News from the Blues

BCBS reports:

Legislative Update

Affordable Care Act Funding
Following the failed efforts to repeal the Affordable Care Act in the U.S. Senate earlier this month, some commentators report that now we can expect efforts to repeal portions of the Affordable Care Act in a piecemeal fashion, to amend it, to delay implementation and to cut funding for all or some implementation.

A number of bills have been introduced that seek to rescind funding for some or all of the Affordable Care Act provisions and its implementation. Others seek to de-authorize appropriation of funds or prohibit the use of funds to implement certain federal mandates under the Act. Blue Cross and Blue Shield of Illinois will continue monitoring these bills and keep you apprised throughout the legislative process.

House Panel to Vote on 1099 Reporting Requirement
Last Thursday, the House Ways and Means Committee voted to repeal a provision in the health care reform law that will require employers to furnish 1099 statements whenever they do more than $600 in business with a corporate vendor. It was a critical first step in getting the measure to the House floor. The Senate voted last month to repeal the provision.

Medical Loss Ratios and Rebates Clarification
We have received inquiries from accounts wanting to know how Medical Loss Ratio (MLR) requirements will be implemented and what information we will be providing them regarding rebates. As you may recall, the Affordable Care Act requires that a certain portion of premium be spent on providing and improving the quality of health care. If an insurance carrier exceeds established limits, it may be required to provide a rebate of the portion of premium dollars over such limits. This applies only to insured business, not self-funded accounts.

According to the MLR Interim Final Rule:
Collection of data begins in 2011; rebates are to be calculated by June 1, 2012; and paid by Aug. 1, 2012. Going forward, rebates will be calculated by June 1 of the following year and paid by Aug. 1 of that year.
MLR is a state-based calculation, with separate MLR calculations for the large group market, the small group market, and the individual market. It is not group specific.
In 2012, reports must be provided to the Secretary of Health & Human Services and made available to the public. The reports must include:
The amount of premium revenue received; as well as
The amount expended on:
(1) Reimbursement for clinical services provided to enrollees under the health insurance plan
(2) Activities that improve health care quality for enrollees
(3) All other ‘‘non-claims’’ costs
(4) Federal and state taxes and licensing or regulatory fees