus Package” and Health Care-Related Provisions: Some Telehealth
- You have heard be talk about the “rise of telehealth.” And now, with the COVID pandemic, telehealth has been shot into the stratosphere, increasing by like 240% (per some reports I have seen).
- Analysis: It’s obviously NOT surprising that telehealth is now a household-name. After all, when you have a pandemic where everyone is supposed to stay inside, how else are medical professionals going to communicate with their patients who had ongoing health issues pre-pandemic?? And, how else can people who have gotten sick during the pandemic – due to COVID or non-COVID-related ailments – get some sort of treatment, counseling on how to care for oneself, as well as get prescriptions and re-fills of prescriptions?? The answer: Telehealth consults. In response to this “new” reality, insurance carriers and self-insured plans are voluntarily waiving the cost-sharing for certain telehealth consults during the pandemic. HHS has also expanded telehealth usage for both the Medicare and Medicaid programs. And, Congress even recognized the importance of telehealth by enacting a provision – in the “3rd Stimulus Package” – allowing HSA-eligible high-deductible health plans (HDHPs) to pay first-dollar for telehealth services and still allow the HDHP-planholder to remain eligible to contribute to their HSA for the year. This change in the law, however, is only temporary (i.e., only for the 2020 and 2021 plan years). Also temporary is the use of telehealth in the Medicare and Medicaid programs, although HHS has been issuing guidance extending and making permanent the telehealth changes. Fast-forward to last week when the Republican-version of the “4th Stimulus Package” was released. In it, there is a provision that would change how a telehealth plan is governed under the law. For example, currently a telehealth plan is generally considered a “group health plan.” As a “group health plan,” the telehealth plan MUST comply with the Affordable Care Act’s “group health plan” requirements. BUT, the “4th Stimulus Package” would re-characterize a telehealth plan as an “excepted benefit,” which is NOT considered a “group health plan” under the law. This is a welcome change because it provides much more legal flexibility for telehealth plans. BUT, there is a very BIG catch here. Two catches to be exact. First, re-characterizing a telehealth plan as an “excepted benefit” is ONLY temporary (i.e., this provision sunsets in 2022 or whenever the COVID “public health emergency ends,” whichever is later). Second, a telehealth plan that is considered an “excepted benefit” can ONLY be made available to employees who are NOT otherwise eligible to participate in their employer’s health plan. This is “code” for part-time employees who most employers exclude from their health plan (because “eligibility” for coverage under the plan is usually defined as working at least 20 hours a week). Temporary and seasonal workers – and often times foreign workers – also find themselves excluded from an employer health plan. Sooooo, while it’s great that Senate Republicans are providing much-needed flexibility for telehealth plans, this flexibility is very limited, which is a disappointment to the employer community. I suppose one silver-lining is that these non-traditional employees who typically have NO access to health coverage at least now could be offered access to a telehealth plan. And, while a telehealth plan is NOT the same thing as a comprehensive “group health plan,” it’s at least some type of health coverage that these non-traditional employees are sorely in need of. Last comment: I want to think that as negotiations over what’s in – and what’s out of – the “4th Stimulus Package” start to really heat up, more and more telehealth-related provisions will be included in the Package. For example, maybe this “excepted benefit” provision is expanded to full-time employees who are otherwise eligible for coverage under their employer’s plan. Also, permanency of an HSA-eligible HDHP’s ability to pay first-dollar for telehealth services, as well as permanency of telehealth usage in Medicare and Medicaid. The Congressional Budget Office (CBO) is likely to “score” these provisions as a “savers,” or at least revenue-neutral. Stay tuned…
The “4th Stimulus Package” and Health Care-Related Provisions: On-Site Clinics
- You have heard me talk about the current HSA rules and what I call the “eligibility rigidity” that is inherent in the existing rules. What do I mean?
- Analysis: Under the current HSA rules, if an HDHP planholder is covered by “other” health coverage that pays for “medical care” (that is NOT considered preventive) before the HDHP’s deductible is met, the planholder is NOT eligible to contribute to their HSA. This “eligibility rigidity” currently limits an employer’s ability to offer their employees innovative health care arrangements like telehealth services, direct primary care services, and medical services that are provided at an employer’s on-site clinic. In other words, if an employer offers telehealth services, or access to direct primary care services, or certain services at the employer’s on-site clinic, these health care arrangements are currently considered “other” health coverage under the HSA rules, and thus, if these arrangements pay for “medical care” (that is NOT considered preventive) before the HDHP’s deductible is met, the planholder is NOT eligible to contribute to an HSA. As you know, both Republicans and Democrats have been trying to smooth out this “eligibility rigidity” for the past couple of years, BUT to no avail. Actually, it wasn’t until the COVID pandemic that Congress finally realized that it should allow telehealth services to be paid for by the HDHP before the deductible is met and STILL allow the HDHP-planholder to remain eligible to contribute to their HSA. BUT, as stated, this change in the law is ONLY temporary. Weelllll, the Republican-version of the “4th Stimulus Package” would allow employer on-site clinics to perform certain medical services where the performance of such services would NOT be considered “other” coverage under the HSA rules. In other words, the Republican bill would amend the existing HSA rules to say that certain medical services performed at an on-site clinic would NOT make it “other” coverage, and as a result, employees who are covered under an HSA-eligible HDHP who utilize these permissible medical services at their employer’s on-site clinic would STILL remain eligible to contribute to their HSA for the year. BUT, don’t get too excited – this provision is TEMPORARY, just like all the rest. Here, this provision is available for 2020 and 2021, ending January 1, 2022. Last comment: Despite the temporary nature of this provision, this is just another example where Congress is chipping away at the “eligibility rigidity” that is inherent in the existing rules. First it was telehealth (albeit temporary). Now, it is on-site clinics (also temporary). You can bet-your-bottom-dollar that advocates of direct primary care are going to continue to beat on Congress to get their own exception from the existing “eligibility rigidity” (temporary or otherwise). To date, these advocates have been unsuccessful. Stay tuned…
Anything Else on the “4th Stimulus Package”?
- After Congress enacted the 2nd and 3rd Stimulus Packages – which mandated free “testing” for COVID – many of us thought that Congress would follow-up this up by mandating that “treatment” for COVID-related symptoms must also be free. However, as time has gone on, Congress and industry stakeholders have cooled on this idea.
- Analysis: It is important to note that a number of insurance carriers and self-insured health plans announced that they would voluntarily waive cost-sharing for “treatment” for COVID-related symptoms performed by in-network providers. As a result, it appears that these industry stakeholders short-circuited a mandate that COVID-related “treatment” must be free to the patient. BUT, it is NO guarantee that we will NOT see this type of mandate when a “4th Stimulus Package” is finally hashed out. There are a couple of other things to think about: If the Democrats do indeed have so much negotiating leverage (as is being reported), could Democrats demand that the Federal Exchange offer up a “special enrollment period” for individuals to enroll in an Exchange plan while the COVID pandemic rages on? This will certainly be a Democratic “ask” that Republicans will want something for. Related to this, could we see government funding for marketing and enrollment outreach efforts for the Federal Exchange? Could we see other “ACA improvements”? I highly, highly doubt it, but you can never-say-never. Stay tuned…