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Beyond the Headlines:Health Care Reform Update and
Analysis
Health Care Reform Law
The Patient Protection and Affordable Care Act (P.L.111-148)
• Generally being referred to as PPACA or the Affordable Care Act (ACA)
• Signed into law by President Obama on March 23, 2010• The Health Care and Education Reconciliation Act of 2010
signed March 30, 2010• Requires a phasing-in of changes from 2010 – 2018 with key
changes taking place in 2014• Health and Human Services (HHS) Secretary Sebelius and her
staff central to the process
President Obama: Why We Need Reform
Statement made at the White House on June 22, 2010
In reference to an implementation planning
meeting with key insurance executives and regulators, the
President noted:
“It’s reform that brings -- that begins to bring down our government’s long-term structural deficit. It’s reform that
finally extends the opportunity to purchase coverage to the millions who currently don’t have it -- and
includes tough new consumer protections to guarantee greater
stability, security and control for the millions who do have health
insurance.”
Two Original PPACA Goals
•Attempt to better manage the cost of chronic care
•Reduce ER visits
•Manage hospital readmissions
Bend the cost curve by expanding access to affordable health
coverage
•Reporting requirements
•Improve outcomes
•Reduce medical errors
•Implement wellness programs
Promote quality through a more transparent and
accountable health care system
Expands Access to Coverage
Requires most U.S. citizens and legal residents to have health insurance coverage
Requires employers to offer health coverage or pay penalties
Requires states to create health care exchanges for individuals and small businesses to obtain coverage (2014)
Expands Medicaid eligibility to 133% of the FPL
Creates a temporary national high risk pool to provide coverage to individuals with pre-existing condition exclusions
Creates temporary employer subsidies for pre-Medicare retiree coverage
Emphasis on Improving Health Outcomes
Establish National Prevention, Health Promotion and Public Health Council to coordinate federal activities
$7 billion in funding for 2010-2015 prevention, wellness, health screenings and research
Grants for wellness and prevention programs
Permit expanded incentives for wellness programs
National quality improvement strategy to improve patient health outcomes
Who are the Key Players at the Federal Agency Level?
Kathleen SebeliusSecretary, Department
of Health and Human Services
Jay AngoffDirector, Office of
Consumer Information and Insurance Oversight, HHS
Department
Donald Berwick
Director, Health and Human Service’s Agency for Healthcare Research
and Quality
Carolyn Clancy
Director-designate, Centers for Medicare and
Medicaid Services
David BlumenthalNational Coordinator
for Health Information Technology
Jeanne Lambrew
Director of Health and Human Service’s Office
of Health Reform
William CorrDeputy Health and
Human Services Director
Understanding the Impact of the Recent
Election Results on Health Care Reform
The Recent Election Results
• To understand what happened
• Where it happened• What it means to your clients• What it means to you
Key Questions
• Was this past election a Republican tsunami?• Was it a mandate, or simply a temporary restraining order on
the Democrats?
/
2008 U.S. House of RepresentativesElection Results
Source: WashingtonPost.com
2010 U.S. House of RepresentativesElection Results
Source: WashingtonPost.com
What is the impact of the election on the U.S. House of Representatives?
.
•Control the House Ways and Means Committee from which all federal taxation and spending authorizations must originate.
•Attempt to influence domestic policy be refusing to fund significant Democrat Party initiatives including part of PPACA.
•Attempt to further forestall the Obama Administration’s policy initiatives through repeated House investigations and hearings.
The Republicans
will:
•Have difficulty moving forward on its domestic policy without control of the House.
•As a group, be more liberal since 34 Blue Dog Moderate Democrats lost their seats in the 2010 election.
The Democrats will:
2010 U.S. Senate Election Results
.
.
The Republican Party picked up six U.S. Senate
seats.
Source: NYTimes.com
2012 U.S. Senate Election Prospects
.
On November 2, 2012:•Will
have to defend 23 Senate seats including the two held by independents who vote with them.
