NJ DOBI responds: No more elder abuse in the ACA marketplace

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My last post spotlighted a form of elder abuse in New Jersey’s ACA marketplace. The state’s Individual Health Program (IHC) allows or requires insurers in the individual market to presume that enrollees who are over age 65 are eligible for Medicare — unless the enrollee provides proof positive otherwise.

If such proof is not furnished (at least one insurer, AmeriHealth, requires a letter from the Social Security Administration, which in turn requires applying for Medicare)— the insurer pays the enrollee’s claims only as a secondary payer, presuming that Medicare will pay the bulk of each claim. That leaves the enrollee on the hook for the bulk of every medical bill she incurs, rendering the insurance policy’s statutory out-of-pocket limit essentially void. NJ DOBI has been allowing insurers to do this since 2016, and in 2023 ratified the practice, stipulating in the standard policy policy form that the insurer “will assume the Covered Person is Eligible for Medicare and pay secondary benefits as set forth in this section unless the Covered Person provides written documentation that proves the Covered Person is not Eligible for Medicare” (p. 126)

CMS guidance issued on May 24, 2023 flatly forbids this practice, as CMS told me in response to a query, adding “CMS has been in contact with the New Jersey Department of Banking and Insurance (NJDOBI) regarding this issue.  We recommend contacting NJDOBI for further information.” The May 24 guidance states that an ACA-compliant individual market insurer “may not limit or exclude coverage based on the theoretical possibility of an individual’s enrollment in other coverage… regardless of whether an individual is (or is presumed) eligible for Medicare.”

NJ DOBI did not respond to my repeated requests for comment on the state insurers’ apparent continuing violation of the CMS guidance — under color of state regulation. But an investigative reporter at NJ.com and the Star-Ledger, Karin Price Mueller, got on the case. And DOBI did respond to Mueller. Thus pushed, they are apparently ending the practice — effective yesterday:

“In light of the possible confusion in the market, the department (Wednesday) issued its own directive to carriers in the individual market — both on and off the marketplace — to ensure they are following the (Medicare guidance), which falls under the `Conformity with Law’ provision of the standard individual health benefits plans,” spokeswoman Dawn Thomas said.

The agency has told all insurance carriers to review the benefits of individuals who are 65 and older and enrolled in plans through GetCoveredNJ “to ensure that the policyholders are receiving the appropriate coverage, and that all coverage is consistent with the applicable Federal Guidance,” she said.

Thomas also said DOBI is reviewing how consumers may have been affected.

“Specifically, it is requiring that all carriers provide information on how the rule was implemented, including any requirements placed on consumers 65+ years of age, and what specific documentation may have been required for both on and off marketplace consumers,” Thomas said.

And, she said, the agency will make sure the language is clear when the 2024 plans roll around.

“If GetCoveredNJ determines a consumer eligible for a marketplace plan, the consumer should remain eligible and get the full benefits of the policy selected,” she said.

If those promises look a little soft to jaded eyes, other language in DOBI’s statement to Mueller, which she shared with me, was less equivocal:

On May 24, 2023, the Centers for Medicare and Medicaid Services (CMS) released guidance to insurers that demonstrated to the department that the IHC board’s rule change was not in compliance with CMS rules. Therefore, in June, the department informed carriers that the CMS guidance will govern the individual market and made clear the department accepted CMS’ position.

Apparently, that June bulletin changed nothing. Now, pending enforcement, this longstanding abuse of the fundamental ACA promise (quality affordable comprehensive coverage) appears to be ended going forward. But “going forward” points to a problem, which Mueller gave me a chance to articulate:

“I’m delighted to learn that DOBI is now acting swiftly to end this abusive practice — allowing Obamacare insurers to strip older plan members of most of the coverage to which they’re entitled,” Sprung said. “Now DOBI needs to dig in and find out whether there are people who have been subject to this practice for years who may have been saddled with provider bills that their insurer should have paid — and if so, to make sure those wrongs are righted.”

