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1 Healthcare Reform 101: Finding Coverage for Those You Serve
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Healthcare Reform 101:
Finding Coverage for Those You Serve
Software Screen
Today’s Speaker
John CoburnDirector of Training
Health & Disability Advocates
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Patient Protection and Affordability Act and Health Care and Education Reconciliation Act
Presentation by: John V. Coburn
Health & Disability Advocates, Chicago, Illinois
June 2010
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Themes of Healthcare Reform
o “If you got it, we want you to keep it and it may get better.”
o “Now, we spend all our time trying to figure out IF those we serve qualify for coverage and how. In the future, for most, it will be a matter of finding out WHICH coverage is appropriate.”
o “Everybody has a box. This is a game of figuring out which box and, if there is more than one, which box is best.”
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If you got it, HCR wants you to keep it.
o This new system does not replace the old one but is in addition to the old one.
o If you have coverage or a “box”, whether public or private, that box was meant to continue.
o Of course, introducing a new system on top of an old system may cause changes.
o Coverage of uninsured with enhancements and reforms to current system thrown in is the purpose of this law.
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Shifting Our Services from “If” to “What”
o Currently, millions do not qualify for health insurance in private or public markets.
o In new system, advocates will be determining where people fit.
o PAPs and charities may respond with eligibility and service changes in this new environment.
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Finding that Box
o Those who work with PAP and other programs with income/asset eligibility should feel right at home in this new system.
o Like we have to do now, this is a matter of finding the appropriate coverage to which a person qualifies.
o While there still may be gaps, most individuals will be able to find coverage under SOME category.
o Categories may have different types and levels of coverage.
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Areas to Discuss
o High Risk Poolso Changes to Medicare Part Do Other Changes to Medicareo Medicaid Expansion and New
Insurance Exchangeo Private Insurance Changes o Decisions States Will Need to Make
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High Risk Pool Expansion
o For individuals with pre-existing conditions and no insurance for last 6 months.
o Premiums same as standard population.o Cost sharing cap of $5950 individual, $11,900
family.o Operates until 2014 when Medicaid expansion
and insurance exchanges begin.o Funded with 5 billion. o hhs.gov/ociio/initiative/hi_risk_pool_facts.html
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Will My State Have a HR Pool?
o States have the option to run their own pool or have the feds run the pool for them.
o “Rejection of high risk pool” language in media and politics was misleading.
o Coverage will be available in every state and the dollar amounts have been allocated.
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Medicare Part D
o Changing of Annual Enrollment Period o Drug Manufacturer Discount During
Doughnut Holeo Discounts to Generics during
Doughnut Holeo Closing of Doughnut Holeo Uniform Exceptions and Appeals
Process
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Medicare Part D
o AIDS Drug Assistance Program and Indian Health Services Count as TROOP
o Means-tested Part D premiums
o Formulary Requirements for 6 Protected Classes and Others
o Elimination of part of tax deduction for employer retiree plans
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Changes to Medicare Advantage
o Open enrollment in January through March eliminated
o Freeze in payments to MA plans in 2011.o Plans paid fixed percentage of traditional
Medicare.o MA plans must remit a specified sum if don’t
maintain medical loss ration of 85%.o Prohibit higher cost sharing for certain
services
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Other Medicare Provisions
o Improvements to care coordination through new Federal Coordinated Healthcare Office
o Independent Payment Advisory Boardo Elimination of cost sharing for certain
preventative services and free annual check-up.o Freeze Part B means tested income levels at
2010 through 2019
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Medicaid Pre-Reform
o Medicaid Categorical Eligibility (TANF, SSI) o Medicaid Medically Needy (Spenddown,
Incurment, Share of Cost)o Medicaid Buy-In for Workers with Disabilitieso Medicaid Waiverso Other Optional Categorieso Every State is Different in What is Covered and
is Allowed to Use Different Income and Asset Calculations.
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Medicaid Now Through 2014
o Same categories.
o Enhanced federal participation continues as long with restrictions in how eligibility can be changed (“maintenance of effort”).
o Option to cover individuals in “newly eligible” category prior to 2014 roll out (explained below) both above and below the 133% FPL.
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Medicaid Expansion 2014
o In 2014, all up to 133% FPL eligible for Medicaid, called “newly eligible”.
o “Newly eligible” must be under 65, not entitled to or enrolled in Medicare A or enrolled in Part B.
o Use modified gross income test and no asset test.o Federal government pays for much greater percentage
of this expansion.o Could be very important for Medicare waiting period.
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“Newly Eligible” Medicaid
o May not necessarily look like the Medicaid package currently offered for other categories in your state.
o Benchmark or “benchmark equivalent” coverage…….still being defined.
o Must Include “Essential Benefits”
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Other Medicaid Changes
o Community First Choice Option (enhanced match of 6% to offer home and community based
o State Balancing Incentive Program (states submit plans to increase percentage of care provided in community setting)
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Newly Eligible Essential Benefits
o Outpatient and lab services,o Emergency services,o Hospitalization,o Maternity and newborn care,o Pediatric services, including oral and vision care,o Mental health and substance abuse, including behavior
health treatment, with parity to physical health services,o Prescription drugs,o Rehabilitative and habilitative services and devices, ando Preventive and wellness services and chronic disease
management
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New Insurance Exchange 2014
o States will establish exchange for individuals and exchange for small businesses.
o Most individuals (exceptions include financial hardship, religious exemptions, etc) must obtain insurance or pay fine greater of $695 per person (family max) or 2.5% of income
o Premium and cost sharing subsidies are available.o Uniform benefits packages ( must include “essential
benefits” and states can add more) with four levels of value.
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Subsidies on the New Exchange
o Premium subsidy available to individuals up to 400% FPL through tax credit.
o Premium subsidy tax credit is calculated at that amount that would assures that a person could purchase second lowest cost silver plan (70% actuarial) at certain percentage of income.
o Cost sharing subsidy allows people with incomes up to 250% of FPL to purchase higher actuarial value plans with same premium subsidy.
o Up to 400% FPL, there is a reduction in out of pocket maximum.
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Bottom Line: Insurance Options
o Medicaid as we know it (SSI, people with disabilities, TANF, kids etc.).
o Medicare with reforms.o High Risk Pool until 2014o Newly Eligible Medicaid up to 133%FPL.o Subsidized Insurance Exchange Product up to
400% FPLo Insurance Exchange Product with No Subsidy.
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Private Insurance Reforms
o Prohibition on pre-existing exclusion for children (2010)
o Young adults can stay on parent’s insurance until 26 (2010)
o Prohibition on lifetime limits and recissions (2010).o Prohibition on denying coverage based on gender or
health status (pre-existing condition). (2014)o Rating variation based on age on 3:1. (2014)o Waiting periods limited to 90 days. (2014)
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Decisions States Will Need to Make
o Participation in High Risk Pool and what it will look like.
o Expanding Medicaid prior to 2014.o What “newly eligible” Medicaid will look like.o Offering state exchange product.o If applicable, revising SPAP given changes to
Part D.o Education and Outreach opportunities.
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What Should You Do Now?
o Learn what your state plans to do with the high risk insurance pool and determine if your consumers will benefit.
o Review Medicare timeline and be prepared for upcoming changes.
o Find a state resource to keep you up to date---much can still be different on a state level.
o Review helpful website materials to get the general overview down and then start to take specifics, one at a time……..you have time!
Questions / Discussion
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