Virginia State Flexibility to Stabilize the Market Grant Award

Grant Application Summary

Virginia Grantee: State Corporation Commission

Award Date: August 20, 2018

Total Award: $285,093.00

Baseline Award: $274,344.83

Workload Award: $10,748.17

Section 2702 - In addition to ensuring health insurance issuers are offering approved products for purchase, the State Corporation Commission, Bureau of Insurance (Bureau of Insurance) will hire an actuarial firm to develop a model, to replicate the current commercial individual market in Virginia. The model will allow the Bureau of Insurance to understand the underlying makeup of the current individual market and how the market is expected to change in the near future under current law through the use of an effective tool that can be used to model the expected impact of various policy changes on premium, enrollment, and market morbidity. The model will allow for the examination of shifts in certain sub-segments of the population, such as changes in the distribution of the covered population by age and income level, and to develop a robust baseline scenario, including projections of future membership, premium, and uninsured rates for the Virginia market(s). The model will also simulate the impact that the introduction of an expanded catastrophic plan as defined under the Affordable Care Act (ACA) could be expected to have on affordability and enrollment in Virginia’s individual market if carriers offering a catastrophic plan were permitted to offer the catastrophic plan to any individual in the market. The Bureau of Insurance will also assess the potential impact that short-term limited duration plans could be expected to have on affordability and on the enrollment in Virginia’s individual ACA market once fully implemented. With actuarial support Virginia will also develop a tool that will summarize plan information by market (i.e., individual, small group), entity, county, rating area, metal level, and exchange status across the Commonwealth. The tool will also create customized interactive maps and tables, designed to display various information about the coverage proposed to be offered by carriers for the upcoming plan year.

Section 2707 - The State Corporation Commission, Bureau of Insurance (Bureau of Insurance) will procure the services of an actuarial firm to review carrier prescription drug benefits as part of Virginia’s enforcement of § 38.2-3451 requiring a health benefit plan providing health insurance coverage in the individual or small group market to include coverage for the Essential Health Benefits (EHB) as required by § 1302(a) of ACA and other related regulations as appropriate. This review would encompass CMS formulary review tools, including the Drug Count tool and the Formulary Review Suite, analyzing and summarizing the results for BOI, and suggesting appropriate communication with carriers to the extent the carrier’s existing documentation requires further justification. A clinician would also analyze specific portions of the formularies for compliance with § 38.2-3412.1 B requiring health carriers to provide mental health and substance use disorder benefits in parity with medical and surgical benefits in accordance with the Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA). This analysis would include collecting documentation from carriers to assess compliance with parity of non-quantitative treatment limits, including the formulary exception process, with a focus on prescription drugs for the treatment of specific mental health and substance use disorder conditions, such as bipolar disorder, schizophrenia, and opioid dependency. The clinician will also create a standard operating procedure to enhance the Bureau of Insurance staff’s review of formularies and any related documentation.