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New Update on National Health Reform:  A Moving Target
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New Update on National Health Reform: A Moving Target

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Presentation by Lynn Blewett to Mount Zion Temple and Jewish Community Action members in St. Paul, MN, October 11 2009.

Presentation by Lynn Blewett to Mount Zion Temple and Jewish Community Action members in St. Paul, MN, October 11 2009.

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  • House leaders are considering limiting the surtax to singles who earn more than $500,000 and families who earn more than $1 million.Original cost of HELP bill was $615 billion.
  • House leaders are considering limiting the surtax to singles who earn more than $500,000 and families who earn more than $1 million.

New Update on National Health Reform: A Moving Target Presentation Transcript

  • 1. New Update on National Health Reform: A Moving Target
    Lynn A. Blewett, Ph.D.
    State Health Access Data Assistance Center
    University of Minnesota, Minneapolis, MN
    October 11, 2009
    Funded by a grant from the Robert Wood Johnson Foundation
  • 2. 2
    Outline of Presentation
    Drivers of Reform
    Overview of Key Proposals
    Broad Implications
    Legislative Process
    What’s Next?
  • 3. Why Is Health Care Reform Needed?
    3
    Cost
    Access
    Quality
    Could be better!
  • 4. $2.5 trillion in 2009
    $8,160
    2009
  • 5. Increase in number of uninsured
    New verification
    question
    15.4%
    of Population
    Millions of Uninsured, all ages
    5
    Source: U.S. Census Bureau, Current Population Surveys (March), 1989-2008
  • 6. Drop in Employer-Sponsored Coverage
    6
    Source: US. Census Bureau, Income, Poverty, and Health Insurance Coverage in the United States: 2008.
  • 7. Quality
    Patients receive the proper diagnosis and treatment only about 55% of the time*
    WHO ranking of 37 behind Costa Rica, and close to Cuba at 39
    Infant mortality rates that are higher than most European countries and three times the rate of countries such as Japan;
    One of the lowest utilization rates of preventive healthcare services in the world
    7
    *McGlynn EA, et al NEngl J Med. 2003.
  • 8. Legislative Proposals
  • 9. Key Legislative Proposals
    1. Kennedy’s Senate “Affordable Health Choices Act”
    • Senator Edward Kennedy (D-MA), Chair, Senate Health, Education, Labor and Pensions (HELP) Committee
    2. Baucus’s Senate “America’s Healthy Future Act”
    • Senator Max Baucus (D-MT), Chair, Senate Finance
    • 10. No Republican support
    3. House Tri-Committee Bill: “America’s Affordable Health Choices Act” (H.R. 3200)
    • Three Committees: Energy and Commerce, Ways and Means, Education and Labor
    • 11. Sponsor: Representative John Dingell (D-MI)
    9
  • 12. Provisions At a Glance
    10
    Co-ops
  • 13. Public Plan Option
    Meets minimum essential creditable coverage
    Paid for with plan premiums
    Quasi-public administration
    No profit, advertising and minimal administrative costs (minimal loading fees)
    Offered along side other private plans through the exchange
    11
    Access
    Senate Finance Rejected
    9-29-09
  • 14. Access
    Health Insurance Exchange
    State-based agency that assesses and approves “cretible coverage”
    Meets some basic pre-set standards
    Organize and displays health insurance options in consumer friendly way
    Easy to shop and compare
    Facilitate the premium subsidies for low-income families not eligible for Medicaid
    Primarily for Individuals and small employers
    12
  • 15. Premium Subsidies
    Access
    Refundable tax credits to low-income families not eligible for Medicaid
    Administered through the Exchange
    Incomes between 133% - 300% of poverty
    Apx. $29,000 - $66,000 for family of four
    To reduce cost of health insurance coverage for individuals and families
    Tied to essential creditable coverage
    13
  • 16. 14
    Premium Subsidies and Medicaid Expansions (Family of Four FPL = $22,050 in 2009)
    ReformProposal
    $88,200
    Family Income
  • 17. Employer-Mandate
    Access
    Employers either provide health insurance coverage or pay a penalty to fund access
    Employers must pay 60-65% of family premiums or
    Penalty of $750 for each employee who is not offered coverage (HELP) or based on percent of payroll (House)
    Small business exemption
    Tax credits for small business
    15
  • 18. Baucus Free-Rider Tax
    • “Free-rider” provision
    -charges employers who do not offer coverage a fee for each employee receiving a tax credit through the exchange
    • Small businesses (≤ 50employees) exempt
    • 19. Tax credits for certain small employers
    - Less than 25 employees
    -Average annual wage < $40K
    16
    Access
  • 20. Insurance Reform
    Restrictions on Premium Rating
    cannot be rated on health status (Baucus)
    Plus gender, class of business (House)
    Plus claims experience (HELP)
    Tightening of rate bands (Baucus)
    -Rate can vary by age (4:1 max. ratio),
    -tobacco use (1.5:1 max. ratio), area, and
    -family composition
    17
    Access
  • 21. Overview of Impact of Three Main Proposals
  • 22. Key Legislative Proposals: CBO Cost Estimates-Over 10 years
    Baucus/Finance
    Kennedy/HELP
    HouseTri-Committee
    $856 Billion
    Net $49 Billion deficit reduction
    $1.34 Trillion
    Net $1.04 Trillion deficit increase
    19
    $1.042 Trillion
    Net $239 Billion deficit increase
  • 23. 20
  • 24. 21
    Source: Center on Budget and Policy Priorities, February 2009
  • 25. Key Baucus Finance Provisions
    Excise tax on high-premium health coverage in
    Fees on manufacturers and importers of drugs and devices
    Adjustments to Medicare Advantage payments
    Reduction in Medicare payments to NHs
    Reducing Medicare and Medicaid payments to hospitals that serve a large number of low-income patients - Disproportionate Share
    22
  • 26. Key Legislative Proposals: Number of Uninsured in 2019
    Baucus/Finance
    Kennedy/HELP
    HouseTri-Committee
    Uninsured reduced to 25 million
    Uninsured reduced to 36 million
    23
    • Uninsured reduced to
    17 million
    Currently there are 46 million uninsured with projections to reach
    53 million by 2019 if no plan is enacted.
  • 27. Legislative Process
  • 28.
  • 29. What Next?
    Big hurdles
    Public Plan
    Financing
    Politics!
    Possibility –a high-level framework for reform with phased in time frame to allow for recovery of economy, development of the details, including payment reform for later…
    States continue strategies for access and coverage without more detail and assurance of national reform
  • 30. 27
    Outlook for Reform…
  • 31. 28
    Contact Information
    Lynn A. Blewett, Ph.D.
    State Health Access Data Assistance Center
    University of Minnesota, Minneapolis, MN
    www.shadac.org
    blewe001@umn.edu
    612-624-4802