Analysis Item 22: Department of Consumer and Business Services Consumer Protections

Transcription

1 Analysis Item 22: Department of Consumer and Business Services Consumer Protections Analyst: Matt Stayner Request: Increase the Federal Funds limitation by $1,157,514 and authorize the establishment of a limited duration Insurance Examiner position (0.67 FTE) in conjunction with a federal grant award from the U.S. Department of Health and Human Services. Recommendation: The Legislative Fiscal Office recommends that the Interim Joint Committee on Ways and Means recommend an increase in the Federal Funds expenditure limitation for the Department of Consumer and Business Services of $1,157,514 and the authorization to establish the requested limited duration position (0.67 FTE) be included in a budget reconcillation bill during the 2018 session. Analysis: The Department of Consumer and Business Services (DCBS) received notification from the U.S. Department of Health and Human Services (DHHS) of the availability of federal funding for the planning and implementation of health insurance market reforms through the Health Insurance Enforcement and Consumer Protections (HIECP) grant program. The grant program is specifically for funding activities related to planning and implementing specific sections of Part A of Title XXVII of the Public Health Services (PHS) Act. The grant funds were awarded in three separate tranches: a baseline award of a minimum of $250,000 for all eligible states; additional funding for select market reforms under sections 2726, 2713, 2707, 2718, and 2719 of the PHS Act; and Workload awards based on DHHS formula if there is remaining funding available after providing awards in the first two award levels. In addition to the $250,000 baseline grant, DCBS was awarded funding in the amount of $240,000 for activities related to Section Parity in Mental Health and Substance Use Disorder Benefits, $180,000 for activities related to Section Coverage of Preventive Health Services, and $90,000 for activities related to Section Non-discrimination under Comprehensive Health Insurance Coverage. A Workload award of $485,919 was also provided. DCBS requested authorization to apply for the funding from the Emergency Board and was authorized to do so at the September 2016 Emergency Board meeting. Additionally, DCBS was provided with an increase in its Federal Funds expenditure limitation of $97,749 to accomodate the anticipated expenditures of the agency from the grant funds through the end of the prior biennium. Actual expenditures in the biennium were $88,405, leaving a need for expenditure limitation of $1,157,514 Federal Funds to be established in the biennium. DCBS will use the funding over a 24-month period between October 2016 and October The grant will be used to fund a limited duration Market Conduct Field Examiner position and to replace up to 10% of the existing funding for three Market Analyst positions and a Grant Coordinator position at a total cost of $281,261 in the biennium. It is assumed that the savings in Other Funds for the existing positions will be recognized in the program s fund balance. DCBS has Legislative Fiscal Office Interim Joint Committee on Ways and Means November 2017

2 budgeted $876,252 of the remaining grant funding request for contracted services to provide consulting services by experienced clinicians with pharmaceutical expertise to review formularies and create standard operating procedures to ensure form filing reviewers can accurately review formularies and related documentation submitted by insurers. The Legislative Fiscal Office recommends that the Interim Joint Committee on Ways and Means recommend an increase in the Federal Funds expenditure limitation for the Department of Consumer and Business Services of $1,157,514 and the authorization of the requested limited duration position (0.67 FTE) be included in a budget reconcillation bill during the 2018 session. Legislative Fiscal Office Interim Joint Committee on Ways and Means November 2017

