Broker blog from Delta Dental

Tag: Affordable Care Act (Page 1 of 2)

The 2020 elections and the Democrats’ clean sweep: What’s at stake for dental insurance

In an earlier Insider Update article, we considered three possible outcomes of the 2020 United States elections and some possible implications of each.

Since then, the Democratic Party has gained control of the Senate, while winning the White House and keeping control (just barely) of the House of Representatives.

From the Delta Dental perspective, this “clean sweep” impacts all our stakeholders, including dentists, enrollees and our group customers. What follows are some potential opportunities and challenges that may affect you.

The Affordable Care Act (ACA) and the health insurance marketplace (exchange) system will be preserved and expanded

President Joe Biden’s administration has made restoring the ACA an immediate priority, and many of the cuts and restrictions imposed by the administration of former President Donald Trump are being reversed.

This is a positive development for the dental industry, said Jeff Album, Vice President of Public & Government Affairs for Delta Dental.

“News that’s good for the ACA and good for the exchanges is good news for the industry,” Album said. “This market and the increased subsidies attract people who wouldn’t otherwise get insurance.”

Among the ACA-related actions that are either underway or soon to happen under this administration:

A special enrollment period to increase exchange enrollment is officially underway

Biden signed an executive order to create a special enrollment period from February 15, 2021 through May 15, 2021, during which eligible people can enroll in coverage from the federal health insurance marketplace. Uninsured residents in the 36 states that use the federal exchange system, including those who lost coverage because of the pandemic, can look for plans.

States with their own marketplaces are also creating special enrollment periods, although the time frames and eligibility requirements may differ.

The Centers for Medicare & Medicaid Services (CMS) has earmarked $50 million for outreach and education during the enrollment period.

The ACA’s Navigator Program will return

Reversing the prior administration’s move to defund this program, CMS will now provide about $2.3 million to help people find coverage on the federal exchanges, a process that can be confusing. The money will fund 30 Navigator Programs in 28 states. This, Album said, should help bolster dental enrollment.

“Several studies suggests that consumers are completely unaware of marketplace open enrollment dates, including the special enrollment periods,” Album said. “We believe this type of outreach will definitely help promote adult dental voluntary enrollment.”

Subsidies for exchanges will increase

The $1.9 trillion American Rescue Plan Act of 2021 (ARP), which Biden signed into law on March 11, includes increases to ACA subsidies. Consumers with household income more than 400% the federal poverty threshold (about $51,000 per year) will receive federal assistance to ensure that no more than 8.5% of their income goes toward a plan.

“The subsidies are getting better and the Biden administration is trying to bring more people into the exchanges,” Album said. “A great many small business and individuals impacted by the economy and COVID will now have an opportunity to get exchange-based dental coverage.”

Waivers that allow states to circumvent exchanges may be eliminated

Section 1332 of the ACA permits states to apply for a waiver to pursue “innovative strategies” to provide their residents with access to affordable health insurance, so long as they retain the basic protections of the ACA.

However, in 2020, the state of Georgia used the 1332 waiver to effectively eliminate its exchange program and force Georgia residents to purchase plans from private insurers without any kind of centralized platform. As a result, Biden directed federal agencies to reexamine all waiver policies, including 1332.

“I think this administration is going to be tougher than the former one when it comes to deviating from the ACA’s framework,” Album said. “We’re not likely to see any other states attempt a direct enrollment alternative to centralized state-based exchanges or the federally facilitated exchange.”

Medicaid eligibility under the ACA will expand

The ARP also includes incentives to encourage states to expand Medicaid eligibility under the ACA. States that choose to expand would receive a 5‑percentage-point increase in Federal Medical Assistance Percentage (FMAP) payments to current Medicaid enrollees.

“The FMAP increases are important because that’s what allows states to do optional benefits like adult dental,” Album said. “Here in California, the adult dental Medicaid program was going to be in trouble if the state didn’t receive more financial assistance.”