Democrats
•Hold 10 Senate seats up for grabs in two years.
•Must gain 3-4 Senate seats in 2012 in order to gain control of the Senate.
Republicans
•Should Barack Obama win reelection, the GOP will need four Senate seats to break a Senate tie.
•Should the Republicans win the presidency they will need just three party switches from Democrat to Republican to seize the Senate majority.
Next President
Source: RightPundits.com
During the November 2, 2010 election,
Republicans and Democrats vied for seats in 87 state legislative
chambers where 6,115 seats were up for grabs.
State Legislative Elections
Source: AmericanThinker.com
GOP Gains
• Alabama – House and Senate• Colorado – House• Indiana – House• Iowa – House• Maine – House and Senate• Michigan – House• Minnesota – House and Senate• Montana – House• New Hampshire – House and
Senate• North Carolina – House and Senate• Ohio – House• Pennsylvania – House• Wisconsin – Assembly and Senate
Undecided: New York - SenateSource: NCSL.org
State Legislatures Before the Election
Source: NCSL.org
State Legislatures after the Election
Source: NCSL.org
State Echo Effect•State
legislatures will be less likely to support national health care reform
•State legislatures will be less likely to approve comprehensive Exchanges
The immediate impact of these
changes is that, in general:
Source: ABCnews.com
http://www.polidata.org/census/st009nca.pdf
2010 U.S. House of RepresentativesElection Results
The redistricting process may
result in as many as an additional
25 US House seats for the Republicans.
Source: Polidata.org
Long Term effects of new Republican Majorities in State Houses
Redistricting
Republicans took control of at least 19 Democratic-controlled state legislatures, and haven't
controlled as many state legislatures in general since
1928. Currently, legislatures in 44 states are responsible for
redistricting.
Source: ABCnews.com
State Governorships Before the Election
Prior to the November 2, 2010
Gubernatorial elections, there
were 29 Democrat Governors and 21
Republican Governors.
Source: Wikipedia.org
State Governorships After the Election
Source: WashingtonPost.com
State Insurance Commissioners
Appointment/Election Process
• 35 of the 50 State Insurance Commissioners are appointed by their state governors.
• 11 State Insurance Commissioners hold elected positions.• Four of those were standing for election this year.
New Wave of Insurance Commissioners• Due to this election, there will be an unusually large influx of
new Insurance Commissioners (both Republican and Democrats)
Source: InsuranceJournal.com
NAIC Activities Under PPACA
Among other responsibilities, the NAIC has held meetings since March developing the following:
• Uniform Explanation of Coverage • Uniform Enrollment Forms• Uniform Definitions• Uniform Group Summary • A Model Act for State Exchanges• Revised Rate Filing Model Act• Medical Loss Ratio Computations• Model Medical Loss Ratio Definitions • Modifications to the Blank Filing Form
Source: InsuranceJournal.com
The Effect of the Election On The NAIC
The 2010 Election had a profound effect on the NAIC:
As many as 2/3rds of the state insurance commissioners might change.
After the election, half of the NAIC officers either lost their election or may lose their appointment.
Critical States such as Ohio, Pennsylvania, Florida, California, New York, and others will most likely appoint new Insurance
Commissioners.
Source: InsuranceJournal.com
Insurance Commissioner Turnover
The Large Turnover had One Serious Implication for Brokers and General Agents:
The NAIC established a task force to address potential adverse impacts on the role of licensed health insurance agents and
brokers resulting from the new federal health care reform law. "With the recent issuance by HHS of the medical loss ratio (MLR)
regulations to be imposed on insurers, there is a very real possibility the role of health insurance agents will be impacted in
a negative way," said Florida Insurance Commissioner Kevin McCarty. "Health insurance is a complex product and
experienced and licensed agents are a valuable resource for consumers. We intend to work with the agent community and our
colleagues at HHS to maintain that resource."
Source: InsuranceJournal.com
The Legislative bodies, regulatory agencies, and associations listed below are all potential entry points to further define, implement
and launch health care reform initiatives.
