From Health Plan Weekly: Executive Order Aims to Boost ACA Exchanges, Medicaid

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Executive Order Aims to Boost ACA Exchanges, Medicaid

Reprinted with AIS Health permission from the January 29, 2021 issue of Health Plan Weekly

President Joe Biden on Jan. 28 launched his Affordable Care Act-centric health insurance agenda with an executive order that will reopen the federal health exchange for a special enrollment period. The administration also directed federal agencies to roll back widely criticized changes to Medicaid as part of a broader review of Trump administration regulations.

The new executive order, which the administration framed as a pandemic relief measure, demonstrates the administration’s emphasis on expanding coverage through the ACA. The special enrollment period (SEP) will run from Feb. 15 to May 15 and will be bolstered by a more aggressive effort to promote enrollment through advertising.

Also, in an anticipated move, the Biden administration directed CMS to roll back “demonstrations and waivers under Medicaid and the ACA that may reduce coverage or undermine the programs, including work requirements,” according to a White House press release. In addition to Medicaid work requirements, insiders expect the administration to halt block grant waivers to some degree.

The special enrollment period is similar to pandemic-driven special enrollment periods launched by state health exchanges. Experts previously told AIS Health that the risk to plans from adverse selection is minimal (HPW 9/7/20, p. 3) for state-level, pandemic-related SEPs. Covered California, that state’s exchange, enrolled 271,820 people in a pandemic special enrollment period between March 20 and Aug. 20, 2020, in addition to a record 418,052 enrollees during the state’s 2020 open enrollment period. Covered California officials credit those robust enrollment figures in part to the exchange’s promotional program.

Dan Mendelson, founder of Avalere Health, tells AIS Health that he expects more promotion will have a notable effect on enrollment during the upcoming SEP.

“There are tens of millions of unused dollars for the promotion of these exchange plans, [and] they can promote Medicaid. Just by virtue of getting out there and educating people of their rights under the Medicaid program, they could probably expand enrollment by a million or a couple million people,” Mendelson says.

 

Medicaid Focus Will Help Underserved

He also notes that the administration’s focus on Medicaid will help address some of the disproportionate impact of the pandemic on people of color (HPW 6/30/20, p. 1), since commercial coverage losses have hit those populations harder than the country as a whole. The executive order makes the same point, observing that “Black, Latino, and Native American persons are more likely to be uninsured, and communities of color have been especially hard hit by both the COVID-19 pandemic and the economic downturn.”

“Today’s actions by President Biden help the nation take an important step toward continuous eligibility for health coverage, which directly addresses the serious concern of churn, where people come on and off of insurance programs….Medicaid plans should see a boost with the increased access for the underserved,” Jerry Vitti tells AIS Health via email. Vitti is founder and CEO of Healthcare Financial, Inc., a firm that connects low-income, elderly and disabled populations with public benefit programs.

In addition to the new executive order, incoming White House Chief of Staff Ron Klain on Jan. 20 released a memo requesting federal officials pause implementation of final rules issued in the last days of the Trump administration for 60 days after their published effective date. Experts tell AIS Health that the pause, a regular part of presidential transitions, will allow the Biden team to take stock of the state of health care rulemaking and make adjustments to any Trump rules it opposes.

David Kaufman, a partner at Laurus Law Group LLC and former general counsel for Blue Cross and Blue Shield of Illinois, tells AIS Health that a change in party control always means a retrospective look at regulations.

 

Congress Could Also Review Rules

“I don’t think it’s unusual for a new administration to put a hold on what they call ‘midnight rules’ that the prior administration is trying to put in at the end,” Kaufman says. “There’s also the Congressional Review Act that lets Congress look at rules finalized in the last 60 legislative days, of which there are many more than calendar days.”

However, there are some limitations on how much the new administration can change course on rules that have already been finalized. Mendelson notes that resource constraints and the bidding cycle mean it’s simply too late for some changes to happen.

