Whats Happening Outside Florida

1

OFFICE OF INSURANCE REGULATION
FAIR. FAST. PROFESSIONAL.
Health Care Initiatives Whats Happening
Outside Florida
Monica Rutkowski, Director Life and Health Produ
ct Review
2
In General

• The nations estimated number of uninsured is
  nearing 45 million just over 15 of the
  population
  
• Nearly 70 of the uninsured live in families with
  one or more full-time workers
  
• Most states are making efforts to improve health
  coverage for the uninsured
  
• Strategies include the use of Medicaid waivers,
  purchasing pools, employer and individual
  mandated coverage, employer surcharges, high risk
  pools, subsidized reinsurance, limited benefit
  plans, and consumer directed health plans (high
  deductibles and HSAs).

3
New York

• July 10th, Governor Spitzer announced a directive
  to the Health Commissioner and the Insurance
  Superintendent to draw up a plan by next summer
  for providing universal coverage
• Currently conducting joint internal briefings
  with state agencies
  
• Will hold public hearings from August through
  November to discuss universal health care
  
• Request for proposals from consulting groups to
  study various universal coverage plans
  
• Child Health Plus expanded to cover additional
  400,000 uninsured children.
  

4
Healthy New York

• Funded by tobacco settlement dollars and a state
  cigarette tax
  
• Administered by the NY Department of Insurance
• Utilizes a stop loss mechanism
• Stop-loss subsidy reimburses health plans for 90
  of claims paid between 5,000 and 75,000 on
  behalf of a member in a calendar year
  
• Claims experience of small businesses, sole
  proprietors and individuals are pooled to
  determine premium rates. Stop loss
  reimbursements are factored into the rates as
  well
• Premiums average 204 for individuals and 602
  for families
  
• Mandates HMO participation.

5
Eligibility Small Employers

• Guarantee Issue
• Must have 50 or fewer employees
• Business must be located in New York
• 30 of employees must earn wages of 35,500 or
  less
  
• Employer must not have provided group health
  coverage in past twelve months
  
• 50 of employees must participate and at least
  one must earn 35,500 or less
  
• Employer must contribute at least 50 of
  premium
  
• Part time employees working 20 or more hours per
  week, earning 35,500 or less are also eligible.

6
Eligibility-Individuals Sole Proprietors

• Not eligible for employer provided insurance
• Ineligible for Medicare or Medicaid
• Must have a household income of less than 250 of
  the federal poverty level (FPL) 25,125 for
  single adults and 49,875 for a family of four
  
• Uninsured in last 12 months or lost their
  insurance for certain reasons
  
• Must have been employed some time in the past 12
  months.
  

7
Plans Available

• Includes inpatient and outpatient hospital
  services, physician services, maternity care,
  preventative health services, diagnostic and
  x-ray services and emergency services. Applicant
  may choose to have prescription drug coverage.
  Co-pays range from 10 to 500.
• Beginning January 1, 2007, participating health
  plans must offer a high deductible health plan
  which allows those with the plan to establish a
  health savings account (HSA).

8
Current Enrollment

• Current enrollment is approximately 142,000.
  
  
• (55 Individuals 28 Small employers
  17 Sole proprietors)
  
• The new enrollment averages nearly 7,300 each
  month.
  
• 92 million or 64.79 per insured is reserved to
  pay the states part of the claims, the remainder
  is used for administrative costs.

9
Massachusetts

• Funding for the subsidized program comes from
  several sources Uncompensated Care Pool (UCP),
  Medicaid matching funds, a surcharge to employers
  who do not provide health insurance.
• Created the Commonwealth Health Insurance
  Connector Authority or Connector to administer
  the plan and to help individuals and employers
  find affordable, quality health insurance
  products.
• The individual mandate - the legal obligation to
  obtain health insurance was July 1, 2007, but the
  real deadline is December 31st. (Plans were
  available May 1st)

10
Components

• Individuals that fail to comply will lose 219
  personal tax exemption
  
• Individuals who cannot afford insurance, as
  determined by the Connector, will not be
  penalized
  
• Requires employers with 11 or more employees to
  provide health coverage or pay a fair share
  contribution of 295 annually per employee
  
• A free rider surcharge will be assessed on
  employers who do not provide health insurance
  coverage to their employees, and the employees
  use free care.

