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Third Way – Getting Health Care Reform Across The Finish Line


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Mike Allen of Politico moderates Third Way’s Idea Forum: Getting Health Reform Over The Finish Line in the Cannon Caucus Room on Capitol Hill July 14, 2009 with Rep John Dingell, Rep Ron Kind, Rep Jason Altmire
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In My Wallet


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Everything that was in my wallet is now sprawled out on my [glass-top] coffee table. Man, I need to invest in an actual camera. The iPhone can only take me so far…

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Third Way – Getting Health Care Reform Across The Finish Line


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Rep Ron Kind on health reform at Third Way’s Idea Forum

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One question will determine the success of health care reform: Whether middle class Americans can answer the question, “what’s in it for me?” Above all else, health care reform will deliver stability to the middle class – stable coverage, stable costs, and stable quality care.

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by aymanfadel

Changes occurring in 2010 include:

Young Adults on Parents’ Health Insurance Plans. Young adults may stay on their parents’ health insurance until age 26, effective six months after enactment. Read more at http://www.easytoinsureme.com/

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Prohibition on Pre existing Condition Exclusions for Children. Insurers are prohibited from excluding coverage of any  pre existing condition for children in the individual health insurance market, effective six months after enactment of the bill.

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Prohibition Against Plan Rescissions. Carriers providing group or individual coverage are prohibited from rescinding coverage once an enrollee is covered under the plan, except in the case of an individual who has performed an act or practice that constitutes fraud or makes an intentional misrepresentation of the material facts. Effective six months after enactment of the law.

Prohibitions Against Lifetime Maximum Benefit Caps. Carriers providing group or individual coverage are prohibited from setting lifetime maximum limits on the dollar value of benefits and from setting unreasonable annual limits on the dollar value of benefits, effective six months after enactment.

National High Risk Pool. People with pre existing conditions who are uninsurable will be eligible for subsidized coverage through a national high risk pool, beginning 90 days after enactment.

Limits on Share of Private Premiums Insurers Spend on Non Medical Costs. New limits will be set for the percent of premiums that insurers can spend on non medical claim costs.

Annual Review of Health Premium Increases. Effective immediately, the HHS secretary and states will establish a new process for annual review of unreasonable insurance premium increases.

Elimination of Cost Sharing for Preventive Care in Medicare and Private Plans. In 2010, cost sharing for proven preventive care services is eliminated in both Medicare and private plans.

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by tedeytan

The following concepts will specifically address the major issues facing the U.S. health delivery system. I have defined the major categories as: 1) Cost control 2) Minimize provider loss, 3) Reduce Insurance premiums 4) Provide catastrophic coverage for every American 5) Create an environment of affordable, manageable health delivery 6) Minimal added cost. 

What follows is a 21st century, free market based, world leadership solution. it is a foundation of a real solution, a place I believe many of us can agree.

A system that for up to one year. Most individuals look at COBRA through the lens of unemployment and conclude that it’s unaffordable. Of course they do; they’re unemployed. Employers should be required to provide a minimum level of health insurance for 12 months after unemployment. After year 1 the displaced employee could choose to buy the minimum coverage in that employer group for an unlimited time frame. Result, an individual will always have access to a group plan as long as premiums are paid. No pre-existing condition discrimination, and this specifically addresses the problem of the temporary uninsured and uninsurable.

The minimum standard coverage would include 2 parts: First, some preventative and basic health care. i.e. 2 doctors visits annually plus some diagnostic coverage benefit. This minimum required employer coverage would provide health insurance to roughly 0 per recipient or family member. This keeps the unemployed going to doctors and minimizes future catastrophic needs. The second part of the minimum requirement would be catastrophic coverage over 0,000 to the 0,000 threshold. Individuals could have the option to purchase “gap” coverage to fill in between 0 and 0,000 if they choose. Once employed again the individual would be transferred to the new employer group and responsibility reassigned. (This would only apply to groups over some predetermined level i.e. 50 members) This would give the unemployed or those doing other work access to a group health plan. Anyone who has at least one job in life would have coverage as long as the premium was paid.

