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States Resisting Health Insurance Overhaul

Wednesday, April 20th, 2011

ARIZONA:

A bill that would require Arizona health insurance carriers to provide written claim reports to plan sponsors up to twice a year, upon request, has been favorably amended in the House to make compliance less onerous. Modeled after a Texas law enacted in 2007, the bill originally required the reports to be provided within 30 days of a request. The type of information that can be requested includes aggregate claims and premium by month, the number of employees covered and pending claims.

Republican-sponsored legislation that would permit cross-border sales of individual health insurance remains in play despite strong opposition by the business community and consumer advocates. The bill would require that out-of-state insurers be subject to the jurisdiction of another state’s department of insurance; maintain reserves not less than the amount required in Arizona; register with the Arizona Department of Insurance (DOI); and that the coverage offered meet, at a minimum, the benefit requirements of the state where the company holds a certificate. The DOI would have authority to revoke the foreign insurer’s registration for reasons that include: inadequate reserves; failure to comply with the unfair practices and fraud statute; and violation of the prompt-pay law. The bill was amended in the House and now goes back to the Senate.

COLORADO:

As the deadline for filing legislation approaches, the Division of Colorado health Insurance released drafts of two bills aimed at bringing the state’s preventive coverage and adverse determination appeal requirements into conformity with the federal health reform law. Health insurers will have a small window of opportunity to provide comments before the bills are formally introduced. Also, a bill was filed to reclassify any product containing pseudoephedrine or ephedrine as a prescription drug to help prevent access to the drug by people illegally manufacturing methamphetamines. The bill has raised strong concerns because it would require a prescription for frequently used allergy medicines and drastically increase medical costs. The sponsor has introduced a joint memorial to Congress requesting the federal government address the issue.

CONNECTICUT:

The fiscal note for the Connecticut health insurance Healthcare Partnership bill, which would allow voluntary municipal and small employer pooling with the state employees’ health plan, has been released and indicates the legislation would be costly to the State. Known costs (those concerning the administration of the program) would be hundreds of thousands of dollars. Other costs that could not be precisely determined include those associated with the public option (similar to the SustiNet legislation but on a much smaller scale) and lost tax revenue from the premium tax.

In other action, the Judiciary Committee passed the Cooperative Health Care Agreements bill out of committee. The legislation would permit health care providers to enter into cooperative arrangements that would not be subject to certain antitrust laws, after approval by the Attorney General. In past years, health insurance plans have successfully argued against action on the bill despite support from the committee’s membership, including both Democrats and Republicans. However, this year the new Chairs have brought the bill forward for a vote. It will now go to the House floor where it will assessed for a fiscal note. The bill still has a long road to travel, including through the Insurance Committee.

FLORIDA and GEORGIA:

The Florida Office of Insurance Regulation and Georgia Department of Insurance have both asked health plans for additional information to help support their requests to HHS for a waiver from MLR regulations under ACA. The requests were prompted by an initial response from HHS asking for the additional information.

GEORGIA:

A bill that includes a prompt-pay provision that would
require third-party administrators to pay for service claims in the same timely fashion as primary insurers, or face penalties, has been passed by both chambers. The bill is opposed by the Georgia Chamber of Commerce, as it would erode current employer protections under the federal Employee Retirement Security Income Act (ERISA). The Georgia Chamber will ask Governor Deal to veto this legislation.

MARYLAND:

Governor Martin O’Malley signed several bills into law last week that will impact Aetna insurance and its customers. The Health Benefit Exchange Act of 2011 establishes the Maryland Health Benefit Exchange as a public corporation and an independent unit of state government. The law sets the purposes, powers and duties of the insurance exchange, establishing the Board of Trustees and providing for the qualifications, appointments, terms, and removal of members of the Board. It requires the board to appoint an executive director of the Maryland health insurance exchange, with the approval of the Governor, and determine the executive director’s compensation. The effective date is June 1, 2011. Another law alters the circumstances under which a person has the right to a hearing and to an appeal from an action of the Maryland Insurance Commissioner. The law provides that provisions of federal law apply to specified health insurance coverage issued or delivered by insurers, non-profit health service plans, and HMOs; authorizing the Commissioner to enforce specified provisions of law. The effective date is July 1, 2011.

MICHIGAN:

Newly elected Governor Rick Snyder continues to push for a 1 percent tax on all Michigan health insurance claims, which would require insurers and third-party administrators to pay $400 million in order to generate $1.2 billion in revenue for Medicaid. The tax would replace the existing 6 percent tax on all products among the 14 Medicaid HMOs. The $400 million tax would trigger $800 million in matching funds from the federal government, thereby generating $1.2 billion in total. Should the tax be passed, the Governor promised no cuts to Medicaid reimbursement rates, services or eligibility. The claims tax is the same type being phased out in Maine that was used to fund the Dirigo Health Plan.

