The Affordable Care Act (“ACA”) took a big leap forward this month with the opening of the federally-facilitated and state-operated Exchanges. Here in Kentucky, 70,467 people reportedly participated in pre-screenings to determine qualifications for subsidies, discounts, or programs like Medicaid on the Health Insurance Exchange’s first enrollment day, October 1, 2013. The ACA is eventually expected to provide health coverage to as many as 30 million additional Americans. So, why are hospitals across the nation slashing jobs?

Earlier this week, we discussed the three-month grace period afforded to enrollees of qualified health plans (“QHPs”). To recap that article, the ACA requires that QHPs pay claims for the first thirty days of the grace period during which premium payment remains unpaid, but issuers may pend claims for the final sixty days of the grace period. If the balance remains unpaid, the issuer may deny any claims submitted within the final sixty days.

Providers contracting with state health insurance exchanges may find themselves shortchanged for services provided due to a little-known loophole in the Affordable Care Act (“ACA”).

The Office of the Inspector General (“OIG”) has always encouraged Medicare and Medicaid providers to implement a compliance program. For 14 years, as a matter of fact, OIG has provided compliance guidance in 11 healthcare sectors (including: hospitals, nursing facilities, home healthcare, hospice and third-party billers). With the passing of the Patient Protection and Affordable Care Act (“PPACA”), compliance plans and programs are now mandatory for any provider enrolled in a Federal health care program, including Medicare.

The Supreme Court’s decision upholding the Affordable Care Act supports The Centers for Medicare and Medicaid Services (CMS) different programs for the development of Accountable Care Organizations (ACOs).  In Kentucky, we are beginning to see these organizations emerge in different models.

The mandatory expansion of Medicaid was an important element of the Affordable Care Act as providing health care benefits to uninsured was intended to achieve equity.  The expansion of Medicaid rolls was also intended to reduce the cost of providing care for the uninsured and the need for disproportionate share hospital funding, which is an adjustment to account for the needs of hospitals serving a large number of low-income patients.  With the ability to opt out of the Affordable Care Act’s expansion of Medicaid eligibility (read more: The Federal Medicaid Apple:  Poison or the Cure?), the opt-out states may create financial problems for hospitals that depend on disproportionate share payments to cover part of their costs for providing non-reimbursed services to the indigent and uninsured.  The Affordable Care Act’s decrease in disproportionate share payments to hospitals is not changed by the Supreme Court’s ruling.

As the uncertainty about healthcare reform was extinguished by the Supreme Court in its 5-4 decision upholding the Affordable Care Act, with the provision that the Department of Health and Human Services may not withhold Medicaid funding from states that refuse to adopt the Medicaid expansion, all states, including Kentucky, now have important decisions to make about expansion of Medicaid to a projected 22.3 million uninsured eligible individuals.  Under the Affordable Care Act, the federal government will pay the full cost of covering the newly eligible Medicaid participants for three years from 2014 to 2016.  Thereafter the federal share will gradually decline until it reaches 90% in 2020.  For traditional Medicaid, the federal government now pays, on average, about 57% of a state’s total Medicaid costs.  With 826,941 Kentucky Medicaid beneficiaries in January 2012, and an additional 290,000 individuals that would be covered under the expansion, Governor Steve Beshear has announced that he is studying the issues and the costs.