260.002 Health Insurance Assistance
| Policy Number | 260.002 |
| Effective Date | November 12, 1998 |
| Revision Date | November 2, 2015 |
| Subject Matter Expert | HIV Services Staff |
| Approval Authority | HIV/STD Prevention and Care Branch Manager |
| Signed by | Shelley Lucas |
1.0 Purpose
This policy reviews eligibility requirements and allowable expenditures for Health Insurance Assistance (HIA) services supported with Texas Department of State Health Services (DSHS) funds, and specifies the types of HIA policies and guidelines that must be established.
2.0 Scope of Policy
This policy provides guidance and requirements for the provision of HIA services to clients with health insurance plans. It does not address the specific eligibility requirements for public insurance programs, job-based coverage, or reduced-cost plans on the Health Insurance Marketplace. The factors that determine the best plan for a client and the final cost of the plan to a client are specific to each client and beyond the scope of this policy. Clients should be referred to expert agencies, organizations, or navigators/individuals to assist them in choosing and enrolling in programs or health plans.
3.0 Background
The Ryan White HIV/AIDS Program (RWHAP) provides access to HIV-related outpatient and support services to low-income persons. DSHS policy 590.001 establishes the Ryan White Part B and State Services (SS) funds made available through DSHS as payor of last resort. Sections 2605(a)(6), 2617(b)(7)(F), 2664(f)(1), and 2671(i) of the Public Health Service Act similarly require funds awarded through all Parts of the RWHAP to be used as payment of last resort.
Access to HIV-related services may be provided directly by using grant funds to pay contracting providers or indirectly through financial support for the costs of health insurance coverage held by clients. HIA has been a RWHAP-eligible service from the initial authorization of the program. RWHAP and SS funds may also be used to provide assistance to eligible clients in making payments associated with health insurance plans, including premium, deductible, and copayments/co-insurance payments as an alternative to making direct payment for health services, and is intended to preserve or newly obtain client health insurance as an alternative payment mechanism for clinical services. Such health insurance assistance payments will be referred to as HIA payments.
Prior to passage of the Patient Protection and Affordable Care Act (ACA), health insurance plans could exclude coverage for pre-existing conditions, so it was essential for HIV-infected people to maintain continuous coverage. High risk pools offered limited coverage for pre-existing conditions, and plans were not affordable for low-income clients. These factors essentially limited HIA recipients in Texas to those requiring assistance with job-related insurance costs, including costs of extending job-related coverage after job loss, as required by the Consolidated Omnibus Budget Reconciliation Act (COBRA).
The ACA bars exclusion of pre-existing conditions and eliminates caps on maximum insurance payments for a beneficiary's health care services, and these changes make insurance more accessible and useful for people with chronic conditions, including HIV infection. The elimination of exclusions for pre-existing conditions gives people living with HIV the choice and ability to change plans, or to pick up new insurance plans after gaps in coverage. The ACA also contains a mandate for most Americans to carry health insurance coverage or face a tax penalty, and contains provisions to lower the cost of such insurance for people with lower incomes through premium tax credits and the availability of insurance plans with lower cost sharing requirements.
In response to the ACA, Policies 7-05, 10-02, and 13-05 from the Health Resources and Services Administration (HRSA) strengthened requirements that RWHAP grantees and their contractors vigorously pursue enrollment into public and private health insurance plans for eligible clients. HIA as an eligible service can be used to make policies more affordable for low-income people living with HIV. However, these policies, as well as this policy, emphasize that insurance plans supported with RWHAP or DSHS funds must provide coverage for HIV treatment drugs and appropriate outpatient primary care, and that the cost of providing HIA must be lower than the cost of providing these health services through grant-supported direct delivery (be “cost-effective”), including costs for participation in the AIDS Drug Assistance Program (ADAP).
This latter provision requires careful implementation of HIA policies because health insurance support does not provide a cost advantage for all clients. For example, clients with household income below 100% of the federal poverty level (FPL) generally do not qualify for cost reductions for plans on the Health Insurance Marketplace, and are unlikely to have access to job-related health insurance coverage. Additionally, since the size of the tax credit shrinks as income increases, the cost of insurance of persons between 350% and 400% FPL may be very similar to the costs for people under 100%.
4.0 Authority
Texas Health and Safety Code, Chapter 85, §§85.003, 85.013, 85.014 - 85.03; Ryan White Treatment Extension Act 2009; HRSA Policy Notices 7 -05, 10-02, 13-01, 13-02, 13-03, 13-04, 13-05, and 14-01 (revised).