A “public option” with a dental benefit could be created — but probably won’t

A public option would be a federal health insurance program offered on states’ exchanges as an alternative to private plans. It would probably be subsidized for lower income Americans and at least partially paid for by enrollees who don’t qualify for subsidies.

While dental coverage wouldn’t be a guaranteed benefit for anyone other than children, it could be made available on a voluntary basis.

Initially, it seemed as though a clean sweep by the Democrats would almost guarantee a public option. Candidate Biden repeatedly said he supported it during his 2020 campaign. And California Attorney General Xavier Becerra, Biden’s pick for Secretary of the U.S. Department of Health and Human Services and a long-time proponent single payer health care, said during a recent Senate hearing that he would support Biden’s efforts to do so.

However, the Democratic sweep in the 2020 election might not be enough to push this through. Despite their control of the Senate, the Democrats depend on the tie-breaking vote of Vice President Kamala Harris. Furthermore, the Democratic majority in the House narrowed significantly, which increases the leverage of moderate Democrats who aren’t enamored with the public option.

“Given the Democrats’ razor-thin majority in both the Senate and the House, and Republican opposition to the concept, a public option currently seems unlikely,” Album said. “I don’t see it happening.”

Leaving the ACA, here are a few other possible issues likely to come up for Congress and the new administration to consider that may potentially impact dental insurance.

A dental benefit could be added to Medicare

Democrats in the House and Senate have introduced bills to add dental under Medicare Part B. As introduced, these bills do not specify which benefits should be added, which makes it difficult to assess whether the proposals help or hurt existing Medicare Advantage dental plans.

“Neither the House nor the Senate is likely to take these bills up in earnest until the latter half of the year,” Album said, “but our goal will be to participate in discussions yet to come on how the industry can help facilitate bringing dental care to seniors without disrupting existing, successful programs.”

Questions remain

As with any new administration, there are more questions than answers at this point, and how — or if — some of these proposed changes will be implemented is uncertain. What is certain, however, is that we can expect more proposals and policy updates that will affect the dental insurance industry in the upcoming months. Be sure to refer back to Insider Update for news and updates as they become available.

The 2020 elections and the ACA: What’s at stake for dental insurance

For the dental insurance industry, the upcoming November elections are among the most important in recent history. Depending on the outcome, the Affordable Care Act (ACA) could be affected significantly, which in turn could reduce access to oral health care for millions of Americans.

What’s going on with the ACA?

The future of the ACA is in question. In the case of California v. Texas, scheduled to be heard before the United States Supreme Court on November 10, the court will decide whether the law should be struck down, and which elements may or may not be saved.

A previous Insider Update article looked at how the upcoming Supreme Court nomination might affect the fate of the ACA. We’ll now consider the potential impact of the upcoming elections.

The upcoming election: What could happen?

On November 3, U.S. voters will decide whether to reelect President Donald Trump, a Republican, or replace him with former Vice President Joe Biden, a Democrat. They’ll also decide who will fill many United States Senate and House of Representative seats. Three outcomes are possible: 

  • A clean sweep by the Democrats. Democrats gain control of the White House and Senate, and retain control of the House.
  • A partial sweep by the Democrats. Democrats gain control of the White House and retain control of the House, but Republicans keep control of the Senate.
  • A return to status quo. Republicans keep the White House and Senate, and Democrats retain control of the House.

Current polling data strongly suggests that Democrats will retain the House, so a Republican sweep is unlikely.

How could a Democratic sweep affect the dental insurance industry?

A clean sweep for the Democrats, not surprisingly, would likely preserve and strengthen the ACA, regardless of the Supreme Court’s decision on California v. Texas, said Jeff Album, Vice President of Public & Government Affairs for Delta Dental.

“With Democrats controlling all three branches, Congress can quickly restore almost anything the Supreme Court might strike down, and do so long before the court’s decision becomes effective,” Album said.