/Catatrophic Coverage for Every American: Specifically addressing a major burden on hospitals, and other providers by the uninsured. This is one of the major issues driving up the cost for the insured. I would impose an off budget, segregated, “Lock box” type trust fund that could not be borrowed from EVER. A small tax on wages would provide for catastrophic coverage over a 0,000 threshold for every American. Since this would be a separate tax on income (over federal poverty level) it would bring every worker into the system including those wage earners with sufficient income to afford some coverage but skate by without health insurance. These individuals currently add cost by increasing risk, and utilizing expensive ER services for care. Those who have insurance end up covering this cost with higher cost of care and higher premiums. This concept would be a positive revenue mechanism by bringing in those who currently pay nothing. (Specifically those 17 million who earn over ,000/year but do not buy health insurance)

Important: Those currently insured will be rewarded as their new tax will be significantly offset by the reduction in their health insurance premiums. This will occur as the artificial inflation of services is reigned in, provider loses are mitigated, and the cost to insurance companies is reduced. With no risk above 250K insurers will be able to lower premiums as the liability above 250K is transferred from insurance companies to the trust fund (could be phased in once the trust fund is in place). Note: Most insurance policies cover up to 2 million, 5 million, or even have unlimited benefit limits.

The total tax to those already insured would be offset – in time – by the savings. I’m confident this would be close to neutral in cost to those currently insured and but it could exceed 100% as the added costs will be borne predominately by those who can afford the coverage in the first place but choose to ignore the need.

As the individuals who ignore health insurance are brought into the system they can still avoid other coverage but the high burden they place on the system will be mitigated. Their newly captured tax pays for catastrophic coverage, and hospitals are relieved of the burden of losses above the 250k. In addition catastrophic costs and shared by every Americans and more important; Every foreign workers, illegal workers, and those irresponsible Americans earning sufficient wages but not contributing are integrated into the system.

Additional Results: Relaxed underwriting standards, (insurer would be more willing to accept some riskier applicants since exposure is limited). This expands the availability of reasonably priced health insurance for those with preexisting conditions and/or elevated risk profiles. This further addresses the uninsured however many would eventually become tied to some group plan. (above)

We need so insurers who provide policies over several states could meet ONE regulatory requirement recognized by all states. Large insurance plans could be overseen by 1 regulator instead of contend with up to 50 regulators in every state they do business. Regional providers that can do better on a local level would remain and drive out cost on a regional level. This would create an environment in which more national plans would emerge strengthening competition, reducing overhead, exploiting synergies and in place infrastructure and technology. This would ultimately reduce insurance cost. I can foresee consolidation potentially reducing options for individual so I would forbid any consolidation that would reduce the number of choices in any given area below 5 or more.

I would make the financial requirement significant in areas of capitalization, loss reserve, as well as other necessary standards. It would and should be tougher than any state so that there is no “systematic risk” in the event of any national provider failure. Essentially, it should be tough enough to almost eliminate the possibility of failure.

An insurance “exchange” as is currently being discussed would be a sufficient alternative but I don’t believe it will work. It is irrational to allow New Yorkers to buy insurance in Georgia or Indiana. How will an insurer be regulated in NY that may be based in Tennessee? It seems like it adds more – not less – bureaucracy, but I am open to suggestions.

: (The ugly and anti-free market dilemma) – The government could create a reimbursement rate for services provided above the catastrophic amount controlling expenditures at the high end. This would be applied to high cost treatment and procedures only. It has been demonstrated that this is an area where we could realistically apply responsibility over a group of multiple providers (Physicians, hospitals, and pharmaceutical providers) for the package treatment and healthcare. (Although not necessary.) The plan could include BONUSES for quality of care, outcomes, and other health performance criteria that many advocate.

