Individual Health Insurance Reform Weekly EasyToInsureME

Week of October 12 , 2009

A new report from PricewaterhouseCoopers made headlines this week in pointing out that the Senate Finance Committee's health care reform proposal, as currently outlined (approved by a 14-9 margin on October 13), would increase the cost of private insurance coverage for individuals, families and businesses above what these costs would be in the absence of reform. Specifically, the report says that four provisions could significantly increase costs: a weak coverage requirement coupled with insurance market reforms, a new tax on high-cost health plans, cost shifting as a result of Medicare cuts and new taxes on several health care sectors. While the Committee is scheduled to vote on its reform package this week, the new report demonstrates much work remains to be done before any bill can appease growing cost concerns and claim broad consensus.

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Federal

The Senate Finance Committee's health care reform efforts were buoyed last week by news from the Congressional Budget Office, in the form of a preliminary analysis that found the Committee's health reform mark-up would reduce the number of uninsured nationally by about 29 million while reducing the federal budget deficit by about $81 billion over the 2010-2019 period. The projected budget impact made many Democrats jubilant, since the President has made it a condition that no reform bill add to the deficit if it is to get his signature. But the initial euphoria over the score started to evaporate within 24 hours as Republicans and some Democrats have questioned the numbers. Aside from the numerous political issues still in play, the CBO identified some significant caveats to its analysis that were not widely reported. The CBO analysis points out that once the reform proposal is converted into actual legislative language, significant changes could be necessary to its estimates. Also, federal spending that would be funded by future appropriations, such as implementation costs for Medicare operations, is not reflected in the estimates. The Senate Finance Committee approved the bill this week, but the legislative path ahead will not be easy.

A glimpse into one of hundreds of subordinate issues connected to health care reform points out how difficult it will be to actually enact legislation. Late last week, Aetna participated (as the only invited insurer) in a discussion among a cross-section of key players in the health care debate: the trial bar, employers, unions, and an insurer. The convening authority was the senior staff from all three key House Committees. The issue is whether the House bill should include a trial bar-supported provision to deny insurers (and union plans) the right to recover, from the insured, health care payments when the insured member has already received payment for the very same expense from a court award or settlement. The staff and the trial bar want this provision, while insurers, employers and the unions strongly oppose any change. The discussion pointed out (a) how a bill this big will surface myriad subordinate issues that will cut numerous ways and force strange bedfellow allies while pushing traditional friends far apart, and (b) how difficult it will be for Congressional leadership to cobble together a passable piece of legislation.


States

CALIFORNIA: Governor Arnold Schwarzenegger has signed legislation prohibiting the use of gender as a rating factor in the individual market but vetoed all new mandated coverage requirements, including a measure that would have required all individual policies to include full maternity coverage. The governor has not yet released his decision on the two rescission bills that were on his desk, although he vetoed similar legislation last year.

KENTUCKY: The Interim Joint Committee on Banking and Insurance is reviewing continuity of care issues related to a contract dispute between Anthem and Norton Healthcare that resulted in the filing of new legislation. The bill would require contracting agreements between a managed care plan and a hospital to be for a term of not less than three years, with at least six months notice by the acute-care hospital to the managed care plan and the Insurance Department when terminating or not renewing a contractual agreement. The managed care plan and the hospital must develop procedures for a covered person's access to care under continuity of care requirements established by law. The bill also would require mediation or binding arbitration in any dispute between the managed care plan and the hospital regarding a covered person's access to care under the continuity of care provisions.

MINNESOTA: The Neighborhood Health Care Network has received $832,768 federal funding in to expand and upgrade electronic health records systems in community health clinics that serve economically and ethnically diverse populations in the Minneapolis-St. Paul metropolitan area. The award will support the implementation of a shared Electronic Health Records (EHR) system with three member clinics: Freemont, Indian Health Board and West Side. Prior funding for this project from the Minnesota Department of Health and the Healthier Minnesota Community Clinic Fund enabled the early phases. The new funding will help support clinic-specific costs associated with “going live” in the months ahead. Network membership includes 14 independent, non-profit community health centers with clinic locations in Minneapolis, St. Paul and Stillwater.