DOBI clarified to Mueller that NJ individual market insurers have been allowed to presume over-65 enrollees eligible for Medicare and act as a secondary payer at least since 2016. I have viewed bills from 2022 that reflect that practice. So there is compensatory work to be done. In 2023, almost 9000 enrollees through GetCoveredNJ were over 65. How many have been enrolled, and shorted coverage, in seven or more years?

Why 2016? In that year’s annual Notice of Benefit and Payment Parameters (NBPP) for the ACA marketplace, clarified that a marketplace enrollee who turns 65 during the plan year and enrolls in Medicare can maintain her marketplace plan, though she would lose eligibility for subsidies. A Medicare enrollee can even renew a marketplace plan if that plan does not change, i.e. if a new “contract of insurance” is not required. Why anyone would want to pay full freight for a marketplace plan (at least $800+/month in New Jersey in 2023 for an over-65 enrollee) when they are enrolled in Medicare is hard to fathom, but it can be done.

While finalizing this rule, CMS noted, “Several commenters expressed concerns that individuals enrolled in Medicare and those who are eligible for but not yet covered by Medicare present a significant burden to the single risk pool” (p. 94068). That is very likely the concern that New Jersey’s individual market insurers brought to regulators to get permission to presume elder enrollees eligible for Medicare. Ever since (if not before), in at least some if not virtually all cases, they have been getting full premiums for enrollees over age 65 while paying only what Medicare is presumed not to pay on claims.

Hats off to Karin Mueller, who was able to get what I could not from DOBI.

New Jersey's Department of Banking and Insurance lays a trap for elderly enrollees in the state's ACA marketplace

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Filling out an application for subsidized health insurance in the ACA marketplace can be straightforward — or not so straightforward. If the exchange’s “trusted sources” of information do not readily identify you, uploading proof of identity nd getting it accepted can be a…process (especially in a family with mixed immigration status). If you are self-employed and your income is not obviously reflected in regular monthly payments, documenting your claimed income and having the documentation accepted can also be a multi-stage process.

That said, once your documentation is accepted and your monthly subsidy is assessed, you are good to go, right?

Not always. Not in New Jersey, anyway, where the insurer can come after you for additional documentation — and potentially reduce your coverage to a shadow.

Meeting the minds of Chinese students in Xi'an

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If you’ll excuse an off-topic post, a graduate school friend of mine (circa 1990…), Wendy Bashant, has published a truly memorable account of her year teaching at a “Chinese MIT” - interrupted but not derailed by the pandemic. The book opens a real window into the minds of Chinese students — elite but not necessarily privileged. Their writings, liberally excerpted, reflect a huge variety of childhood experiences in a country that contains multitudes. The book is The Same Bright Moon: Teaching China’s New Generation During Covid. My Amazon review is below.

The Same Bright Moon

* * *

After decades serving as a dean at various U.S. colleges and universities, Wendy Bashant was burned out and ready to return to her teaching roots and meet the minds of students in a distant land. With her equally willing physician husband, she landed in mid-2019 at Jiaotong University in Xi'an, a megacity in central China,  tasked with teaching American literature and writing at a school she describes as MIT-equivalent. In the course of a teaching year, she also experienced a pandemic, Chinese-style: emergency travel through a ghosted airport; swift, strict lockdown; partially successful experiments with remote teaching; and gradual return to something like normalcy under a regime of strict, unquestioned rules. 

A passionate and empathic teacher, Bashant managed to form deep connections and spur original thought from a significant number of her students. She shares their reflections on their childhoods, their aspirations, and how they think the world works through conversation (in-class and one-on-one) and through the students' essays and poems. The writings and conversations offer a series of truly illuminating windows into young Chinese adults' varied experiences and mindsets. One reality that comes through very clearly is that China contains multitudes: the students' home environments range from rural villages to megacities (and often to both, as one recurring pattern is parents working in the city while their children live with grandparents in the home village), their parents from professionals or government officials to laborers with minimal education. The students have lived through decades of rapid change; often their parents' experience is radically different from their that of their grandparents, and the students’ essays describe these discrepancies.