5.0 Definitions
Administrative Agency (AA) – DSHS contracts with Administrative Agencies to disburse funds from DSHS through a subcontractor system to provide comprehensive services to HIV-positive individuals and those affected within the service planning area
Co-Payment – A cost-sharing requirement that requires the insured to pay a specified dollar amount for each unit of service (e.g. $10 for each prescription dispensed).
Co-Insurance – A cost-sharing requirement that requires the insured to pay a percentage of costs for covered services/prescription (e.g., 10% of the prescription price).
Deductible – A cost-sharing requirement that requires the insured to pay a certain amount for health care or prescriptions before the insurance plans covers these costs.
Job-Based or Employer-Based Insurance Coverage – A health insurance plan in which individual employees or family members are included under one group policy provided by their employers.
Local Benchmark – The sum of the average ADAP expenditure and the average local expenditure on covered clinical services is the total per client expenditure on directly delivered clinical services that will be used in each HSDA as the comparison benchmark to judge the cost-effectiveness of health insurance assistance. Calculation of the benchmark is described in DSHS Policy 270.001.
Open and special enrollment periods – Specified times of year when clients eligible to purchase insurance on the Health Insurance Marketplace may enroll in plans. Information on open and special enrollment periods can be found at healthcare.gov.
Out-of-pocket (OOP) costs – Out of pocket costs are expenses for medical care that aren't reimbursed by insurance. Out-of-pocket costs include deductibles, coinsurance, and copayments for covered services plus all costs for services that aren't covered.
Qualifying Event – A change in status that allows an individual to change their insurance plan or enroll outside of open enrollment. For example, involuntary loss of insurance coverage, becoming or gaining a dependent, marriage or divorce, etc.
Premium – The amount paid by the insured to an insurance company to maintain an insurance policy.
Service Providers/Subcontractor – A local organization contracted by an Administrative Agency to provide services for HIV positive clients.
State Services – State general revenue funds provided for HIV-related services as a match requirement of the Ryan White HIV/AIDS Treatment Extension Act of 2009.
Supplemental Insurance – An insurance policy which will cover expenses that may not be covered by other insurance. For example, a Medigap Policy will help pay for the “gaps” in coverage related to Medicare Part A and Part B. The individual may be responsible for the cost of services not covered by Medicare. Supplemental Insurance requires a payment of a premium.
6.0 Persons/Organizations Affected by this Policy
- DSHS HIV/STD Prevention and Care Branch Staff
- DSHS-funded Administrative Agencies
- DSHS-funded HIA service providers
7.0 Responsibilities
7.1 DSHS
DSHS must maintain HIA policy and provide technical assistance to AAs, and monitor AA actions to ensure service providers comply with local HIA policies. DSHS must collaborate with Part A Planning Councils, Part A AAs, and DSHS-funded AAs to clarify or modify the HIA policy as needed.
7.2 Service Providers
Service providers must assure that all clients are screened for potential third party payers or other assistance programs, and that appropriate referrals are made to the offices, organizations, or individuals who can assist clients in enrollment. Providers must assure that the client's ability to contribute is included in this screening. Requirements for assessment of potential third party payers and other assistance programs may be found in DSHS Policy 590.001 on payment of last resort.
HIA Providers must obtain written approval from their AA before providing HIA for insurance coverage that exceeds local benchmark service costs, providing payments for out of network charges, discontinuing HIA due to client conduct, or refusing HIA for a client who is eligible and for whom HIA provides a cost advantage over direct service delivery.
HIA Providers must assure that HIA payments are made in a timely manner, and must make reasonable efforts to have coverage reinstated if client delays in assistance requests have caused coverage to lapse. Providers may maintain policies that discontinue HIA services for clients that habitually require such reinstatement assistance.
HIA providers must maintain communication with the client and with other relevant service agencies to assure that information that would affect HIA is appropriately reported. HIA providers must maintain communication with the Administrative Agency regarding trends in use of insurance monies to maximize best use of current funds.
7.3 Administrative Agencies (AA)
AAs or local planning bodies for Part A Eligible Metropolitan Areas (EMAs) must develop the local policies and procedures required by this policy and other relevant DSHS policies and requirements, and assure providers comply with these local policies and processes. AAs must assure that contractors use DSHS funds as payment of last resort. AAs must provide requested adjudication for exceptional requests for assistance or denial of assistance from HIA service providers and on complaints from clients (subject to local procedures for resolving client complaints).