11
Eligibility

• Government-funded subsidies to low-income
  individuals
  
• No premiums will be imposed on those Individuals
  with incomes of less than 150 (15,315) of the
  FPL
  
• For those earning between 151 and 300 (up to
  30,630) of the FPL, the monthly premium ranges
  from 35 to 105 and is determined on a sliding
  scale
• The Plan includes the expansion of Medicaid to
  children up to 300 of the FPL.
  

12
Plans Available and Markets

• Plans include the following services inpatient
  and outpatient hospital, prescription drugs,
  emergency care, mental health, rehabilitation,
  vision and wellness. Orthotics and podiatry is
  included for diabetics only.
• The individual and small group insurance markets
  will be merged after a one year study, which is
  expected to reduce premium costs for individuals
  by 25.
• The merger will allow young adults to remain on
  their parents policy for 2 years past their
  dependent status, or until they turn 25.

13
California

• The Legislature passed reform bills in June
• Both SB48 and AB8 cover all working residents and
  dependents and all children, regardless of
  immigration status, with incomes up to 300 of
  the FPL
• Both bills require employers to spend at least
  7.5 of payroll on employees health care costs or
  pay an equivalent amount to a state trust fund
  
• SB48 contains an individual mandate while AB8
  does not
  
• Employers with fewer than 10 employees are
  exempt
  
• The Senate bill is under review by the Assembly
  and the Assembly bill is under review by the
  Senate to narrow the differences and propose one
  plan.

14
The Governors Proposal

• Initiative is based on prevention and wellness
  coverage for all and affordability and cost
  containment.
  
• Funding sources for the subsidized program come
  from several sources
  
• 4 employer payroll tax
• Hospitals will contribute 4 of gross revenues
• Physicians will contribute 2 of gross revenues
• Redirection of 2 billion in indigent care
  funding
  
• Federal reimbursements for Health Families
  Program expansion (SCHIP program), Medi-Cal rate
  increases to providers and Medi-Cal Section 1115
  Wavier

15
Administration

• Revenues will be deposited into the Health Care
  Services Fund for the State Purchasing Pool
  Program. The program will be administered by the
  Managed Risk Medical Insurance Board (MRMIB).
• Enrollment in the subsidized program will be
  coordinated and arranged by county governments on
  a sliding-scale fee schedule.

16
Individual Mandate

• All residents will be required to obtain health
  insurance.
  
• Enrollment will be through the provider community
  or existing enrollment opportunities (brokers,
  etc.).
  
• Enforcement will be insured through proof of
  insurance when filing income tax. For those who
  do not purchase health insurance, a salary tax
  withholding and payment process will be
  implemented through the Employment Development
  Department.

17
Employers

• Employers with 10 or more employees who choose
  not to offer health coverage or drop their health
  coverage will contribute 4 in payroll tax toward
  the cost of employees health coverage.
• Companies with less than 10 employeesa full 80
  of businesses are exempt.
  
• All employers will need to establish a Section
  125 pre-tax benefit account for employees.
  

18
Health Plans and Insurers

• Plans will be on a guaranteed issue basis
• 85 of every premium dollar will be spent on
  patient care
  
• All plans will implement the Healthy Action
  Incentives/Rewards program
  
• This is projected to expand the states insurance
  pool by 4-5 million and give insurers fair
  compensation for their services.
  

19
Benefits and Subsidies

• Minimum benefit packages must be a maximum 5,000
  deductible plan with maximum out-of-pocket limits
  of 7,500 per person or 10,000 per family.
  
• Subsidies for purchasing coverage
• 100 150 of FPL 3 of gross income
• 151 200 FPL 4 of gross income
• 201 250 FPL 6 of gross income
• Employed workers with incomes between 100 250
  (up to 25,525) who are purchasing coverage
  through an employer or in the individual market
  will be eligible for financial assistance through
  the purchasing pool.

20
Cost Containment Efforts

• Reduce medical errors and develop innovative
  health information technology applications.
  
• Review mandates and plan benefits in order to
  reduce costs, eliminate unnecessary reporting and
  increase use of electronic submission of
  documents to streamline health plan product
  approvals.
• Establish education/outreach campaigns for
  obesity, smoking cessation and diabetes.
  
• Institute a plan that will provide discounts on
  prescription drugs of as much as 40 on brand
  name drugs and 60 on generic drugs to residents
  below 300 of the FPL (61,050 for a family of
  four).

21
MinnesotaCare

• Approximately 55 of the cost of the program is
  absorbed through the states Health Care Access
  Fund which is funded by a 2 tax on the gross
  revenue of health care providers, hospitals,
  surgical center and wholesale drug distributors
  and a 1 premium tax on HMOs, nonprofit health
  corporations and community service networks.
• Enrollee premiums and federal funding received
  under the Prepaid Medical Assistance Project Plus
  waiver and SCHIP pay the remainder.
  
