De Pere Area Chamber Affordable Care Act Presentation, Daren Allen, Common Ground Healthcare Cooperative

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Presentation on the Affordable Care Act given by Daren Allen, Vice President of Sales & Business Development for the Common Ground Healthcare Cooperative to De Pere Area Chamber of Commerce on …

Presentation on the Affordable Care Act given by Daren Allen, Vice President of Sales & Business Development for the Common Ground Healthcare Cooperative to De Pere Area Chamber of Commerce on 9/11/13.

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  • It is important to remember why we have reform in the first place… What were the average rate increases prior to reform? What did you get for the increases?It was just too expensive and it was only getting worse. It is Math not Politics
  • Let’s talk about how dynamic the health care market is becoming as a result of the Patient Protection and Affordable Care Act, which I’ll call “ACA” or the health reform law.These are obviously National numbers, but are significant nonetheless.Approximately 30 million individuals will be newly insured. 80 million are likely to switch their coverage. More than 20 million are anticipated to purchase their health insurance through an Exchange. And more than 15 million are expected to be affected by Medicare increases (Wisconsin declined Federal Funding to increase Medicaid to 150% FPL). Many of these individuals may have lower income and may be more diverse, in poorer health and less sophisticated and educated.Many folks will be coming off of Small Business plans as Small Employers make financial decisions to eliminate coverage and move people to Individual plans.
  • The biggest question is “how will premiums adjust”?The truth is that premiums will adjust to account for the significant changes being made to the system – Guarantee Issue, The creation of the Exchange, changes in rate formulas, expanded benefits, increases in fees. Numbers are all over the place…40% increase in Group, 80-100% increase in Individual. We will not know where the market is until JulyThe premiums should stabilize as the system matures and consumers take a more active role in their health.So let’s look at the primary components…
  • Expanded Benefits – Self Explanatory – Every plan on the exchange has to have these benefitsOut of Pocket MaximumsMaximums– On average Deductibles will be around $2,000/$4,000 (Silver Level). However, it can be higher on Bronze. All plans cannot exceed $6,400 (single) for a Maximum Out Of PocketMetal Plans and AV - On the Exchanges, there are going to be at least four tiers of benefits, the so-called “precious metal” plans, defined as plans with 60%-70%-80%-90% actuarial values for Bronze-Silver-Gold-Platinum plans. Applying the definition of “actuarial value” literally, this means that one would expect Bronze plans to cover 60% of the medical expenses for those on that plan. What about these metallic plans and “AV”
  • The purpose is to do all of these things……it creates a new playing field for the consumer where…Is it easy to find? No, it will be confusing because…..
  • It is important to remember the purpose o the new marketplace….
  • SO why us?
  • It is important to remember the purpose o the new marketplace….


  • 1. Common Ground Healthcare Cooperative Daren R. Allen Vice President, Business Development
  • 2. Math not Politics
  • 3. Health Care Reform Overview
  • 4. Major Changes to Health Plans Premium Rate Calculations Expanded Benefits Insurer Fees No Underwriting New Rate Formulas Premium Cost Sharing Limits (Community Rate) Adjustments Actuarial Values Probationary Periods Marketplace Guarantee Issue
  • 5. Expanded Benefits • Ambulatory Patient Services • Emergency Services • Hospitalization • Laboratory Services • Maternity and Newborn Care • Mental Health and Substance Abuse Services • Prescription Drugs • Rehabilitative Services • Preventive and Wellness • Pediatric Services including dental and vision care Essential Health Benefits Out of Pocket Maximums $2,000 single / $4,000 Family Deductible $6,350 Out of Pocket Max Metallic Coverage Levels Platinum, Gold, Silver, Bronze
  • 6. Community Rating • In 2014, Insurers shift to a community rating structure • Insurers will only be allowed to set premiums based on four factors: • • • • Coverage category (Individual vs. Family) Geographic Rating Area (Set by State) Age Tobacco use
  • 7. Health Insurance Marketplace (Exchange)– What is it? Insurance Companies need to manage care – price driven marketplace New ways for employers to fund premiums for employees Health Insurance Plans Defined Contribution In every market, competition reduces cost – e.g. Cooperatives Competition Reduce Cost Trends Remove Volatility Ensure Sustainability Choice and Flexibility Freedom to move across insurers will keep costs low and service levels high Best-in-market Efficiencies Consumerism Consumers will make economic choices if they reap the full economic benefit – not only price! Regional rate bands allows market specific insurer /provider strengths to emerge
  • 8. Consumerism
  • 9. Why Common Ground or any Cooperatives • • • • • • • We are a Cooperative - Member Governed We are a NonProfit Organization We are Locally Managed and Operated We Specialize in serving the Individual and Small Group Market We promote patient-centered care, and put our member’s health first We will offer Choices in plans at Competitive Prices We are committed to Transparency to both members and providers with the goal of improved health
  • 10. Why Common Ground or any Cooperatives • Eight Individual Plans • Six Small Group Plans • Large Group Plans • PPO – Two network options • • Aurora – Envision Plans (Integrated Network) Trilogy – Empower Plans (Broad Network)
  • 11. VOICE
  • 12. Overview of Projected Impacts to Medicaid/BadgerCare Plus BadgerCare Plus Enrollment Impacts • An estimated 87,000 parent and caretaker relatives and 5,000 childless adults will transition to coverage in the new federal marketplace • An estimated 84,000 childless adults and 9,000 parent and caretaker relatives that are currently uninsured will be enrolled in BadgerCare Plus • Overall BadgerCare Plus enrollment is projected to stay between 770,000 to 800,000 over the next biennium • DHS assumed that the uninsured rate for non-elderly (nonpregnant) adults would be reduced by 50%- from 14% to 7%. The following take-up rates were used in our modeling: -Parents/Caretakers - 25% -Childless Adults (new adult group)- 65%
  • 13. Income Categories – Federal Poverty Level 2013 Group Size 100% FPL 133% FPL 200% FPL 300% FPL 400% FPL 1 $11490 $15282 $22980 $34470 $45960 2 $15510 $20628 $31020 $46530 $62040 3 $19530 $25975 $39060 $58590 $78120 4 $23550 $31322 $47100 $70650 $94200 5 $27570 $36668 $55140 $82710 $110280 6 $31590 $42015 $63180 $94770 $126630
  • 14. Help Paying the Cost The maximum an individual will pay for their premium is a percentage of their income based on cost of the Silver Plan: Up to 133% FPL 2% of income 133 - 150% FPL 3 - 4% of income 150 - 200% FPL 4 - 6.3% of income 200 - 250% FPL 6.3 - 8.05% of income 250 - 300% FPL 8.05 - 9.5% of income 350 - 400% FPL 9.5% of income Calculator:
  • 15. Questions