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Questions & Answers for Physicians on Affordable Care Act Implementation
1. Where can I learn the basics of the law's coverage provisions?
ACP has developed an Affordable Care Act (ACA) Outreach and Enrollment campaign that will provide members with information on the law's key coverage provisions and where patients can go for help. Posters, contact information and other materials are also available to promote health coverage to your patients.
The U.S. Department of Health and Human Services www.healthcare.gov website serves as the access point to federally-run marketplaces and also provides links to resources on state-operated marketplaces. (The ACA left it up to the states to decide if they wanted to operate their own marketplace, partner with the federal government to operate it, or let the federal government operate it for them).
Marketplace.cms.gov offers posters, fact sheets, and videos on health reform.
In 2019, ACP released a position paper called “Improving the Patient Protection and Affordable Care Act’s Insurance Coverage Provisions,” which recommends that eligibility requirements for premium tax credits and cost-sharing reduction payments be expanded and enhanced to make coverage more affordable for more people. ACP also recommends that health plans that do not comply with the law be banned, that market stabilization funding be authorized, and that a public insurance option be made available.
2. Have any changes been made to help people get coverage during the COVID-19 pandemic?
The COVID-19 pandemic has created a massive demand for comprehensive health coverage. Millions have lost their employer-sponsored health insurance due to the pandemic-triggered economic recession and Medicaid and Children’s Health Insurance Program enrollment has increased. The pandemic is expected to worsen coverage disparities among Asian, Black, and Hispanic populations.
ACP called on the Trump Administration to create a special enrollment period so that uninsured individuals have an opportunity to enroll in marketplace-based insurance. Although the administration has not initiated a COVID-19-related special enrollment period for the federal marketplace, those who have lost job-based coverage may shop for and enroll in COBRA or marketplace-based coverage through a special enrollment period. ACP has also called on Congress to provide additional Medicaid funding to states and support employer-sponsored coverage.
ACP’s advocacy in response to COVID-19 can be found here.
3. What is the Trump Administration doing to get the word out about the 2020 open enrollment period?
Nationally, individual market insurance benchmark plan premiums for a 27-year-old enrollee are down 2% from the previous year in the federal market. Many insurers are profiting as a result of the pandemic and some insurers are returning to the marketplaces or entering for the first time. The Trump Administration has approved a number of state reinsurance waivers that have helped reduce premiums. The federal marketplace now enables people to “window shop” for plans before the start of Open Enrollment.
That being said, actions taken by the Administration have tempered the marketplace’s potential and an effective enrollment campaign is needed more than ever. Unfortunately, President Trump and his allies in Congress continue to oppose the ACA and support its repeal. ACP has strongly opposed efforts to repeal the ACA because the replacement proposals would, among other things, result in millions of people losing health insurance and undermine our nation’s efforts to achieve universal coverage (More on ACP’s advocacy efforts can be found here.) In 2017, Congress voted to repeal the individual mandate, which penalizes certain people who do not have minimum creditable coverage.
The U.S. Department of Health and Human Services (HHS) is providing a meager level of funding for outreach and education efforts to promote enrollment, which is especially important because the remaining uninsured may be harder to reach. This is concerning because many consumers are unaware of the availability of financial assistance that can lower the cost of their insurance.
The population that remains uninsured may be less able to afford coverage or may not know of the availability of subsidies. The uninsured are particularly concerned about the affordability of insurance. Nearly 80% have less than $1,000 in savings and half have less than $100, potentially undermining their ability to afford cost sharing requirements. A substantial portion of the uninsured marketplace-eligible group would qualify for cost-sharing assistance and premium tax credits to reduce the cost of coverage. The uninsured also have substantial unmet care needs and are less likely to receive preventive care than those with employer-sponsored insurance. However, many do not know of the availability of low-cost or free care from marketplace plans or Medicaid. Given this lack of awareness, it is important that physicians and their staff educate themselves about the health insurance options that may be available to their patients and be prepared to direct patients to their local health insurance Navigator or other assistance organization. ACP has developed state-specific patient resources that provide contact information for community-based enrollment assistance. It is also important for current enrollees to re-enroll in marketplace coverage. Many may benefit from shopping around for better care since new plans from new carriers are available in many states and may be a better fit for patients.
