Health Care Reform: A Review


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An overview of the affordability provisions in reform: what they are, how the bills incorporate them.

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  • All of these provisions TOGETHER expand coverage for Americans – *these are the general ideas of provisions in all the bills (the public option being contentious, of course)*none of these are the SAME in any of the bills – different types of exchanges, different levels of subsidies, public option vs co-op, different medicaid expansions, and different mandate expectations, etc.*each of the bills has different levels of subsidies, different levels of medicaid expansion, etc. Even after the bills are marked-up in committee, these things will still be changed again and again as they are combined and brought to votes. These provisions are all under consideration one way or another, but how they will end up looking in the final bill is yet to be determined.
  • The Exchange is essentially a “marketplace” for Americans to see all the merits, costs, and coverage of all the plans available that meet the minimum coverage requirements – it’s a safeguard for consumers as they know what they’re getting meets the minimum quality and cost requirements and allows them to make an informed decision.The public option is ONLY available via the exchange. National exchanges are more portable, across state lines, so ppl don’t have to lose or change their coverage when they move or change jobs. They overall provide more access. State-based exchanges are not portable and because they have a smaller population as part of them, have a smaller risk-pool and buying power.
  • Right now, insurance companies have state-based regulations that they can get around easily by simply moving states to where it is more favorable for business. In 8 states around the country, it is legal to deny coverage based on domestic abuse as a “pre-existing condition.”Reforms would prevent insurers from denying coverage based on any pre-existing conditions, from dropping coverage because a patient becomes sick, from capping the amount of benefits they’d pay out, or for charging higher premiums based on race, socioeconomic status, or gender. They would limit changes in premiums based on age or tobacco use. Reforms would also cap the amount of medical costs a person has to pay out-of-pocket (including premiums and co-pays, etc.)Lastly, reforms would change the way we see medical loss ratios. Right now, any money an insurer pays out to a patient for a claim is considered a “medical loss” – the higher the medical loss ratio, the worse an insurer is seen as far as profits. To maximize profits for investors, insurers do what they can to keep their medical loss ratio low – in other words, to keep the amount of money paid out for medical reasons low. The more claims are denied, the better the company is doing, according to this theory. New reforms would force companies to make this information public and in some cases, to keep their medical loss ratio at a certain level so it never falls too low – so they never deny too many claims.
  • Subisides are mainly helpful for those Americans that are at too-high an income level for Medicaid, but too low to be able to get affordable coverage on their own. Depending on your income level, there are different amounts of subsidies in each of the bills. These subsidies are essentially monies from the federal government to help you buy insurance through the exchange – whether public or private.
  • Choice: right now, 85% of companies (employers) offer their employees only one health plan typeLess than half of small businesses can afford to offer insurance, most ppl in individual market cannot find affordable coverage (89% in 2005)The public option is a government financed insurance coverage option in two of the three bills (HELP and HR 3200). It is not in the Senate Finance bill. The public option currently proposed is available ONLY through the exchange, so who’s allowed in the exchange determines who can get the public option – and it’s not everyone.The controversy is:ideological – should the federal government be this involved in healthcare?A question of fairness – would the public option have inherent advantages over private insurance companies because it is a part of the government? Would it be the end of the private insurance market?Of quality – would this be quality coverage for the American people?What would it really do? The goal is that the public option would be the affordable, not-for-profit, public good coverage that would provide a choice for the American people and not feed them directlyIt also has the ability to drive innovation, quality, and patient safety via reimbursement and coverage
  • Expansion of medicaid to above 100% of the federal poverty level. The exact level of expansion is different in each of the bills and is still being debated.
