Healthcare Options: ACA, AHCA, and More

1. The Affordable Care Act and possible alternatives

2. the Affordable Care Act

3. The basics • Requires U.S. citizens and legal residents to have qualifying health coverage • Tax penalty for those who do not • Exemptions for financial hardship, religious objections, and other objections • Provides premium tax credits to eligible individuals with incomes between 100% and 400% of FPL to purchase coverage on the Marketplace • Provides cost-sharing reductions to eligible individuals with household income between 100% and 250% of FLP that enroll in Silver plans on the Marketplace

4. The basics • Prohibits lifetime and annual dollar limits • Prohibits pre-existing condition exclusions • Provides dependent coverage for children up to age 26 • Limits annual cost sharing for individuals and families • $7,150  individual for 2017 • $14,300  family for 2017 • Requires medical loss ratio (“MLR”) standards for individual, small group and large group plans • 80%  individual and small group • 85%  large group

5. The basics • Requires all individual and small group ACA-compliant plans to cover the 10 essential health benefit categories

6. The basics • Requires all individual and small group ACA-compliant plans to cover preventive services as required by the U.S. Department of Health and Human Services (“HHS”) at zero cost-sharing even if the policyholder has not met his deductible

7. Types of Plans Available • Metal Levels • ACA-compliant plans available on and off the Marketplace are categorized into metal levels • Metal levels are based on how the costs of health care will be divided and paid for by the consumer and the insurance company • Metal levels are not based on the types of benefits provided under the plan • The metal levels are Bronze, Silver, Gold, and Platinum

8. Types of Plans Available Bronze Plans Silver Plans Moderate premium Moderate deductible Eligible for cost-sharing reductions Insurance pays approximately 70% Consumer pays approximately 30% • Low premium • High deductible • Not eligible for cost-sharing reductions • Insurance pays approximately 60% • Consumer pays approximately 40%

9. Types of Plans Available Gold Plans Platinum Plans High premiums Low deductible Not eligible for cost-sharing reductions Insurance pays approximately 90% Consumer pays approximately 10% • Moderately high premium • Moderately low deductible • Not eligible for cost-sharing reductions • Insurance pays approximately 80% • Consumer pays approximately 20%

10. Status • The ACA is still the law of the land • Recent sub-regulatory guidance has modified some of the requirements of the ACA

11. Market Stabilization Rule

12. The basics • The Patient Protection and Affordable Care Act; Market Stabilization final rule was issued by the Department of Health and Human Services on April 18, 2017 • This sub-regulatory guidance modifies the interpretation of certain provisions of the ACA

13. The Basics • Shortens the open enrollment period from November 1, 2017 to December 15, 2017 • Requires pre-enrollment verification for 100% of all new consumers applying for a special enrollment period • Allows insurance companies to require individuals to pay back past due premiums before they can enroll into a plan with the same insurance company for the following year • Allows flexibility in certain plans’ actuarial value

14. Status • This rule was effective beginning June 19, 2017

15. the American health care act

16. The basics • The American Health Care Act (“AHCA”) is a repeal and replacement legislation that was introduced in the House of Representatives (“House”) on March 20, 2017 • Additional amendments were made to the original bill • The Palmer – Schweikert Amendment established the Federal Invisible Risk Sharing Program • The MacArthur Amendment established state waivers for the age ratio, essential health benefits package, and underwriting

17. The basics

18. Status • The House voted on the AHCA on May 4, 2017 • It passed with a final vote was 217 – 213

19. The better care reconciliation act

20. The Basics • The Better Care Reconciliation Act (“BCRA”) is a repeal and replacement amendment to the AHCA that was introduced in the Senate on June 22, 2017 • An additional amendment permitted insurance companies to not comply with the essential health benefits or community rating requirements of the ACA

21. The basics

22. Status • The Senate voted on the BCRA on July 25, 2017 • It failed with a final vote of 51 – 50

23. The Graham-Cassidy-Heller Amendment

24. The basics

25. Status • This is still active legislation • There has been no action on it to date

26. Current issue regarding Cost-sharing reductions

27. Cost-sharing reductions • Cost Sharing Reduction (“CSR”): a discount that lowers the amount that a consumer has to pay for deductibles, copayments and coinsurance. • Insurance companies take on additional costs by providing CSRs to eligible consumers • The Department of Treasury reimburses the insurance companies • This is a separate subsidy from premium tax credit • Eligibility is determined by the federal government • 100% and 250% of the federal poverty level • Only available on Marketplace Silver plans

28. Cost-sharing Reductions

29. United States House of representatives v. price, et al. • Initially United States House of Representatives v. Burwell, et al. • In 2014, the House filed a lawsuit against the Obama administration • The federal government reimbursed insurance companies who provided CSRs to Marketplace enrollees that enroll in a Silver plan and have incomes between 100% and 250% of the Federal Poverty Line • The House claimed that Congress had never appropriated the funds to reimburse such insurance companies and such reimbursements were a violation of the Appropriations Clause under the Constitution • In September 2015, the District Court for the District of Columbia ruled that the House did have standing • Violation of Constitutional rights • Justiciability because the injury was concreate, particular, and redressable

30. United States House of representatives v. price, et al. • In May 2016, U.S. District Judge Rosemary Collyer ruled in favor of the House • Granted the House’s Motion for Summary Judgement • Enjoined further reimbursements until a valid appropriation was in place but stayed the injunction pending any appeal by either party • The Obama administration filed an appeal • In December 2016, the case was delayed until after President Trump took office • Likely to change the ACA • Further action required in February 2017

31. United States House of representatives v. price, et al. • In March 2017, the District Court granted a joint status report motion submitted by the House and Department of Justice to submit a status report every three months beginning May 2017 • Multiple continuances have been filed since this motion was granted • The next status report is due on October 30, 2017 • In May 2017, New York and California filed a Motion to Intervene and Motion to Lift Abeyance to Consider States’ Motion to Intervene to protect the interests of its states and residents • This was granted in September 2017 • The case is still being held in abeyance

32. Questions?