Minuteman Health, one of the new nonprofit, member-owned CO-OP carriers, may have to pay an amount equal to about 40 percent of its enrollees’ 2015 premiums into New Hampshire’s Affordable Care Act risk-adjustment program.
The ACA Consumer Operated and Oriented Plan carrier may also have to pay an amount equal to 39 percent of its Massachusetts premiums into the state-run, Massachusetts-based version of the ACA risk-adjustment program.
In New Hampshire, the CO-OP may account for 90 percent of all 2015 risk-adjustment program payments, even though it had only a 19 percent share of the state’s individual exchange market.
Julie Myers, regulatory counsel at the Boston-based CO-OP has put those statistics in a comment on U.S. Department of Health and Human Services’ to adjust the ACA risk-adjustment program.
From the perspective of a small, new health insurer, the way the U.S. Department of Health and Human Services is running the Affordable Care Act risk-adjustment program is “wildly ineffective,” Myers writes. “Such Minuteman’s cost-saving, narrow-network business model, are plainly not what Congress intended.”
Managers of the CO-OPs, which tapped an ACA startup loan program that was supposed to help increase the level of competition in the commercial health insurance market, have been trying to get HHS to change the way three big ACA risk management programs, including the risk-adjustment program, for months. Some other smaller, newer carriers have also joined the effort.
Myers gives a particularly blunt, detailed rundown of Minuteman Health’s concerns about the program in the new comment letter, which was posted on a federal government regulatory comment management site.
The risk-adjustment program is supposed to help ACA exchange plan issuers operate without use of medical underwriting. The program takes cash from issuers that end up with enrollees with low risk scores and sends the cash to issuers with enrollees with high risk scores.
One obvious problem has been program managers’ delays in building enrollee prescription drug user records into the health scoring system, even though the prescription records are actually more accurate than physician health records, Myers says.