- Medigap News: Disparities in Enrollment Rights; Bill Introduced to Strengthen Medigap Access and Protections
- Nursing Home “In-House” Managed Care Plans May Harm Residents
- Now Can We Call it Sabotage?
- Helpful News for Some Lower Income Medicare Beneficiaries
- SNF "No Harm" Newsletter – New Issue Now Available
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Kaiser Family Foundation Report
A report recently issued by the Kaiser Family Foundation, “Medigap Enrollment and Consumer Protections Vary Across States” (July 2018), “provides an overview of Medigap enrollment and analyzes consumer protections under federal law and state regulations that can affect beneficiaries’ access to Medigap. In particular, [the] brief examines implications for older adults with pre-existing medical conditions who may be unable to purchase a Medigap policy or change their supplemental coverage after their initial open enrollment period.”
After describing Medigap enrollment rights available under federal law (in other words, rules governing when issuers of such policies must sell them to individuals), the Report highlights the variance in state laws, which can go further than the minimum federal enrollment standards to provide additional enrollment rights. Among other findings, the Report notes that “[o]nly four states (CT, MA, ME, NY) require either continuous or annual guaranteed issue protections for Medigap for all beneficiaries in traditional Medicare ages 65 and older, regardless of medical history.” The Report goes on to note that “[i]n all other states and D.C., people who switch from a Medicare Advantage plan to traditional Medicare may be denied a Medigap policy due to a pre-existing condition, with few exceptions, such as if they move to a new area or are in a Medicare Advantage trial period.”
In addition, “[o]nly 5 percent of traditional Medicare beneficiaries under age 65 had Medigap in 2015—considerably lower than the shares in older age brackets [citation omitted]. The low enrollment in Medigap by beneficiaries under age 65 is likely due to the lack of federal guarantee issue requirements for younger Medicare beneficiaries with disabilities […] and higher rates of Medicaid coverage for people on Medicare with disabilities who tend to have relatively low incomes.” As discussed in a CMA Alert from October 2016, state law varies considerably with respect to extending Medigap rights to individuals under 65.
The Report also highlights that Medigap enrollment rights are considerably more limited than the annual opportunities Medicare beneficiaries have to get in and out of private Medicare Advantage and Part D plans, and that those who wish to change from a Medicare Advantage plan to Medigap coverage may be disadvantaged:
Medigap is not subject to the same federal guaranteed issue protections that apply to Medicare Advantage and Part D plans, with an annual open enrollment period. As a result, in most states, medical underwriting is permitted which means that beneficiaries with pre-existing conditions may be denied a Medigap policy due to their health status, except under limited circumstances.
Federal law requires Medigap guaranteed issue protections for people age 65 and older during the first six months of their Medicare Part B enrollment and during a “trial” Medicare Advantage enrollment period. Medicare beneficiaries who miss these windows of opportunity may unwittingly forgo the chance to purchase a Medigap policy later in life if their needs or priorities change [citation omitted]. This constraint potentially affects the nearly 9 million beneficiaries in traditional Medicare with no supplemental coverage; it may also affect millions of Medicare Advantage plan enrollees who may incorrectly assume they will be able to purchase supplemental coverage if they choose to switch to traditional Medicare at some point during their many years on Medicare.
As the Center has noted elsewhere, recent statutory and regulatory changes have served to both favor Medicare Advantage enrollment and undermine Medigaps as an option for Medicare beneficiaries. Rights to purchase Medigap supplemental insurance policies should be expanded to people under 65 and to include ongoing access for all in order to provide real, meaningful choices for all Medicare beneficiaries. As discussed below, a Congressional bill has recently been introduced that would vastly improve this situation.
Bill Introduced to Strengthen Medigap Access and Protections
Today, July 18, 2018, , Representative Sandy Levin (D-MI), the Ranking Member of the Ways and Means Health Subcommittee, introduced the “Medigap Consumer Protection Act of 2018” (see press release, bill text, and summary).
