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Health Care Reform 101

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A Blue Cross and Blue Shield Association Presentation. Health Care Reform 101 ... run program to compete with private insurers such as Blue Cross and Blue Shield ... – PowerPoint PPT presentation

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Title: Health Care Reform 101


1
Health Care Reform 101
Healthcare Reform and the Future of Healthcare
IPPFA Benefits Conference, 6/4/09
2
Agenda for todays discussion
  • The need for healthcare reform
  • Political process and timeline for action
  • What are the issues, and where does BCBSA stand
  • Long-term optimal healthcare The Pathway to
    Covering America
  • How you can get involved

3
Healthcare reform Action likely this year
Strong commitment
Too many uninsured
Unsustainable costs
  • 45.7 million Americans currently without
    coverage, including 10 million children
  • U.S. spending 2.2 trillion on healthcare
    annually
  • Growing frustration with high healthcare costs
  • Average premiums for family coverage have more
    than doubled since 1999 
  • Top priority for President and Congress

STRONG MOMENTUM FOR REFORM
4
Political process and timeline for action
  • President and Congress strongly committed to
    enacting healthcare reform this year.
  • House and Senate committees now working on bills
  • Multiple House committees
  • Baucus/Grassley Senate Finance Committee
  • Kennedy Senate Health, Education, Labor and
    Pensions
  • House and Senate floor action expected before
    August recess
  • Final bill expected to be ready for Presidents
    signature this fall

5
  • BCBSA strongly believes everyone should have
    health insurance

6
Broad consensus on certain reform priorities
Insurance/market reforms
Delivery system reforms
Expansion of health coverage
  • Simplify the process of obtaining coverage,
    especially for individuals and small employers
  • Assure that everyone has coverage
  • Build on the current employer-based system where
    160 million get coverage today
  • Provide subsidies to make coverage affordable
  • Expand existing public programs such as Medicaid
  • Change payment to reward high-quality care
  • Emphasize prevention and wellness
  • Coordinate care for patients with chronic
    illnesses

7
but less agreement on others
Individual/employer mandates
Connector or Exchange
New government plan
  • Establish a government plan for
    non-Medicare/Medicaid eligibles to compete with
    private insurers
  • Assure everyone has coverage by requiring
    employers to provide and/or individuals to
    purchase it
  • Create a new government agency where consumers
    would purchase coverage

8
BCBSA position
  • BCBSA supports the vast majority of reforms being
    proposed by the President and Congress.
  • Top concern
  • Creation of a new government program to compete
    with private insurers
  • This would decimate employer coverage, and most
    employees would end up enrolled in a government
    program.
  • Other concerns
  • New Connector or Exchange
  • Insurance reforms in a voluntary market

9
Government plan The Vision
Employers and individuals sign-up with exchange
and individuals select plan from among
government approved options
EMPLOYER
INDIVIDUAL
EE
EE
EE
EE
EE
EE
IND
IND
IND
IND
Exchange BCBS United Aetna Kaiser CIGNA
Public Plan
Government Plan
Government Subsidies
10
Government plan
  • Proponents urging
  • Establish a government-run health insurance
    option for everyone
  • Why?
  • Increase competition by creating a government-run
    program to compete with private insurers such as
    Blue Cross and Blue Shield
  • Reduce costs by using the governments
    bargaining power to set better prices with
    doctors and hospitals

11
Government plan will cause health reform to fail
  • Most people would lose their current employer
    coverage
  • Over 100 million people would be shifted into
    government plan (Commonwealth Fund 2009)
  • Government plan would lead to a two-tiered system
  • As government plan underpays providers, private
    insurance premiums would increase. With no
    choice but to switch to government plan, people
    would face longer lines, less access.
  • Policymakers should build on what works today
    the employer system that covers 160 million
    people
  • Private sector drives innovation that improves
    care
  • Government control would make system slower, more
    costly and less responsive to patient needs
  • Government plan is unnecessary in comprehensive
    reform

Govt plan eliminates choice access to many
providers
12
Federal Exchanges
  • Proponents urging
  • Create a new federal or regional agency where
    consumers would purchase coverage
  • Why?
  • Simplify purchasing
  • Enhance competition
  • Increase choice
  • Viewed as a regulatory enabler of healthcare
    reform and gateway to government plan

13
Exchange BCBSA position
  • Offer alternative State Insurance Marts
  • Federal Exchange would
  • Increase costs by duplicating administrative
    functions (e.g., collecting premiums and
    marketing coverage)
  • Have the government select coverage options
    rather than employers
  • Usurp states ability to regulate insurance
  • BCBSA alternative SIMs would build on
    existing structures
  • Provide a state internet portal with consensus
    benefit templates, standard application, subsidy
    calculators, and links to brokers/programs
  • Accomplish the same goals as an Exchange
  • Provide a less costly, less complex, more
    transparent and faster alternative to a new
    federal bureaucracy

14
Insurance reforms
  • Proponents urging
  • Require insurers to provide coverage to all
    regardless of health status (Guaranteed Issue)
  • Require insurers to charge everyone the same rate
    regardless of health status (Community Rating)
  • Why?
  • Guaranteed Issue will ensure everyone has access
    to coverage
  • Community Rating will assure fair rates

15
Insurance reforms BCBSA position
  • Support guarantee issue and rating reforms if
    coupled with an effective requirement that
    everyone have insurance.
  • Requiring everyone to have insurance and
    providing subsidies to make it affordable will
  • Allow insurance to work as it should spreading
    risk across a broad population and
  • Assure a balance of healthy/young people to
    cross-subsidize the high cost of caring for
    older/sicker individuals.
  • However, implementing guaranteed issue and
    community rating without everyone being covered
    will
  • Result in increased premiums, more uninsured
  • Allow people to wait until they are sick to buy
    coverage

Lowest-cost HMO for a 23-year-old in Buffalo,
N.Y., is 973/month
16
BCBSA Approach Pathway to Covering America
The Blue System strongly supports comprehensive
reform to rein in costs, improve quality and
extend coverage to all.
17
BCBSA Approach Pathway to Covering America
Future State?
Objective stds. drive delivery of the
highest-quality care
Payers incent coordination of care and optimal
outcomes
Enhanced information and tools (e.g.,
e-prescribing)
Minimized chronic illnesses, obesity, smoking
Fewer uninsured thru new subsidies, enrollment
support and products
18
Why its important for you to be engaged
  • A lot is at stake, including
  • Choice The employer-based system, through which
    160 million Americans get their coverage, could
    be eliminated
  • Cost Your private insurance premiums would
    skyrocket if insurance reforms are not done right
  • Care Your benefits could be negotiated by a
    government agency instead of your employer
  • Competition A government option could mean the
    end of true competition and all the innovation it
    brings

19
How you can get involved
  • Learn more about BCBSAs key positions by
    visiting www.BlueAdvocacy.org
  • Access educational resources and send letters to
    Congress on www.GetHealthReformRight.org
  • Write to your elected officials
  • Write a letter to the editor about whats at
    stake in the healthcare reform debate

20
Health Care Reform 101
Questions?
Healthcare Reform and the Future of Healthcare
Questions?
21
Health Care Reform 101
Healthcare Reform and the Future of Healthcare
IPPFA Benefits Conference, 6/4/09
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