“I think the incoming administration is being very selective in terms of what they accept and what they reject with respect to regulation,” Mendelson says. “There are going to be some regs that I expect to stand.”

For example, Mendelson predicts that the new administration “will not have either the time or inclination to dig into the managed care reg that specifies how MA [Medicare Advantage] plans are going to operate in the next calendar year. They might agree with some of it, they might not agree with some of it — but the bids start, and before you know it, you’re off to the races.” Trump’s CMS issued MA rules for the 2022 plan year on Jan. 15, and finalized other changes to Part D on Jan. 19, the last day of the administration (HPW 1/22/21, p. 5).

Kaufman makes a similar point — and observes that the pandemic imposes significant constraints.

“They probably are inundated with a million different matters that they might address. One big question is, what are the priorities?” Kaufman asks. “No. 1 is going to be COVID, so I wonder when things will be addressed, and how they’re going to determine which are the most significant issues and priorities.”

 

Admin Can’t Do Everything at Once

Michael Bagel, the director of public policy at the Alliance of Community Health Plans, tells AIS Health that the capacity of the civil service also curtails what the new administration can do — even though Biden and his team have extensive experience with rulemaking and the bureaucracy.

“It’s important that they’re not pursuing too many interests at the same time,” Bagel explains. “Maybe they’re in contradiction with each other, or maybe it’s infeasible to carry out multiple regulations and multiple directives at the same time — there are only so many people who can write so many regulations. So many people have to review regulations: from a legal perspective, from a programmatic perspective, and then OMB has to review them.”

Kaufman adds that the Trump administration’s chaotic approach to rulemaking exposed regulations to more frequent litigation than normal, meaning the Biden team’s regulatory review process should also include legal consultation. That problem became more acute in the last days of the outgoing administration, Kaufman says, as Trump’s team pushed out regulations with shorter-than-usual comment periods. The Biden administration will have to decide which rules it will defend in court from industry stakeholders, states and other possible litigants.

Loren Adler, associate director of the USC-Brookings Schaeffer Initiative for Health Policy, says he expects to see the administration move quickly on controversial CMS waivers like Medicaid work requirements and block grants in part because of the ongoing legal battles they have instigated.

“The courts have been pretty clear so far in saying that Medicaid work requirements are illegal,” Adler tells AIS Health. “Certainly there won’t be any more waivers approved on things like that. I think it’s less clear what you can do for already existing rules, more like the block grant proposals. I’m a little uncertain exactly what the legal tools really are.”

The executive order takes aim at work requirements, instructing agencies to eliminate “policies or practices that may present unnecessary barriers to individuals and families attempting to access Medicaid or ACA coverage.”

“With the strict reporting of employment status required to maintain coverage, people may be kicked off the rolls because they were unable to keep up with the added administrative burden of having to prove that they’re working,” observes Abner Mason, founder and CEO of ConsejoSano, a tech startup specializing in culturally-aligned member outreach for Medicaid plans. “A bigger issue is continuity of coverage. If a working Medicaid enrollee becomes unemployed, they lose their coverage until they find another job. But studies show that having Medicaid makes it easier to find work.”

Adler says Congress may do more to limit work requirements when it takes up Medicaid issues later this year.

“If Congress declared work requirements illegal more explicitly,” the matter would be cleared up, Adler observes. “I think it’s already pretty clear in the statute that work requirements are illegal. But I think that has a pretty clean budgetary impact that you could pass under reconciliation. Obviously, there’s going to be a legislative package on Medicaid reforms, presumably in the next reconciliation bill after [pandemic relief legislation].”

Meanwhile, the executive order also seems to target block grants, as it instructs agencies to review “demonstrations and waivers, as well as demonstration and waiver policies, that may reduce coverage under or otherwise undermine Medicaid or the ACA.”

by Peter Johnson

Read the executive order. Contact Adler, Bagel via Dan Lemle, Kaufman, and Mendelson.