AAs or planning bodies for Part A EMAs must develop proposed annual allocations for HIA services that are reasonable and sufficient given the requirements of DSHS and HRSA policy for vigorous pursuit of cost effective coverage.
8.0 Allowable Uses of HIA Funds
HIA payments may be made for premiums, deductibles and co-payments/co-insurance payments. Deductibles and co-payments/co-insurance payments are collectively referred to as out of pocket payments (OOP) in this policy. Payments may also be made for certain tax liabilities, as outlined below. DSHS-funded AAs must maintain policies that specify the insurance-related costs that are supported by HIA, and that specify that clients must be informed of covered and non-covered costs.
Funds may not be used to pay fines or tax obligations incurred by clients not maintaining the health insurance coverage required by the ACA. RWHAP funds and State Services funds may not be used to make OOP payments for inpatient hospitalization and emergency department care. HIA funds may be used for payments for services delivered by providers outside a plan’s network of providers only after review by the AA (see Section 14). HIA providers must ensure that HIA payments are made only for outpatient medical care. Payments may never be made to clients. Premium payments must be made directly to insurance companies, and OOP payments must be made directly to the provider of services, such as a clinic, physician office, or pharmacy.
HIA funds may be used to pay a tax liability associated with the premium tax credit. If AAs choose and if resources are available, they may permit the use of Ryan White Part B and State Services funds to pay the IRS any additional tax liability a client may owe to the IRS solely based on reconciliation of the premium tax credit. AAs should take into consideration their decision to pay such additional tax liability for clients when determining how to operationalize a premium and cost-sharing assistance program. AAs and HIA service providers are responsible for establishing and maintaining policies and procedures for coordinating such payments to the IRS since AAs and HIA service providers are prohibited from making any direct payments to clients. This payment to the IRS must be made from funds available in the year when the tax liability is due, even if the premiums that generated the tax liability were incurred in a previous funding year. However, under no circumstances can Ryan White Part B and State Services funds be used to pay the fee (i.e., shared responsibility payment) for a client’s failure to enroll in minimum essential coverage or any other tax liability owed by the client that is not directly attributed to the reconciliation of the premium tax credits.
9.0 Estimated Expenditure on Covered Clinical Services as Benchmark for Cost Comparison
To evaluate the cost effectiveness of health insurance coverage, local expenditures on clinical services typically covered by health insurance plans must be benchmarked. DSHS Policy 270.001 describes the methods to be used by DSHS to estimate expenditure on covered clinical services. Policies on the use of DSHS funds for HIA must reference this estimated cost in the development of eligibility guidelines and cost-control polices. DSHS-funded AAs and HIA providers must make the benchmark amounts publicly available to aid in decision making.
10.0 Allocations for HIA
Proposed Part B and State Services allocations for health insurance assistance services must be reasonable given the number of presently uninsured clients in the service area who are likely to qualify for low-cost health insurance plans based on client household income. DSHS will confer with AAs and Part A Planning Councils to improve guidance on allocation based on estimates of true costs of health plans on the Marketplace as areas gain more understanding of typical levels of expenditures associated with these plans.
11.0 Client Eligibility for HIA Services
Each DSHS-funded AA must maintain policies that specify the criteria for client eligibility for HIA services. To be eligible for HIA services paid for by Part B or State Service funds, individuals must meet the general eligibility criteria described in DSHS Policy 220.001 as well as any local eligibility requirements associated with residence, income, or other factors. Requirements for setting local eligibility criteria are found in DSHS Policy 220.001, Eligibility to Receive HIV Services.
11.1 Considerations for the Use of Income Eligibility Criteria
Clients may receive HIA only for health insurance plan costs that are lower than the local benchmark for cost of directly delivered services. If income is used as an eligibility criterion or guideline, policy makers must consider that persons under 100%FPL are not usually eligible for low cost plans on the Marketplace. Income eligibility guidelines should consider both upper and lower financial eligibility limits on client income.
Since HIA is intended to support health insurance as an alternative to payment for direct service delivery, income eligibility guidelines for HIA should be consistent with the local income eligibility for Ryan White Part B and State Services funded Outpatient/Ambulatory Medical Care services.
Policies must detail the expectation for client contribution, subject to provisions in DSHS Payer of Last Resort policy and local policies on client contributions.
Local policies using income-based criteria must be based on the modified adjusted gross income of the household (MAGI) against the federal poverty guidelines/levels (FPL) for that household size. AAs should strongly consider using the same methods for annual income estimation as are used to determine Marketplace eligibility for premium tax credits and reduced OOP requirements, and should also strongly consider using income estimation methods consistently for all service categories that have income eligibility criteria.