I would allow providers and hospitals to balance bill (up to 15%) and/or opt out of the catastrophic coverage system altogether (not likely since they would be exposed to loses when any uninsured presented in their emergency room and they were mandated to provide service) ALL group plans would have to include excess charges. However, “Gap” plans available to only unemployed individuals would not. Further, Individual plans would be available as including excess charges OR as HSA accounts and would require a minimum (/month) HSA contribution as a trade off. The benefit; The HSA contribution would belong to the specific individual but could only ever be used for healthcare. This is the obligation for purchasing individual coverage without the “excess” coverage feature. Theoretically the HSA owner would be saving for future catastrophic expenses that entered the “excess” dimension. The insured would have the option to purchase these HSA plans or purchase plans that included the additional excess coverage.

Result: Under The new reform everyone but especially the younger American’s could accumulate (with HSA’s) 10′s of thousands of dollars in their 20′s, 30′s, and 40′s. This account could then be used later in life as health care needs become more likely. Additionally, the HSA could be used for the individual owner or family healthcare requirements. Eventually it could be applied toward LTC premiums after age 55. That would solve ANOTHER problem facing the U.S. healthcare system. So individuals are now in control, saving for their own of family healthcare needs and in addition have an account that could pay LTC premiums later in life.

As many have wisely pointed out, when individuals use there own accounts they spend more wisely. Having ownership of a health plan from the age of 18, 21, or even later in life keeps individuals involved. Ultimately we’ll create an environment were everyone pays something, everyone gets something, and everyone has some level of affordable healthcare insurance. No excessive government intrusion necessary.

Some additional Details: Similar to our current environment HMO’s, PPO’s, and other plan providers would still negotiate reimbursement of charges above the 250K catastrophic limit. The insurance provider would manage and make payments to facilities and others but would be reimbursed at the scheduled rates from the healthcare trust. This will control excessive inflation for high end health services but does not completely communize and thwart our free market system. Further we need to also reform HSA account use and expand premium tax deductions to individuals. Employer provided versions require users to spend down accounts each year. This is Dumb. We need to allow employer based MSA’s to accumulate over years.

Although the “excess” billing option creates an environment of complexity to this solution it allows some sensible variations in pricing and regional cost variations. At the same time it does not create a system that encourage providers to “excess bill” and individuals to avoid the coverage. The result may be some high end clinics, hospitals and providers, but this is no different to the free-market environment present in the current hospital and provider system. Some providers will always be better than others. Experience and expertise will naturally accumulate in “pools” this is Nature at work and a working plan will have to accommodate the laws of nature.

In a later phase I MIGHT require all insurers to cover all applicants at some maximum rate. Say, 2x the base rate. Or, create some sort of national high risk pool and assign applicants to plans based on size and other factors. This would make health care coverage attainable to those few remaining high risk individuals. I would only consider this after several years and the impact of phase one of the health care reforms is evaluated. Another option is a “High risk” reimbursement for those who have been denied coverage from 2 of more insurance providers. They would pay 2x the base rate from a provider of their choice and the government would kick in the balance necessary for the provider to take in the previously denied applicant. Details on this portion world need to be worked out. Ultimately, most every worker would have access to a group plan from point 1

finnally, many readers might retort that I overlooked items such as Malpractice Insurance and caps on lawsuits. I trust you I did not. Certainly there are additional issues that need addressing but healthcare reform should not be confused with other reform. We must find common ground and that sometimes means shrinking the ground to be covered. (Pay attention Washington)

Before we continue on any such reform we should keep a few simple principles at the top of any government reform package including healthcare:

1) Do no harm

2) Minimize government involvement (infrastructure, regulatory platforms, and technology platforms like online records etc. are the role of government – Not biased competition, or industry manipulation) You can apply for insurance online Example Aetna Health Insurance , but your doctor can’t get test results or health history.

3) Improve the system for everyone. Society should provide a safety net for everyone including themselves. But it should be simple and just – No excessive burden on any class.

