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Affordable Care Act Issues Physicians Need to Know

The bulk of the Affordable Care Act’s coverage provisions went into effect on January 1, 2014, including tax credits for Marketplace-based coverage, Medicaid expansion, and insurance industry reforms such as prohibitions on pre-existing condition coverage limits. For physicians and patients, the expansion of coverage presents an opportunity to improve patient’s access to care and nurture the doctor-patient relationship. The ACA may also create new challenges, as some insurance plans offer limited provider networks that may disrupt continuity of care, create tight prescription drug formularies, and require high cost-sharing responsibilities that may place a financial burden on patients. This document will provide practical advice to physicians and their patients who face such issues and what they can do to ensure access to patient-centered care in the reformed health system. ACP has created resources for physicians and their patients to help them learn about the ACA’s coverage provisions, how to sign up for coverage and where to get enrollment help. The ACA enrollment resources can be found here.

Have questions or comments about ACA health insurance marketplaces and enrollment? Contact ACP staff at policy-regs@acponline.org to share your thoughts.

Provider Networks

Some Marketplace-based insurers have formed limited networks of providers in an effort to curb costs. A study by McKinsey & Co. found that narrow network plans (where less than 70 percent of all hospitals in the rating area participate in the network) and tiered plans (where cost-sharing varies for different hospitals) comprise 48 percent of all exchange networks in the United States and were available to 92 percent of individuals eligible to purchase exchange-based health insurance.

The ACA network rules are in place to ensure that:

  • Plan networks are adequate to meet patient need. Federal regulations mandate that a plan’s network be sufficient in number and types of providers to assure that services are accessible without unreasonable delay.
  • Plan networks must include providers specializing in mental health and substance abuse services.
  • Marketplace-based plans must ensure that “essential community providers” that serve predominately low-income, medically-underserved individuals are available in their network.
  • States may have their own network adequacy requirements that complement federal rules, such as those related to travel times, patient-to-physician ratios, and geography considerations.

For 2015, the provider network adequacy of plans sold through the federally-run marketplace will be evaluated using a reasonable access standard and will give special attention to a network’s access to hospital systems, mental health providers, oncology providers, and primary care providers. If CMS determines that a plan’s network does not provide access without unreasonable delay, the agency will alert the plan, evaluate the health carrier’s response, and decide whether the plan can be certified. CMS will also work with state officials and provider ongoing monitoring of QHP network access. The agency has indicated it will work with states to articulate specific network adequacy criteria, such as time and distance requirements, to ensure providers are accessible.

State insurance regulators are largely responsible for enforcing the ACA’s insurance regulations. If physicians are concerned that a health plan is not meeting network adequacy standards, they should contact their state’s insurance regulator to file a concern.

Because provider directories may be outdated and provider network status difficult to verify, physicians may find it difficult to advise their patients on whether they’re included in a plan’s network.

  • Physicians are encouraged to scrutinize insurer contracts for all-product clause language and consider their practice’s capacity and existing patient panel prior to entering any new agreement with the insurer.
  • If a plan’s network has not yet been finalized and is not subject to an all-products clause, the practice can then make the decision whether it wants to participate in the plan’s network or opt out.
  • Practices should be proactive and verify with insurers whether or not they are included in their marketplace-based insurance networks.
  • Similarly, physicians should alert health plans if their network status changes and they are no longer participating in the plan so that provider directories can be updated.

To help promote continuity of care, on December 17, 2013 the federal government published an interim final rule encouraging health plans to consider certain out-of-network providers as in-network if they were listed as such in the provider directory available to patients at the time of enrollment. The rule also urges insurers to consider providers as in-network for the duration of an acute care treatment that was initiated in the previous year. Finally, the rule encourages plans to refill patients’ existing prescriptions, even if they’re not on the plan’s formulary, for the month of January. The 2015 notice to federally-run marketplace insurers again encourages coverage of a fill of non-formulary drugs and transitional access to out-of-network providers during acute care episodes for new enrollees. Some states require plans (often managed care plans) to temporarily continue care provided by a health care provider that does not participate in the plan’s network. A list of relevant state laws can be accessed here.