ACP believes that the Administration should work with Congress to provide sustained funding for dedicated outreach, consumer assistance, and education to promote open enrollment, provide in-person and virtual enrollment assistance, and respond to inquiries from the community.
4. I hear there are cheaper health insurance options available this year. Are they worth looking into?
The Administration has permitted the sale of expanded short-term, limited duration plans, which are not required to comply with the ACA’s ban on pre-existing condition exclusions, essential heath benefit coverage requirements and other consumer protections. ACP is concerned that short-term limited duration plans may destabilize the individual insurance market and increase premiums for those who need comprehensive insurance. People who enroll in short-term limited duration plans may be exposed to high health care costs if the plan they buy doesn’t cover the services they need. An investigation by the Government Accountability Office found that one-quarter of health insurance brokers deceptively marketed the plans to shoppers, with some claiming that the plans covered pre-existing conditions. ACP believes that efforts should be made to make comprehensive coverage more affordable rather than allow the sale of cheap insurance that offers little value when it’s needed most.
5. What is the California v. Texas case about? Will it really eliminate the ACA if it’s upheld by the courts?
In February 2018, a group of Republican state attorneys general, governors, and others filed a lawsuit arguing that the ACA was unconstitutional because Congress zeroed-out the individual mandate’s financial penalty in 2017. The Trump administration sided with the plaintiffs and refused to defend the ACA. As a result, a group of Democratic state attorneys generals and governors intervened to defend the law. In December 2018, a U.S. District Court judge ruled in favor of the plaintiffs, threatening the health insurance coverage of millions of Americans. The ruling was appealed and oral arguments were made in July 2019. The U.S. Supreme Court is scheduled to hear arguments on the case in November 2020.
Nearly every American would be affected if the decision to overturn the ACA is upheld. Millions would be uninsurable if the law’s insurance regulations, including pre-existing condition protections, are eliminated. Seniors could pay more for prescription drugs under Medicare. The Congressional Budget Office estimated that eliminating the major provisions of the law would cause 32 million people to become uninsured and premiums in the individual insurance market to double. ACP joined other medical societies in an amicus brief in support of the law’s defenders. In the brief, the amici argue that a decision in favor of the plaintiffs would “wreak havoc on American health care.” The College will continue to monitor developments in this important case and defend the law at every opportunity.
6. I run a small practice. Are there any resources that will help me buy coverage for my employees?
Small businesses, defined as being up to 50 full-time equivalent (FTE) employees, can shop for and purchase health insurance for their employees through a Small Business Health Options Program (SHOP)-registered agent or broker or directly from an insurance carrier. Similar to the individual marketplace, the SHOP will enable employers to make informed decisions about their options and pick coverage that meets their needs and budget. Businesses with up to 25 FTEs and an average annual employee wage of less than $50,000 (adjusted for inflation starting in 2014) are eligible for a sliding scale tax credit to purchase health insurance for their employees. The qualifying small business must also pay at least 50% of full-time employees' premium costs. Beginning in 2014, the amount of the credit is a maximum of 50% of the for-profit employer's health insurance contribution, and 35% for tax-exempt entities.
How do qualifying small business owners, e.g., physicians who qualify, claim the tax credit?
The definition of "business owner" includes a shareholder owning more than 2 percent of an "S" corporation, a sole proprietor, a partner in a partnership, an owner of more than 5 percent of other businesses, or a family member or dependent of such an individual. Additionally, an owner would not count as an employee when calculating the number of full-time employees. So, if a physician is also the owner of their practice, their salary would not be counted when determining if their firm qualifies for the small business tax credit. The salary of a physician employed by a practice would be considered if they do not meet the above criteria (partner in a partnership, sole proprietor, etc.). Employers (other than tax-exempt employers) with no taxable income for the year cannot use the credit for that year since it is applied to the employer's income tax liability. However, the IRS notes that an unused health insurance credit is considered a general business credit and can be applied to be carried back one year (excepting 2010 credits) and carried forward up to 20 years. It is unclear if physicians who claim business income as personal income for tax purposes will be eligible for the credit. Physicians are encouraged to consult their financial advisor to determine if their practice is eligible for the small business tax credit.
Employers can visit healthcare.gov for more information on how to enroll.
