Washington Insurance Commissioner adopts emergency EHB rules

Yesterday we found out how the Washington essential health benefits rule was going to be in place soon enough for insurers to draft and file new reformed health plans in time for the Washington Exchange. The Insurance Commissioner (OIC) adopted the latest draft (2012-17102-4) as an emergency rule. There will be no hearing and no more comment on the rule for now. Under the state administrative procedures act, the rule cannot remain in effect longer than 120 days after filing. At some point the OIC must re-file the rules for hearing and adoption as permanent rules.

For association plans, the latest draft omits the objectionable overreach noted in the previous draft. Here is the new definition of “small group plan:”

“Small group plan” includes any nongrandfathered health benefit plan offered, issued, amended or renewed by an admitted issuer in the state of Washington for the small group health benefit plan market to a small group, as defined in RCW 48.43.005, unless the certificate of coverage is issued to a small group pursuant to a master contract held by or issued through an organization meeting the definition established pursuant to 29 USC 1002 (5).

[The federal statutory reference in the rule above incorporates the ERISA definition of employer – “(5) The term “employer” means any person acting directly as an employer, or indirectly in the interest of an employer, in relation to an employee benefit plan; and includes a group or association of employers acting for an employer in such capacity.”]

The adopted rule includes the provider non-discrimination language from earlier versions of the rule:

An issuer must not apply visit limitations or limit the scope of the benefit category based on the type of provider delivering the service, other than requiring that the service must be within the provider’s scope of license for purposes of coverage. This obligation does not require an issuer to contract with any willing provider, nor is an issuer restricted from establishing reasonable requirements for credentialing of and access to providers within its network. [WAC 284-43-877(5)]

The rule contains a broad catch-all power for the OIC to prohibit the offering of any health plan if the benefits within a category “are limited so that the coverage for the category is not a meaningful benefit.” [WAC 284-43-877(9)(b)]

Some parts of the new rule create ambiguity and will require trial and error to determine the full impact of the rule. For example, under WAC 284-43-878 describing the essential health benefit categories, you’ll find each of the following instructions for rehabilitative services:

(7)…an issuer must classify as rehabilitative services medically necessary services that help a person keep, restore or improve skills and function for daily living that have been lost or impaired because a person was sick, hurt or disabled, in a manner substantially equivalent to the base-benchmark plan.

 [This must include]

(a)(ii) In-patient rehabilitation facility and professional services delivered in those facilities;

(iii) Outpatient physical therapy, occupational therapy and speech therapy for rehabilitative purposes;

[The benchmark plan includes the following limit]

(d)(ii) Outpatient physical therapy, occupational therapy and speech therapy are limited to twenty-five outpatient visits per calendar year, on a combined basis, for rehabilitative purposes.

(f) An issuer must not classify services to the rehabilitative services category if the classification results in a limitation of coverage for therapy that is medically necessary for an enrollee’s treatment for cancer, chronic pulmonary or respiratory disease, cardiac disease or other similar chronic conditions or diseases. For purposes of this subsection, an issuer must establish limitations on the number of visits and coverage of the rehabilitation therapy consistent with its medical necessity and utilization review guidelines for medical/surgical benefits.

WAC 284-43-882(3)

An issuer may use reasonable medical management techniques to control costs, including promoting the use of appropriate, high value preventive services, providers and settings. An issuer’s policies must accommodate enrollees for whom it would be medically inappropriate to have the service provided in one setting versus another, as recommended by the attending provider, and permit waiver of an otherwise applicable copayment for the service that is tied to one setting but not the preferred high-value setting. [emphasis added]

As we all get the chance to digest the new rule, we’ll gain a better understanding of its impact of benefits and costs.