Despite these policy improvements, concerns about limited provider networks remain. Physicians and their patients should be aware that the ACA requires that non-grandfathered plans (i.e. most plans created after March 23, 2010) cover hospital emergency care and that plans provide coverage of emergency services without prior authorization and cannot charge higher cost-sharing for out-of-network emergency services.

ACP has issued recommendations on how to improve provider networks. The College’s work on this and other ACA policy matters can be found here.

Appealing Health Plan Decisions

If a Marketplace-based health plan denies to pay a patient’s claim for a service they’ve already received, the patient can request an internal review with the health plan, but must do so within 6 months of receiving notice that the claim was denied. If the patient disagrees with the health plan’s internal review decision, they can have the claim reviewed by an independent third party. An expedited external review may be granted depending on the immediacy of the patient’s medical need. A representative – such as a physician or other health care professional – may be appointed by the patient to act on their behalf during the external review process. Health insurers are required to abide by the decision of the external reviewer. More information on this process can be found here and here.

State appeal review processes may vary, so patients should check with their local Department of Insurance or other related regulator regarding their appeals rights.

Patients can seek help with an appeal through the following resources:

  • The Health Insurance Marketplace Call Center, 1-800-318-2596 (TTY: 1-855-889-4325); the call center is accessible 24-hours a day, 7 days a week. Patients with limited English proficiency can call 1-800-318-2596.
  • Patients may also contact their state’ insurance commissioner or Consumer Assistance Program. More information can be found at localhelp.healthcare.gov.

Patients may also appeal eligibility decisions made by the Marketplace and associated plans, including a Marketplace’s decision on eligibility for premium or cost-sharing assistance. More information on that process can be found here.

High Deductibles and other Cost Sharing

It is estimated that the law will reduce the number of people without health insurance by 26 million by the year 2024. New insurance regulations will cap cost-sharing and mandate minimum benefits for most health plans. Shopping for, and enrolling in, health insurance will be less complicated. Insurers will be prohibited from denying or renewing health coverage based on a patient’s pre-existing condition or health status. Annual and lifetime dollar limits on essential health benefit coverage will also be banned (plans that existed before March 23, 2010 may be subject to annual dollar limits) and plans can no longer drop enrollees from coverage when they get sick.

Despite these positive changes, the new system will undoubtedly pose challenges to physicians and other health care providers. Many of the currently uninsured and newly insured may not understand health coverage concepts like deductibles and coinsurance, leading to cost-sharing collection problems. Reflecting trends in existing employer-sponsored health plans, many Marketplace plans will have significant deductibles and other cost sharing requirements.

However, physicians can smooth the transition by educating themselves about the law’s coverage provisions and directing patients to Navigators and other consumer-assistance resources. Physicians should tell their patients at the time of service what their cost-sharing obligation will be. It’s also a good idea to contact the patient’s insurer and verify that they’re enrolled in coverage. This will be particularly important in the early months of the health insurance expansion. Physician practices should be aware that patients receiving premium tax credits who do not pay their monthly insurance premiums will enter a 90-day grace period after which their coverage will be terminated. During months two and three of the grace period, insurers may pend claims for services provided during that period; if the patient’s coverage is terminated, the insurer is not obligated to pay claims for services provided during the final 2 months of the grace period. Insurers are required to notify providers that the patient has entered the grace period and that claims may go unpaid for services provided during final 60 days.

Patients need to be aware of their cost sharing responsibility and make necessary financial arrangements, such as setting aside money to pay deductibles.