Employer contributions towards employees' individual market health insurance premiums
Some small employers have considered dropping their group health insurance and providing their employees a stipend or reimbursement to help them purchase individual market insurance. As of 2017, certain small employers with fewer than 50 employees may be able to provide a Qualified Small Employer Health Reimbursement Arrangement (QSEHRA), an HRA to their employees to pay premiums or fund the purchase of coverage that meets the ACA’s minimum essential coverage definition. Starting January 1, 2020, employers have the option of offering employees an Individual Coverage Health Reimbursement Arrangement (HRA) to reimburse medical care costs, including premiums for individual market coverage, instead of providing traditional group health insurance. Small physician practices may find that providing their employees with funding to buy individual market insurance is a viable option, but a few points should be considered:
- The ACA provides premiums tax credits to individuals who do not have an offer of affordable and comprehensive job-based insurance and meet the income thresholds. Practices should be aware of the eligibility requirements for premium tax credits for marketplace-based insurance. Eligibility information can be found here. Even with the ACA's premium tax credits, employees may end up with higher premiums than employer-based group health insurance. Practices should also consider how any additional premium-offsetting income would affect employees' eligibility status for tax credits to purchase marketplace-based insurance.
- Employees cannot receive tax credits to purchase marketplace-based insurance if they have an offer of job-based health insurance that meets affordability (i.e., employee contribution is under 9.83% of household income for self-only coverage in 2021) and comprehensiveness (insurance has an actuarial value of at least 60%) guidelines. If a practice is considering transitioning their employees to the individual market and contributing to their health costs, then they would need to terminate existing group coverage in sufficient time to permit their employees to enroll in marketplace-based coverage.
- As stated above, Individual Coverage HRAs can now be used to help pay individual market health insurance inside or outside of the marketplace instead of traditional group health insurance. However, there are many rules and regulations to be considered before making a decision. For example, an employer has to offer the HRA on the same terms to all individuals within a class of employees, such as full-time workers, part-time workers, and seasonal employees. If an employer chooses to offer employees an HRA it may affect whether the employee can receive a premium tax credit to subsidize marketplace-based insurance. This FAQ provides additional information on the Individual Coverage HRA option.
- Employers receive a tax break for providing group insurance to their employees. Practices should consider the financial impact if health benefits change.
- The ACA requires that starting in 2016, employers with over 50 full-time equivalent employees will be subject to a tax penalty if they do not offer affordable, comprehensive health insurance and their employees receive tax credits to purchase marketplace-based insurance. More information on the employer penalty can be found here and here.
- Consult your tax or financial advisor to determine the best option for your practice.
For more information on health insurance options for small businesses, consult this guide from Small Business Majority.
7. My staff already has trouble collecting co-pays and deductibles from patients. Is the law going to make this problem worse?
Evidence shows that the ACA has improved self-reported coverage, access to primary care, medications, affordability and health. New insurance regulations cap cost-sharing and mandate minimum benefits for most health plans. Premium tax credits and cost-sharing assistance are available to make insurance more affordable. Shopping for and enrolling in health insurance is less complicated and enrollment and post-enrollment assistance is available from Navigators, in-person assisters, and telephone hotlines.
The rising cost sharing burden has been increasing for the past decade, well before enactment of the ACA. Facing pressure from rising health insurance premium costs, employers have shifted a larger portion of the insurance cost burden to their employees, mostly in the form of deductibles.
Physicians should be aware that cost sharing assistance is available for silver plan-enrolled individuals with incomes up to 250% of the federal poverty level. This subsidy enhances the plan's generosity, reducing co-payments, deductibles and other cost sharing. Unfortunately, many enrollees are not aware of the availability of financial assistance or how to choose a plan with affordable cost sharing. Many of the newly insured may not understand health coverage concepts like deductibles and coinsurance, leading to cost-sharing collection problems. Many may be unaware of what health services and items are covered by their insurance or that certain preventive services are free. They may be confused about provider network policies and surprised when confronted with unexpected changes for receiving out-of-network care. For some enrollees, cost sharing–particularly deductibles–could create affordability problems.
Physicians can educate themselves about the law's coverage provisions and direct patients to Navigators and other consumer assistance resources. The Local Help search tool is a directory of trained community Navigators and assisters who can provide impartial information to patients about finding the right coverage.
There are resources that you can provide to your patients to educate them about how insurance works. The Kaiser Family Foundation’s Frequently Asked Questions on Health Insurance Marketplace and the ACA document provides information on a variety of topics.