As noted in the press release issued by Congressman Levin’s office, among other things, this Bill would:
- “Strengthen federal consumer protections to ensure that beneficiaries with disabilities and end-stage renal disease can purchase a Medigap policy without being denied coverage or subjected to higher premiums based on their health status or pre-existing conditions.
- Extend access protections to other beneficiaries, including individuals in Medicare Advantage who wish to switch back to traditional Medicare.
- Require the Secretary of HHS to conduct a comprehensive overhaul of the Plan Finder website to ensure that beneficiaries have access to complete and understandable information when comparing enrollment options.
- Restore access to the two most popular Medigap policies (Plans C and F), which are set to be eliminated for beneficiaries who enroll in Medicare after January 1, 2020.”
If enacted, this Bill would be an important step toward improving beneficiary choice regarding how they wish to access their Medicare coverage, and leveling the playing field between traditional Medicare and Medicare Advantage.
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An emerging issue of concern for advocates is nursing facilities’ increased marketing of “in-house” managed care plans – specifically, Institutional Special Needs Plans, or I-SNPs – to their residents. These Medicare Advantage plans are limited to beneficiaries who require, or are expected to need, institutional long-term care for 90 days or more.
A recent article in Skilled Nursing News describes the “boon” for some nursing facility companies in developing their own I-SNPs, citing Marquis Companies. Skilled Nursing News reports, “Marquis Companies, which primarily operates in the MA hotbed of Portland, Ore., has seen $10 million in revenues since it launched its AgeRight Advantage plan in January 2017.” Operating an I-SNP gives long-term care companies “greater control over their reimbursement fates.” In 2015, “there were about 65 plans nationwide with a total of 50,000 covered enrollees; in just three years, that number rose to 113 and 75,451, respectively.”
While I-SNPs may be financially advantageous to nursing home chains, they can create real dangers of non-coverage for nursing home residents who buy the plans. Last year, Kaiser Health News examined Erickson Advantage, an I-SNP offered solely to residents of Erickson Living, its continuing care retirement community (CCRC).
A resident of an Erickson CCRC in Massachusetts, who had an Erickson Advantage plan, was hospitalized and then returned to the skilled nursing facility (SNF) part of the CCRC. After 11 days, Erickson Advantage advised the resident’s daughter that her mother no longer needed daily therapy and, as a result, that the plan would no longer cover her stay at the SNF. The SNF billed the resident a daily rate of $463, later raised to $483. The daughter appealed the denial of coverage for the SNF stay. She eventually lost her administrative appeal before the Administrative Law Judge who, relying on testimony from the SNF staff, held that her mother’s stay in the SNF was not covered by Erickson Advantage. The resident’s bill for the SNF was $30,000 and counting at the time of the Kaiser report. The Erickson CCRC in Maryland reversed its denial of coverage for a SNF stay of another resident, following an inquiry by the Kaiser reporter.
Kaiser Health News quoted Center for Medicare Advocacy attorney Toby Edelman as saying that in-house plans reflect a conflict. While CCRCs claim they provide a full range of services to their residents, including SNF care, the managed care plan sold to the CCRC’s residents may decide that the SNF stay is not covered.
 Alex Spanko, “In-House Insurance Plans May Boost Skilled Nursing Operators, But Not Without Risk,” Skilled Nursing News (Jul. 8, 2018), https://skillednursingnews.com/2018/07/house-insurance-plans-may-boost-skilled-nursing-operators-not-without-risk/.
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In a previous CMA Alert we highlighted a statement reportedly made by CMS Administrator Seema Verma that she took “exception to those out there who have made claims that we have tried to sabotage the health care of the American people, particularly when it comes to the health-care exchanges…” We listed actions taken prior to that statement that we believe undermined the Affordable Care Act (ACA) and the stability of the Exchanges.
