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Home : Consumers : Health care reform
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Health care reform
The North Dakota Insurance Department is fielding countless questions surrounding the Patient Protection and Affordable Care Act (PPACA) signed into law on March 23, 2010. Consumers, business owners, Medicare recipients, students and others all want to know how the new legislation will affect them.
The Insurance Department is analyzing information to provide North Dakota's consumers with unbiased resources concerning the new health reform law. Many details are not yet available, so as the Department learns more, this website section will change.
Use the links on the left to access frequently-asked questions for consumers and businesses and a glossary.
Please come back to read more about how the new law will affect you.
If you have a question that is not answered here, please contact us at 1.800.247.0560 or insurance@nd.gov.
Click here to join the stakeholders email list.
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Timeline
The health care reform law contains many requirements and programs that will be phased in over the next nine years. Following is a brief implementation timeline. Click on a link below to learn what reforms take effect that year. Click here for a print-friendly timeline.
2010 2011 2012 2013 2014 2018
2010
Annual and lifetime limits
Plans may not establish lifetime limits on the dollar value of essential benefits. Plans may only establish restricted limits prior to Jan. 1, 2014 on essential benefits.1
Preexisting condition exclusions
A plan may not impose any preexisting condition exclusions-effective six months after enactment for under age 19.1
Rescissions
Insurers cannot rescind coverage after a sickness. Coverage may be rescinded only for fraud or intentional misrepresentation of material fact.1
Small business tax credit
Available to small businesses offering coverage to employees (see business FAQs for more information)1
$250 Medicare Part D rebate
A $250 rebate will be available to seniors reaching the Medicare Part D donut hole.1
Coverage of preventative health services
Plans must provide coverage without cost-sharing for:
- Services recommended by the U.S. Preventive Services Task Force
- Immunizations recommended by the Advisory Committee on enactment Immunization Practices of the Centers for Disease Control
- Preventive care and screenings for infants, children and adolescents supported by the Health Resources and Services Administration
- Preventive care and screenings for women supported by the Health Resources and Services Administration
Current recommendations from the US Preventive Services Task force for breast cancer screenings will not be considered.1
Extension of adult dependent coverage
Plans that provide dependent coverage must extend coverage to adult children up to age 26.1
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Provision of additional information
All plans must submit to the Secretary of Health and Human Services (HHS) and state insurance commissioner and make available to the public the following information in plain language:
- Claims payment policies and practices
- Periodic financial disclosures
- Data on enrollment
- Data on disenrollment
- Data on the number of claims that are denied
- Data on rating practices
- Information on cost-sharing and payments with respect to out-of-network coverage1
Prohibition on discrimination based on salary
Extends current law provisions prohibiting discrimination in favor of highly compensated employees in self-insured group plans to fully-insured group plans1
Appeals process
Internal claims appeal process:
- Group plans must incorporate the Department of Labor's claims and appeals procedures and update them to reflect standards established by the Secretary of Labor.
- Individual plans must incorporate applicable law requirements and update them to reflect standards established by the Secretary of HHS.
External review:
- All plans must comply with applicable state external review processes that, at a minimum, include consumer protections in the NAIC Uniform External Review Model Act (Model 76) with minimum standards established by the Secretary of HHS that is similar to the NAIC model.1
Patient protections
A plan that provides for designation of a primary care provider must allow the choice of any participating primary care provider who is available to accept them, including pediatricians.
If a plan provides coverage for emergency services, the plan must do so without prior authorization, regardless of whether the provider is a participating provider.
A plan may not require authorization or referral for a female patient to receive obstetric or gynecological care from a participating provider.1
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Health insurance consumer assistance offices and ombudsmen
States may establish and operate offices of health insurance consumer assistance or health insurance ombudsman programs to:
- Assist with the filing of complaints and appeals
- Collect, track and quantify problems and inquiries
- Educate consumers on their rights and responsibilities
- Assist consumers with enrollment in plans
- Resolve problems with obtaining subsidies
States may be required to collect and report data of all the types of problems and inquiries encountered by consumers.1
Ensuring that consumers get value for their dollars
States shall develop a process for the annual review of unreasonable premium increases for health insurance coverage. The process shall require insurers to submit to the state and the Secretary of HHS a justification for an unreasonable premium increase and post it online.1
Temporary high-risk pool program
The Secretary of Health and Human Services (HHS) is required to establish a temporary high-risk health insurance pool program to provide coverage to individuals with preexisting conditions who have been without coverage for at least six months.
Pools must:
- Have no preexisting condition exclusions
- Cover at least 65% of total allowed costs
- Have an out-of-pocket limit no greater than the limit for high deductible health plans ($5,950 for individuals and $11,900 for families)
- Utilize adjusted community rating with maximum variation for age of 4:1
- Have premiums established at a standard rate for a standard population
The state's current high risk pool, the Comprehensive Health Association of North Dakota (CHAND), does not meet the requirements. North Dakota will not operate the federal government's new temporary high risk health insurance pool.1 Click here for more information about the high-risk pool in North Dakota.
Temporary reinsurance program for early retirees
The Secretary of HHS shall establish a temporary reinsurance program to reimburse employment-based plans for 80% of costs incurred by early retirees age 55 and over but not eligible for Medicare between $15,000 and $90,000 annually.1
Web portal to identify affordable coverage options
The Secretary shall establish a mechanism, including a website, through which individuals and small businesses may identify affordable health insurance coverage.1 Click here to access the web portal.
