The document discusses employer forum discussions on healthcare reform in 2009. It covers topics like changing the supply and demand curve for healthcare, the various players involved, why reform is happening now versus the 1990s, potential models for reform, and impacts on employers and employees. It also provides information on controlling costs, current bills being considered, and actions employers can take to manage healthcare costs.

1. Employer’s Forum Discussion on HealthCare Reform - 2009 Changing the Supply and Demand Curve regarding Health Care The Players Why now instead of under Clinton? Which Model will prevail? What will be the impact on Employers and Employees? What can you do now to control costs?

3. Supply and Demand Curve

4. Supply and Demand Curve What happens when you change the demand, hold the cost and no change in Supply?

5. Employer’s Forum Discussion on HealthCare Reform - 2009 Question – How many children in California are un-insured for basic health care?

6. Employer’s Forum Discussion on HealthCare Reform - 2009 Question – How many children in California are un-insured for basic health care? 683,000

7. Employer’s Forum Discussion on HealthCare Reform - 2009

8. Employer’s Forum Discussion on HealthCare Reform - 2009

9. Employer’s Forum Discussion on HealthCare Reform - 2009

10. Paying for Health Care Reform Source Health Care Reserve Fund ($ in billions) 10 years FY 2010 Budget $635 - Medicare and Medicaid Savings $309 - Revenues $ $326 Additional Medicare and Medicaid Savings - $313 - Incorporate productivity adjustments into Medicare payment updates $110 Reduce hospital subsidies for treating the uninsured as coverage increases $106 Pay better prices for Medicare Part D drugs $75 Other $22 Total $948

11. The Players Employers Employees Unemployed Retired Organized Medicine (Docs, Hospitals, HMOs, ancillary Providers, Pharma, etc.) For Profit Insurance Companies & HMO’s States Federal Government

13. Why Now? Between 2002 and 2009, premiums more than doubled, increasing 117.5%, while California's overall inflation rate increased 23.1%. Cost shifting has reached tipping point to trigger federal & state intervention Tipping points are "the levels at which the momentum for change becomes unstoppable." $800,000,000,000 in potential savings???

14. Plan Design Trends 2007 2009 PPO HMO PPO HMO KP Co – Pays $10 $20 $ 20 $20/$30 EOA $15 Inpatient Hosp $250/$750 $250 per day $0 Deductible Avg. $364/842 $250 $ 500 - 1000 250 -1000 $? Out of Pocket Max In-Network $2178 $1973 $2000 $1500/$4500 1500/3000 Out of Network $5187 NA $6000 NA NA Co-Insurance In-Network 80% 100% 80% 100% 100% Out of Network 60 -70% 0% 70% 0% 0%

15. National Rx Benefit Trends 2005 2007 2009 Prescriptions (3 Tier) Generic $ 10 $ 10 $ 10 to $20 Brand $ 23 $ 24 $ 30 (after ded) Non-Formulary $ 40 $ 50 $ 50 (after ded) Data Source – National Survey of Employer Sponsored Health Plans

16. Macro Cost Shifting

17. Macro Cost Shifting Pay Full Retail

18. Macro Cost Shifting Pay Full Retail Best Risks and Underinsured

19. Macro Cost Shifting Pay Full Retail Best Risks and Underinsured Poor Risks, Can’t afford Insurance, etc.

20. Macro Cost Shifting Pay Full Retail Medical paid at $.60 on the dollar Best Risks and Underinsured Poor Risks, Can’t afford Insurance, etc.

21. Why Now? Health Care costs have doubled in last 8 years Cost shifting has reached tipping point to trigger federal & state intervention Tipping points are "the levels at which the momentum for change becomes unstoppable." $800,000,000,000 in potential savings!

22. What Cost Control Options do Employers currently have? Unavoidable Costs Cost Sharing (5% to 10%) Coverage Elections (0% to 15%) Plan Selection (5% to 10%) Provider Selection (5% to 10%) Prescription Therapies (5% to 7.5%) Disease Management (5% to 10%) While no silver bullets will solve the health care crisis, aggressive strategies in two to four areas will have a dramatic impact.

23. Which Model will Prevail? Single Payor System Universal Health Care With Health Care Exchange that includes a Public Plan or Health Care Co-operative At State Level? (A program like the HIPC?) At Federal Level?