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4) Find Common Ground – Effective legislation can only be accomplished when we find areas of agreement and commit to legislation directed to specific areas on which there is agreement. If you don’t understand the hidden costs of government involvement see http://www.cahi.org/cahi_contents/resources/pdf/CAHI_Medicare_Admin_Final_Publication.pdf The Council for Affordable Health Insurance

Responsible government means specifically defining problems, outlining solutions, and analyzing reasonable outcomes. There needs to be sufficient time for review before instituting reform. 30-60 days seems rational time for debate and analysis. Anything less is irresponsible. Our Constitution was not completely ratified for 9 months and it took 3 months before the first state put its signature on the plan. The current rush into new programs is our current governments attempt to cloak what is happening from the public. It is a disgrace, and the absence of these principles is destroying our great country. We need to return to the place our founders created. (1 – large – page I might add)

by Aaron Landry

Effective 2010

Indoor tanning services are subjected to a 10 percent service tax.

Effective January 2011

n Pre-tax dollars from health savings accounts (HSA), flexible spending accounts (FSA) or health reimbursement accounts (HRA) can not be used to buy over-the-counter, non-prescription medicines. Easy To Insure ME

n Increase the tax from 10 percent to 20 percent for non-medical early withdrawals from a health savings account for those under age 65.

n Impose an annual cap of ,500 on contributions to flexible spending accounts, which are now unlimited; the cap is indexed for inflation.

n Premiums for Part D Medicare drug benefits for high-income senior citizens will increase in income tiers like the ones used for Part B benefits. An average Part D premium is about -40 per person per month, so this provision will add about a 1 percent marginal tax impact. Like Part B, the higher Part D premium will be determined based on a two-year look-back: 2011 premiums will be based on reported Modified Adjusted Gross Income in 2009.

n The threshold for the higher-income related Medicare Part B premiums is frozen until 2019, effectively making an increasing number of people each year subject to higher premiums. The current standard Medicare premium is 0.50 per month and increases to 4.70 per month when the threshold – ,000 for individuals and 0,000 for couples – is reached and continues to increase as income increases.

Effective Jan. 1, 2013

n A new 0.9 percent payroll tax on individuals earning more than 0,000, or 0,000 for joint filers. Currently the Medicare payroll tax is 2.9 percent of all earned wages – with workers and employers each paying 1.45 percent. As an example, an individual who makes 0,000 a year in wages and ,000 a year in investments would not have to pay the new tax.

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n A new 3.8 percent tax on unearned income generated from interest, dividends, capital gains, annuities, royalties and rents for individuals who earn more than 0,000 or couples who make more than 0,000. The tax will be imposed on the lesser of either net investment income; or modified Adjusted Gross Income (plus any excluded foreign income) over a threshold amount. The threshold amounts are 0,000 for joint filers and 0,000 for single filers. “Net investment income” does not include distributions from qualified plans or IRAs. Also affected are individuals who make a profit of more than 0,000 on a real estate sale or couples who make a profit of 0,000 on a real estate sale.

n A tax per participant on insured and self-insured health plans for funding comparative effectiveness research to be paid by insurance companies. In 2014, the tax increases to per participant and can increase based on a specific formula.

n Increase from 7.5 percent to 10 percent the floor on itemized deductions for medical expenses, but taxpayers age 65 and over are exempt from the cutback through 2016.

EFFECTIVE 2014

n Pharmaceutical companies will face a new excise tax based on the market share of the company.

n Most medical devices become subject to a 2.3 percent excise tax collected at the time of purchase.

n Health insurance companies become subject to a new excise tax based on their market share; the rate gradually raises between 2014 and 2018 and thereafter increases at the rate of inflation.

n Annual penalty of or up to 1 percent of income (whichever is greater) is imposed on individuals who do not obtain health insurance; this will rise to 5, or 2.5 percent of income, by 2016. Families have a limit of ,085. Exemptions to the fine include cases of financial hardship (where health insurance would cost more than 9.5 percent of an individual’s income) or religious beliefs.

n Employers with more than 50 employees who don’t offer full-time employees health insurance face a ,000 per employee penalty. Businesses with fewer than 50 employees are exempt from the requirement.