2011
Bringing down the cost of health care
Carriers must report to the Secretary of HHS the ratio of incurred losses (incurred claims) plus loss adjustment expense (change in contract reserves) to earned premiums. The report must include the percentage of total premium revenue, after accounting for risk adjustment, premium corridors and payments of reinsurance. Insurers must provide a rebate to consumers if the percentage of premiums expended for clinical services and activities that improve health care quality is less than 85% in the large group market and 80% in the small group and individual markets. All hospitals must establish and make public a list of its standard charges for items and services, including for diagnosis-related groups.1
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Loss ratio
Medical loss ratios of 80 and 85 percent, respectively, are required for individual/small group and large group plans. Loss ratio is the fraction of revenue from a plan's premiums that goes to pay for medical services.2
Long-term care
A voluntary long-term care program will begin, financed through payroll deductions. (See consumer FAQs for more information)2
2012
Ensuring quality of care
Plans must submit annual reports to the Secretary of HHS on whether the benefits under the plan:
- Improve health outcomes through activities such as quality reporting, case management, care coordination, chronic disease management
- Implement activities to prevent hospital readmission
- Implement activities to improve patient safety and reduce medical errors
- Implement wellness and health promotion activities1
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2013
Administrative simplification requirements
The Secretary of HHS will develop operating rules for the electronic exchange of health information, transaction standards for electronic funds transfers and requirements for financial and administrative transactions.1
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2014
Health benefit exchange
State exchanges must be operational by Jan. 1, 2014. Additionally, the Secretary of HHS must determine by Jan. 1, 2013 whether states intend to operate qualified exchanges. If a state does not create a qualified exchange, the Secretary must create one. There must be two exchanges: a non-group market exchange and an exchange for small businesses. States may choose to operate only one exchange serving both groups.
Some functions to be performed by an exchange include:
- Certify qualified plans to be sold in the exchange
- Maintain a website
- Provide for initial, annual and special open enrollment periods
- Maintain a toll-free number
- Create a rating system for plans and perform satisfaction survey
- Provide a calculator to determine enrollee premiums and subsidies
- Identify those individuals exempt from the individual mandate and notify treasury
- Require participating plans to provide justification for rate increases1
Preexisting condition exclusions
Starting Jan. 1, 2014, a plan may not impose any preexisting condition exclusions on anyone.1
Requirement to maintain minimum essential coverage
U.S. citizens and legal residents are required to have qualifying health coverage. Those without coverage pay a tax penalty of the greater of $695 per year up to a maximum of three times that amount ($2,085) per family or 2.5% of household income. The penalty will be phased-in according to the following schedule: $95 in 2014, $325 in 2015, and $695 in 2016 for the flat fee or 1.0% of taxable income in 2014, 2.0% of taxable income in 2015, and 2.5% of taxable income in 2016.
Beginning after 2016, the penalty will be increased annually by the cost-of-living adjustment. Exemptions will be granted for financial hardship, religious objections, American Indians, those without coverage for less than three months, undocumented immigrants, incarcerated individuals, those for whom the lowest cost plan option exceeds 8% of an individual's income, and those with incomes below the tax filing threshold (in 2009 the threshold for taxpayers under age 65 was $9,350 for singles and $18,700 for couples).3
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State flexibility to establish basic health programs for low-income individuals not eligible for Medicaid
The Secretary of HHS shall establish a basic health program under which a state may contract with standard health plans providing at least essential benefits to individuals between 133% and 200% FPL and legal immigrants above 133% FPL who are not eligible for Medicaid. The federal government will provide states creating basic health programs the subsidy funds that eligible individuals would have otherwise received.
Individuals eligible to participate in these plans would not be eligible to purchase coverage through the exchange, and premiums may not exceed what the individual would have paid in the exchange. Cost-sharing may not exceed that of a platinum plan in the exchange for individuals below 150% FPL or that of a gold plan for all others. Plans must have an MLR of at least 85%.
States may enter into compacts to allow residents of all compacting states to enroll in all standard plans.1
Guaranteed issue and renewability in all markets
The law requires guaranteed issue and renewability and allows rating variation based only on age (limited to 3 to 1 ratio), premium rating area, family composition and tobacco use (limited to 1.5. to 1 ratio) in the individual and the small group market and the exchanges.3
Employers must offer coverage
Imposes a mandate on employers with 50+ workers: offer coverage of by 2014 pay $2,000/full time worker (excluding the first 30); if offer unaffordable coverage, pay $3,000/employee receiving taxpayer assistance to buy it or a total of $2,000/employee, whichever is more. Employers of 50 or fewer workers are exempt.2
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2018
Tax on "Cadillac" plans
Imposes new taxes on so-called "Cadillac" health insurance policies2
Sources:
1 National Association of Insurance Commissioners
2 National Conference of Insurance Legislators
3 Kaiser Health News
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Kaiser Family Foundation implementation timeline
The implementation timeline allows you to show or hide all the changes occurring in a year by clicking on that year. Click on a provision to get more information about it. Customize the timeline by checking and unchecking specific topics.
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