HHS Changes PCIP Payment Rates Beginning June 15

The Department of Health and Human Services (HHS) has updated the payment rates for covered services provided to individuals enrolled in the Pre-Existing Condition Insurance Plan (PCIP). The interim final rule is effective on June 15, 2013, and was published in the May 22 Federal Register.

The Patient Protection and Affordable Care Act (ACA) established the PCIP, which is a temporary insurance program for high risk individuals with preexisting conditions who have been uninsured for at least six months. Funding for this program was capped at $5 billion, and the program will terminate on Jan. 1, 2014, when individuals enrolled in a PCIP will be transferred to coverage under a health insurance exchange.

The HHS noted that since enrollment began in July 2010, the PCIP program has experienced significant and sustained growth, enrolling more than 135,000 otherwise uninsured individuals with preexisting conditions. In 2012, the average annual claims cost paid per enrollee was $32,108. Due to the number of individuals enrolled in the program, their high utilization of covered services, and the statutory limitations on enrollee cost-sharing (which limits the maximum amount an enrollee pays out-of-pocket for covered services to $6,250 in 2013), the overall cost of the PCIP program is higher than originally projected, according to the HHS.

The final rule adjusts payment rates for covered services in the federally-administered PCIP, to ensure there is sufficient funding available to provide coverage to currently enrolled individuals until the program ends in 2014. In addition, the interim final rule prohibits facilities and providers who, with respect to dates of service beginning on June 15, 2013, accept payment for most covered services furnished to an enrollee in the federally-administered PCIP from charging the enrollee an amount greater than the enrollee’s out-of-pocket cost for the covered service as calculated by the plan.

Comments will be excepted for 60 days after publication in the Federal Register and may be submitted electronically at http://www.regulations.gov; or by mail to the Centers for Medicare and Medicaid Services, HHS, Attention: CMS-9995-IFC3, P.O. Box 8010, Baltimore, MD 21244-8010.

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