Conservative radio talk show hosts jumped on news this week broken by the New York Times that some of the consumer protections in the Affordable Care Act would be delayed a year. But how many insurance plans in Connecticut would be impacted?
That’s hard to say since the Insurance Department doesn’t regulate self-insured plans generally offered by large companies or the government. The state Insurance Department regulates plans held by about 30 percent of Connecticut’s population and about 50 percent of the commercial market. The rest of the commercial market is regulated by the U.S. Department of Labor.
But one state official said the delay on the out-of-pocket costs would only impact a subgroup of those self-insured plans that don’t use big insurance companies or HMOs to administer their health plans. It could impact employers that use smaller, third-party administrators to handle their claims data.
The federal ruling that limits the out-of-pocket costs, including deductibles and co-payments, to $6,350 for an individual and $12,700 for a family, only applies to self-insured plans outside Connecticut’s exchange.
The U.S. Department of Labor release a FAQ document in February detailing the delay, but it went largely unnoticed until the New York Times published its piece on Tuesday.
Access Health CT CEO Kevin Counihan said Thursday that those out-of-pocket limits won’t be exceeded by any of the carriers offering their plans through Connecticut’s exchange.
“I frankly believe this issue got overblown,” he said.
Consumers purchasing their plan through the exchange will be guaranteed not to pay more than $6,350 if they’re on an individual plan or $12,700 if they’re on a family plan. The only plans the federal ruling would impact would be plans offered by private companies that use third-party administrators who have computer systems that can’t talk to the pharmacy benefit manager or behavioral health partner’s computer systems to keep track of those costs. Theoretically, it means some people could be charged up to $6,350 twice, once for major medical and once for pharmacy benefits.
But it’s unlikely that will be the reality for many in Connecticut.
“I really think this is a small issue,” Counihan said Thursday. “I think some people are making a bigger deal out of it than it is.”
The one-year delay is supposed to give the companies time to figure out how to get their systems to share data so they can track the out-of-pocket costs for pharmacy and behavioral health benefits. But the limits were established as part of the law to help those with chronic illnesses from having to pay more for necessary treatments.
In April, Nancy Hughes of the National Health Council, a patient advocacy group, wrote a letter to the U.S. Department of Labor asking it to revise the one-year exemption.
“Permitting certain plans to have a total annual out-of-pocket limit that is twice the amount of other plans is contrary to the Affordable Care Act (ACA) and can have an enormous negative impact on patients,” Hughes wrote.
“The affordability of coverage is a significant concern to people with chronic diseases and disabilities,” Hughes continued. “The limits on annual out-of-pocket spending do not include the monthly premiums for enrollment, which have risen dramatically in recent years. When premiums are taken together with the annual out-of-pocket maximum, patients with chronic conditions could be facing annual costs for health care at around $12,000.”
Frances Padilla, president of the Universal Health Foundation, said she was relieved to hear the plans on the exchange wouldn’t be impacted, but was still disturbed that enforcement of that portion of the law would be delayed for at least some plans in the state.
“This postponement comes on the heels of the decision to delay enforcing the provision that requires large employers to offer health coverage to their full-time employees,” she said. “Even though they are separate issues, they highlight the challenges in rolling out the law.”