• Administered by the Minnesota Department of Human
  Services and County Human Services agencies are
  responsible for determining eligibility and may
  process applications and managing cases.

22
Eligibility

• Must be a resident at least 180 days
• Household income must not exceed 275 (37,648)
  of the FPL or 50,000 single adults must not
  exceed 175 (15,315) of the FPL
  
• Total net assets are less than 10,000 for single
  adults and 20,000 for household
  
• Individual must not have access to employer
  subsidized health care coverage. Employer must
  pay 50 or more of the premium cost.

23
Benefits and Premiums

• Offers three benefit sets. Pregnant women and
  children have access to broadest range of
  services with no benefit limitations. Other sets
  have a limitation of 10,000 annually for
  inpatient hospital services
• Co-pays range from 3 to 50, with a 10 on
  inpatient hospital up to 1000, and 50 on
  restorative dental
  
• Annual premiums per person range from 48 to
  144
  
• All enrollees receive health care services
  through prepaid health plans and not through
  fee-for-service.

24
Pennsylvania

• Prescription for Pennsylvania proposed this
  year
  
• Includes a ban on smoking in public places, a
  reduction in the rate of hospitalization for
  chronic disease, an expansion of the role nurses
  play in treating patients, and the creation of
  Cover All Pennsylvanians (CAP)
• Uninsured adults who earn more than 300 of the
  FPL can participate in CAP program by paying the
  full cost of the premium, which would be
  approximately 280 per month
• Uninsured adults earning less than 300 of the
  FPL would get help in paying the CAP premiums
  through discounts and subsidies
  
• Mandates health insurance coverage for those with
  incomes of more than 300 of the FPL
  
• Would include a fair share assessment on all
  employers that do not insure their employees
  
• Employers with fewer than 50 employees would be
  exempt.
  

25
Prior Innovations

• Prior innovations in expanding health coverage
• Community Health Reinvestment Agreement (CHRA)
• The adultBasic program
• CHIP Cover All Kids
• Pennsylvania Employee Benefit Trust Fund (PEBTF)
  Get Healthy Program
  

26
Community Health Reinvestment Agreement (CHRA)

• Agreement between the Pennsylvania Department of
  Insurance and the four Blue Plans (Highmark,
  Inc., Independence Blue Cross, Capital BlueCross
  and Blue Cross of Northeastern Pennsylvania) that
  each year, the Plans will allocate a percentage
  of their surplus dollars
• To make an annual investment to provide
  affordable basic health care coverage to low
  income and uninsured
  
• To fund health care-related services in their
  communities
  
• Contributions through 2010 will total nearly 1
  billion.
  

27
adultBasic

• Provides subsidized basic health insurance
  coverage to uninsured adults earning less than
  200 (20,420) of the FPL
  
• Coverage includes hospitalizations (unlimited
  days), physician services (primary care and
  specialists), emergency services, diagnostic
  tests (e.g. x-rays, mammograms and laboratory
  tests), maternity care and rehabilitation and
  skilled care
• Enrollees pay a 33.50 per month premium and
  minimal service co-payments
  
• Over 50,000 Pennsylvanians are covered
• Funding is proved by 60 of the dollars from the
  Blue Plans and the remaining 40 is funded with
  tobacco settlement dollars
  
• Administered by the Pennsylvania Department of
  Insurance.

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Eligibility Requirements

• No health coverage for 90 days prior to
  enrollment
  
• Must be between the ages of 19 and 64
• Family income below 200 (22,410) of the FPL
• Resident of the state for at least 90 days
• U.S. citizen or permanent legal alien
• Guaranteed issue if eligibility requirements are
  met
  
• 71,524 applicants are on a waiting list
• While on the waiting list, eligible applicants
  are offered the choice of plans at the states
  rate an average of 266.50 monthly
  
• Enrollment increased by 34.3 in 2006.

29
Children's Health Insurance Program (CHIP)
Expansion "Cover All Kids"

• Legislation has been introduced to expand the
  CHIP to Cover All Kids. This program would
  
• Extend health insurance coverage to children
  whose parents earn too much to qualify for CHIP
  but can't afford to purchase insurance for their
  children
• Cover All Kids will guarantee affordable,
  comprehensive health care coverage for visits to
  doctors, hospitalization, prescription drugs,
  vision, home health care, and mental health and
  substance abuse services
• Cover All Kids is designed to extend health
  coverage to each and every child.

