Implementing Massachusetts Health Reform Families USA Brian Rosman ([email protected]) Health Care For All () January 2007.

Implementing Massachusetts Implementing Massachusetts Health Reform Health Reform

Families USABrian Rosman ([email protected])Health Care For All (www.hcfama.org)January 2007

Presentation OutlinePresentation Outline

What Is Health Care For All MA Health Reform History – Why ‘Third Wave?’ Round 3: Chap. 58 Acts of ‘06 – What Passed?

Insurance Connector: Subsidized Coverage – CCHIP MassHealth Expansions & Restorations Individual and Employer Responsibility Insurance Market Reforms Quality, Costs, Health Disparities and more

Why and How Did Chapter 58 Happen? What’s Happening with Implementation? Is Chapter 58 a National Model? What’s the Emerging Political Window of

Opportunity for Health Care Access Reform?

Health Care For All: Who We AreHealth Care For All: Who We Are

Just Massachusetts We Run Health Policy Coalitions

Affordable Care Today (ACT!!) Children’s Health Access Coalition (CHAC) Racial & Ethnic Health Disparities Action Network (DAN) Oral Health Advocacy Task Force Private Market Consumer Coalition Emerging projects on e-Health and Quality

We Run Programs to Help Consumers Consumer Helpline (telephone/email), Outreach &

Enrollment, Health Law Advocates We Communicate to Inform Everyone

www.hcfama.org, email updates, Blog (blog.hcfama.org)

Brief History of MA Health ReformBrief History of MA Health Reform

1988: Universal Health Care Law $1680 Pay or Play Employer Mandate

Delayed three times/Repealed 1996 CommonHealth, Student Insurance Mandate, Medical Security

Plan (unemployed), Healthy Start (pregnant)

1996: MassHealth Waiver Expansion law Medicaid->MassHealth; Enrollee growth from 670,000 (’95) to

1,020,000 (’01) Uninsurance Drop: 680,000 to 365,000 Coverage for all children – CMSP Senior Pharmacy Program

Both reform waves inspired national action 1988 Leads to state-based innovations 1996 Leads to Creation of SCHIP

April 12, 2006: Chapter 58April 12, 2006: Chapter 58

Medicaid Expansions and RestorationsMedicaid Expansions and Restorations

MassHealth ( = Medicaid waiver): Children’s coverage expands to 300% fpl from 200% fpl MassHealth enrollment caps lifted

Essential, CommonHealth, HIV Optional Benefits Restored: dental, dentures, eyeglasses,

other adult services New smoking cessation and wellness benefits $3M outreach/enrollment grants $270M ($90 per year) rate hikes to hospitals and physicians

Years 2/3 tied to Pay for Performance/Racial Ethnic health disparities benchmarks

Bottom Line: 53,000 new enrollees since July – half kids, half adults

Chapter 58 – Insurance Connector Chapter 58 – Insurance Connector and Commonwealth Careand Commonwealth Care

Insurance Connector set up as quasi-public authority – 10 member board Provides Commonwealth Care - subsidized

coverage for below 300% fpl Provides Commonwealth Choice – non-

subsidized “affordable” coverage for individuals and small business

Defines individual mandate

Subsidized CoverageSubsidized Coverage

“Commonwealth Care:” subsidized coverage for uninsured adults below 300% of poverty Rules:

No employer coverage available in past 6 months

COBRA or non group OKLegal residents OK, even Medicaid ineligible“private coverage” – offered by 4 Medicaid

MCOswww.macommonwealthcare.com

Subsidized CoverageSubsidized Coverage

Below 100%: No premium, no deductiblesMedicaid Drug copays ($1 / $3)comprehensive benefits, including dental

No major issues34,000 enrolled, mostly from charity care

program (“Uncompensated Care Pool”)

Subsidized CoverageSubsidized Coverage

100% - 300%: Sliding scale premiums, no deductiblescommercial copays ($10 - $30)comprehensive benefits, but no dental

Enrollment just getting startedWe’re pushing to add dentalTo be decided: employee buy-in for those

with employer coverageTop Issue: are premiums too high?