Beyond the ACA, industry experts predict a clean sweep could lead to many other outcomes relevant to the dental industry:

  • Medicare could become available to people younger than 65, which could open new Medicare Advantage (MA) markets in which dental is often offered.
  • A dental benefit could be added to Medicare Part B, or as separate Part “T” (for teeth). Depending on the extent of the benefit provided, a Part B dental benefit could create or eliminate opportunities for dental insurers. A comprehensive Part B benefit could replace the private dental coverage purchased by millions of Medicare beneficiaries today, give growth to dental as a part of Medi-Gap policies, and eliminate employer-sponsored retiree dental plans. However, a Part B dental benefit limited to only preventive care could create opportunities for insurers to offer supplemental benefits plans. A Part B dental benefit would also require that all Medicare Advantage plans provide at least the same set of dental benefits, which would result in these plans receiving larger payments from the U.S. Centers for Medicare & Medicaid Services (CMS). About a third of MA plans today don’t offer dental.
  • A “public option” could be created. While the Biden campaign hasn’t offered many details, a public option is conceptually a federal health insurance program to be offered on state Health Insurance Exchanges as an alternative to private plans. It would likely be subsidized for lower income Americans, and partially or fully paid by enrollees who currently don’t qualify for subsidies. While dental coverage isn’t guaranteed to be a benefit for anyone other than children, an intriguing possibility is that it could be made available on a voluntary basis.
  • The public option might even entail automatic enrollment for low-income people into an existing Medicaid managed care or Medicaid fee-for-service plan.
  • Balance billing, or “surprise billing,” by out-of-network providers could become regulated by federal law, but it’s unclear how this might affect dental benefits, if at all.

How about a partial Democratic sweep?

A partial sweep, with a Republican-controlled Senate able to prevent legislation beginning in the House from reaching the president, would likely thwart a public option, strengthening the ACA or adding dental coverage to Medicare. However, a Biden White House could preserve the ACA as it currently exists, and eliminate through executive order moves by the prior administration to weaken it.

“Dramatic change is unlikely,” Album said.

Paired with an unfavorable Supreme Court ruling, however, a partial sweep could spell trouble for the ACA, Album said.

“It makes recovering from an adverse Texas decision in the Supreme Court much harder because the Senate Republicans may support many of the cutbacks an adverse SCOTUS decision could cause,” Album said. “And should the Supreme Court strike the ACA entirely, it’s hard to imagine Democrats and Republican agreeing on replacement.”

And what if we maintain status quo?

Should the country continue with a Republican president and divided Congress, the outcome of California v. Texas is uncertain.

A ruling that either leaves the ACA in place, or finds that the law’s individual mandate can be eliminated while leaving the ACA otherwise intact, means little change. But a ruling that the ACA is inseverable from the mandate means millions will lose coverage they have today, with Congress likely unable to respond.

Album predicts that a Republican White House would probably continue to work through executive orders to weaken the ACA and make ACA-non-compliant alternatives more widely available.

The worst-case scenario for the ACA occurs if federal funding for the program is eliminated. As many as 2 million people with Exchange-based dental benefits in the Exchanges could lose that coverage. For insurers, the risk is most acute for those with sizeable managed Medicaid and Exchange business.

“Marketplace changes could be profound,” Album said.

The Supreme Court nomination and the ACA: What’s at stake for dental insurance

In the case of California v. Texas, scheduled to be heard before the United States Supreme Court on November 10, parties challenging the Affordable Care Act (ACA) seek to overturn the law as unconstitutional. What might this case mean for the future of the ACA and insurance more widely?

The usual questions surrounding the outcome of this case have been complicated by the appointment of Amy Coney Barrett, a new justice to the Supreme Court, nominated by President Donald Trump.

What’s at stake for the ACA?

The elimination of the ACA could have significant consequences, including:

  • Decreases or complete loss of state and federal Exchange enrollment, adult Medicaid enrollment and commercial enrollment of dependents up to age 26
  • A reduction or elimination of individual health insurance subsidies, which could erode Exchange enrollment
  • A reduction or elimination of dental benefits for adults in Medicaid

So what’s California v. Texas about, anyway?