Effective 2018

n A new 40 percent excise tax on high cost (“Cadillac”) insurance plans is introduced. The tax is on the cost of coverage in excess of ,500 (family coverage) and ,200 (individual coverage), and increases to ,950 (family) and ,850 (individual) for retirees and employees in high-risk professions. The dollar thresholds are indexed with inflation; employers with higher costs because of the age or gender demographics of their employees may value their coverage using the age and gender demographics of a national risk pool.

by Andrew Coulter Enright

ARIZONA: The Department of Insurance (DOI) hosted two recent meetings related to health care reform using HHS grant funding. The first was an exchange workgroup discussion that focused on risk adjustment, transitional reinsurance and quality measures. The consensus among health plans was that existing measures of quality, such as HEDIS, NCQA and URAC, should be used to assess plans participating in an exchange. Absent additional guidance from HHS, the discussion around risk adjustment was less fruitful and will be continued in a future meeting.

The second meeting concerned rate review, providing participants with an opportunity to compare and contrast existing statutory authority and regulations in the individual and small group markets. While the individual market has a somewhat robust regulatory review scheme, the DOI currently receives a minimal amount of information on small group rate filings. The Assistant Director has voiced some concern about whether the state’s process is “effective” in the context of ACA.

CALIFORNIA:  The California HealthCare Foundation has released a report that recommends an end to California’s bifurcated insurance regulatory structure. Currently, the California Department of Insurance (CDI) and Department of Managed Health Care (DMHC) oversee different health insurance segments.  The authors stressed that it is “imperative” to merge oversight of health insurers because of marketplace changes mandated by ACA. The new federal government role in health insurance oversight compels California to apply the new rules consistently and uniformly across the board.  The authors also suggest that ACA will bring the products closer together, leading to increased uniformity in product design.

The report suggests criteria by which to assess health insurance regulatory reform and presents two options: 1)  consolidating into one regulatory agency, or 2) institutionalizing coordination and consistency between the two agencies. The criteria include: improving the consumer experience; ensuring transparency and accountability; ensuring consistent interpretations of federal law; evaluating potential system costs and savings; and building on the strengths of the existing regulators.  Most of Aetna’s business is regulated by the CDI while most of the large CA-based health insurers and HMOs are regulated by the DMHC.

TEXAS: House Republicans have broken through an impasse that threatened to delay – with the special session ending Wednesday – a key health care bill. The bill, which includes 8 million in expected savings to Medicaid and other programs, got hung up on the House floor last week as House Republicans argued over language that would ban state funding for hospital districts that use tax money to pay for elective abortions. Included in 20 floor amendments added by the House, the ban was tweaked in conference committee to exempt hospitals that perform abortions when a fetus has a fatal and “irreversible abnormality.” In the end, a planned vote was delayed to allow time for continued negotiations. Those talks produced an agreement to rewrite the bill to more clearly define life-threatening conditions. A revised conference committee report was distributed Friday, and the full House will try to get the bill passed before the end of the special session.

by uniondocs

Some people see the implementation of health insurance exchanges as being a key component in health care reform. The reason for this is that health insurance exchanges give consumers options.

For example, if you receive your health care benefits through your employer, you basically only have two options. You either enroll in the plan chosen for you, or you do not enroll in that plan. There are not a lot of other options available to you. If you decide to not enroll in your employer-sponsored group health plan, then you have to navigate the private insurance market. This can be a complicated process. Also, in this market, the health insurance carriers have all of the power, and will deny or approve your application based on your health.

In the future, will do a lot to alleviate some of those problems. Health insurance carriers will be prohibited from basing premiums or approval on pre-existing medical conditions. New health insurance policies in the future will have a standard required comprehensive set of benefits. More importantly, all of these plans, policies, and companies will list their information on health insurance exchanges.

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Consumers will go to these health insurance exchanges and will be able to find a wide array of competing insurance companies, and their competing plans. Health insurance exchanges will provide easy access to compare benefit levels, included and excluded services, network restrictions, and premium costs. A consumer will not have to go to each different company’s web site, but will instead find all of the information available on health insurance exchanges. Of course, that is what insurance brokers do right now, but many people do not know they can use insurance brokers to provide all of this information, plus excellent customer service. Health insurance exchanges in the future will serve the same function as an insurance broker does now.