  • Individual mandate – all Americans are required to have coverage or face a penalty – EXCEPT if there is no affordable coverage available. (exact definition of affordability is different in each of the bills, defined as a percentage of your income going to premiums)Employer mandate – different requirements in each bill, but essentially employers must contribute to the costs of coverage for their employees (except small businesses – and yes, there is a different definition of a small business in each bill – which are exempt and have different requirements in each bill. There are special provisions to protect small businesses that cannot afford coverage)
  • House Tricommittee bill already released and marked up in each of three committees, but not yet conferenced together. They’re working on it.Senate HELP  bill released, marked-up, and final version releasedSenate Finance  Chairman’s Mark (Baucus) released, currently in Mark-Up (watch it on CSPAN!)After the Tri-Committee bill is conferenced together, it will go to a floor vote for the House.After the Senate Finance committee is marked up, the Senate Finance & HELP bills will be conferenced together. The bill that comes out of that will go to a Senate floor vote.After the House and Senate each have a bill come out of a floor vote, THOSE two bills will be conferencd together and sent AGAIN to the floor of each chamber to be voted on. When both of those are approved, the bill will be taken to the President’s desk to be signed.
  • This section goes through the major healthcare financing provisions of each of the bills.
  • -There will be one national exchange in this bill, which will include a public option. To be part of this exchange, you must be uninsured without employer coverage. Employers will slowly be allowed to enter the exchange, based on size, year after year. It is a phase-in process, not an all-of-a-sudden-everyone’s-in process. AMSA does not like the limitation of who can be in the exchange, and believes everyone should be allowed in – if they don’t like the coverage they have now, they should be allowed out of it.-Subsidies will be given to families up to 400% of the federal poverty line, which AMSA and many other orgs support. This ensures that middle class families that currently struggle to pay for coverage will be able to comfortably afford health care coverage while still affording the other necessities of life.-- There is an individual mandate. Employers are required to either provide private insurance to their employees as they currently do, or, they can choose to opt out of that and have their employees participate in the public plan – but then must pay for each employee that is in the public plan.--Medicaid will be expanded to Americans up to 133% of the FPL-- This bill actually limits medical loss ratio so that insurers cannot have too low of medical losses – they MUST spend a certain amount of their income on medical benefits, essentially.**as for primary care and workforce issues:This bill establishes as “public health investment fund” which essentially gaurantees funding for great, proven primary care and public health programs in Title VII of the Public Health Services Act and the National Health Service Corps.
  • This bill was put together by three committees: Ways & Means, Education & Labor, Energy & Commerce. It was put out as one bill originally, but then was taken and edited by each committee separately…so there are now technically three different versions. It is now being put together.Ammendments to note:The Kucinich amendment is a “single-payer” amendment – it essentially gives states t he ability to make the first step towards opting out of this reform system if it’s not working for the state, and establishing something for themselves.Exchange expansion amendment – an amendment was made to expand the exchange to include larger employers and allow all employers into the exchange one year earlier than the original bill. Still not “open to all on day one” but better.Conservative Compromise: an amendment in another committee was made that would actually be regressive relative to AMSA’s needs in reform. It makes the exchange closed to more people, and reduces the subsidies available for families – making the bill cheaper, but shifting cost onto hardworking Americans.
  • HELP (Senate)Exchanges are statebased, actually called “gateways”There is a public optionSubsidies are available but not to the point of the House billThere is an individual mandate and employer mandateThere is a medicaid expansion to up to 150% of the federal poverty levelThere is a very high level of National Health Service Corps Funding (NHSC)
  • Exchanges are state-basedThere is NO public option, but co-ops: which are NOT a public option, but essentially supposed to be consumer-driven, not-for-profit insurance entities. We’ve tried non-profit before, they went for-profit (Blue Cross Blue Shield)There are subsidies but they are far lower than the other two bills.There is an individual and employer mandate, but not to the same strength as the other two bills. Also, we worry about the ethics of forcing Americans to buy insurance from essentially the private insurance industry.Medicaid and S-CHIP would be expanded.This bill is the “cheapest” of all the bills (on the federal government, not the American people) and the most conservative.