Bashant develops a rather lovely framework to encompass this diversity, adapting the (fading) Chinese tradition of the "hundred family jacket," in which local families donate embroidered cloth patches to a newborn's family, to be sewn onto a jacket that's worn at festivals. Bashant's "jacket" is a map of China in which she places various students, chapter by chapter (initially, as a device to remember their names), as their narratives reflect the diverse regions and cultures in which they grew up, from open plains near Mongolia to small dark grandparents' apartments in megacities. This works, because the students' essays do take us to these places.

While these students have been studying English since they were 5 (Bashant tells us), English is a second and very foreign language. The essays reflect this -- along with, to my ear, a sometimes reflexive reliance on authority -- governmental, parental, commercial -- to frame the writer's thoughts. The book's drama comes in large part from students' efforts -- sometimes stunningly successful -- to break out of conventional wisdom and think for themselves. 

Bashant gives a vivid account of the physical privations and social pleasures of living in a 60s-era Chinese apartment block that houses the university community, ranging from professors to custodians. The Bashants are showered with food, invited to residents' family homes outside of town, helped through logistical difficulties. You have to credit their resilience and willingness to embrace new experience. I would have liked to hear a bit more about the experience and perspective of husband David, who worked as a tutor and translator of scientific texts at the university.

While antagonism between China and the U.S. was not as intense in 2019 as now, it was rising quickly, and turbo-charged during the pandemic as Trump unleashed his incontinent verbal fury at China. The Bashants are asked constantly about Trump and about American attitudes toward China. Bashant's students voice some negative perceptions about Americans and America, but these do not seem to impede their relationship with her -- at least not for the students whose experience she chronicles and records. Bashant does not really engage politically (there would be severe constraints on doing so in China, I imagine). There are no discussions of Trump either as appalling anomaly or true expression of the worst American traditions. Nor does Bashant engage with escalating authoritarianism in China. Indeed, she seems receptive to positive aspects of Chinese governance -- that is, the tight restrictions and preventive procedures (many of which proved to be mistaken epidemiologically) in the first months of the pandemic. 

That said, The Same Bright Moon fulfills the premise of its title: that minds can meet across cultures, that we can process the common elements of human experience very differently, while communicating and gaining some understanding of these differences; that on an individual level at least, empathy can bridge continents.

In Massachusetts, ACA Marketplace enrollees with income up to 500% FPL get affordable platinum coverage

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A rickety but serviceable connector

In a two-year pilot program beginning in 2024, Massachusetts has extended eligibility for ConnectorCare, the state’s alternative to a standard ACA marketplace that features standardized plans with low out-of-pocket costs, to applicants with incomes up to 500% of the Federal Poverty Level (FPL), or $72,900 for an individual in 2024. Since the ACA marketplace’s 2014 inception, ConnectorCare has been the (only) option for applicants with income ranging from 138% FPL, the Medicaid eligibility threshold, to 300% FPL. The extension means that almost all subsidy-eligible marketplace enrollees will get a standardized ConnectorCare plan, at least through 2025.

All insurers who offer plans in Massachusetts’ regular ACA exchange (available through this year to enrollees with income over 300% FPL) will be required for the first time to offer ConnectorCare plans in 2024. Importantly, since ConnectorCare plans are in a single risk pool with the insurer’s offerings in the higher income marketplace, extending eligibility to 500% FPL should not cannibalize the Health Connector market plans offered to enrollees with income above that threshold. That is, the extension should not drive up premiums for those who get no subsidy or minimal subsidy.

The Massachusetts legislature included such an extension in its budget passed in August 2022, but Republican Governor Charlie Baker vetoed it. Last month, Democratic Governor Maura Healy, inaugurated this past January, signed the eligibility extension into law.