The state of Texas, along with a group of other states and individual plaintiffs, is arguing that the ACA is unconstitutional. Specifically, they say that the 2017 changes to tax law, eliminating the penalty for failure to purchase health coverage, essentially eliminated the individual mandate, upon which the entire law depended.

Originally, the individual mandate required most people to have health insurance coverage. It penalized those who failed to comply by requiring them to pay a financial penalty to the IRS. The 2017 Tax Cuts and Jobs Act eliminated the financial penalty, but left the mandate in place.

The Texas-led plaintiffs argue that because the mandate no longer produces revenue for the federal government, it’s unconstitutional. Further, they say that the mandate can’t be severed from the rest of the ACA, so if the mandate is unconstitutional, the entire ACA is unconstitutional.

In December of 2018, a U.S. District Court judge in Texas agreed. In 2019, the case went to the U.S. Court of Appeals for the Fifth Circuit. That court agreed with the District Court’s decision that the mandate was unconstitutional, but didn’t rule on whether the mandate was inseverable. 

On the other side, California, together with a group of 18 other states, is defending the ACA.

In an unusual move, the federal government is siding with Texas, though offering arguments to allow some elements of the ACA to continue.

The Supreme Court has agreed to hear the case, scheduled for November 10. It will decide whether the Texas case has merit, whether the mandate is unconstitutional and, if so, whether this invalidates the entire ACA, or whether to let lower courts rule on severability.

Why a new Supreme Court justice matters

Justice Amy Coney Barrett has been confirmed and will fill a vacant seat on the Supreme Court. 

Barrett was formerly a circuit judge on the U.S. Court of Appeals for the Seventh Circuit. She’s considered a political conservative and constitutional originalist, which means she believes the U.S. Constitution should be interpreted as it was understood at the time it was written. As a judge, she has also ruled against the ACA in the past. She replaces Justice Ruth Bader Ginsburg, known for being one of the Supreme Court’s most liberal justices.

What specifically Barrett’s confirmation means in terms of a ruling is unclear, said Jeff Album, Vice President of Public & Government Affairs for Delta Dental.

“We’re not sure how the conservative judges are going to hear this particular case,” Album said. “Conservatives are thought to be originalists or strict interpretationists, and if they were truly to follow an originalist philosophy, striking the entirety of the ACA is not consistent with that.”

That’s because, Album said, if Congress had intended to overturn the ACA, the 2017 tax cut bill would have explicitly called for such an overturn, and the merits of that debated openly in hearings. That this didn’t happen speaks to the intent of Congress, which is an important consideration for a Supreme Court reaching a decision based on originalist thinking.

“Strict interpretationists are loath to reverse an act of Congress,” Album said. “They don’t want to counter Congressional intent, and they certainly don’t want to legislate from the bench. And if you listen to remarks that Amy Barrett has been making in the hearings, she’s gone out of her way to say she doesn’t believe that it’s a judges’ job to do anything other than enforce the Constitution and enforce the law.”

Still, that’s not a guarantee that Barrett will rule to preserve the ACA, Album said.

“We know that Amy Barrett is not fond of the ACA,” Album said. “She’s ruled against it many times, so she already has that track record.”

So what if the ACA is struck down? Then what?

If the Supreme Court rules to strike the entire bill, the impacts are “going to be profound,” Album said.

In that scenario, blue states such as California, New York, Massachusetts and Maryland would pass state laws to attempt to preserve some elements of the ACA, Album said, but they might lack federal support for the subsidies people depend on to afford those programs. Few red states, meanwhile, would be prepared to run their own Exchanges without the federally facilitated marketplace. This could lead to enrollment in Exchanges dropping substantially, Album said.

And this could lead to substantial enrollment declines for insurance companies with sizeable managed Medicaid and Exchange business.