Subsidized CoverageSubsidized Coverage

Premiums for lowest cost plan (per month): 100%-150%  $18

($9,800 - $14,700)

150%-200%  $40($14,700 - $19,600)

200%-250%  $70($19,600 - $24,500)

250%-300%  $106($24,500 – $29,400)

note: income amounts rounded

Individual ResponsibilityIndividual Responsibility

Individual Mandate Beginning 7/1/07, all residents 18+ must obtain health

insurance coverage. Penalty if no coverage on 12/31/07 Penalties assessed if “affordable coverage” is available 2007: loss of personal tax exemption 2008+:tax penalty=½ cost of affordable plan per month

Issue: what is affordable? Coalition doing focus groups, research. Decision this spring.

What is “Minimum Creditable Coverage?” that meets mandate. Initial proposal: $1,500 deductible, generics only. We issued policy guidance.

Employer ResponsibilityEmployer Responsibility

Employer “Mandate”“Fair Share” Employer Contribution

Employers (11+ workers) who don’t offer “fair and reasonable” coverage must pay $295 per worker

Definition of “fair and reasonable” neither: either pay 25% of premium, or cover 33% of workers

We’re filing bill for 50% of premium, 50% of workers, include part-timers

ERISA issue?????

Employers must facilitate Section 125 “cafeteria plan” for pre-tax health insurance, or pay “Free Rider Surcharge”

Non-Subsidized CoverageNon-Subsidized Coverage

Commonwealth ChoicePlans for individuals and small business3 levels: high, mid and “minimum

creditable coverage”Tough new issues for us to learn:

List billing Brokers and intermediaries Actuarial equivalents etc . . .

Starts July 1

Chapter 58– Insurance Market and Chapter 58– Insurance Market and Other ReformsOther Reforms

Small/Nongroup Insurance Market Reforms Non-group (individual) market will merge with small group

market on 7/1/07. Study commission found non-group goes down 15%, small group up 1.5%

Young adults (19-25) can stay on parents’ plans for 2 years after lose dependency

Reduced-benefit plans for 19-25 year olds Other Reforms

$20M Public Health/Prevention Restorations Diabetes, cancer, infection control, more

Quality and Cost Council Sets cost and quality benchmarks Produces website with data/findings

Racial/Ethnic Health Disparities Council Statewide Disparities Council Pay for Performance benchmarks

Computerized Prescription Order Entry – $5 million

How Do the Pieces Fit Together?

17%

40%

29%

14%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

MassHealth(Medicaid) expansions

Commonwealth Care(subsidized coverage)

AffordableCoverage/IndividualMandate? (income

300-600% FPL)

Individual Mandate(those with incomes

>600% FPL)

Percent of State’s Total Uninsured Targeted by different approaches

Coalition Role After Bill PassesCoalition Role After Bill Passes

Coalition continues strong. ACT! is now ACT!!

Monitoring implementation – central source of information

Administrative advocacy with Connector and state agencies (Division of Insurance, Medicaid)

Introduced legislation with 15 provisions It’s never over

Is Chapter 58 a National Model…?Is Chapter 58 a National Model…?

Reasons why not… Different makeup of uninsured population

Lower proportion of uninsured Lower proportion of lower-income uninsured

Highly regulated insurance market Guaranteed issue, prohibition on medical

underwriting, modified community rating Essential protections for individual responsibility

Robust Safety Net/Deep Federal Financing Reasons why…

Individual/Employer/Government responsibility Confronting the affordability challenge Less a policy blueprint/More a political one

MedicareMedicaid

Employer Coverage

IndividualIndividualMandateMandate

MedicaidExpansions

EmployerResponsibility

InsuranceMarket

Reforms

AffordableProducts

Young Adult

Products

Connector

CommonwealthCare

Where From Here?Where From Here?

State Actions – 2007-08 New, invigorated conversation CA, CO, CT, MI, MO, NY, OH, RI, WA, WI, IL… 10 states now Democratic Gov and leg (was 3)

Congressional Action – 2007-08 SCHIP expires 9-30-07 Medicare issues Access – is there room on the agenda?

2008 Presidential Campaign Changed dynamic for all Democrats Changes dynamic for all Republicans Different kind of conversation in 2008