How the Supreme Court ruling on the Affordable Care Act could help, or hurt, the ESRD Program

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GUEST

BLOG: How the Supreme Court ruling on the Affordable Care Act could

help, or

hurt, the ESRD Program

by Dolph

Chianchiano 4. June 2012 05:23

The U.S.

Supreme Court is expected to vote next month on the

legality of the Affordable Care Act—the legislation passed by Congress

in 2010

that reformed health care insurance coverage in this country. Although

certain

aspects of health care reform have yet to be resolved, the Affordable

Care Act,

if deemed constitutional by the court next month, has the potential to

address

many concerns of individuals with kidney disease, including transplant

recipients, and living donors.

The impact

of the individual mandate

A key component of the reform law––and at the center of the Court's

review––is

whether the government can require U.S. citizens to buy health

insurance. Assuming that insurance is affordable, it would provide

coverage for

individuals with pre-existing conditions, such as kidney disease.

Provisions in

the ACA eliminate annual and lifetime caps on the amount of expenses

that

health insurance covers. Among other things, these provisions have been

seen as

an opportunity to address discrimination against living organ donors

seeking

health insurance and as providing an option for kidney transplant

recipients

who lose Medicare coverage for anti-rejection medications.

Getting

insurance

At the heart of the Affordable Care Act is the concept of a new

state-based

marketplace for health insurance, known as the health care exchange.

Starting

in 2014, this new marketplace would give individuals and small

employers some

of the advantages that large companies enjoy because of their

purchasing power.

In addition, a program of premium and cost-sharing subsidies would

advance the

goal of making exchange-based insurance affordable. A dozen states have

already

created the health insurance exchanges envisioned by ACA, either by

legislation

or executive order. Will those states be able to operate those

exchanges

independent of federal law?

Medicaid expansion could hurt

states

struggling to balance budgets

In addition to the individual mandate, health care reform advances the

goal of

universal coverage by increasing the number of individuals who are

eligible for

coverage under Medicaid. The court is also considering the

constitutionality of

Medicaid expansion since such an expansion would ultimately impose

additional

financial burdens on the states that share in the cost of the Medicaid

program.

It is important to note for the kidney community that the Medicaid

expansion

criteria only apply to those who have Medicaid as their primary

insurance and

not those who are dually eligible for Medicare and Medicaid.

Can some

provisions be saved?

If the Supreme Court does not uphold the constitutionality of the

individual

mandate, it may also decide whether other provisions of the Affordable

Care Act

will remain in force, or leave that decision up to Congress. This could

be

problematic for provisions that are already in effect, such as the ban

on

lifetime limits on health coverage, and reductions in out-of-pocket

spending

for Medicare beneficiaries who reach the coverage gap ("donut hole")

in prescription drug coverage. (Since 2011, name-brand drugs have been

available at half-price through the donut hole.) In the first four

months

of 2012, CMS claimed that more than 416,000 people with Medicare saved

an

average of $724 on prescription drugs and 12.1 million used a free

preventive

service. That has amounted to $3.5 billion savings on prescription

drugs in the

Medicare drug benefit coverage gap from the enactment of the law in

March 2010

through April of 2012, CMS said. If the ACA is struck down, those

savings to

seniors could go away.

Provisions

affecting renal care

In the two years since the passage of the Affordable Care Act, the

kidney

community has identified a number of health care reform implementation

issues

that would have to be resolved through advocacy.

These

include the following:

Would treatment of

end-stage renal disease be included as "essential health benefits" in

the insurance that is to be made available through the exchanges and

will there be any restrictions on these benefits?

Would individuals with

ESRD be able to keep exchange-based small employer group health

coverage even though they are eligible for Medicare?

Would individuals with

ESRD be eligible for premium and cost-sharing subsidies for

exchange-based insurance despite eligibility for Medicare?

Some, but

not all, of these questions have been answered during

the last three months. In an "Essential Health Benefits Bulletin,"

issued by the Center for Consumer Information and Insurance Oversight

on

December 16, 2011, it was stated that organ transplants are

consistently

covered across the existing markets and plans examined, and,

presumably, should

be considered an essential health benefit.

