Health Care Reform Overview of The Patient Protection and Affordable Care Act - PowerPoint PPT Presentation


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Health Care Reform Overview of The Patient Protection and Affordable Care Act


Health Care Reform Overview of The Patient Protection and Affordable Care Act June 5, 2010 Chris Barley, Staff Attorney Ohio Poverty Law Center * What is a Health ... – PowerPoint PPT presentation

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Title: Health Care Reform Overview of The Patient Protection and Affordable Care Act

Health Care ReformOverview of The Patient
Protection and Affordable Care Act
  • June 5, 2010
  • Chris Barley, Staff Attorney
  • Ohio Poverty Law Center

Presentation Overview
  • Limited to major provisions
  • Details to be determined later
  • Effect of reform will be different across states
  • Many interpretations exist

Structure of Reform
Key Insurance Provisions
  • Health insurance market reforms
  • Ombudsman program
  • High risk pool
  • Reinsurance program
  • Health Insurance Exchange
  • Required Purchase of insurance
  • Subsidies

Pre-Reform BlueprintWhat It Looks Like NOW.
Chart prepared by PICO National Network,
Washington D.C. 2010
Post-Reform Blueprint2014
Chart prepared by PICO National Network,
Washington D.C. 2010
Early Insurance Market Reforms
  • No lifetime limits
  • Restrictions on allowable annual benefit limits
  • Coverage of dependents up to age 26
  • Pre-existing condition exclusions prohibited for
    children up to age 19
  • Appeals processes for enrollees
  • May not discriminate based on salary
  • Benefits for preventive services required
  • Coverage for emergency services at in-network

Early Insurance Market Reforms
  • Review of Premium Rates
  • Federal HHS will develop a process for the annual
    review of premium rate increases
  • Federal HHS will distribute 250 million in
    grants over 5 years to cover state costs

Early Insurance Market Reforms
  • Health Plan Loss Ratio Requirements
  • Loss ratios reported to HHS
  • Report must breakdown on how premiums are spent
  • Reporting requirements to be developed by HHS
  • In January 2011, rebates provided when plans do
    not meet loss ratio targets.
  • Loss ratio expenses based on clinical services
    and activities that improve health care quality

Early Insurance Market Reforms
  • Health Plan Disclosure Requirements
  • Payment policies and practices
  • Financial disclosures
  • Enrollment and disenrollment data
  • Claims denial information
  • Data on rating practices
  • Information on cost-sharing and payments with
    respect to out-of-network coverage

Insurance Market Reforms
  • Must provide
  • uniform summary of benefits
  • explanation of coverage documents.
  • Must use standardized definitions
  • HHS to publish standards in 12 months

Insurance Market Reforms
  • Guaranteed issuance
  • Elimination of
  • Preexisting condition
  • Annual limits on coverage
  • Waiting periods
  • Limitation on deductibles
  • Rating restrictions for group and individual
  • Small employer redefined (1-100 employees)

Consumer Ombudsman Program
  • Provides grants to create health ombudsman
  • Serves as an advocate for consumers
  • Assists with insurance-related complaints and
  • Assists consumers with enrollment
  • In 2014, Resolves problems with subsidies
  • Collects, tracks and quantifies consumer problems
    and insurance inquiries

Temporary High Risk Pool
  • For individuals with pre-existing conditions
  • For uninsured for 6 months or longer
  • May contract with states or non-profit entities
    to provide coverage

Temporary High Risk Pool (continued)
  • Federal funding of 5 billion allocated to fund
    eligible enrollees until 2014.
  • Federal HHS working with states to develop
    program guidelines

Temporary Reinsurance Program for Early Retirees
  • For employers providing insurance to retirees age
  • Including state government programs like PERS,
  • Program pays 80 of claims costs between 15,000
    and 90,000 annually
  • Payments under the program must be used to lower
    costs of the plan
  • Must submit application to HHS to participate
  • Funding of 5 billion

Electronic Health Care Transactions
  • Requires compliance with standard electronic
    health care transactions
  • Imposes new, earlier deadlines for federal HHS
    rules and implementation

Health Insurance Exchange
  • Directs states to establish American Health
    Benefit Exchanges
  • Small Business Health Options Program (SHOP).
  • Exchanges must be operational by January 2014
  • Must be administered by governmental agency or
    non-profit organization
  • HHS will establish exchanges in those States
    where they fail to create one.