30
Healthy Lifestyles

• Pennsylvania Employee Benefit Trust Fund (PEBTF)
  Get Healthy Program
  
• State employee's health insurance trust fund
• A year ago the state began charging its employees
  0.5 of their salary for their health insurance
  coverage
  
• This employee premium is waived if employees
  participate in the Get Healthy program
  
• Ongoing participation in the program is required
  to maintain the health insurance premium waiver.

31
Illinois Illinois Covered

• A Tax Fairness Plan was proposed that would have
  replaced the corporate income tax with a simple
  fair Gross Receipts Tax.
  
• The legislature rejected the plan as a means to
  fund extended health coverage.
  
• Under the Illinois Covered plan, residents fall
  into three categories
  
• Choice, Rebate or Assist

32
Choice, Rebate Assist

• Small businesses and individuals without employer
  sponsored coverage would be eligible
  
• New comprehensive plans would be offered through
  private insurance companies no one would be
  denied
  
• Premiums determined on sliding scale up to 400
  (40,840) of the FPL
  
• Rebates in the form of discounted premiums for
  employees are available with maximum annual
  premiums being capped at between 1.5 - 3.5 of
  annual income for family coverage
• To Assist, Medicaid and Family Care eligibility
  is being increased from 185 (18,889) of the FPL
  to 400 (40,840).
  

33
Availability Wellness Strategy

• The plan would increase the young adult dependent
  age to 30.
  
• To improve quality and reduce costs, the State
  will work with consumers and Illinois healthcare
  providers on a Roadmap to Health strategy to
  improve the overall healthcare system.
• A statewide consensus plan will be developed for
  promoting wellness and managing chronic
  conditions.
  
• The State will build upon recent efforts to
  improve patient safety, promote electronic
  medical records, improve access to information on
  quality of care and reduce administrative costs

34
Maine Dirigo Health

• A comprehensive set of reforms with a goal of
  providing all residents with access to health
  care by 2009
  
• The plan was signed into law in June 2003
• Provides an affordable health insurance option to
  small businesses (50 or less), the self-employed
  and eligible individuals without access to
  employer-sponsored insurance
• Offers discounts on monthly payments and
  reductions in deductible and out-of-pocket costs
  on a sliding scale to enrollees with incomes
  below 300 (30,630) of the FPL
• Cost-containment initiatives included premiums
  and health care costs.

35
Dirigo Health - Continued

• Coverage is written through Anthem Blue Cross and
  Blue Shield of Maine
  
• Enrollment is voluntary
• Encourages a healthy lifestyle by offering
  wellness services and 100 coverage of prevention
  services
  
• Funding is through Maine public funds. These
  include General Fund appropriations, tobacco
  settlement allocations, contributions paid by
  employers and employees who elect to enroll from
  insurers doing business in the state through
  Savings Offset Payments. The offset payments
  are designed to recapture savings to the health
  system from the plan
• The source of funds for the state share of
  Maine's Medicaid costs after Dirigo is the same
  as it was before Dirigo.

36
Maryland

• In January 2006, the Maryland General Assembly
  overrode a veto by Governor Robert Ehrlich to
  enact the Fair Share Health Care Act (HB 1284)
  which would have taken effect on January 1, 2007.
  The law required employers with more than 10,000
  employees in the state to pay a penalty to the
  state if they fail to pay an amount equal to 8
  of their state payroll for health insurance for
  those employees.
• In January 2007, the U.S. Court of Appeals for
  the Fourth Circuit upheld a federal courts
  decision that the Act violated ERISA. In
  practice, the law only affected one employer
  Walmart.

37
Maryland - Continued

• Section 1115 Waiver - Full Medicaid coverage to
  disabled individuals with incomes up to 300
  (30,630) of the FPL and began April 2006.
  
• High Risk Pool - Offers discounted premiums and
  deductibles to individuals with incomes under
  225 (22,973) of the FPL.
  
• Limited Benefit Plan -The Minimum Benefit
  Legislation (SB 570), enacted in 2004, requires
  carriers who insure 10 of the covered lives in
  the small group market to offer a limited-benefit
  plan.
• Dependent coverage - Enacted legislation in 2007
  (HB 1057) allows young adults (including child
  dependents of domestic partners) to remain
  eligible until the age of 25 if unmarried.

