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In the Loop: Affordable Care Act (ACA)
1/30/2012 10:43:28 AM
When President Obama was poised to deliver his State-of-the-Union speech
last week, the White House released the attached report that summarizes the
impact of implementing the Affordable Care Act (ACA) so far. The report notes
that 28 states have “taken important steps toward establishing their own” health
insurance exchanges. One of the key provisions of the ACA requires that
qualified health plans be offered to consumers and small businesses exclusively
through exchanges starting in 2014. The report summarizes the actions taken by
10 states to illustrate the diversity of exchange approaches employed so far.
What the report does not address specifically is that some states are refusing
to advance exchange proposals until the constitutionality of the politically
unpopular law is determined by the U.S. Supreme Court later this year. In the
event that some states do not establish exchanges, consumers in those states can
access health coverage through a federal exchange. The report also notes that
the Obama administration is making new options available to states reluctant to
establish an exchange, such as partnership exchanges in which states perform
some but not all of the functions of an
exchange.
Federal
The House last week approved a joint resolution expressing disapproval of a $1.2 trillion increase in the federal government’s debt limit scheduled to take effect under the Budget Control Act of 2011. The Senate is expected to vote to reject the resolution this week. The measure would be vetoed if it reached the President’s desk. Additionally, a conference committee will be working in the coming weeks to reach agreement on a full-year extension of the Medicare physician payment fix, unemployment benefits, the payroll tax holiday, and other unfinished business from the 2011 session. Legislation must be enacted before March 1 to ensure that these provisions do not expire.
States
ARIZONA: The rate review work group continues to meet with the Department of Insurance (DOI), which has set a goal of initiating its rulemaking process in February. The initial focus remains on using the existing framework as a basis for a process that could be deemed "effective" for review of individual market rates. Comments during the “informal” stage are due by the end of January. The DOI also will conduct informational meetings around the state and allow for formal comments once the rule is filed. In the absence of an "effective" rate review process, the U.S. Center for Consumer Information and Insurance Oversight (CCIIO) reviews rate increase filings in excess of the 10 percent threshold.
CONNECTICUT: At a board meeting of the Connecticut Health Insurance Exchange, a new consultant to the state provided an overview of 10 recommended positions for the board on key issues. These positions include keeping the individual and small group risk pools separate, keeping the definition of small employer at 50 employees until 2016, and establishing a special task force to further analyze defining essential health benefits. The board also created four advisory committees to be made up of both board members and external stakeholders. The four committees are: health plan benefits; small business health options (SHOP); consumer experience and outreach; and brokers, agents and navigators.
COLORADO: The Division of Insurance and the Colorado Health Benefit Exchange hosted a listening session on January 18 regarding essential health benefits. The stated goal was to hear high level comments and questions regarding the development of a benefits package without addressing the actual content, benefit levels or cost structure. Despite those parameters, stakeholders' concerns were overwhelmingly geared toward the details of what will or won't be considered for inclusion. Comments from health benefits industry representatives focused on striking a balance between desirable and affordable benefits. Two groups advocating for autism treatment coverage recommended retaining state mandates.
DELAWARE: Governor Jack Markell delivered his fourth state-of-the-state address last week with a message focused on job creation. Additionally he spoke of the state’s need to contain health care costs, specifically citing a $56 million increase in Medicaid spending as a key concern. To address the problem, the governor is proposing new incentives to drive efficiency and quality in the delivery of care. Finally, he highlighted the need to leverage technology to establish claims and cost databases to help the state better identify cost drivers in the system.
KANSAS: The heads of the Kansas Medical Society and the Kansas Hospital Association testified last week in favor of Governor Sam Brownback's plan to expand Medicaid managed care into long-term services for the developmentally disabled, the elderly and the mentally ill. Those endorsements put leading medical provider groups at odds with the state's 27 community developmental disability organizations who oppose the plan. Administration officials claim KanCare, the proposed plan, would be accomplished without major cuts in payments to medical providers, including doctors and hospitals. They maintain that better care coordination and elimination of unneeded services will produce cost savings of about $850 million over five years. The program currently provides services to about 350,000 Kansans at an annual cost of about $2.8 billion in combined federal and state spending. Completed bids are due February 22, and officials say they plan to sign, as early as July, contracts with three companies to provide Medicaid services statewide beginning Jan. 1, 2013. The plan has been the subject of ongoing hearings by the Senate Public Health and Welfare Committee since the legislature started its new session two weeks ago.