24. Current Bills HR 3962 Americas Affordable Health For America Act Proposed Senate Bill “America’s Health Future Act” - HR 3590

25. HR 3962 Americas Affordable Health Choices Act Public Option Pay or Play for employers Guaranteed Coverage (no cherry picking) Minimum benefit level established Federal and State subsidies Probably at 400% of Federal Poverty Level Minimum ER contribution levels set (like SF city regs)

26. HR 3962 Americas Affordable Health Choices Act Immediate Reforms High Risk Pool Ins. Carriers subject to 85% loss ratio max Dependent coverage up to age 27 Limits on Pre-existing conditions exclusions Protection for retiree health Health Insurance Exchange in 2013

27. HR 3962 Americas Affordable Health Choices Act Health Insurance Exchange in 2013 Small employers Groups with 100 employees after three years Individuals Contracts negotiated with Providers Includes Ins. Plans and Public Option

28. HR 3962 Americas Affordable Health Choices Act Health Insurance Exchange in 2013 No Lifetime or annual limits on coverage No exclusions for pre-existing conditions Age rated products allowed, however with Ins. Premium ratio limit of 1 to 2 from youngest to oldest.

29. Affordable Health Care for America (House bill from Pelosi) Health Insurance Exchange in 2013 Minimum standard benefit package for all Preventive care with no cost sharing by member Mental Health benefits Oral health and Vision for children Caps on annual Out of Pocket costs ($5K/$10K) Creates CLASS – Voluntary LTC plan

30. Affordable Health Care for America (House bill from Pelosi) Sliding Scale Affordability Credits Up to 400% of FPL ($43k and $88K) Expands M’Caid (Cal) to 150% FPL Improves M’Care Removes donut hole No cost sharing for preventive services Low income subsidies Improved access to providers

31. HR 3962 Americas Affordable Health Choices Act Individuals not buying med. Insurance will pay penalty of up to 2.5% of annual taxable income Play or Pay for employers based on taxable payroll Incentives for more medical students and ancillary medical personnel

32. Business Case for Investing in HC Reform Expanding Access Lowering Health Care Administrative Costs Through a Public-Private Approach to Health Reform The United States leads all industrialized countries in the share of national health care expenditures devoted to insurance administration. Estimated administrative costs would fall from 12.7 percent of claims to an average of 9.4 percent. Savings—as much as $265 billion over 2010–2020—would be realized through less marketing and underwriting, reduced costs of claims administration, less time spent negotiating provider payment rates, and fewer or standardized commissions to insurance brokers.

33. Payment Reform Health Care Payment Reform That Rewards Value, Not Volume Bundling payments to cover care over a specified period, revising fees to increase compensation for primary care, and offering providers financial incentives to serve as patient-centered medical homes Quality Improvement Health Information Technology Policy Evidence Based Medicine and a Business Case for Health Information Technology Business Case for Investing in HC Reform

34. NOW – Silos of Payment Doctors HMO’s Hospitals Nursing Homes and ECF’s $$$ $$$ $$$ $$$ $$$ $$$ $$$

35. NOW – Silos of Payment Doctors HMO’s Hospitals Nursing Homes and ECF’s $$$ $$$ $$$ $$$ $$$ $$$ $$$

36. FUTURE? Bundled payment Doctors HMO’s Hospitals Nursing Homes and ECF’s $$$

38. Proposed Senate Bill America’s Health Future Act – HR 3590 $849 billion in cost (over 10 years) $127 Billion decrease in National Debt over next 10 years and $600 billion in following decade

39. Proposed Senate Bill America’s Health Future Act – HR 3590 Mandates that everyone buy HC Insurance (like auto in CA) with financial penalty for failure to do so Insurance Exchanges established to provide selected individuals and families with subsidies (100 to 400% of FPL) Start up funds to create CO-Ops Significantly expand M’Caid eligibility (up to 133% of FPL) Expands state liabilities by $33B Reduce growth of M’Care reimbursement to providers and eliminate subsidies for Medicare Advantage HMO plans

40. Proposed Senate Bill “America’s Health Future Act” – HR 3590 Impose exise tax on Ins “Cadillac” Plans with high premiums 40% on excess of $8000 (single) and $21000 (family) per year Tax credits for small employers to cover employees Other changes to M’Care, M’Caid and the tax code Affects employers with 50+ employees. Penalty for not providing insurance coverage ($750) Penalty if employees have to pay more than 10% of their salary for insurance Increase in M’Care payroll tax (=.5%) to 1.95%

41. What can you do today to manage health care costs? Ideas on how to lower HC Costs

42. Improving employees Lives Improving Work/Life Cycle Being a catalyst for Wellness Employee/dependents Health Care education Seeking Synergy in Managing Employee Benefits!!!