The Interim

Final Rule on health insurance exchanges published in

the Federal Register on March 27, 2012, provided additional

clarification.

"We note that neither the proposed nor the final rule state that

individuals will automatically be terminated from Exchange coverage

should they

be found eligible for Medicare." And, on June 1, the Department of

Health

and Human Services issued a proposed rule entitled, "Data collection to

support standards related to essential health benefits; Recognition of

entities

for accreditation of qualified health plans." This proposed rule would

establish data collection standards necessary to implement aspects of

the ACA,

outlining the data on applicable plans to be collected from issuers to

support

the definition of essential health benefits. The proposed rule would

also

establish a process for the recognition of accrediting entities for

purposes of

certification of qualified health plans.

In addition,

employees with kidney failure will not have to give

up their exchange-based small employer group health insurance during

the first

30 months of ESRD. Specifically: "We clarify that QHPs (Qualified

Health

Plans) offered in the small group market fall under the definition of a

group

health plan subject to MSP (Medicare Secondary Payer) provisions

codified in

section 1862((1) of Social Security Act. This would result in parity

between

the SHOP (Small Business Health Options Program) and non-Exchange small

group

market regarding the applicability of MSP rules that pertain to ESRD

coverage."

On the other

hand, the U. S. Department of Health and Human

Services declined to require that exchanges enforce specific standards

for

access to health care providers reimbursed by exchange-based insurance.

"With respect to the other specific suggestions offered by commenters,

(reasonable proximity of providers to enrollees' homes or workplaces,

ongoing

monitoring process, and out- of-network care at no additional cost when

in-network care is unavailable), we are concerned that the proposed

standards

may not be compatible with existing State regulation and oversight in

this

area."

Moreover,

the Internal Revenue Service has ruled that individuals,

who are eligible for other qualifying coverage, including Medicare ESRD

beneficiaries, are not eligible for the premium tax credit that enables

individuals to purchase health insurance through the exchanges.

Although the

End-Stage Renal Disease Program has a 30-year history

as a federally-funded entitlement, it remains to be seen whether the

treatment

of end-stage renal disease is recognized as an Essential Health Benefit.

What does the future hold?

Despite these rulings, and because gridlock in Congress would make it

difficult

to pass some of the beneficial ACA provisions, kidney patients, and

living

kidney donors, would probably benefit the most, at least in the short

term, if

the Supreme Court were to uphold the Affordable Care Act.

If the

Supreme Court rules only that the individual mandate is

unconstitutional but leaves it up to Congress and the Administration to

decide

the fate of the other provisions of the Affordable Care Act, it may be

possible

to extend the life of the Pre-existing Condition Insurance Program

(PCIP) that

was slated to terminate in 2014. On the other hand, Congress would have

to

provide support to make PCIP premiums affordable, and that may not be a

realistic expectation.

Alternatives

to the individual mandate that have been discussed as

ways to spread risks of health costs more broadly may not be helpful to

individuals who are considered to already have a pre-existing

condition. These

alternatives would be designed to discourage individuals from waiting

until

they are sick to purchase health insurance, such as penalties for late

enrollment, and/or limited open-enrollment periods.

If the

Supreme Court invalidates the Affordable Care Act in its

entirety, a number of scenarios are possible. States could elect to

operate

their own health insurance exchanges. (For example, health insurance

exchanges

already exist in Massachusetts and Utah.) However,

the cost

of running these exchanges may make it impossible for many states to

consider

this option. Furthermore, the exchanges would no doubt vary from state

to state

with respect to the kind of protections they afford for individuals

with kidney

disease. Certainly, the kidney community will have to redouble its

efforts to

make sure that more kidney transplant recipients have Medicare coverage

for the

drugs that prevent rejections.

Mr. Chianchiano, JD, MBA,

most

recently served as the National Kidney Foundation's Senior Vice

President of

Health Policy and Research and continues to work for NKF as a

consultant on

health policy. He originally joined the NKF staff in 1979, having

previously

worked for the American Heart Association.

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Louis

Transplant Financial Coordinator

Kidney and Pancreas Transplant Program

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Weill Cornell Transplant Center

Visit the Cornell Transplant Website

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