8. Will my claims be paid if a patient with Marketplace-based coverage doesn't pay their premium and loses their coverage?
Only if the service occurs in the first month that the enrollee enters the 3-month grace period before coverage is 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. The federal regulations state that 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.
This is a potential problem, especially because it's unclear how quickly insurers will alert physicians about the grace period. To prevent any unpaid claims, staff should verify each patient's health coverage status to ensure they are in good standing. ACP is working to change this policy. On February 11, 2014, the College sent the following recommendations to Health and Human Services Secretary Kathleen Sebelius regarding the grace period:
- ACP recommends that QHPs [qualified health plans] be required to adopt standards enabling physicians to access real-time patient enrollment verification, patient cost-sharing responsibility, and claims processing information. QHPs should be required to provide real-time notification when a patient enters the 90-day grace period. Notification should provide information on which month of the grace period the enrollee is in. Failure to notify a physician of grace period entry should initiate a binding eligibility determination upon the insurer, requiring the QHP to pay claims during the grace period.
- CMS should track QHP adherence to grace period notification standards and consider such criteria during the initial certification and recertification process.
- In 2017, the Centers for Medicare and Medicaid Services (CMS) finalized a regulation allowing insurers to collect past-due premiums upon re-enrollment. ACP commented that if this policy is adopted, insurers should be required to pay claims for services provided to the enrollee during the grace period. CMS clarified "that issuers are required to pay all appropriate claims for services rendered to the enrollee during any months of coverage for which past-due premiums are collected."
9. Will patients be able to check to see if I am in a marketplace-based plan's network before signing up?
The ACA requires that health plans make a provider directory available to provide information on which providers are in the plan's network. As recommended by ACP, the federally-facilitated marketplace requires health insurers to provide a link to their online provider directory. Plan shoppers can use a provider search tool to search for insurance based on whether their preferred provider is in the plan's network. Some state-based health insurance exchanges also offer a provider search tool.
ACP is pleased that the federal government has enhanced its requirements on provider directories for plans offered in federally-operated marketplaces. Insurers are now obligated to update their online provider directories at least monthly and provide more information to plan shoppers. Healthcare.gov also allows shoppers to search for plans that include their preferred physician in the “provider” network. Patients can also contact the health plan directly or their physician's office staff to see if their preferred physician or hospital is listed as a participating provider and considered in-network before signing up for a plan.
10. I've heard that marketplace-based health plans have created tight provider networks that exclude physicians and hospitals that are popular with patients. Will this exclude the best physicians and other health care providers from plan networks?
Some insurers are forming limited networks of providers in an effort to curb costs. The ACA and state 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. States may have their own network adequacy requirements that compliment federal rules. Further, marketplace-based plans must ensure that "essential community providers" that serve predominately low-income, medically-underserved individuals are available in their network.
Despite these safeguards, narrow networks persist.
- A report by the Robert Wood Johnson Foundation found that 41% of 2014 silver QHP networks were small (they include 10-25% of office-based participating providers in the area) or extra small (less than 10% included in network).
- By specialty, 36% of primary care networks and 23% of internal medicine specialty networks were small or extra small.
- A McKinsey & Co. report found that in 2017, 53% of individual market hospital networks across all metal tiers were tiered, narrow or ultra-narrow. Network breadth is declining in some areas and the percentage of consumers who only have access to narrow network plans has increased three-fold since 2015.
ACP remains concerned that narrow networks may prevent affordable access to high quality, local providers. Patients with limited health insurance literacy may not understand the implications of choosing a narrow network plan, including having to pay elevated cost sharing for seeking an out of network preferred physician. To function correctly and mitigate the potential for surprise charges and frustration, health plans need to improve network transparency and regulators need to provide ongoing scrutiny of provider networks to ensure they are adequate. To address the narrow network issue, ACP has made the following recommendations to federal and state regulators:
- Improve current network adequacy standards by taking into account additional criteria-including patient-to-physician ratios, use of out-of-network clinicians and hospitals, and urban, suburban, and rural area-relevant standards-as indicators of access.
- Develop network adequacy standards for PPOs, including factors such as whether a hospital contracts with an in-network physician.
- Continuously monitor network adequacy and make compliance and complaint information available to the public.