Because many people will use health insurance exchanges to find a health insurance policy, they may allow for quantity group discounts on their policies, which will mean more leverage and buying power for the consumer. When health insurance exchanges promote competition among companies, more consumer power, lower prices, higher quality, and better service is often a result. This in turn will result in more individuals purchasing health insurance plans through health insurance exchanges, and a productive cycle of customer service and better health care will take place.

At this time, has not been fully formed and is not fully functioning. Some examples of health insurance exchanges have existed in Massachusetts and Utah, so many future health insurance exchanges will be based on their model, and that of New York’s health insurance exchange. Many people are looking forward to the positive health care reform results that health insurance exchanges should have. Health insurance exchanges will start out serving the self-employed and individuals, but eventually, they may offer competition for even employer-sponsored group health plans. The idea of health insurance exchanges, however, is that people who want better health care options will be able to find better health care plans.

by Bread for the World

JANUARY 29, 2010

This Week in Health Care Reform

Following the election of Republican Scott Brown to the Massachusetts State Senate last week and the resulting loss of Senate Democrats’ supermajority, lawmakers continue to pave the way for health care reform – with limited progress. In addition, polls indicate that the public would rather lawmakers focus more on the economy than on health care.

State of the Union Address

President Obama Gives State of the Union Address: On Wednesday evening, President Barack Obama delivered his first State of the Union address before a joint session of Congress. Having hoped to have a health care reform bill on his desk prior to his address, the President instead used his speech to encourage Congress to push forward on health care reform. Yet, he did not give specific guidance as to how to proceed with the legislation. Instead, he made it clear that his primary focus would be on jobs and the economy.

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Health Care Reform Negotiations

Democrats Still Seek Way Forward: While vowing not to give up, Democratic Senate leaders indicated Tuesday that they no longer felt pressure to move quickly on health care reform; and, in the wake of the Massachusetts election and in reaction to public opinion, they shifted focus to jobs and the economy. Senate Majority Leader Harry Reid (D-NV) commented that there is “no rush” on health care and said that he and Speaker of the House Nancy Pelosi (D-CA) were working to map out a way to complete health care reform in the coming months. On Wednesday, Sen. Pelosi floated a two-pronged strategy to pass incremental changes now and pursue comprehensive reform later.

Some lawmakers have considered breaking up the legislation into smaller pieces that have bipartisan support. However, this option will prove challenging given the complexities and interdependencies of the measures. For example, lawmakers would like to include a measure that requires all insurance companies to insure those with pre-existing conditions; however, premiums will most likely increase unless there is an individual mandate.

Earlier this week, Democrats appeared to be coalescing around a different strategy through which Senate lawmakers would make changes to their bill to appease members of the House. The Senate would then pass the revised bill via reconciliation, which only requires 51 votes. Following that, the House would approve the revised bill, giving it to President Obama for his review. However, movement on this strategy stalled Tuesday when two centrist Senators, Sens. Evan Bayh (D-IN) and Blanche Lincoln (D-AK), indicated that they would oppose using reconciliation to bypass Republican support. Others, including Sen. Joe Lieberman (I-CT) and Sen. Dianne Feinstein (D-CA), have suggested a “time out” on health care reform until there is a clear path forward.

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In the GOP response to President Obama’s State of the Union address, Virginia Governor Robert McDonnell said that Republicans share the Democrats’ desire for health care reform, but do not agree with their proposed solutions. Republicans suggest that Democrats scrap the current proposals and start over with more Republican input on issues such as medical malpractice reform and selling insurance policies across state lines.

Republicans Call for Transparency: On Wednesday, the House Energy and Commerce Committee marked up a resolution presented by Rep. Michael Burgess (R-TX) which requested that the administration divulge documentation regarding the health care reform deals made with trade associations and a labor union. Committee Chairman Henry Waxman (D-CA) said that while details remained to be worked out, he would support a narrowed version of the Republican request for White House records.

