Hearing Description:
The health subcommittee recently met to check in on the status of the open enrollment period set to begin on October 1st for the Federal and State health exchanges around the country. Witnesses from the private sector (contractors and experts) testified to the readiness of the exchanges.
Hearing Date: September 10th, 2013
Hearing Summary: Prepared for AAPS by the Market Institute
The Energy and Commerce Health subcommittee recently convened to continue their assessment on the readiness of the implementation of the Affordable Care Act. The hearing will examine the concerns around the October 1st open enrollment of health exchanges and the effect of the ACA on employers. In his opening statement, Chairman Joe Pitts (R-PA) said he had grave concerns over the implementation of the legislation, citing numerous delays of different aspects of the law. Replying to a remark by CMS Administrator Marilyn Tavenner that she had only heard of “isolated incidents” regarding negative effects of Obamacare, Pitts recounted numerous examples of his own constituents that were cutting back and shifting employees to avoid the costs of complying with ACA’s employer mandate.
Rep. Frank Pallone (D-NJ) said in his opening statement he was disappointed in the Republicans attempt to disrupt the implementation of the law. Rep. Michael Burgess (R-TX) said in his opening statement he was looking forward to questioning the witnesses as they would be the ones doing the implementation of the law because the Administration and HHS contracted them to do so.
The first witness, Brett Graham, Partner at Leavitt Partners testified in his opening statement that there is not a single state presently ready for open enrollment set to begin on October 1st. He believes that a baseline enrollment will be ready, but the exchanges will undergo a rocky period. The readiness issues is a result of four different problems: complexity of the data architecture, data verification and integration with the federal hub, privacy/security concerns, and outreach/education to achieve optimal enrollment.
The second witness, Antoinette Kraus, Director at the Pennsylvania Health Access Network testified in her opening statement the ACA is providing peace of mind for many residents of the state that have pre-existing conditions like asthma and leukemia who can not be denied coverage. Small business owners are now eligible for new tax credits for their employee’s coverage and overall, Pennsylvanian’s are now getting more bang for their buck because of the law.
The third witness, Edward Lenz, Senior Counsel at the American Staffing Association (testifying on behalf of the Employers for Flexibility in Health Care Coalition) testified in his opening statement employers around the country have major concerns with some of the points of the ACA. In particular, employers with high turnover rates face unique challenges in complying with the ACA. The ACA defines a full time employee as working 30 hours of service per week when most employers consider 40 hours as full time. There needs to be harmony between these figures. Finally, the auto-enroll provision in the ACA is an inappropriate mandate that will only cause confusion, not to mention an extreme administrative burden on employers.
The fourth witness, Cheryl Campbell, Senior VP at CGI Federal testified in her opening statement that CGI Federal was contracted by CMS to design and develop the FFM (Federally-Facilitated Marketplace). The FFM allows insurers, citizens, CMS, and states to participate in the marketplaces. The company is on track for consumers to start signing up for plans on October 1st.
The fifth witness, John Lau, Program Director at Serco testified in his opening statement that his company is contracted to supply support services and determining eligibility for the Federally-Facilitated Marketplaces. There are 10 tasks Serco is contracted to perform, with 3 optional tasks. Serco is prepared to manage the 6.2 million paper applications to be received between October 2013 and March 2014, but will not be responsible for recruiting Americans, eligibility decisions, or online enrollment systems. A strong information security program will be a top priority when managing applications.
The sixth witness, Lynn Spellecy, Corporate Counsel at Equifax Workforce Solutions testified in her opening statement that her company will be providing income verification services to determine benefits eligibility under the ACA. Equifax will provide CMS with information (upon request) regarding whether a person is eligible for Medicaid, CHIP, premium tax credits, and reduced cost sharing. The final phase of testing the system is scheduled for September 15th, 2013, but there should not be any changes to the process during this time. The eligibility verification system will be ready when open enrollment begins October 1st.
The last witness, Michael Finkel, Executive VP of Program Delivery at QSSI testified in his opening statement that his company is contracted to write the software code for the Data Services Hub. The system will be housed in CMS, and once the Hub is ready and out testing (on track for open enrollment October 1st), QSSI will revert to a support role to assist CMS in seeing the Hub runs smoothly. There are routine modifications and improvement still being performed.
In response to questioning, Edward Lenz said:
- They have had discussions with the agencies, including Treasury, regarding the employer mandate
- Employers still need to be ready for the rules now, despite the employer mandate being delayed
In response to questioning, John Lau said:
- His company is able to accommodate changes in regards to decisions like delaying the employer mandate
In response to questioning, Brett Graham said:
- States that do not promote outreach and education on the marketplaces run the risk of having smaller pools and higher premiums
In response to questioning, Michael Finkel said:
- The Federal Data Hub has gone through a security assessment
Hearing Website:
http://energycommerce.house.gov/hearing/ppaca-pulse-check-part-2
Testimony:
Lynn Spellecy
Corporate Counsel
Equifax Workforce Solutions
John Lau
Program Director
Serco
Cheryl Campbell
Senior Vice President
CGI Federal
Michael Finkel
Executive Vice President of Program Delivery
QSSI
Brett Graham
Partner
Leavitt Partners
Edward A. Lenz
Senior Counsel
American Staffing Association
Testifying on behalf of the Employers for Flexibility in Health Care Coalition
Antoinette Kraus
Director
Pennsylvania Health Access Network