43. Employee Benefits Cost Control Plan Design Utilization Management Risk Management Data Reports Seeking Synergy in Managing Employee Benefits!!!

44. Employers “In Control” Improving Work/Life Cycle Plan Design Being a catalyst for Wellness Utilization Management Employee/dependents Health Care education Risk Management Data Reports Seeking Synergy in Managing Employee Benefits!!!

46. Information and Data Sources

47. Health Care Reform Web Sites commonwealthfund.org / healthreform.gov / mailmanschool.org/facultypubs/womenshealthcarereform.pdf whitehouse.gov/assets/documents/CEA_Health_Care_Report.pdf reuters.com/article/healthNews/idUSTRE56K01720090721 hudson.org/files/documents/20090612_JB_Kuttner_longterm_fiscal_impact_health_reform.pdf

48. http:// randcompare.org / http:// randcompare.org /current/ http:// randcompare.org /options/ http:// randcompare.org/options/mechanism/refundable_tax_credit http:// randcompare.org/options/mechanism/purchasing_pools Massachusetts “Health Care Connector” http:// randcompare.org/options/mechanism/employer_mandate Pay or Play explained Mandates (Cal, Or, WA passed and subs repealed) Hawaii 1974 Mass 2006 Health Care Reform Web Sites

49. Health Care Web Sites

50. Medical Info/Research www.medem.com - modern medical library www.ncqa.com - Nat'l Committee on Qual. Assurance www.doctorsolve.com / - Info on drugs in Canada www.coverfingtheuninsured.org www.insureusa.org http://www.prevent.org/ - information on disease prevention and health promotion policies and practices www.cmwf.org/index.htm - Commonwealth Fund

51. Employee Empowerment & Health Wellness www.4women.gov - Nat'l Women’s Health site www.ivanhoe.com - Medical Breakthroughs http:// vm.cfsan.fda.gov - US FDA Food Safety Ctr. www.healthyroads.com – ASHP wellness product www.new.chcf.org - Cal Health Care Fndn www.mrmib.ca.gov – MRMIB http:// www.opa.ca.gov/report_card / . - Cal Office of Patient Advocate www.healthcarecoach.com/ www.mayoclinic.com http:// www.doclopedia.com - Use doclopedia to put your medical history, prescriptions, and bills in one convenient space for FREE

52. Employee Empowerment & Health Wellness http://www.hhs.gov/transparency/ - The “Four” Value Driven Health Care Principles. Health care transparency provides consumers with the information necessary, and the incentive, to choose health care providers based on value. www.netwellness.org – 100 health topics to find in-depth information on hundreds of diseases and wellness issues http://www.insureuonline.org/ - The National Association of Insurance Commissioners (NAIC) has created the Insure U — Get Smart About Insurance program to help consumers make educated decisions. www.organizedwisdom.com - OrganizedWisdom is a collaborative health information community, combining professional and user-generated health content with social networking technologies to help people make the most informed health decisions possible .

53. Provider/Health Plan Report Cards www.healthscope.org www.lumetra.org - dedicated to measurably improving the quality, safety, and integrity of healthcare. www.aahp.org - Amer Assn of Health Plans www.chcf.org – California Health Care Foundation www.healthcarecoverageguide.org – Cal Health Care Foundation web site www.guiadecoberturadesalud.org – CHCF hispanic site for small employers www. benefitscheckup.org/

54. Government Web Sites www.cdc.gov - Center for Disease Control www.medlineplus.gov www.medicare.gov / - info on Part D drug plans www.leginfo.ca.go - Cal ins code www.dmhc.ca.gov - Dept Managed Health Care www.mrmib.org – High Risk Ins pools

55. Insurance / Employer Purchasing www.pbgh.org - Pacific Business Group on Health www.calchoice.com – Small employer purchasing pool www.ibenefits.com www.bizjournals.com www.definedcare.com - Defined Care Website www.egroupbenefits.com http://www.healthsmart.org/ - Practical health care information brought to you as a service from the National Business Coalition on Health . http://www.nbch.org/members/members.cfm - List of Business Coalitions by state

56. Info for HR Specialists www.smartbrief.com - AAHP Smartbrief www.benefitsalert.com - ER benefits legal news www.mcol.com [email_address] - Email newsletter http:// www.lifemasters.com / - An internet site to help employers access disease management information www.ncqucalculator.com www.healthleaders.com - stock site www.allbusiness.com - small bus resources