Everybody has heard about the subsidies to help cover premiums for Americans that are at or below four times the federal poverty level. What most people don't know, and is sure to be massively confusing to administer and monitor, is that folks under 2.5 times the federal poverty level are also entitled to help in paying for copays and coinsurance at the point of service. It looks like bureaucrats are finally ready to begin administration of this program.
The federal government is supposed to do more than help moderate-income consumers pay the premiums for "qualified health plan" (QHP) coverage. The Patient Protection and Affordable Care Act (PPACA) also calls for the government to help purchasers of silver-level QHPs who earn enough to qualify for QHP premium subsidies, but less than 250 percent of the federal poverty level, handle out-of-pocket expenses -- deductibles, co-payments and coinsurance amounts.
The Centers for Medicare & Medicaid Services (CMS) talk a little about the "cost-sharing reduction" (CSR) program in a routine paperwork review notice that's set to appear in the Federal Register Friday.
CMS officials say that, once the CSR system is working the way the parent of CMS, U.S. Department of Department of Health and Human Services (HHS), wants the system to work, the QHP issuers will get advance CSR payments throughout the year.
After the end of the year, CSR program managers will use a reconciliation process to see whether it paid the QHP issuers the right CSR amounts. Program managers are supposed to send more money to issuers that got too little, and take money from issuers that got too much. ...
The paperwork review notice covers the data elements managers will need to get to run the reconciliation process. Many consultants are trying to give the QHP issuers advice about how to handle the reconciliation process. ...If you find yourself wondering just how this will work, you are not alone. Many of us in the industry foresee this being a massive boondoggle, rife with confusion and frustration.
And this is from Kathryn Mayer at BenefitsPro detailing more confusion around these lesser known subsidies:
Consumers who are eligible for cost-sharing subsidies under the Patient Protection and Affordable Care Act are still likely to pay high out-of-pocket costs on medications and other services.
That’s because of “inconsistent reductions in spending” depending on which plan a consumer chooses, according to analysis from Avalere Health. While almost all plans reduce deductibles and out-of-pocket caps in cost-reducing plans, researchers say, many don’t lower cost-sharing for other treatments and services, particularly specialty drugs.
“Many people assume that the lowest-income exchange enrollees will have reduced cost-sharing across all services, but the reality is quite different,” said Caroline Pearson, vice president at Avalere Health.
“While all plans must have reduced out-of-pocket limits for individuals earning less than 250 percent of poverty, how consumers will reach those limits differ significantly. For example, consumers may not experience reduced cost-sharing amounts for drugs or physician visits in many plans.”
Avalere looked at the silver and cost-sharing reduction plans offered in federally facilitated exchanges in 34 states, and found substantial differences in how carriers adjust cost-sharing benefits.
“While the Affordable Care Act requires CSR plans to lower maximum out-of-pocket limits, health insurers have broad flexibility about how to adjust cost-sharing for other services to reach the required actuarial values,” the report said. “Notably, plans do not evenly reduce cost-sharing across all types of benefits; in fact, plans vary substantially in how they alter cost-sharing for each of the benefits examined in this analysis.”...