President Obama to Speak with House Republicans: President Obama will meet with House Republicans on Friday in response to an invitation to speak at their annual retreat in Baltimore that begins Thursday and ends Saturday. The meeting comes just after the President’s State of the Union address, and members of the news media speculate that the meeting may spur more bipartisanship or potentially lead to even more tension between the two parties.

Interest Groups Call for Reform: With health care reform’s fate in jeopardy, interest groups have voiced their support, encouraging Democrats to push forward with legislation. The AARP, American Cancer Society Cancer Action Network, Consumers Union, Families USA and Service employees International Union sent a joint letter last Thursday urging Congress not to abandon comprehensive health care reform. Further, the United States Conference of Catholic Bishops also sent a letter to Congress urging a push for reform.

Public Opinion

Polls Show Concern with Health Care Reform; More Focus on Jobs and Economy: Several polls were released this week that highlight the public’s disenchantment with health care reform and anxiety around the struggling economy.

A new CNN/Opinion Research poll released Tuesday shows that only three in ten Americans say they want Congress to pass legislation similar to the bills currently being discussed in Congress. Forty-eight percent of Americans would like lawmakers to start again on a new bill, and 21 percent believe Congress should not work on bills that would change the current health care system. Further, a Wall Street Journal/NBC poll released Wednesday found that 51 percent of Americans believe President Obama has paid “too little attention” to the economy and that 44 percent feel he has paid “too much attention” to his proposed health care overall.

In addition, a new USA Today/Gallup poll released late last week finds that most Americans call for a more bipartisan effort in health reform. A 55 percent majority of Americans say that President Obama and Congressional Democrats should suspend movement on health care reform and consider alternatives that would increase Republican support.

A poll released last weekend by the Washington Post , Henry J. Kaiser Family Foundation and Harvard University’s School of Public Health indicated that dissatisfaction with the direction of the country, including the Democrats’ health care reform proposals, drove the outcome of the Massachusetts election. The post-election survey of Massachusetts state voters showed that overall 43 percent say they support the health care reform proposals advanced by President Obama and Congressional Democrats, while 48 percent oppose them.

A new poll released Monday from the Robert Wood Johnson Foundation found that fears regarding the health care reform package increased significantly in December as members of the Senate finalized their bill. Thirty-three percent of respondents said they believed their access to care would worsen if the legislation passed, up from 25 percent in November. Forty-two percent said the country’s finances would suffer under reform, compared with 34.6 percent in November.

Looking Ahead

Next week, the President will present his Budget to Congress (which includes health programs), after which Congressional hearings will commence. We expect health reform to be discussed in these sessions. While there remains no clear path forward for health care reform, Congressional leaders will continue to work to find a solution.

by Steve Rhodes

Health care spending projections for the next decade, published in the journal  Health Affairs last week, appeared to have a little something for everyone. Prepared by Medicare’s Office of the Actuary, the report notes that health care spending will increase 0.2 percent faster than previously projected due to the health reform law’s many changes to the system. As a result, The New York Times proclaimed that the “health plan won’t fuel big spending,” causing an annual spending increase of 6.3 percent rather than 6.1 percent. The Christian Science Monitor, on the other hand, warned that reform will definitely cause health insurance costs to rise and that Americans should be on guard for big increases in 2014 when many of the law’s major provisions kick in. Spending on health insurance is expected to increase 12.8 percent in 2014 as millions of uninsured Americans gain coverage. However one interprets the results of the report, it is clear that rising health care costs remain unfinished business.

ARIZONA: The Senate has established an Ad-Hoc Committee on the Impacts of Health Care Reform Implementation. The Committee will hold its initial meeting later this month. The preliminary agenda includes: Arizona Health Care Cost Containment System (Medicaid) requirements; insurance reforms; impacts on health care providers; and tax implications. Members appointed to the committee include AHIP retained counsel, clinical and employer representatives, and representatives of the Goldwater Institute, a conservative think tank.