Health Insurance Quote Reform Weekly EasyToInsureME

Sept. 18, 2009

This Week in Health Care Reform
Lawmakers continued to negotiate health care reform legislation this week. On Wednesday, Sen. Max Baucus (D-MT), chairman of the Senate Finance Committee, revealed his proposed reform legislation despite ongoing concerns from both Republicans and Democrats.

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Senate Negotiations

Sen. Baucus Unveils Proposed Legislation: On Wednesday, after months of negotiations to develop a bipartisan reform proposal, Sen. Baucus unveiled a major health care reform bill. The GOP, to date, has withheld its support of the bill.

With an expected price tag of $856 billion , the bill proposes insurance cooperatives, individual mandates, taxes on high-end insurance plans, fees on industry players, Medicaid expansions and government subsidies for qualifying families. It would also prohibit insurance companies from dropping or denying coverage based on preexisting conditions. The bill is deficit-neutral and less costly than prior proposed bills. In addition, the Congressional Budget Office (CBO) reports that the bill will trim federal deficits by $49 billion over 10 years.

Sen. Baucus has indicated he will continue to work to forge bipartisan consensus, saying that the bipartisan talks could continue even as the Finance Committee begins its formal bill drafting and voting session next week. With concerns voiced from both sides of the aisle, however, it is not clear whether the bill will receive enough support.

Republicans question the states' role in paying for Medicaid expansion, an individual requirement to purchase coverage, and fees on health insurance companies, clinical laboratories and medical device manufacturers. In addition, they want to include specific language restricting the use of federal dollars for abortion.

Democrats believe there are excessive cost burdens placed on some families and have concerns about the financing of the plan. Interested parties, from consumers to employers to industry groups, are still digesting what Sen. Baucus's reform bill will mean for them.

Public Plan

American Opposition Drops if Public Option Dropped: A recent Washington Post-ABC News poll, conducted in the days following President Obama's televised address to a joint session of Congress, found that 46 percent of those polled favor proposed changes to the nation's health care system, while 48 percent are opposed. Public opinion appears to shift if the public option is dropped from the reform package, though, with opposition dropping 6 percent. About 55 percent of those polled like the idea of a public option.

Additional Activities

Industry Groups Give Support Following President Obama's Speech: Following the President's presentation of a health care reform blueprint to a joint session of Congress, industry groups expressed support for the proposed reform plans . The Americas Health Insurance Plans (AHIP), the American Medical Association (AMA), the Pharmaceutical Research and Manufacturers Association (PhRMA) and the American Association of Retired Persons (AARP), endorsed President Obama's calls for change, saying they remain open to major reform for availability, financing and regulation of health care.

Debate Swirls Around Illegal Immigrants and Health Care: House Democrats asked White House officials to clarify statements made by Press Secretary Robert Gibbs last week indicating that President Obama would bar illegal immigrants from directly buying health insurance from a government-created insurance exchange. Democrats believe that the health care proposals were developed to prevent illegal immigrants from getting tax-supported subsidies to buy health insurance, but not to prevent them from using their own money for private insurance.

White House officials clarified that illegal immigrants could use their own money to buy coverage from the few private insurance companies that will be permitted to sell insurance outside the exchange. Rep. Lamar Smith (R-TX) accused the Administration of providing coverage to illegal immigrants with this arrangement.

Looking Ahead

The Senate Finance Committee is expected to begin mark-up on Tuesday, preparing the bill for debate in the full Senate next month. The full committee will meet on Thursday to discuss the proposal, with any amendments due by end of the day Friday.

