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April 6, 2022

Around the nation: Biden administration proposes to fix ACA's 'family glitch'

Daily Briefing

    The Biden administration released a proposal to fix what is known as the "family-glitch" in the Affordable Care Act (ACA), in today's bite-sized hospital and health industry news from Colorado, the District of Columbia, Maryland, and Utah.

    • Colorado/Utah: SCL Health and Intermountain Healthcare on Tuesday announced the completion of a merger between the two organizations. The combined organization, with an estimated value of $14 billion, has 33 hospitals, 385 clinics, and a health plan with over a million members. The organization has about 59,000 employees in seven states. "SCL Health approached us in the wake of Sanford merger. The nicest thing that came out of that was that SCL knew we were in the market to grow," said Intermountain CEO Marc Harrison. "They are an organization that has been approached again and again and were never interested, but they wanted to join us because of our quality footprint, our commitment to digital innovation and value, and the benefits of having a health plan in the toolbox." According to the Colorado attorney general's review, the merger has "sufficient safeguards" that will maintain access to care across Colorado and maintain SCL's charitable mission. "Both organizations are very careful with headcount and run very lean and efficiently," said Harrison, who will lead the combined organization. "Some will choose to leave, but we do not wish to lose any talent." (Kacik, Modern Healthcare, 4/5)


    • District of Columbia: The Biden administration on Tuesday released a proposal to fix what is known as the "family-glitch" in the ACA—a rule that currently blocks millions of individuals who receive health care coverage through a family member's employer from qualifying for coverage assistance. Under the current regulations, the ACA provides assistance to single customers who spend over 9.83% of their income on their workplace health plan. Under the new proposal, a worker's spouse and children could qualify for assistance with purchasing a private plan through the ACA marketplace if the workplace plan for the entire family costs more than 10% of the household income. "Should the proposed change be made, it's estimated that 200,000 uninsured people would gain coverage, and nearly 1 million Americans would see their coverage become more affordable," the White House said in a fact sheet. According to a senior Biden administration official, the updated rule is expected to take effect at the start of 2023, meaning people would be able to sign up for financial assistance during this year's open enrollment period. (Choi, The Hill, 4/5; Groppe, USA Today, 4/5; Watson/Ake, CBS News, 4/5; Pettypiece, NBC News, 4/5) 4/5; Groppe, USA Today, 4/5; Watson/Ake, CBS News, 4/5; Pettypiece, NBC News, 4/5, Frieden, MedPage Today, 4/5)


    • Maryland: On Monday, in its final rate notice for next year's Medicare Advantage (MA) plans, CMS announced that MA plans are expected to see an 8.5% average revenue increase in 2023. According to the announcement, private insurers who administer MA plans can expect to see a 5% average increase in federal payments during 2023—half a percentage point higher than the Biden administration's proposed amount from January. At the beginning of 2022, over 28 million seniors and people with disabilities were enrolled in private MA plans. While insurers have argued that MA provides better care than traditional Medicare, some critics have voiced concern over the rate increase, saying that insurers and private investors are gaining a higher share of federal Medicare funds and increasing their profits, rather than improving patient care, Axios reports. (Pugh, Bloomberg Law, 4/4; Bettelheim, Axios, 4/5; Goldman, Modern Healthcare, 4/4; Herman, STAT+ [subscription required], 4/4)

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