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Second Opinion

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Washington Highlights

AAMC Urges HHS to Withdraw CCIIO FAQ Discouraging Hospital Efforts to Help Low-income Patients Maintain Coverage

November 15, 2013—The AAMC Nov. 7 sent a letter  to Secretary of Health and Human Services Kathleen Sebelius asking the Department of Health and Human Services (HHS) to withdraw a Nov. 4 FAQ that discourages provider efforts to help low-income patients struggling with their qualified health plan (QHP) premium payments and cost-sharing obligations. The FAQ was issued by the Center for Medicare and Medicaid Service (CMS)’s Center for Consumer Information and Insurance Oversight (CCIIO).

The AAMC’s letter points out the conflicting messages sent by CCIIO’s FAQ and an Oct. 30 letter from Sec. Sebelius to Rep. Jim McDermott (D-Wash.), which included statements that supported the conclusion that hospitals subsidizing premiums to help prevent low-income patients from losing their QHP coverage would not violate the Anti-Kickback Statute (AKS).

HHS removing this substantial legal barrier seemed to open the door for hospitals to mitigate the barriers to access caused by a CMS final rule that weakened a consumer protection in the Affordable Care Act (P.L. 111-148 and P.L. 111-152). 

Specifically, the ACA includes a section that was intended to ensure that low-income QHP enrollees would remain covered for a three month grace period even if they failed to pay their premiums during this time period. Contrary to this provision of the law, CMS finalized a policy that effectively shortened the grace period to one month by allowing retroactive termination of a QHP beneficiary’s coverage for the latter two months of the grace period.

The AAMC first responded with a letter asking CMS to withdraw this final rule. When the agency failed to act, providers looked for other solutions to help low-income patients so they would not end up losing their coverage for services. One solution would be to subsidize premiums for these patients. Just as questions of legal obstacles to such a solution were resolved, CCIIO issued a FAQ discouraging the practice and encouraging issuers to reject these third party payments, expressing concerns about the effect on risk pools.

The AAMC’s letter explains that this is an inappropriate response because Congress did not intend to exclude low income individuals from insurance risk pools during the three-month grace period. Additionally, CCIIO’s FAQ is contrary to the ACA’s goal of expanding access to coverage, and for these reasons it should be withdrawn.

Contact:

Ivy Baer, J.D., M.P.H.
Senior Director and Regulatory Counsel
Telephone: 202-828-0499
Email: ibaer@aamc.org

Allison M. Cohen, J.D., LL.M.
Senior Policy and Regulatory Specialist
Telephone: 202-862-6085
Email: acohen@aamc.org

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org