About 1.9 million adults who have purchased optional, non-subsidized dental benefits in the Exchanges could lose their coverage. Young adults between the ages of 19 and 26 who were added to commercial employer coverage as a result of the ACA will lose that coverage if the ACA is completely struck.

Congress could decide to provide relief, but its ability to do so is dependent on the results of the November election. We’ll take a closer look at what the election results could mean for these issues in an upcoming article.

However…

Regardless of what happens, Album said, don’t expect anything to happen any time soon. Following the California v. Texas hearing in November, the decision won’t be announced until April or May, and possibly as late as June.

And if the Court agrees that the mandate is severable and sends that question back down to the lower courts, it could take years before that outcome and the additional legal challenges it will face.

A final twist is that while the current administration is arguing that the mandate should be struck down, it’s also urging that lower courts rule which provisions should and shouldn’t be invalidated.

“Even the Trump administration has suggested, and perhaps will argue in the Supreme Court, that some things should be left alone,” Album said. “We just don’t know which things they would cherry-pick in terms of what should be inseverable and what shouldn’t.”

Note: This post was updated to note Barrett’s confirmation to the Supreme Court on October 26.

Policy pops: Health care exchanges — 2019 enrollment results

3‑minute read

Join our guest blogger, Devin McBrayer, as she reviews the outcomes of the 2019 open enrollment period for health care exchanges. Devin is a Legislative and Policy Analyst based in Sacramento, California.

The open enrollment period to purchase Affordable Care Act (ACA)-compliant individual health insurance coverage off the health insurance exchanges for 2019 has come to an end. Sign-ups were off to a slow start at the beginning of the enrollment period, leaving many experts fearful that ACA plans would experience a significant decrease in enrollment. However, total enrollment only decreased by about 3.8% nationwide on Healthcare.gov, much of this due to a 15% reduction in new sign-ups. 

While the total enrollment drop in individual health insurance plans on the exchange may have been less drastic than expected, it is still worth exploring why new enrollment decreased considerably and why year-to-year enrollment continues to decline. Several 2018 policy changes, combined with a growing economy, could help explain the decrease in enrollment in ACA plans for the 2019 plan year. 

Are policy changes to blame?

In 2018, Congress reduced the tax penalty for not having an ACA-compliant health insurance plan to zero, effectively eliminating it. The federal government also shortened the open enrollment period and reduced marketing for open enrollment. Simultaneously, the federal government passed several rules that expanded the availability of cheaper and less comprehensive insurance plans such as short-term limited duration plans. No tax penalty for lack of coverage, combined with a shorter sign-up period and more plan options outside the exchanges, may help explain the enrollment decrease.

The impact of the economy

Another possible explanation for the drop in enrollment could be attributed to an improving economy. When open enrollment started on November 1, 2018, 2 million more jobs were added to the economy than were added at the same time in 2017. As more people head back to work, it’s possible that they’re gaining access to employer-sponsored health insurance, eliminating the need to renew their ACA plan. 

What does this mean for dental?

Any loss in enrollment for medical coverage also means less people enrolled in dental coverage on the exchange. (As a reminder, dental coverage is an essential health benefit for children but not for adults.) 

In the exchanges, dental coverage is included in some health plans or consumers can get a stand-alone dental plan and pay a separate premium. However, there is no way for consumers to purchase a stand-alone dental plan without also purchasing a medical plan on the health care exchange. Pushing for states and the federal government to allow for the independent purchase of stand-alone dental plans on state and federal health insurance exchanges is a top priority for the Public & Government Affairs team at Delta Dental.

For more thought leadership from Delta Dental, subscribe to Insider Update, our newsletter for brokers, agents and consultants.

If you’re a benefits decision maker, administrator or HR professional, subscribe to our group newsletter, Word of Mouth.