NEW JERSEY: Governor Chris Christie last week signed into law legislation requiring insurance carriers to cover oral chemotherapy drugs no less favorably than intravenous chemotherapy medications. New Jersey now joins more than a dozen states with similar laws. The law is effective 180 days from enactment. In other news, Governor Christie delivered his state-of-the-state speech to a joint meeting of the legislature. No health care issues were mentioned. The governor focused his remarks on the three priorities: 1) education reform, 2) cutting state income taxes by 10 percent; and 3) reforming bail laws and the incarceration of non-violent drug offenders.
NEW MEXICO: The legislature convened on January 17 for a 30-day "short" session limited to a narrow agenda: 1) budget or appropriations; 2) legislation vetoed in the 2011 session; or 3) bills containing a special message from the governor. In her state-of-the-state message, Governor Susana Martinez identified her priorities as education, escalating Medicaid expenditures, gross receipts tax relief for small employers, and blocking the ability of illegal immigrants to obtain a driver's license. Although the state will use its $34 million Exchange Planning Grant, the administration is not seeking legislation on this issue. The governor wants to wait for the outcome of the U.S. Supreme Court decision. Despite the governor’s veto of an exchange bill adopted by the legislature in 2011, the sponsor has again introduced the measure with changes. Under the guidelines for the "short" session, the exchange bill should not be on the table for consideration.
NEW YORK: As expected, Governor Andrew Cuomo has included language in his recently proposed state budget creating a health insurance exchange with a nine-member voting board and five regional (NYC, metro suburban, northern, central & western) advisory committees. The language in this bill is almost identical to the 2011 compromise bill that was negotiated by the governor's office and legislature but which failed to pass more than one chamber (Assembly). The bill would create the governance structure and determine overall functions of the exchange consistent with the ACA. But it would require virtually all key policy decisions to be studied, with reports/recommendations due by August 1, 2012. Many recommendations could require further legislation to implement. To take advantage of analyses already being done, the bill language makes clear that the exchange may rely on studies already completed prior to August 1. In a new report on health insurance exchange markets, the influential "think tank" United Hospital Fund recommended that New York "chart a course somewhere in between the passive market organizer and active purchaser approaches."
OHIO: The directors of the Office of Health Transformation and Department of Health have announced new funding for the creation of 50 patient-centered medical home (PCMH) sites across the state. Drawn from a federal bonus, the money will support the training and transition of physician practices in four regions of the state, including rural areas. To be recognized as a PCMH, practices will be required to serve at least 15 percent of their patients as part of the Medicaid population and obtain recognition as a PCMH from the National Committee for Quality Assurance. In other business, Speaker of the Ohio House William Batchelder and members of the House Republican Caucus have unveiled their legislative agenda for 2012. The priority of the House Republicans continues to be on creating jobs. However, Speaker Batchelder said he expects the chamber to tackle a number other issues in 2012, including:
• Reforms within the Ohio Bureau of Workers’ Compensation with a focus on measuring outcomes on treatment of injured workers and timely return to work status
• Creation of regulations on Ohio's casinos and racetracks
• Revisions to Ohio's school funding formula.
House Republicans also suggested that they plan to address a health care exchange, which is required by the federal health care law. The decision to create a state-run health care exchange has been a contentious issue between Republicans and Democrats.
TEXAS: Lawmakers got their first look at a new Medicaid waiver last week, leading to some moments of self-congratulation. But uncertainty over just how the serious systemic changes would be accomplished under a tight timeline is now a concern. The waiver, formally approved by the Obama administration in mid-December, was designed to fix a specific problem – how to ensure that hospitals would not lose a key source of federal dollars that helps cover the cost of providing indigent care. This fix became necessary after lawmakers approved the expansion of HMO-style managed care in the Medicaid program into South Texas and other areas of the state. The House of Representatives' County Affairs Committee held an interim hearing last week to discuss the creation of a series of Regional Healthcare Partnerships called for by the waiver. Those partnerships will take the federal dollars currently sent directly to hospitals for uncompensated care and redirect those dollars toward a regional health care approach. The money will be divided into two pools, one funding hospitals’ uncompensated care as before while the other serves as a flexible source of funding to promote preventive care and access to care. The overall goal is to avoid reliance on the hospital emergency room to treat the poor. The waiver is also on the agenda for this week’s House Public Health Committee meeting. The Texas legislature is not scheduled to meet again for a regular session until January of 2013.