Local polices for HIA must require that HIA providers maintain referral relationships with organizations or individuals who can provide expert assistance to clients on their health insurance coverage options and available cost reductions. In addition, local polices for HIA must ensure HIA providers maintain referral relationships with organizations or individuals who can provide income tax preparation assistance.
In areas with Part A Planning Councils, HIA-related policies must be coordinated and harmonized with the Planning Council's guidelines and policies. DSHS funded AAs must also make good faith efforts to coordinate policies and guidelines with Part C and Part D grantees in their area.
11.2 Lawfully present immigrants and Marketplace savings
A lawfully present immigrant can buy private health insurance on the Marketplace and may be eligible for lower costs on monthly premiums and lower out-of-pocket costs based on income.
- If client annual household income is 400% of the federal poverty level or below, they may qualify for premium tax credits and other savings on Marketplace insurance.
- If client annual household income is below 100% federal poverty level, meet all other eligibility requirements, and are not otherwise eligible for Medicaid they may be eligible for premium tax credits and other savings on Marketplace insurance.
12.0 Plans Eligible for HIA Payment
HIA may be extended for job-related health insurance coverage and plans on the individual and group market, including plans available through the federal Health Insurance Marketplace (Marketplace). DSHS funds may also be used towards premiums and OOP payments on Medicare plans and supplemental insurance policies, insofar as the primary purpose of the supplemental policy is to assist with HIV related outpatient care. DSHS funds may not be used to support plans that offer only catastrophic coverage or supplemental insurance that assists only with hospitalization.
HRSA policies affecting all Parts of the RWHAP also exclude plans that do not cover HIV-treatment drugs; specifically, the plan must cover at least one drug in each class of core antiretroviral therapeutics from the HHS clinical guidelines as well as appropriate primary care services. HRSA policies affecting all Parts also specify that HIA payments may be made only when assistance with health insurance is cost neutral or offers a cost-advantage when compared to estimated expenditure for covered clinical services. When making cost comparisons, both premiums and reasonable estimates of out of pocket costs must be considered.
13.0 Considerations for Coverage Obtained through Group Policies
Access to health insurance coverage may be available to or currently carried by clients who are eligible for coverage due to their employment or membership in a group, such as a church, union, or professional organization. The person with the membership or employment that qualifies him/her for the health insurance plan is referred to as the covered member or policy holder. The policy holder may be able to add a spouse/ partner and dependents to their coverage.
DSHS-funded AAs and HIA providers must maintain polices on the assistance that can be offered for clients who are covered under a group policy. Before extending assistance, providers must determine the share of policy costs associated with the eligible client. For example, if the client is a dependent of the policy holder, then only the premium costs of adding dependents to a plan and the OOP payments for the client can be paid with HIA. Extension of assistance is also dependent on meeting requirements for minimum levels of drug coverage and cost-effectiveness of the health plan. It is only allowable to assist an eligible client with the entire cost of a group policy that includes coverage for persons not eligible for HIA when the inability to cover these expenses would result in the eligible client losing health insurance coverage. In such circumstances, providers must receive approval from their AA prior to extending HIA.
13.1 COBRA Continuation Coverage
Clients may request assistance with COBRA continuation coverage if they have lost access to job-related insurance through job loss, reduction of work hours, or other qualifying event. COBRA continuation coverage is time-limited, and is usually more expensive than the job-related coverage formerly available to the person electing to continue coverage under COBRA.
Before providing HIA support for COBRA insurance coverage, the cost of other options must be evaluated, such as enrolling on a spouse's job-based plan, enrolling in Medicaid, or getting coverage through the Health Insurance Marketplace. Loss of job-related insurance triggers a 90-day special enrollment period for the Marketplace, and people whose COBRA is running out are also eligible for special enrollment periods. However, persons already enrolled in COBRA are not eligible for special enrollment periods if they voluntarily end their COBRA coverage prior to its end date, although they can change to a Marketplace plan during open enrollment periods. Marketplace Navigators, Certified Application Counselors or insurance brokers may be helpful in helping the client determine eligibility for premium tax credits and reduced OOP requirements that will reduce the costs of Marketplace coverage.
AA policy must specify that HIA must not be extended for COBRA coverage if a client is eligible for other coverage that provides the required minimal level of coverage at a cost-effective price. If the client has already elected COBRA continuation coverage, HIA for this coverage is subject to the conditions specified in this policy. Since clients with COBRA continuation coverage may enroll in Marketplace plans during open enrollment periods, any HIA support for COBRA plans must be reconsidered during open enrollment.