Policy pops: How tax reform may affect dental enrollment

3‑minute read

Join our guest blogger, Devin McBrayer, as she unpacks the Job and Tax Cuts Act of 2017 and its likely effect on dental benefits enrollment. Devin is a Legislative and Policy Analyst based in Sacramento, California.

government workers walking down stairs

When most people think of the Affordable Care Act (ACA) and the increase in Americans with insurance coverage, medical insurance is the first thing that comes to mind. What’s sometimes overlooked is the significant growth in dental insurance, particularly among adults.

Pediatric dental is considered an “essential health benefit” in the ACA, meaning insurance must cover it. Dental carriers are also able to offer stand-alone family dental coverage on the health insurance exchanges as long as the pediatric benefits are included. This has made dental coverage more widely available to the 1.9 million people who purchased stand-alone dental coverage through the marketplaces in 2017.

Dental coverage could be threatened, however, due to the Job and Tax Cuts Act of 2017. This bill effectively repealed the mandate requiring most Americans to have health insurance by eliminating the financial penalty for lack of coverage.

Without the individual mandate, it’s likely that medical and dental insurance enrollment will decrease in the coming years. The Congressional Budget Office, a non-partisan agency that conducts analyses for Congress, predicts that the U.S. will have 8–13 million more people living without health insurance by 2026.

Stand-alone dental plans on the exchanges in particular will struggle to sustain enrollment in the marketplace, because stand-alone dental plans cannot be purchased unless an individual has already purchased a medical plan. If consumers choose not to purchase medical insurance because they no longer have to pay the penalty, then those consumers will also not be able to purchase dental on the exchange.

Adding more strain on the uncertain future of the exchanges, heathier and younger people who believe that they do not need insurance are most likely to drop their coverage. The exchanges could soon face a scenario where older or sicker individuals will choose to keep their coverage, and healthier, younger people will choose to drop their coverage. An unhealthy risk mix, due to healthier people leaving the exchanges, would likely cause health insurance premiums to rise even higher.

On the bright side, open enrollment totals for health insurance exchanges in 2018 exceeded expectations. Nearly 65% of state-based exchanges saw an increase in their overall enrollment. Only time will tell if the exchanges can sustain their enrollment, while also maintaining a healthy risk mix, after the tax reform bill repealed the individual mandate.

Despite the uncertainty facing the marketplace, Delta Dental is still working hard to ensure that consumers continue to have access to the dental care that they need.

For more thought leadership from Delta Dental, subscribe to Insider Update, our newsletter for brokers, agents and consultants.

If you’re a benefits decision maker, administrator or HR professional, subscribe to our group newsletter, Word of Mouth.

 

The three R’s, and why dental shouldn’t be left out

Repeal, replace or repair? These are the three R’s dominating the news in recent weeks about how U.S. Congressional Republicans want to overhaul the Affordable Care Act.

Republicans, who represent the majority in both the House and Senate, have an opportunity to rewrite the health care law, but are generally split into three camps on how to do so: Repeal the whole law now and replace later, perhaps incrementally; repeal once a complete replacement is ready; or repair the ACA for now, then determine what to do next.

Regardless of which strategy they select, something new is on the horizon, and Delta Dental is working to ensure dental benefits aren’t left out of the discussion.

About 1 million previously uninsured Americans today have affordable dental coverage as a result of dental benefits sold in public health exchanges, while employer-sponsored plans continue to enjoy tax-exempt coverage. Since our mission is to advance dental health and access to care, we want to preserve this progress in whatever legislation may come.

To this end, here’s what we’re telling lawmakers:

  • Allow people with exchange dental coverage to renew those policies with the carriers they’ve selected—whether or not those marketplaces continue—to minimize disruption.
  • If a new law includes tax credits to help eligible Americans purchase benefits, let those credits be used for dental as well as medical coverage.
  • Keep the tax-exempt status for employer-sponsored dental benefits; expand that exemption to allow individuals to pay dental premiums with tax-free dollars.

Whether repeal, replace, or repair, the key “r” word for Delta Dental is ready.

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