WISCONSIN: Governor Scott Walker announced that the state will not pursue the implementation of a health insurance exchange and has turned down a $37 million Early Innovator Grant from the federal government. The governor also will repeal the executive order that created the Office of Free Market Health Care due to "the potential to have a devastating impact on Wisconsin’s economy."
Federal
The House last week approved a joint resolution expressing disapproval of a $1.2 trillion increase in the federal government’s debt limit scheduled to take effect under the Budget Control Act of 2011. The Senate is expected to vote to reject the resolution this week. The measure would be vetoed if it reached the President’s desk. Additionally, a conference committee will be working in the coming weeks to reach agreement on a full-year extension of the Medicare physician payment fix, unemployment benefits, the payroll tax holiday, and other unfinished business from the 2011 session. Legislation must be enacted before March 1 to ensure that these provisions do not expire.
States
ARIZONA: The rate review work group continues to meet with the Department of Insurance (DOI), which has set a goal of initiating its rulemaking process in February. The initial focus remains on using the existing framework as a basis for a process that could be deemed "effective" for review of individual market rates. Comments during the “informal” stage are due by the end of January. The DOI also will conduct informational meetings around the state and allow for formal comments once the rule is filed. In the absence of an "effective" rate review process, the U.S. Center for Consumer Information and Insurance Oversight (CCIIO) reviews rate increase filings in excess of the 10 percent threshold.
CONNECTICUT: At a board meeting of the Connecticut Health Insurance Exchange, a new consultant to the state provided an overview of 10 recommended positions for the board on key issues. These positions include keeping the individual and small group risk pools separate, keeping the definition of small employer at 50 employees until 2016, and establishing a special task force to further analyze defining essential health benefits. The board also created four advisory committees to be made up of both board members and external stakeholders. The four committees are: health plan benefits; small business health options (SHOP); consumer experience and outreach; and brokers, agents and navigators.
COLORADO: The Division of Insurance and the Colorado Health Benefit Exchange hosted a listening session on January 18 regarding essential health benefits. The stated goal was to hear high level comments and questions regarding the development of a benefits package without addressing the actual content, benefit levels or cost structure. Despite those parameters, stakeholders' concerns were overwhelmingly geared toward the details of what will or won't be considered for inclusion. Comments from health benefits industry representatives focused on striking a balance between desirable and affordable benefits. Two groups advocating for autism treatment coverage recommended retaining state mandates.
DELAWARE: Governor Jack Markell delivered his fourth state-of-the-state address last week with a message focused on job creation. Additionally he spoke of the state’s need to contain health care costs, specifically citing a $56 million increase in Medicaid spending as a key concern. To address the problem, the governor is proposing new incentives to drive efficiency and quality in the delivery of care. Finally, he highlighted the need to leverage technology to establish claims and cost databases to help the state better identify cost drivers in the system.
KANSAS: The heads of the Kansas Medical Society and the Kansas Hospital Association testified last week in favor of Governor Sam Brownback's plan to expand Medicaid managed care into long-term services for the developmentally disabled, the elderly and the mentally ill. Those endorsements put leading medical provider groups at odds with the state's 27 community developmental disability organizations who oppose the plan. Administration officials claim KanCare, the proposed plan, would be accomplished without major cuts in payments to medical providers, including doctors and hospitals. They maintain that better care coordination and elimination of unneeded services will produce cost savings of about $850 million over five years. The program currently provides services to about 350,000 Kansans at an annual cost of about $2.8 billion in combined federal and state spending. Completed bids are due February 22, and officials say they plan to sign, as early as July, contracts with three companies to provide Medicaid services statewide beginning Jan. 1, 2013. The plan has been the subject of ongoing hearings by the Senate Public Health and Welfare Committee since the legislature started its new session two weeks ago.
NEW JERSEY: Governor Chris Christie last week signed into law legislation requiring insurance carriers to cover oral chemotherapy drugs no less favorably than intravenous chemotherapy medications. New Jersey now joins more than a dozen states with similar laws. The law is effective 180 days from enactment. In other news, Governor Christie delivered his state-of-the-state speech to a joint meeting of the legislature. No health care issues were mentioned. The governor focused his remarks on the three priorities: 1) education reform, 2) cutting state income taxes by 10 percent; and 3) reforming bail laws and the incarceration of non-violent drug offenders.