  • Premium tax credits are available to individuals and families with incomes up to 400% of the federal poverty level (FPL). Additionally, patients with incomes up to 250% FPL ($59,625 for a family of four in 2014) who pick a “silver-level” plan are also eligible for financial assistance to lower the amount of cost sharing they have to pay. This additional financial assistance can be a big help to patients facing large deductibles, co-insurance, or co-pays.
  • Marketplace-based insurance plans are grouped by metal tiers, which indicate a health plan’s generosity. A bronze plan generally will have lower premiums but higher cost-sharing, while a platinum plan will have higher premiums and lower cost-sharing. There can be variation within metals tiers: for instance, two silver-level plans may have the same deductible, but one may charge $1,500 per hospital admission, while the other would charge 30% coinsurance per hospital admission.
  • The ACA requires total yearly out-of-pocket costs for in-network services to be capped at $6,350 for a single person plan and $12,700 for a family plan in 2014. This cap will be adjusted annually.
  • For small group health plans, annual deductibles on essential health benefits may not exceed $2000 for an individual or $4000 for a family health plan.
  • Non-grandfather plans (i.e. those created after March 23, 2010) are required to cover certain preventive services and vaccines at no cost to the patient. A list of eligible services can be found here.
  • Patients need to be aware that if their circumstances change – their income increases or they switch plans – their cost-sharing and premium assistance may be affected. Patients should be advised to notify their state’s Exchange when their income increases so their financial assistance can be adjusted accordingly; otherwise, they may have to refund a portion of their tax credit amount when they file their taxes.
  • Insurance plans are also required to provide a Summary of Benefits and Coverage as well as a Uniform Glossary of insurance terms. This will provide patients with an easy-to-understand explanation of the benefits to which they are entitled, the portion of cost-sharing they are required to pay and other information. The glossary will explain terms such as deductibles and co-insurance in plain language. The healthcare.gov glossary of terms can be accessed here. Summaries and glossaries are available in languages other than English. Patients can request such documents from their insurer.

Prescription Drug Coverage

A recent Kaiser Health News article highlighted a troubling problem – that health insurance plans were crafting their benefit packages in a way that would discourage sick people from enrolling, such as through the creation of tiered prescriptions drug formularies that would force chronically ill patients to pay steep co-payments for necessary medications. Advocates for HIV/AIDS patients have filed complaints against a number of Florida health plans arguing that prescription drug benefits have been structured in a manner that discriminates against vulnerable patients. When shopping for the Marketplace-based plan that is right for them, patients should consider the plan’s drug coverage adequacy and cost and whether or not the plan uses drug tiers, quantity limits, formularies, step therapy or other mechanisms. Regulations state that health benefits cannot be crafted or implemented in a way that discriminates based on a person’s age, expected length of life, present or predicted disability, degree of medical dependency, quality of life, or other health conditions. Individual and small group health plans are now required to cover an essential health benefits (EHB) package that includes services in categories such as hospitalizations, outpatient care, and maternity care. Prescription drug coverage is among the EHB categories. Specifically, to meet EHB requirements, plans must cover:

  • At least the greater of one drug in every category and class in the U.S. Pharmacopeia, or the same number of drugs in each category and class as the state’s EHB-benchmark plan. State benchmark plans can be found here.
  • Drugs have to be chemically distinct to be counted as more than one drug per category or class. For instance, a brand-name drug and its generic equivalent would not be counted as two separate drugs in a category or class.
  • Marketplace-based health plans are obligated to submit drug lists to the Marketplace. Plans sold outside of the Marketplace must provide drug lists to the state, and multi-state plans must submit their drug lists to the federal Office of Personnel Management for review.

Health plans are required to have in place an exceptions process to ensure that enrollees have access to clinically-appropriate drugs that are prescribed by a provider but are not included on the plan’s drug list.

Patients should contact their plan for specific guidance on accessing non-covered drugs. The general Marketplace-recommended process is as follows:

  • Physician contacts the patient’s health plan (orally or in writing) to confirm that the drug is medically appropriate for the patient’s condition based on one or more of the following:
    • All other drugs covered by the plan either haven’t or won’t be as effective as the requested drug
    • Any alternative drug covered by the plan has caused or is likely to cause side effects that may be harmful to the patient.
    • If there’s a limit on the number of doses you’re allowed:
      • That dosage hasn’t worked for your condition, or
      • The drug may not work for you based on your physical or mental makeup.
    • If a patient is granted an exception the drug will be treated as covered and the plan will charge a copayment equivalent to that of the most expensive drugs covered by the plan. Cost-sharing will be counted towards the patient’s out-of-pocket maximum and deductible.

The federal government is encouraging health plans to decide drug coverage requests within 3 days of receipt.

Plans are obligated to provide the drug to the patient during the exceptions process.

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