THINKBYTE: Final HHS Discrimination Rules to the ACA

Section 1557 forbids discrimination by (a) age, (b) race, (c) sex (including orientation), (d) color, (e) religion or  (f) national origin with respect to benefits, benefit-related programs or eligibility thereof.

Programs which are subject to these regulations include  health plans which receive financial assistance such as (a) basic employer-sponsored health plans (DB or DC), (b) Medicare, (c) Medicaid, (d) student health, (e) CHIP, (f) federal or state market-place activities.  The Rules do not apply to health programs administered by departments other than HHS which are affected by ACA but not affected by these new HHS rules.

The Rule requires covered entities to (a) file HHS-provided forms of significant length and complexity assuring  compliance, (b) be proactive with all of the regulators and beneficiaries in enforcement and (c) treat compliance as an ongoing activity. 

The Rules are detailed and complex covering such issues as: (a) language requirements of the notices, (b) details on grievance procedures, (c) how the Rules and the compliance therewith are to be made known to the entire population of affected persons (d), how the Office for Civil Rights (OCR) will assist in compliance processes, (e) required programs to publicize the Rules and of great importance is that penalties for non-compliance are potential issues for any entity which is affected by the Rule.

This Rule, now in place, has the potential for many surprises to many people in many ways for many months.

THINKBYTE: Defined Contribution Health Plans

A Defined Contribution Health Plan (DCHP) is a large and important topic and regularly becoming more so.  With such plans, the predetermined contributions determine the benefits which is the opposite of the traditional defined benefit plan.  The two primary reasons for the growing popularity of this new approach are: (1) plan costs for the sponsor are more controllable and (2) participants are provided needed benefits with options to make the plan better fit their needs.  It is important to understand that a DCHP must have a sponsor.  Without such, it is not a health plan but only a plan strategy.   Numerous key words/terms collectively describe our topic.  Each such is then further discussed as a separate Thinkbyte as follows:

Consumer-Directed Health Plan (CDHP), 
Decision Support Tools, 
Defined Benefit Health Plan (DBHP), 
Defined Contribution Health Plan (DCHP), 
Flexible Spending Account (FSA), 
Fully Insured Health Plan, 
Health Insurance Exchange, 
Health Reimbursement Arrangement (HRA), 
Health Savings Account (HSA), 
High Deductible Health Plan (HDHP), 
Individual Health Policy,
Multi-Carrier Health Insurance Exchange, 
Out-of-Pocket Costs, 
Affordable Care Act, 
Self-Funded Health Plan, 
Single Carrier Health Insurance Exchange, 
Voluntary Benefits and 
Wellness Program.

Attained Age Adjustment Factors

Here is a table that allows the scaling of relative claim dollar totals for attained age bands 0-4, 5-19, 10-14 ... 60-64 (source: Chart 6: Inpatient Facility Costs by Age and Experience Year, "Health Care Costs—From Birth toDeath", Society of Actuaries, Dale H. Yamamoto, 2013).

Age	Factor
0 - 4	5.35
5 - 9	0.47
10 - 14	0.30
15 - 19	0.44
20 - 24	0.45
25 - 29	0.67
30 - 34	0.85
35 - 39	0.82
40 - 44	0.81
45 - 49	1.00
50 - 54	1.36
55 - 59	1.88
60 - 64	2.55

Notes

The Average falls in the 45-49 range.  All the other factors can be thought of as ratios to the cost values in the 45-49 age group.