COLORADO: The Division of Insurance (DOI) has applied for a million health insurance exchange grant. If awarded, the funds will be used for research and developing recommendations for implementation of an exchange. Specific areas mentioned include modeling on adverse selection, value choices, increasing actuarial staff and determining the actuarial effects of benefit packages within an exchange and in the external regulated market. The Department of Regulatory Agencies finalized three regulations that define the standardized electronic identification and communications systems to be used by all health plans operating in Colorado. The regulations are the result of 2008 legislation requiring carriers to use systems certified by the Committee on Operating Rules for Information Exchange (CORE). Carriers must be able to demonstrate their compliance by Sept. 1, 2012.

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DELAWARE: The Department of Insurance (DOI) has issued a bulletin regarding recently enacted legislation that prohibits rescissions based on medical claims underwriting. The legislation signed into law by Governor Markell on August 30th prohibits rescission, cancellation, or limitation once an enrollee is covered, except in cases of fraud or intentional misrepresentation of a material fact. Effective Sept. 23, 2010, prior approval by the Commissioner or her designee is required before a health insurer may rescind, cancel or limit existing coverage based on written health or medical information.

LOUISIANA: The DOI has applied for a grant related to health insurance exchanges. Aetna, along with the Louisiana Association of Health Plans, will participate in a meeting with the DOI to discuss the grant and other issues related to health care reform.

NEW JERSEY: The Department of Banking & Insurance (DOBI) last week issued a bulletin providing template contract riders that insurance carriers can use for the large group market and the (non-reform) individual and small employer markets to describe changes to comply with the Patient Protection and Affordable Care Act (PPACA). The rider templates, which may be used by carriers without submission to DOBI for formal review or approval, address the following health benefit plan requirements: Extension of coverage to dependents; annual and lifetime dollar limits; first-dollar coverage of preventive services; limitations on preexisting condition exclusions; and rescissions. A carrier not using the rider template must submit their own forms for DOBI’s formal review and filing, or approval to bring benefit plans into compliance by September 23, 2011.

OKLAHOMA: DOI Commissioner Kim Holland and staff hosted an informational stakeholder meeting last week to discuss the DOI’s plans for creation and implementation of Oklahoma’s exchange under the PPACA. DOI intends to use issue-specific working groups to manage the task going forward. The state’s online Medicaid enrollment process went live September 7 and processed over 2,000 applications with a 60 percent approval rate the first 28 hours. Over 400 apps came from hospitals that provided overwhelmingly positive feedback. This web tool was referenced as a possible “starting point” of the exchange’s eventual infrastructure. The DOI submitted an application for a million Exchange Planning Grant in August and expects to hear a decision from HHS by the end of this month. If awarded, the money will be used, in part, to hire a consultant to assist with an RFP to hire a vendor to help build the exchange. Other topics of conversation focused on the more technical and difficult aspects of building an exchange, such as coordinating billing/payment through employers, collecting and reporting data on those entitled to tax or premium credits and cost sharing subsidies,   allowing/finding/identifying navigators to assist consumers, and deciding if any additional state benefits/mandates would be included in coverage. Aetna will stay active in this process by serving on future workgroups when appropriate.

WYOMING: The DOI has submitted its plan for a health insurance exchange grant to the federal government. The DOI will use 0,000 to fund a study, to be overseen by a Governor’s task force, of the feasibility of three exchange options. The options include (1) operating a Wyoming state exchange, (2) participating in a regional exchange, or (3) allowing HHS to run the exchange. This study would occur in two phases:  phase one would help educate task force members and consult with stakeholders and experts on operating an exchange in the state;  phase two would include implementing the recommendations of the task force if it is decided that Wyoming should participate in the operation of an exchange. DOI has indicated that no legislative action is necessary to carry out the duties of the grant, unless the state decides to pursue the operation of an exchange. The white paper also outlines that several key governmental agencies will participate in the efforts, which will be facilitated by the University of Wyoming.

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