What is a Health Care Exchange?
  • Virtual Marketplace
  • Run by the state or the federal government (at
    the states choice)
  • Insurance companies that want to sell insurance
    in the Exchange must sell plans that meet
    certain standards
  • The Exchange will allow consumers to comparison
  • The Exchange will also determine appropriate
    levels of subsidies for consumers to help them
    afford coverage, up to 400 FPL.

Health Insurance Exchange Program Features
  • One-stop insurance shopping
  • Provide a selection of Exchange qualified plans
  • Standardizes presentation of insurance options
    for plan comparability
  • Provides a rating system for plans
  • Redefines small businesses as 1-100 employees
  • Must contract with navigators
  • Four levels of plans
  • Catastrophic plans available to individuals under
    age 30
  • Insurers must offer children-only plans
  • Exchange must provide a seamless application
  • Federal funding implementation grants to states

Other Provisions
  • Co-Op program
  • Merging of individual and small group markets
  • Employer rewards
  • Health Care Choice Compacts
  • Nationwide plans

Individual Requirement to Purchase Insurance
  • Individuals required to obtain coverage
  • Can be an individual or group plan
  • Exemptions
  • religious objections,
  • financial hardship,
  • undocumented immigrants,
  • American Indians,
  • people earning under the tax filing threshold,
  • short gaps in coverage.
  • Subsidies
  • up to 400 of federal poverty level

Individual Requirement to Purchase
  • Penalties for non-compliance
  • 95 per person in 2014
  • 325 per person in 2015
  • 695 per person in 2016
  • Enforcement through IRS.

Small Employer Requirements and Tax Credits
  • Small employers exempt
  • Part - time workers
  • How are the counted?
  • Not required to offer coverage
  • Tax Credits for small employers
  • lt 25 employees
  • lt50,000 in average annual salary
  • 35 of premium, 50 in 2014
  • Credits phased out gradually

Large Employer Requirements to Purchase
  • gt50 full time employees
  • Must offer insurance
  • If employees receive public subsidies employer
    pays 2,000 per year
  • Large employers whose employees who receive
    premium assistance pay the lesser of
  • 1) 3,000 per year
  • 2) 2000 per year
  • Penalties calculated monthly based on number of
    applicable employees
  • gt200 employees must automatically enroll new

Impact on Market and Consumers
  • Premium rates will change
  • Minimum loss ratio requirements may mitigate some
    increased premiums
  • Uninsured individuals with preexisting conditions
    to be able to obtain coverage through the
    temporary insurance risk pool
  • Rating requirements and guarantee issue will
    impact small and individual markets

Impact on Market and Consumerscontinued
  • All plans issued going forward must meet federal
  • Employers with existing group plans can continue
    to enroll new employees
  • All private plans sold after March 23rd must
    comply with new benefit provisions

Additional Information
  • Ohio Consumers for Health Coverage
  • tracking news and
  • experts on people with
  • Kaiser Family Foundation
  • working on
    delivery reforms

For More Information
  • Cathy Levine, Executive Director
  • OCHC, Co-Chair
  • (614) 456-0060 x 222
  • Col Owens, Senior Attorney,
  • Legal Aid of Southwest Ohio
  • OCHC Co-Chair
  • 215 E. Ninth Street
  • Cincinnati, Ohio 45202
  • (513) 300-3042
  • Kathleen Gmeiner, UHCAN Ohio
  • OCHC Project Director
  • (614) 456-0060 x 223
  • Gene King, Director
  • Ohio Poverty Law Center
  • 555 Buttles Ave.
  • Columbus, Ohio 43215
  • (614) 221-7201