Filed Under:Health Insurance, Individual Health

What if producers and FFEs break up?

For some enrollees, FFE managers might calculate risk scores.
For some enrollees, FFE managers might calculate risk scores.

The "qualified health plans" (QHPs) that sell coverage through the new Patient Protection and Affordable Care Act (PPACA) "federally facilitated exchanges" (FFEs) may have to take money orders, debit orders and cashier's checks as well as credit cards.

FFE brokers who want to escape from the FFE broker program might have to give their FFEs at least 30 days' notice.

And, if a QHP fails to provide the information that the FEE managers need to formal risk adjustment programs, then the FFE managers might impose a "default risk adjustment" charge.

In some documents, state and federal exchange builders seem to assume that the time of a health insurance agent or broker who is helping consumers enroll in the exchange QHPs has a low value, but, for purposes of analyzing the economic impact of exchange paperwork requirements, federal officials are assuming that the time of an agent or broker is worth an average of $41.15 per hour, and that the time of a brokerage clerk is worth about $28.81 per hour.

The Centers for Medicare & Medicaid Services (CMS) has included those thoughts, and more, in a new set of draft regulations Patient Protection and Affordable Care Act; Program Integrity: Exchange, SHOP, Premium Stabilization Programs, and Market Standards (CMS-9957-P) (RIN 0938-AR82).

The proposed regulations are supposed to appear in the Federal Register Wednesday.

Comments will be due 30 days after the official publication date.

CMS developed the regulations to fill in gaps in the implementation of many different PPACA provisions that relate to the new exchanges, or health insurance supermarkets, and to standards for individual and small group health insurance.

PPACA is supposed to require insurers in the individual and small group markets to sell coverage on a guaranteed-issue basis, and without taking personal health information other than age and some wellness program information into account when setting prices.

To compensate for the possibility that the new underwriting restrictions could flood some health insurers with costly new patients, PPACA drafters created risk corridor, risk adjustment and reinsurance that are, in effect, supposed to transfer cash from carriers with unusually healthy enrollees to carriers with unusually sick enrollees.

In the FFE agent-broker sections of the new regulations, CMS officials have, for example, suggested that a Web-based broker that sells FFE coverage must post all of the cost and quality information they get from exchanges and QHPs but need not go out of their way to get extra data.

If an ordinary, brick-and-mortar producer is helping a consumer, the producer could use either the FFE's website or the QHP issuer's website to help a customer sign up for coverage.

Officials also have talked about the grounds an FFE's managers might have for terminating an exchange producer's contract, and the procedures an exchange producer would use to notify the FFE of an intent to break up with the FFE.

Still other provisions have to do with matters such as personal health data privacy and risk-management program integrity.

When states are overseeing state-managed insurer risk-adjustment programs, they would have to make provisions for summary reports and independent external audits, and they could use 11 centers per capita per year for health reinsurance program administrative expenses.

States and exchanges would have to provide certain types of data to federal risk management program supervisors.

The provision for consumer QHP payment types seems to be a direct CMS response to concerns raised by Jackson Hewitt and consumer groups about the possibility that some exchanges or QHPs were thinking that QHPs could insist that consumers pay their premiums with credit cards.

"We realize that a segment of the population that will seek health insurance coverage through an exchange will not have bank accounts or credit cards, and we have received numerous questions and comments on this topic," officials said.

Consumers "should be able to access coverage through an exchange on the same basis as those with a bank account or credit card and should not be unable to access coverage merely due to the inability to pay their share of the premium," officials said.

CORRECTION: An earlier version of this article gave officials' estimates of broker and brokerage clerk hourly compensation incorrectly. The correct figures are $28.81 for a clerk and $41.15 for an agent or broker.

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