Individual Health Insurance Reform Weekly : EasyToInsureME : July 30th, 2009

The House is scheduled to leave town for summer recess on July 31, and the Senate's current schedule sends them home a week later on August 7. It will be next to impossible for the House to address individual health insurance care reform on the floor in that timeframe, and the Senate Leadership has already put off Senate floor action until September. The focal point in the Senate, the Finance Committee has three options: work out a deal and go to mark-up before the break; put out paper but no mark-up before the break; do nothing now and put it all off until fall. The last option seems to be gaining favor daily and may soon become the choice by default. In the House, the conservative Blue Dog Coalition has the numbers to keep a bill from emerging from the Energy & Commerce Committee, which while not fatal is certainly a wake-up call to Democrats that Congress may be moving too fast on health care reform with little or no real focus on health care costs. The on-again/off-again talks between Blue Dogs and E & C Chairman Waxman broke off at the end of last week with conflicting reports on whether they will resume this week. Technically, House Leadership can proceed to the House floor with approval from only two of the three Committees with jurisdiction. But this would send a very bad signal to the public and could portend even more fireworks on the House floor. The bottom line is that neither chamber of Congress is likely to do anything official before the break, but there could well be a years' worth of policy and political activity in these last two weeks.

States
CALIFORNIA: The budget plan, which requires a two-thirds vote in the state Assembly and Senate, includes about $15 billion in cuts and some gimmicks to generate revenue in the 2009-10 fiscal year. Next to education, health and welfare programs will absorb some of the largest cuts with $1.3 billion coming out of Medicaid funding and $124 million from Healthy Families, a program that provides health insurance for 930,000 low-income children. The plan borrows about $2 billion from local governments' property tax revenue, captures $1 billion in redevelopment money from local governments, and temporarily redirects to state coffers $1 billion in transportation funding. Local government groups have told legislators and the media that they will sue the state if these transfers occur. Meanwhile, hospitals are divided over a non-budget related tax proposal designed at drawing down additional federal Medicaid funds. If the proposed two-year fees help generate $2 billion in state funds, California could qualify for an additional $3.2 billion in federal funding. Facilities that either don't treat Medi-Cal patients or do so on a very limited scale are opposing the measure. Gov. Arnold Schwarzenegger has said in the past that he supports using hospital fees to boost funding for health programs but is non-committal about this bill.

CONNECTICUT: In a special "veto session" held last week, the General Assembly failed to override Governor M. Jodi Rell's veto of the controversial health care pooling bill but it did succeed in overriding her veto of the SustiNet plan. The pooling bill would have required the comptroller to offer employee and retiree coverage under the state benefit plan to: non-state public employers beginning January 1, 2010; municipal-related and nonprofit employers beginning July 1, 2010; and small employers beginning January 1, 2011. The SustiNet legislation establishes a nine-member Board of Directors to make recommendations to the Assembly by January 1, 2010 for the creation of a SustiNet universal coverage plan by January 1, 2012. The legislature and the governor will have to agree on the issue of self-insurance. SustiNet proposes to make the state liable for all insurance claims, though it is unclear how the revenue would be generated. Estimating the cost of SustiNet at $1.1 billion in 2012, the Governor and Republican legislators said the SustiNet program is simply too expensive, with a projected $8.85 billion deficit looming. Aetna will continue to work with all boards, councils and commissions for real health care reform that improves quality, reduces costs and expands access to insurance.

MARYLAND: The Insurance Administration circulated a draft regulation that would impact payments to non-participating providers under a PPO policy. The proposed regulation would require parity between a member's in-network and out-of-network cost-sharing responsibility for services provided as 1) emergency care, 2) through a referral, and 3) by a hospital-based physician in a preferred facility. The Commissioner's position is antithetical to the controlling statutory requirement and his own public statements that insureds are not protected from balance billing in a PPO environment. In addition, the Health Care Reimbursement Task Force, in which the Commissioner participated, considered this issue earlier and decided to make no recommendations regarding PPOs.

MISSOURI: A group of orthopedic surgeons in Springfield has initiated the state-required legal process to achieve an "any willing provider" statute through the 2010 general election ballot. These physicians and possibly other advocates are calling themselves Missourians United for Choice in Health and have reportedly amassed $1.5 million to start the initiative petition process. A coalition of opponents is forming. Aetna is evaluating whether it should be a member of the opposition effort.