NEW MEXICO: The legislature convened on January 17 for a 30-day "short" session limited to a narrow agenda: 1) budget or appropriations; 2) legislation vetoed in the 2011 session; or 3) bills containing a special message from the governor. In her state-of-the-state message, Governor Susana Martinez identified her priorities as education, escalating Medicaid expenditures, gross receipts tax relief for small employers, and blocking the ability of illegal immigrants to obtain a driver's license. Although the state will use its $34 million Exchange Planning Grant, the administration is not seeking legislation on this issue. The governor wants to wait for the outcome of the U.S. Supreme Court decision. Despite the governor’s veto of an exchange bill adopted by the legislature in 2011, the sponsor has again introduced the measure with changes. Under the guidelines for the "short" session, the exchange bill should not be on the table for consideration.
NEW YORK: As expected, Governor Andrew Cuomo has included language in his recently proposed state budget creating a health insurance exchange with a nine-member voting board and five regional (NYC, metro suburban, northern, central & western) advisory committees. The language in this bill is almost identical to the 2011 compromise bill that was negotiated by the governor's office and legislature but which failed to pass more than one chamber (Assembly). The bill would create the governance structure and determine overall functions of the exchange consistent with the ACA. But it would require virtually all key policy decisions to be studied, with reports/recommendations due by August 1, 2012. Many recommendations could require further legislation to implement. To take advantage of analyses already being done, the bill language makes clear that the exchange may rely on studies already completed prior to August 1. In a new report on health insurance exchange markets, the influential "think tank" United Hospital Fund recommended that New York "chart a course somewhere in between the passive market organizer and active purchaser approaches."
OHIO: The directors of the Office of Health Transformation and Department of Health have announced new funding for the creation of 50 patient-centered medical home (PCMH) sites across the state. Drawn from a federal bonus, the money will support the training and transition of physician practices in four regions of the state, including rural areas. To be recognized as a PCMH, practices will be required to serve at least 15 percent of their patients as part of the Medicaid population and obtain recognition as a PCMH from the National Committee for Quality Assurance. In other business, Speaker of the Ohio House William Batchelder and members of the House Republican Caucus have unveiled their legislative agenda for 2012. The priority of the House Republicans continues to be on creating jobs. However, Speaker Batchelder said he expects the chamber to tackle a number other issues in 2012, including:
• Reforms within the Ohio Bureau of Workers’ Compensation with a focus on measuring outcomes on treatment of injured workers and timely return to work status
• Creation of regulations on Ohio's casinos and racetracks
• Revisions to Ohio's school funding formula.
House Republicans also suggested that they plan to address a health care exchange, which is required by the federal health care law. The decision to create a state-run health care exchange has been a contentious issue between Republicans and Democrats.
TEXAS: Lawmakers got their first look at a new Medicaid waiver last week, leading to some moments of self-congratulation. But uncertainty over just how the serious systemic changes would be accomplished under a tight timeline is now a concern. The waiver, formally approved by the Obama administration in mid-December, was designed to fix a specific problem – how to ensure that hospitals would not lose a key source of federal dollars that helps cover the cost of providing indigent care. This fix became necessary after lawmakers approved the expansion of HMO-style managed care in the Medicaid program into South Texas and other areas of the state. The House of Representatives' County Affairs Committee held an interim hearing last week to discuss the creation of a series of Regional Healthcare Partnerships called for by the waiver. Those partnerships will take the federal dollars currently sent directly to hospitals for uncompensated care and redirect those dollars toward a regional health care approach. The money will be divided into two pools, one funding hospitals’ uncompensated care as before while the other serves as a flexible source of funding to promote preventive care and access to care. The overall goal is to avoid reliance on the hospital emergency room to treat the poor. The waiver is also on the agenda for this week’s House Public Health Committee meeting. The Texas legislature is not scheduled to meet again for a regular session until January of 2013.
WISCONSIN: Governor Scott Walker announced that the state will not pursue the implementation of a health insurance exchange and has turned down a $37 million Early Innovator Grant from the federal government. The governor also will repeal the executive order that created the Office of Free Market Health Care due to "the potential to have a devastating impact on Wisconsin’s economy."