Federal statute (i.e., Congress)
Federal regulations (e.g., CMS,
HHS)
State statute State regulation
Agency bulletins
Attorney general opinions
Federal and state court decisions
Official office interpretations
Government as purchaser (e.g., OPM)
Government as grant
funder (e.g., AHRQ)
Government research (e.g.,
NIH)
Government associations (e.g., NAIC, NGA, NCSL)
The Implementation ChallengePPACA is just One Part of the Health Care Reform Puzzle:
Other Sources of Government Oversight
PPA Pressure Points
Establish a level
playing field
Using navigators who can make a
difference
Promoting informed decision-making
Making a realistic financial
commitment
Realizing there are limits to
cost cutting
Establish appropriat
e legal foundation
s
Implement the right
proportions
Ensuring the
availability of clinical resources
Consider other
challenges
How will all of the terms be define,
regulations drafted, and programs implemented?
How will the high risk pools and other benefits
be paid for (since the economy is still
struggling and we are supporting the war)?
How will Federal and State Programs interface?
Will the new federally-sanctioned
reform programs override private
sector initiatives?
Does HHS and the other federal
agencies have enough resources?
How will the market insurance reforms be
implemented in a meaningful way?
Will the reforms really reduce
costs and improve clinical
outcomes?
Hundreds and hundreds of unanswered questions.
Many, Many Questions
Funding electronic health record systems
Promoting evidence-based medicine
Establishing more transparency and accountability through more outcomes research
Requiring more quality improvement and patient safety
Promulgating some of the basic insurance reforms
Expanding prevention programs and wellness programs
PPACA Positives
Source: DHHS.gov
Each State will have the opportunity to establish a Health Care Exchange by January 1, 2014.
If a state declines to create an Exchange, the federal government will operate one within the
state.
An Exchange is envisioned by PPACA to serve as a central marketplace for health care consumers.
Health Care Exchanges
It is supposed to allow small groups and individuals to access the health
insurance on a large group basis.
Individuals or small businesses
will be able to compare the costs of various health
plans and different types of health
coverage benefits.
Small businesses with 100
employees or less can purchase
health coverage for their
employees in an Exchange.
Beginning in 2017, the states may
allow businesses with more than
100 employees to purchase
coverage in the Exchange.
More on Exchanges
PPACA was passed with the recommendation that states contract with “Navigators” to provide
information about the available health plans.
The Navigator Concept?
What will be the impact of the changes in the U.S. House of
this election and the impending 2010 Census-
driven redistricting?
Eric Cantor, the odds on favorite for the post of
Majority whip, has stated that “ he hopes to “put a repeal bill on the floor right away."
Failing that, the Republican Majority may simply choose to refuse to allocate funding
for the implementation of the PPACA…
What is next for Congress?
While the two sides may differ on the exact definition of “tweaking” the following list may meet with some success at being “tweaked” away.• Revocation of the 1099 Filing Provision that obligates the filing of a
1099 for every transaction in excess of $600.• The individual purchase mandate.• The Medicare Fix in which Medicare was used to keep the stated costs
of the Act below One Trillion Dollars over 10 years. This provision has caused significant concern for seniors who see the cut decreasing the numbers of physicians who would accept a Medicare patient.
Short Term Congressional Fixes
• A complete repeal.• An attempt to repeal specific
elements of PPACA .• Attempts to substitute elements of
PPACA with more centrist provisions that can gain moderate democrat votes.
• Cutting off funding for key reform activities such as the Exchanges.
• Holding hearings to spotlight the imperfections of Reform.
Republican Options for Combating Reform
Must continue to demonstrate value in the ever-changing U.S. health care system
• Bring experience to the table.• Stay current and develop new expertise.• Help carriers become more efficient.• Actively participate in the regulatory rulemaking process.• Stay connected with customer base.• Become part of the solution.
Brokers & Agents Make A Difference
Thank You