NEW YORK: In just two days recently, the Senate passed hundreds of bills previously passed by the Assembly over several months before it adjourned. Health insurance legislation that has gone to Governor Paterson for his signature include bills expanding dependent coverage to age 29, extending COBRA eligibility to 36 months and opening the Family Health Plus program to voluntary employee benefits associations (VEBAs). The Managed Care Reform Act also passed. It would require that a provider be given notice of an adverse reimbursement change to a provider contract and an opportunity to cancel the contract; extend overpayment recovery limitations to all health care providers and permits them to challenge such recoveries; require that providers moving to New York be provisionally credentialed until the final credentialing determination is made; shorten utilization review timeframes for post-hospital home health care services; allow providers to appeal concurrent adverse determinations through the external appeal process; and establish a new external appeal standard for rare disease treatments. The bill also would authorize the Superintendent of Insurance to require that mandated submissions be filed electronically and lower the prompt-payment-of-claims threshold to 98 percent, rather than the current zero-tolerance policy. Bills that failed to pass include prior approval of claims and 85 percent medical loss ratio legislation.

NEW JERSEY: Neil Jasey has was named interim commissioner for the Department of Banking and Insurance. This was a surprising development given the indeterminate nature of the post, due to the upcoming gubernatorial election. Mr. Jasey spent more than 25 years with Prudential serving as general counsel prior to his retirement in 2004. His wife is a current assemblywoman running for reelection.

NORTH CAROLINA: The Governor has rejected a budget compromise that did not include an increased premium tax increase. So it is back to the drawing board and, in all likelihood, another extension of the legislative session. Last month, the Budget Committee of the legislature introduced a proposal to increase the premium tax across all lines of business from 1.9 percent to 2.25 percent effective January 1, 2011. Strong opposition to the tax increase helped take it off the table, but things could change as legislators search for a new budget solution.

OHIO Health Insurance : The state's budget crisis concluded with Governor Strickland signing a compromise bill that includes a provision placing the contentious and heavily partisan video lottery terminal issue on the November ballot. Bill provisions affecting health care plans include: extending coverage to dependent children up to age 28; transferring oversight of health plans' network adequacy from the Department of Health to the Department of Insurance; expanding the open enrollment program for individuals with a more gradual reduction in the rate cap; requiring a health insurer to cover a service if the Director determines it is a covered service; requiring a carrier to conduct an external review automatically upon notification by the Director that determination of coverage involves a medical issue; requiring electronic payment of electronically submitted provider claims; submission to the Director of an annual report detailing components of administrative expenses by line of business; requiring filing of small employer premium rates; and requiring employers of 10 or more to offer Section 125 plans. An autism mandate was removed.

Health Insurance Reform Weekly : EasyToInsureME : July 16th 2009

On the health care reform front, the Senate HELP Committee continues to slug it out amendment by amendment, with Democrats winning all of the important ones on straight party-line votes. The HELP Committee started the week by unveiling its new language on the public plan and the employer mandate, but it still has no language on biogenerics. The committee hopes to complete this work by week's end. The Finance Committee has yet to meet to mark up a bill because it doesn't have a bill as yet - the Chairman is still seeking a bipartisan compromise with Republicans. The long-awaited beginning of the Finance Committee mark-up will have to wait until the following week at the earliest. The House-planned introduction of its bill was postponed until early this week, which puts off the beginning of the House mark-up until later in the week. It seems clear that the Democratic leadership is seeking to convey the impression that progress is being achieved, while having to deal with constant rumblings that the bills simply cost too much for even Democrats to accept. While the House surely has the capacity to meet its goal of having a bill ready for floor debate by mid-July, it is unlikely that Speaker Pelosi will allow this without an expectation that the Senate also will debate a bill before the August recess, set for August 7 in the Senate.

States
ARIZONA Health Insurance : In the wake of the failed 2008 ballot "Medical Choices Act" initiative, the legislature passed a resolution proposing to amend the Arizona Constitution to state that "no law or rule shall compel a person, employer, or health care provider to participate in any health care system, including a prohibition of penalties or fines for direct payment of lawful health care services." The amendment would also state that "the purchase or sale of health insurance in private health care systems shall not be prohibited by law." The resolution was certified for the 2010 general election. Additionally, the legislature passed and sent to the Governor a proposal to limit the benefit mandates that apply to the individual market; the proposal awaits the Governor's signature.

