Blue Cross and Blue Shield of Louisiana said Monday that it will no longer allow community groups to use money from a federal program for HIV/AIDS patients to enroll those patients in insurance plans offered under the Affordable Care Act.
“Our policy is that effective March 1, 2014, we will only accept individual members’ premium payments from the policyholder or an immediate family member/blood relative or legal guardian of the policyholder,” Blue Cross spokesman John Maginnis said. “We will no longer accept third-party payments.”
That stance flies directly in the face of the most recent instructions from the federal Centers for Medicare and Medicaid Services.
CMS says federal rules do not prevent the use of what are called federal “Ryan White funds” to pay for health care plans, a point that it made clear last week in encouraging insurers to accept those payments.
“Given the importance of access to care for people with HIV/AIDS, CMS is considering amending those rules to require issuers to accept these payments,” the agency said in a more forceful statement issued Monday.
Blue Cross says CMS’ most recent directive is quite different than instructions issued in November, which “strongly advised” insurers against accepting any third-party payments.
Maginnis said the insurer is reviewing and considering the new information to decide whether it is helpful in addressing the company’s concerns about taking third-party payments.
CMS said the November third-party instructions were an effort to stop hospitals, other providers and commercial entities from paying premiums for individuals.
A few hospitals had attempted to enroll some of their most costly patients, the chronic users of the emergency room, through the online federal insurance marketplace.
At issue is the use of “Ryan White Program” funds, the single-largest federal program specifically for people with HIV. In the 2012 fiscal year, Louisiana received $50.7 million in Ryan White funds.
Under the program, states, cities and nonprofits receive grants to help poor people with HIV buy health insurance, and pay for prescriptions and treatments they could not otherwise afford.
In 2011, Ryan White programs served an estimated 13,458 clients in Louisiana, according to the U.S. Health Resources and Services Administration. Roughly 1,100 of those people had private insurance.
Noel Twilbeck, chief executive officer of New Orleans AIDS Task Force, said it’s difficult to say how many people the Blue Cross decision will affect.
There are 19,000 people in Louisiana living with HIV, Twilbeck said. The need is great.
NO/AIDS has helped more than 200 people apply for coverage from Blue Cross through the online federal insurance marketplace, Twilbeck said. Now the nonprofit has to shift gears and get those people coverage through different insurance providers.
Meanwhile, Lambda Legal, of New Orleans, announced Monday that it has filed an administrative complaint against Blue Cross with the U.S. Department of Health and Human Services Office of Civil Rights. The New Orleans AIDS Task Force has joined in the complaint.
Blue Cross’ decision could prevent thousands of low-income residents in Louisiana from getting the life-saving care they need, said Scott Schoettes, HIV project director at Lambda Legal.
The only logical explanation for Blue Cross’ actions, if the insurer doesn’t change course, is discrimination.
Blue Cross’ strategy keeps people with HIV off the company’s insurance rolls and is a reminder of the insurance industry’s “sordid legacy” of denying coverage to those living with HIV, Schoettes said.
“Our biggest fear is that if we stand by and do nothing, and Blue Cross gets away with this, a lot of others will try to do the same,” Twilbeck said.
Maginnis said Blue Cross is aware of Lambda’s complaint but had no other comment.
Ged Kinslea, communications director for the AIDS Healthcare Foundation, in Los Angeles, said it looks as if Blue Cross is deliberately misunderstanding CMS.
“It seems like they are trying to weasel out of covering high-acuity patients,” Kinslea said.
That goes directly against the tenets of the Affordable Care Act, which no longer allows insurers to charge more money to cover people with pre-existing health conditions, he said.
CMS’ November instructions were a little confusing, said Jen Kates, vice president and director of HIV policy at Kaiser Family Foundation.
Those directions didn’t make it clear that the third-party payments didn’t apply to Ryan White funds, she said. The latest CMS statement does.
Kates said the Ryan White funds are especially important in states such as Louisiana, which chose not to expand Medicaid programs under the Affordable Care Act.
The decision left a gap in coverage, Kates said, for people who earn too much to qualify for Medicaid but not enough to qualify for the federal subsidies that help pay for coverage bought through the online federal insurance marketplaces.
Kates said she expects the Ryan White funds issue will be resolved in the next few weeks.