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2014 2018 Reforms in place today
Health Benefit Marketplace (formerly called Exchange)
State Marketplaces will serve as a one-stop online portal for individuals and small businesses to purchase health insurance and determine eligibility for public programs like Medicaid and CHIP. Marketplaces will also assist individuals in applying for subsidies to help pay for the cost of health insurance.
Marketplaces must be open for enrollment Oct. 1, 2013 and operational by Jan. 1, 2014. North Dakota's Marketplace will be facilitated by the federal government.
Annual and lifetime limits
Many health insurance plans place dollar limits upon the claims that the insurer will pay over the course of a year and over the course of an individual's life. Under the Affordable Care Act, no health plan can impose lifetime limits on coverage on any plans.4 For plans issued or renewed beginning Jan. 1, 2014, all annual dollar limits on coverage of essential health benefits will be prohibited.5 Plans may only establish restricted limits prior to Jan. 1, 2014 on essential benefits.1 This does not mean there are no restricted limits on any benefits nor does it mean there is no cost-sharing for the insurance.
Preexisting condition exclusions
Starting Jan. 1, 2014, a plan may not impose any preexisting condition exclusions on anyone.1 This is also known as guaranteed issue.
Requirement to maintain minimum essential coverage
U.S. citizens and legal residents are required to have qualifying health insurance 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.
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 2012, the threshold for taxpayers under age 65 was $9,750 for singles and $19,500 for married couples filing jointly).3
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 Marketplace, and premiums may not exceed what the individual would have paid in the Marketplace. Cost-sharing may not exceed that of a platinum plan in the Marketplacefor individuals below 150% FPL or that of a gold plan for all others. Plans must have an MLR of at least 85%.
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 based on geographic area, family composition and tobacco use (limited to 1.5. to 1 ratio) in the individual and the small group market and the Marketplace.3 Guaranteed issue is the right to purchase insurance without a physical examination; the present and past physical condition (pre-existing conditions) of the applicant are not considered.
Employers must offer coverage
Imposes a mandate on employers with 50+ workers to provide health insurance coverage.
- More than 200 employees: employer must automatically enroll employees; however, employees can opt-out.
- More than 50 employees: employers must provide essential coverage of pay penalties
- 50 or fewer employees: exempt2
Tax on "Cadillac" plans
Imposes new taxes on so-called "Cadillac" health insurance policies2
Reforms in place today
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
Medicare Part D donut hole savings
Costs for seniors reaching the Medicare Part D donut hole will decrease through 2020.
- 2014: 47.5% for brand-names and 72% for generics
- 2015: 45% for brand-names and 65% for generics
- 2016: 45% for brand-names and 58% for generics
- 2017: 40% for brand-names and 51% for generics
- 2018: 35% for brand-names and 44% for generics
- 2019: 30% for brand-names and 37% for generics
- 2020: 25% for brand-names and 25% for generics
Coverage of preventative health services
Plans must provide coverage without cost-sharing for:
Current recommendations from the US Preventive Services Task force for breast cancer screenings will not be considered.1
- 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
Extension of adult dependent coverage
Plans that provide dependent coverage must extend coverage to adult children up to age 26.1North Dakota laws also apply. Companies have been instructed to apply the state or federal regulation, whichever is more generous.
Provision of additional information
All health insurance 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
Internal claims appeal process for nongrandfathered plans:
- 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.
Nongrandfathered health insurance plans issued in North Dakota must comply with N.D.C.C. § 26.1-36-46 in establishing a mechanism to review and determine whether medical care rendered was medically necessary and appropriate.
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
Ensuring that consumers get value for their dollars
States developed a process for the annual review of unreasonable premium increases for health insurance coverage. The process requires insurers to submit to the state and the Secretary of HHS a justification for any premium increase exceeding 10 percent and post it online.1
Temporary high-risk pool program
The Secretary of Health and Human Services (HHS) established 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.
The state's current high risk pool, the Comprehensive Health Association of North Dakota (CHAND), does not meet the requirements. Click here for more information about the high-risk pool in North Dakota.
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.
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 make public a list of its standard charges for items and services, including for diagnosis-related groups.1
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
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
1 National Association of Insurance Commissioners
2 National Conference of Insurance Legislators
3 Kaiser Health News
5 The Centers for Consumer Information and Insurance Oversight