Here are a few new examples that must, unfortunately, be added to our previous Sabotage list:
- In a hearing on Capitol Hill, Health and Human Services (HHS) Secretary Azar defended the Administration’s proposal on junk plans. Azar is quoted as saying “…expanding short-term health plans will not harm the insurance marketplace.” He also stated that “People are not going to be leaving subsidized insurance,” even as repeated studies show the opposite to be true.
- The U.S. Department of Justice (DOJ) sided with the states that are suing the federal government over the constitutionality of the ACA and will not be defending it against the lawsuit. DOJ actually argued against provisions of the ACA that guarantee coverage to people who are older, sicker, or have pre-existing conditions.
- The Department of Labor issued the final rule for Association Health Plans. Expanding these plans will make it easier for certain small employers to offer plans don’t have ACA coverage protections. These plans could attract younger, healthier consumers away from the ACA Marketplace, raise costs for consumers who are older or sicker, and weaken essential health benefits for people who need coverage the most.
- CMS released reports on the performance of the exchanges and the individual health insurance market. The reports used unhelpful statements such as “Reports show individual market erosion and increasing taxpayer liability” and “…Obamacare was failing its consumers.”
- The Administration is slashing even more funding for organizations called “navigators” that assist people who need health insurance. The Washington Post reported that for the upcoming enrollment period, funding for navigators will be cut from $36.8 million to $10 million. Just as troubling, organizations that apply for navigator grants will be “expected” to promote inadequate insurance such as Association Health Plans and short-term plans.
- The Sunlight Foundation’s Web Integrity Project found that HHS removed 14 pages of information about the Affordable Care Act from its Medicaid website. According to the Sunlight Foundation, the removed pages “provided information such as eligibility requirements under Medicaid and the ACA…” The Foundation also states that “Other Americans who are newly eligible for Medicaid through Medicaid expansion under the ACA could have used this information to understand how the ACA affects their Medicaid benefits and services they can receive.”
- The Administration announced that it was stopping payments to insurers under the ACA’s risk adjustment program. The risk adjustment program supports insurers that provide coverage to large numbers of sicker enrollees who have higher costs. America’s Health Insurance Plans, an insurance industry group, stated that CMS’ decision “will create more market uncertainty and increase premiums for many health plans, putting a heavier burden on small businesses and consumers, and reducing coverage options.
Regrettably, this looks like more sabotage to us.
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The Social Security Administration (SSA) has released revisions to the Program Operations Manual System (POMS) regarding how to process Part A enrollments that are conditional to a state’s determination of a beneficiary as a Qualified Medicare Beneficiary (QMB). The update is intended to address inconsistencies and confusion in SSA field offices and includes important clarifications, such as:
- The conditional enrollment process applies in both Part A Buy-in and Group Payer states.
- Field Offices should explain the QMB program and conditional enrollment process if an individual lacks premium-free Part A and appears to meet QMB requirements.
- SSA field offices can add notes to the “Remarks” section of the application and provide a screen shot to the individual so the individual can provide proof of conditional Part A enrollment when applying for QMB through the state.
- Beneficiaries are allowed to complete the conditional application even if they owe Medicare premiums.
- In Part A Buy-in states, SSA should process conditional applications on a rolling basis (without regard to enrollment periods), even if the application coincides with the General Enrollment Period.
For more information on QMB status and the Medicare Savings Programs please visit: https://www.medicareadvocacy.org/medicare-info/medicare-savings-programs/.
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Elder Justice: What "No Harm" Really Means for Residents is a newsletter published by the Center for Medicare Advocacy and the Long Term Care Community Coalition. The purpose of the newsletter is to provide residents, families, friends, and advocates information on what exactly a "no harm” deficiency is and what it means to residents. This issue provides real stories of resident harm from New York, New Jersey, Massachusetts, and Tennessee. Resident harm from this issue include a nursing home failing to secure a resident in her wheelchair, resulting in a hematoma, lack of oxygen, bodily pain, and bruising.
- To read the latest issue of the newsletter or to access past issues, please visit: https://www.medicareadvocacy.org/newsletter-elder-justice-what-no-harm-really-means-for-residents/.
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