- Federal and state regulators must work together to address network adequacy concerns that are most relevant to each state (and the individual health plan service areas within each state).
11. Will the medications my patients are taking be covered by a marketplace plan?
Prescription drug coverage is considered an essential health benefit that all qualified health plans offered through the marketplace are required to cover. However, there can be variation among plans as to which drugs are covered and which ones are not; a drug covered in one plan may not be covered in another. Qualified health plans are required to cover at least the greater of one drug in every U.S. Pharmacopeia category and class or the same number of drugs in each category and class as the state's essential health benefit benchmark plan. State benchmark plans can be found here. Health plans must also have procedures in place to ensure that enrollees have access to clinically appropriate drugs prescribed by a provider but not included in the health plan's drug formulary. It is best for the patient to review the prescription coverage offered by a plan in consultation with their doctor prior to purchasing the plan to ensure it covers their medications. If the patient is still unsure if their specific medications are covered, they should contact the plan directly to inquire about coverage.
ACP has asked health plans and federal and state regulators to provide increased oversight of formularies to ensure they are not unduly restrictive. Regulators should closely monitor formularies and other benefit design features to ensure that coverage does not exclude vulnerable patients. The prescription drug exception process should be strengthened so that patients can receive necessary services. The College has recommended that health plans with restrictive formularies should allow patients to have access to prescription drugs in dispute during the entire exception review process, with expedited internal appeals for urgent care situations, and if an exception is granted, plans should continue to provide coverage.
12. My practice can't handle any more patients. Does the law require me to see patients with marketplace-based coverage?
No. Physicians are not obligated to contract with commercial plans or public programs like Medicaid and Medicare. However, health plans offered through the marketplaces are required to meet "network adequacy standards" to ensure that there are a sufficient number of physicians and other clinicians available for their plan enrollees. In addition, the ACA includes a number of programs to increase the supply of primary care physicians including funding a near-tripling of the number of physicians who have received scholarships or loan forgiveness under the National Health Services Corps; increased funding for Community Health Centers; redistribution of unused residency positions to primary care residencies; and funding for innovative primary care delivery models including Patient-Centered Medical Homes. Team-based care arrangements-where physicians, advanced practice nurses, physician assistants, and health professionals work together to ensure that patients have access to the care they need-can also help meet the growing demand for primary care. Additional reforms will be needed, though, to alleviate shortages in primary care and other specialties.
13. Are there resources available to me to help answer questions from my patients about the ACA, and get them help in understanding and enrolling in the plans offered through the marketplaces?
Yes! ACP has compiled extensive resources that you use to help your patients. In addition, brochures explaining the marketplaces and other key parts of the law are available from www.healthcare.gov. See all of the resources for you and your patients that are available through ACP.
14. Will I be able to sign up for health insurance coverage in time to avoid facing a penalty?
First off, starting in the 2019 plan year there is no penalty for failing to enroll in health insurance coverage. However, having comprehensive coverage is incredibly important and is associated with reduced mortality. After a somewhat rough start, the healthcare.gov website is much more functional and reports of problems have decreased. The website now features new shopping tools to help consumers find plans that reflect their level of health care usage, a simplified re-enrollment process, a provider director and formulary search tool, and more resources designed to educate shoppers about health insurance and how to use it.
The healthcare.gov website is not the only way to apply for coverage. There are still four ways that consumers can sign up for health insurance:
- Over the phone - Call center is available 24 hours a day, 7 days a week. The number is 1-800-318-2596/ TTY: 1-855-889-4325
- In-Person - find in-person assistance in your community here.
- By mail using a paper application
Visit this page for more details on how to apply.
15. I don't support the ACA so why should I help my patients sign up for something I think will be bad for them and the country?
You must make your own decision on how you will respond to questions from patients about the new law. ACP, for its part, supports the ACA's programs to expand coverage to tens of millions of persons and provide better health insurance to everyone else. We urge all of our members to be helpful to your patients when they come to you with questions about the marketplaces, subsidies, and other benefits created by the ACA. Members who disagree with the ACA have every right to engage in the political and election processes to seek changes, but we hope that when it comes to one of your patients coming to you to seek help in understanding how they might get coverage from the marketplaces or Medicaid, you will use the practical resources available from ACP and others to make it as easy for them as possible.