  • AMSA supports first and foremost, a single payer system of HCFA. Second to that, at a minimum, we support a robust public health insurance option as a part of reform, and in addition to other important reform provisions such as:Addressing of health disparities (racial & ethnic) in a way that assures that health care is equitably distributed regardless of socioeconomic statusAddressing the disparities that women face in obtaining coverage for comprehensive preventative & reproductive servicesAddressing disparities and inequities in healthcare for the LGBT populationIncreasing support and infrastructure for a robust physician workforce, especially within primary care and rural areas. To do this, we encourage strong support for programs like the National Health Service Corps (also addressing student debt)Assuring that policies regarding medications are written to allow medications to get to those who need them in an affordable manner
  • Health Care Reform: A Review

    1. 1. health care reform.<br />the provisions, the bills, and the people behind it<br />
    2. 2. reform provisions.<br />
    3. 3. Health Care Financing Provisions<br />Exchange<br />Insurance Market Reforms<br />Subsidies<br />The Public Option<br />Medicaid/CHIP Expansion<br />Individual Mandate<br />Employer Mandate<br />
    4. 4. exchanges.<br />What are they?<br />Why were they thought up?<br />National or State-based?<br />
    5. 5. insurance market reforms. <br />1) Exchanges – the way you get insurance<br />2) Regulation<br />Gaurantee issue<br />Community Rating<br />Increase dependent age<br />3) Caps<br />4) Medical Loss Ratios<br />
    6. 6. subsidies.<br />Refund!<br />
    7. 7. the public option<br />What is “the public option”?<br />What is the controversy around the public option?<br />What would it really do?<br />
    8. 8. THE COMMONWEALTH<br /> FUND<br />Exhibit 15. Average Annual Savings per FamilyUnder Three Reform Scenarios, 2020<br />Data: Estimates by the Lewin Group for The Commonwealth Fund.<br />
    9. 9. THE COMMONWEALTH<br /> FUND<br />Exhibit 12. Source of Improved or More Affordable CoverageUnder Three Reform Scenarios, 2014<br />Public Plan at<br />Intermediate Rates<br />Public Plan at<br />Medicare Rates<br />Private Plans<br />Medicare<br />2 m<br />1%<br />Employer<br />Direct <br />9 m<br />5%<br />Medicare<br />2 m<br />1%<br />Medicare<br />2 m<br />1%<br />Individual<br />Exchange<br />18 m<br />10%<br />Medicaid<br />16 m<br />8%<br />Employer<br />Direct <br />16 m<br />10%<br />Medicaid<br />16 m<br />10%<br />Medicaid<br />16 m<br />12%<br />Individual<br />Exchange<br />18 m<br />12%<br />Employer<br />Direct <br />21 m<br />16%<br />Individual<br />Exchange<br />19 m<br />14%<br />Employer<br />Exchange<br />72 m<br />57%<br />Employer<br />Exchange<br />102 m<br />66%<br />Employer<br />Exchange<br />141 m<br />76%<br />Data: Estimates by The Lewin Group for The Commonwealth Fund.<br />
    10. 10. Medicaid<br />Medicaid expansion for Americans that do not have another affordable option<br />
    11. 11. mandates.<br />Why a mandate?<br />What’s the good?<br />And of course, what’s the bad?<br />
    12. 12. steps to actionreview<br />
    13. 13.
    14. 14. the bills.<br />
    15. 15. hr 3200<br />Covers 97% of Americans by 2019<br />National Exchanges, Public Option<br />Subsidies<br />Individual Mandate & “Pay or play”<br />Medicaid<br />Regulations: limits MLR<br />
    16. 16. …three is better than one<br />Kucinich amendment (accepted)<br />Exchange expansion amendment<br />Conservative compromise<br />
    17. 17. health, education, labor and pensions. <br />State-based exchanges<br />Public Option<br />Subsidies<br />Individual Mandate<br />Employer Mandate<br />Medicaid Expansion<br />NHSC funding<br />
    18. 18. FINANCE<br />State exchanges<br />Co-Ops<br />Subsidies<br />Individual Mandate <br />Employer penalties<br />Expand Medicaid & S-CHIP<br />
    19. 19. Medical Students & Reform <br />Where does AMSA stand?<br />Health Care system funding<br />Health Disparities<br />Primary Care<br />Access to Medications<br />
    20. 20. Resources<br /><br />ReformsKOOL<br />AMSA’s Health Policy listserv:<br />STAT: STudent Action Team:<br />National Grand Rounds<br /><br />