14.0 Special Requirements for Plans Purchased on the Marketplace
If a client is eligible for a premium tax credit, the client must take this as an advance premium tax credit to receive assistance with premium payments. Clients that are eligible for plans with reduced cost sharing/reduced OOP payments must select a Silver Marketplace plan to receive assistance with OOP payments. In some cases if a client is over 250% FPL and within the locally set upper financial limit then it may be more cost effective for a client to purchase a Gold or Platinum policy. This requires a comparison of the maximum OOP cost between a Silver Plan and other options. Clients must report changes in income, family size, tobacco use or residence promptly. These changes may affect the amount of premium tax credit or cost sharing reductions. HIA or case management providers working with a client with Marketplace insurance who needs to make changes must assist the client with making these changes or refer the client to an organization or individual that can provide assistance.
15.0 Requests for HIA for Plans that Exceed Benchmark Costs
AAs must develop procedures for reviewing requests to provide HIA for plans that exceed benchmark costs. Requests for health insurance assistance that exceed the estimated cost of directly-delivered services should only be approved when special circumstances exist that make financial support of health insurance necessary to preserve the health of the client. For example, a client may have significant co-morbidities that are costly to treat and if left untreated will limit the success of HIV treatment. Another common exemption may allow continued HIA support for policies that exceed local costs of care for clients that elected coverage prior to development of local eligibility criteria for HIA; such exemptions must be contingent on client enrollment in more cost efficient coverage at the earliest opportunity. DSHS-funded AAs must maintain policies outlining the procedures for obtaining a waiver under these circumstances, and these policies must name the DSHS-funded AAs as the adjudicator for such requests. In areas with RWHAP Part A, C, D and F grantees, DSHS-funded AA must collaborate with these grantees in the development of waiver policies.
16.0 Cost Control Policies for HIA
16.1 Annual Caps and Expenditure Limits
DSHS-funded AAs may develop local policies such as annual caps or expenditure limits for HIA for individual clients. DSHS advises that these caps or limits be based on local benchmark costs of direct delivery of covered clinical services. These policies may not restrict assistance for either premiums or out of pocket payments in such a way to render otherwise cost-effective, equivalent plans unaffordable for clients, such as placing monthly caps on OOP payments rather than annual caps on this type of assistance. In areas with RWHAP Part A, C, and D grantees, DSHS-funded AA must collaborate with these grantees in the development of these policies.
16.2 Restrictions on Out-of-Network Payments
DSHS-funded AAs must develop polices restricting payment of co-pays or co-insurance costs when clients use out of network providers or fill prescriptions for drugs that incur higher co-pays or co-insurance because they are outside their health plan's formulary. The policy must make exception for payments for HIV-related care if an in-network provider is not available or appointment wait time for an in-network provider exceeds local standards for delivery of care. Payments for drugs that are off-formulary for a plan may be made only if the client makes use of the appeal process available under her/his policy. Case managers, clinical providers, and HIA providers may assist clients in these appeals, subject to their locally-described roles. The policy must require AA documented approval before a payment for out of network services is made.
If RWHAP/State Services- funded providers of medical services are not enrolled as providers of the public and private health plans that cover their clients, then out of network charges will rise, and may eliminate the cost competitiveness of insurance coverage. The authorizing legislation for the RWHAP and DSHS Policy 159.001 require RWHAP and State Services -funded providers to be enrolled as Medicaid providers if they offer services that are covered by Medicaid. DSHS Policy 159.001 extends this requirement to provider enrollment in Medicare and private health plans that cover 20% or more of their RWHAP-eligible clients. Providers must make good faith efforts to enroll in these plans. AAs must maintain policies specifying the types of evidence that may be requested from funded providers to demonstrate these efforts have been met.
16.3 Use of Drug Manufacturer Co-Pay Cards and Other Programs to Reduce OOP Payments
DSHS-funded AAs must create policies and provide technical assistance to case managers and HIA staff that promote the use of manufacturer co-pay cards and other programs that reduce OOP.
17.0 Revision History
| Date | Action | Section |
|---|---|---|
| 11/2/2015 | Revisions too numerous to list; therefore treated as new policy | All |
| 10/2/2014 | Converted format (Word to HTML) | - |
| 4/24/2009 | Revisions too numerous to list; therefore treated as new policy | All |
| 11/12/1998 | New policy | - |