38
Healthy Wisconsin

• 15.2 billion universal health care plan (Senate
  committee testimony being heard at this time.)
  
• ALL Wisconsin residents and employees under age
  65 would be guaranteed health insurance through a
  choice of public or private plan
  
• Funded by payroll taxes
• Employers would pay 10.5 of each employees
  wages in taxes (estimated at 370 per month)
  
• Employees would pay 4 of their wages (estimated
  at 140 per month).

39
Healthy Wisconsin - Continued

• Would replace over 700 different health insurers
  with a single publicly financed plan
  
• Administered at the state and local level by the
  Department of Health, Planning and Finance under
  the guidance of the Wisconsin Health Policy
  Board
• Would establish the Health Trust Fund in the
  Department of Health Planning and Finance
  
• All revenues earmarked for health care would be
  deposited into Fund, from which all providers are
  reimbursed.

40
BadgerCare

• In 1999, the BadgerCare was created as a health
  insurance program for low-income working families
  with children with net family incomes through
  185 (18,889) of the FPL.
• Effective with the June 1, 2007 renewal, federal
  funding will cover the BadgerCare Adult Parents
  with incomes below 100 (10,210) of the FPL and
  Parents with incomes from 100 to 130 (up to
  13,273) of the FPL.
• Badgercare benefits are the same as Medicaid
  benefits.

41
IowaCare

• In 2005, its Medicaid program was expanded by the
  creation of the IowaCare program which qualified
  the state for federal matching funds for indigent
  care for services provided at two large hospitals
  and four mental hospitals.
• Federal funding of 66.55 million with 35
  million from the states General Fund.
  
• Residents with under 200 (20,420) of the FPL
  are eligible.
  
• Currently considering creating a reinsurance
  program for small businesses.
  

42
Hawaii

• Hawaii enacted the Prepaid Health Care Act in
  1974, the same year ERISA became law.
  
• The Supreme Court in 1981 upheld a lower court
  ruling that PPHCA was preempted by ERISA,
  prompting Congress in 1983 to grant a special
  exemption to Hawaiis program. The exemption
  froze the mandated coverage arrangement.
• All employers are required to purchase health
  insurance for their employees who work more than
  20 hours per week.
  
• Employers may choose a comprehensive plan or a
  limited type plan.
  
• Employer contribution is capped at 1.5 of the
  employees wages.

43
Oklahoma

• HB1225 signed on June 4th to expand eligibility
  for the Oklahoma Employer/Employee Partnership
  for Insurance Coverage (O-EPIC).
  
• The state pays 60 of the premium costs, the
  employer pays 25 and the employee pays 15.
  
• Pending CMS approval, eligibility for employers
  would be increased to include those with 250 or
  fewer employees (currently 50 or fewer).
  
• An average 35 year old employee would pay about
  72.60 per month for the most popular option that
  includes a 1,000 deductible, 50 maximum office
  visit co-pay, and 500 pharmacy annual deductible
  maximum.

44
Texas

• Medicaid overhaul bill (SB10) signed into law
  June 14th
  
• Creates a health opportunity pool trust fund
• Pending CMS approval, the fund will initially be
  used to provide uncompensated care to hospitals,
  and eventually be used for premium assistance to
  low-income employees
• Creates a pilot three-share program, similar to
  Oklahomas, where local governments, employers
  and employees share the costs of premiums and
  creates regional health plans
• Over one-quarter of Texans are uninsured.

45
Other Reforms

• In 2005, Georgia modified its Small Group and
  Individual laws to allow the option of purchasing
  products that contain a smaller set of mandated
  benefits.
• In Arkansas and Kentucky, individuals and
  groups may choose to purchase plans without
  state mandated benefits. The applicant is
  provided with a written notice that outlines and
  explains what will not be covered under the plan.

46
States Currently Conducting Studies

• Alaska
• Colorado
• Kansas
• Louisiana
• New Mexico
• North Carolina
• Oregon

47
Recap

• California Individual mandate, subsidized
  premiums
  
• Iowa and Texas Medicaid expansion
• Hawaii Employer mandate
• Illinois Guaranteed issue, subsidized premiums
• Maryland Mandated coverage (violated ERISA)
• Massachusetts Individual mandate, subsidized
  premiums
  
• Minnesota Subsidized premiums, prepaid health
  plans
  
• New York Guaranteed issue, subsidizing claims
• Wisconsin Universal coverage, payroll tax
• Pennsylvania Guaranteed issue, subsidized
  premiums
  
• Maine Voluntary participation, subsidized
  premiums