CONNECTICUT Health Insurance : As anticipated, Gov. M. Jodi Rell vetoed two of the most significant and flawed pieces of legislation approved this year by the legislature. The first, the Connecticut HealthCare Partnership bill, would have opened the very expensive state employee health plan to small businesses and other groups on an unregulated, self-insured and financially risky basis. The second would have set in motion a fully state-run health care system in Connecticut by implementing the "SustiNet Plan." Either measure would be very costly to taxpayers, especially with the state facing a projected $8.85 billion budget deficit over the next two years. The legislature may attempt to override these vetoes in a "veto session" scheduled for July 20. A veto override requires 101 votes in the House and 24 votes in the Senate - all 24 Senate Democrats would need to be present on a summer day to enact the override. The Democrats have only overridden one of Rell's vetoes during the past five years. The insurance industry has advocated for an alternate concept for expanding health coverage. That plan also would create an insurance pool, but the plan would permit insurers to offer coverage rather than forcing people to use a public pool.

Governor Rell has also issued an Executive Order creating a 15-member Connecticut Health Care Reform Advisory Board to develop a set of health care policies in response to federal reform initiatives. These proposals are directed at emphasizing cost containment, maximizing federal matching funds, enhancing access to preventative care, and assuring coverage for all children. The board is required to make interim recommendations by Feb. 1, 2010 and submit final recommendations to the Governor and General Assembly by January 1, 2011.

MASSACHUSETTS Health Insurance : Harvard Pilgrim Health Care President Charlie Baker announced that he is pursuing the 2010 GOP nomination for Governor of Massachusetts, and will be leaving his job at Harvard Pilgrim Health Care. Baker is seeking to unseat incumbent Democratic Gov. Deval Patrick. Patrick was elected the state's first African American governor in November 2006, ending a 16-year run of Republican control over the Executive Office. State Treasurer Timothy Cahill may also be in the mix as he announced he is leaving the Democratic Party and weighing an independent candidacy for governor. Cahill has been espousing a fiscal conservatism usually voiced by Republicans. Bruce Bullen, Harvard Pilgrim's current chief operating officer, will become interim chief executive officer.

NEW YORK Health Insurance : After more dramatic developments late last week, the deadlock in the Senate was finally broken and the Senate immediately began passing bills. More than 100 were moved through the process in one night. As expected, the Senate voted to make the state's mental-health parity law (Timothy's Law) permanent. They did not take up any other health industry issues. The way toward legislative action was paved when breakaway Democrat Senator Pedro Espada announced he would rejoin the Democrats, giving them the needed 32-30 majority over Senate Republicans. Sen. Espada will be the Senate Majority Leader, and Senator Malcolm Smith will serve as the Senate President. The scope of their authority in those roles is undefined at this time, as ordinarily those titles are held by the same Senator. The Senate plans to be back in session on Wednesday, July 15, to address several local municipality bills. The complete calendar of bills has yet to be made public.

NORTH CAROLINA Health Insurance : Key legislators have heard from numerous interested parties regarding the proposal to increase premium taxes across all lines of insurance from 1.9 percent to 2.25 percent, effective January 1, 2011. Because of the strong opposition to the tax, alternatives measures continue to be discussed. Aetna is working with all interested parties to defeat the new taxes.

Ohio Health Insurance : The state's budget woes continue as the deadline for the interim budget expired on July 7. Governor Ted Strickland signed a second seven-day extension through July 14, giving the legislature additional time to craft a bipartisan plan. But, with the ongoing stalemate between the Governor and the Senate over video lottery terminals, the conference committee has been unable to engage in any substantive discussion regarding the deficit. Instead, Senate President Harris forwarded a letter and a joint resolution to the Governor calling for a ballot vote in November. It is unclear what the next step will be. Health industry issues, including open enrollment program changes, electronic claims payment, a dependent age increase and administrative expense reporting, remain in limbo.