3 22 Department of Consumer and Business Services Heath Request: Increase Federal Funds expenditure limitation by $1,157,514 for the Department of Consumer and Business Services for a federal Health Insurance Enforcement and Consumer Protections grant and establish one limited duration Insurance Examiner (0.67 FTE). Recommendation: Approve the request during the 2018 Legislative Session. Discussion: The Department of Consumer and Business Services, Division of Financial Regulation oversees the regulation of the insurance market in Oregon, including the market for health insurance. The federal Department of Health and Human Services, in order to ensure implementation of the insurance market reforms of the Affordable Care Act, established the Health Insurance Enforcement and Consumer Protections grant program. The first round of this funding was designed to make sure insurers were reimbursing the benefits required under federal law, insurance plans covered preventive services, and mental health and substance abuse disorder treatments were reimbursed fairly. The department applied for this grant in August of At the September 2016 meeting of the Emergency Board, the department still had not received notification of an award, but received $97,749 in Federal Funds expenditure limitation because part of the grant was awarded automatically to states that applied. In October 2016, the department received notification it had been awarded $1,245,919 for the program, more than the $974,556 originally requested. The department expended $88,405 of the $1,245,919 in the biennium. Approving this request would allow them to expend the remainder in the biennium. There is no match required for the funding. Accepting the award requires the state to not reduce or supplant funds currently spent on Affordable Care Act-related regulatory activities from other sources. There is no required maintenance of effort for grant-funded activities after the grant expires. The Department of Administrative Services Chief Financial Office recommends approving the request during the 2018 Legislative Session. Legal Reference: Establishment of an expenditure limitation of $1,157,514 for the Department of Consumer and Business Services, Division of Financial Regulation for the payment from Federal Funds, collected or received for the biennium beginning July 1, Department of Administrative Services 22-i November 15, 2017

4 October 16, 2017 The Honorable Senator Richard Devlin, Co-Chair The Honorable Representative Nancy Nathanson, Co-Chair Interim Joint Committee on Ways and Means 900 Court Street NE H-178 State Capitol Salem, OR Dear Co-Chairpersons: Nature of the Request The Department of Consumer and Business Services (DCBS) was granted the authority to apply and expend federal grants from the Department of Health and Human Services (HHS). The Health Insurance Enforcement and Consumer Protections Cycle I grant support states in planning for and implementing insurance market reforms. At the September 2016 Emergency Board, DCBS was approved for the retroactive submission of the federal grant, and the Federal Funds expenditure limitation was increase by $97,749 for the implementation of the federal grant. The remaining portions of the grant request were deferred until the amount of the grant award was known. On Oct. 31, 2016, DCBS was provided a notice of award in the amount of $1,245,919 to be used Oct. 31, 2016, through Oct. 30, Agency Action On June 15, 2016, HHS notified DCBS that it would make available Health Insurance Enforcement and Consumer Protections Cycle I funds to support states in planning for and implementing insurance market reforms. Federal funding for activities related to planning and implementing the following provisions of Part A of Title XXVII of the PHS Act: Section 2707 Non-discrimination under Comprehensive Health Insurance Coverage (Essential Health Benefits Package) Section 2713 Coverage of Preventive Health Services Section 2726 Parity in Mental Health and Substance Use Disorder Benefits The application of this grant was due no later than Aug. 15, 2016, and DCBS provided the required 10-day notice of our intent to apply for the grant to Legislative Fiscal Office on Aug. 1, The anticipated award date was initially set to be no later than Oct. 19, Awardees are not required to provide matching funds.

5 Since then, DCBS has been notified of an updated timeline adjustment of the grant approval period. At the September 2016 Emergency Board, DCBS received an increase of federal funds expenditure limitation of $97,749 for the implementation of the federal grant with the remaining portions of the grant request being deferred until the amount of the grant award was known. DCBS expended $88,405 for the biennium. Action Requested DCBS respectfully requests that the Interim Joint Ways and Means Committee approve an increase of $1,157,514 in Federal Funds expenditure limitation to be used this biennium. In addition, the authority to establish one limited-duration Insurance Examiner (0.67 FTE - OAS C5748 AP) to complete the work described in the grant application for the biennium. Legislation Affected Approval of this request will increase Federal Fund expenditure limitation established by SB 5512, section 4 for the Department of Consumer and Business Services, Division of Financial Regulation in the amount of $1,157,514 for the biennium. Sincerely, Jean Straight Acting Director