Federal regulators are trying to ease insurers’ worries about a major risk management program by promising to get early results out quickly.
The Centers for Medicare & Medicare Services (CMS) say it will give insurers preliminary Patient Protection and Affordable Care Act (PPACA) risk-adjustment program results for 2015 in March.
CMS was not able to get insurers any information about their 2014 risk adjustment program results until June 30, 2015 — months after they had filed their individual health insurance rates for 2016. But “the interim summary report will provide preliminary information for only those states and markets where the risk-adjustment data that has been submitted by Feb. 1, 2016, meets CMS’ data sufficiency thresholds,” CMS officials say in an answer to a question about when the adjustment data will be available.
If insurers get complete, clean data to CMS in time, CMS will give issuers estimates of a market’s average monthly premiums, average plan enrollee health risk score, billable member months, and other data, officials say.
PPACA now bans use of personal health information other than location when insurers are selling individual and small-group health coverage, and it bans use of information other than location, age and tobacco use when insurers are pricing coverage. The risk-adjustment program is supposed to protect insurers against the risks involved with lack of medical underwriting by using cash from insurers with enrollees with low health risk scores to help insurers that end up with enrollees with high risk scores.
The risk adjustment program is also supposed to give insurers an incentive to attract consumers with chronic health problems and improve their health, by letting them keep the extra risk-adjustment money when enrollees who have diabetes or other costly conditions use less care than expected.
An issuer with unusually high-risk enrollees can collect the full amount of risk adjustment money it’s owed only if the issuers with lower-risk enrollees pay their full risk-adjustment program bills.
A representative from a New York state unit of UnitedHealth Group Inc. (NYSE:UNH) noted during a recent hearing that insurer insolvencies may affect the ability of a market’s risk-adjustment pool to meet program obligations.
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