MISSOURI:

The attorney general, a Democrat, broke with his party last week and urged a federal judge to invalidate the central provision of the new Missouri health insurance law. The filing of the brief by Attorney General Chris Koster, a onetime Republican state legislator who switched parties in 2007, underscores ACA’s political tenuousness in a critical Midwestern swing state. Koster’s action followed months of pressure from state Republicans that he join attorneys general from other states who are challenging the constitutionality of the law. Instead, Mr. Koster chose to file a “friend of the court” brief in the U.S. Court of Appeals for the 11th Circuit. In Missouri, a ballot referendum aimed at nullifying the law was approved by nearly three to one last year, and the legislature recently passed resolutions urging Koster to join the legal challenges. In a letter to the Republican leaders of the legislature announcing his decision to oppose the law, Koster acknowledged that the legislative resolutions, though nonbinding, were impactful as they give voice to the political will of state residents. His central argument echoed those made by plaintiffs in a number of the lawsuits.

NORTH CAROLINA:

Legislation was introduced last week prohibiting most favored nation clauses in North Carolina health insurance contracts. The Insurance Committee in the House has already held one hearing on the bill.

OKLAHOMA:

Governor Mary Fallin last week joined other state leaders in announcing that Oklahoma will establish an Oklahoma Health Insurance Private Enterprise Network to prevent the establishment of a federal health care exchange in Oklahoma. To address concerns expressed by some, state leaders added specific safeguards into legislation to prevent the implementation of a federal health care exchange, while creating an Oklahoma-based health insurance network.  The Health Insurance Private Enterprise Network, based on a concept by the conservative Heritage Foundation and legislation passed by the legislature in 2009, would increase access to portable, private, affordable health insurance plans through a market-based network featuring competition and offering choice to consumers. The network would be governed by a board made up mostly of private sector members and chaired by the Insurance Commissioner.  The network would be funded through state or private resources. The state will not accept the federal $54 million Early Innovator Grant. The legislation is expected to be amended onto a pending bill and make its way through the legislative process. which is scheduled to end May 27, 2011.

TEXAS:

A bill designed to squeeze savings out of social programs won unanimous approval from a Senate budget subpanel last week. The bill includes about 10 ideas for greater economies – primarily in Medicaid but some in food stamps and the Children’s Texas Health Insurance Program. The biggest single savings — $290 million over the next two years — would come from eliminating a South Texas “island” of fee-for-service payments under Medicaid. Since 2003, Cameron, Hidalgo and Maverick counties have been exempt from the managed care trend at work elsewhere in Texas. The bill also would save $51 million by carving prescription drugs into Texas Medicaid managed care programs and requiring most Medicaid patients to use medicines on a state preferred drug list; save $15.9 million by moving children from the State Kids Insurance Program to the Children’s Health Insurance Program; and save $28 million by requiring Texans with disabilities who receive in-home attendant care services to use a Medicaid state program first at a lower cost to the state. The measure now heads to the full Senate Finance Committee, which is crafting its version of the much-reduced budget for 2012-13.

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Posted in HHS, MLR, aetna health insurance, affordable health insurance, arizona health insurance, colorado health insurance, connecticut health insurance, florida health insurance, georgia health insurance, health care overhaul, health insurance exchange, health insurance plans, individual health insurance, maryland health insurance, michigan health insurance, missouri health insurance, north carolina health insurance, oklahoma health insurance, texas health insurance | No Comments »

Health Care Overhaul & Deficit Reductions

Wednesday, April 20th, 2011

Just one week after House Republicans unveiled their deficit-reduction plan, President Obama last week unveiled his own plan for cutting $4 trillion from the federal budget deficit. The two plans propose much different routes to deficit reduction, and among the differences likely to draw the most attention in the upcoming campaign season are how each would cut Medicare and Medicaid costs. The President’s framework would largely preserve Medicare and Medicaid in their existing forms while the Republican plan would essentially convert Medicare into a voucher program and Medicaid into a block grant program giving states a lot more latitude to make changes in benefits. President Obama says his more modest changes and other measures would save $290 billion in medical spending, though critics have charged it may not be possible to clamp down significantly on health care spending without broader changes.

Democrats in the Senate last week defeated legislation approved by the Republican-led House, in largely symbolic fashion, to bar spending government funds on the health-care overhaul law. The House had voted to deny funding for the Affordable Care Act (ACA), but the Senate rejected the measure 53-47 on a straight party-line vote. The votes in both chambers were held last week just days after an 11th hour budget agreement was reached preventing a government shutdown and continuing the financing of government operations through the end of the 2011 fiscal year. The separate budget measure cleared both chambers. The outcome of the de-funding vote was never in doubt, but Republicans pursued the effort as a nod to voters who overwhelmingly elected Republicans to Congress last fall and to force Democrats to be on the record as supporting ACA. The House in January passed a measure to repeal the health care reform law, but that measure failed to advance as well in the Senate. Also, the House on Friday approved, largely along party lines, a budget resolution that proposes $5.8 trillion in spending reductions over the next 10 years (relative to current law). This was the last major issue on the legislative agenda before Congress recessed for a two-week Easter/Passover break that is scheduled to run through May 1.

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Oklahoma Health Insurance Exchange

Wednesday, April 6th, 2011

Gov. Mary Fallin is defending her efforts to create an Oklahoma health insurance exchange for uninsured Oklahoma residents, explaining that if the state does not have an exchange in place by 2013 the federal government will step in and create its own. Fallin discussed her support for legislation to help create the exchange just four days after a dozen demonstrators carrying signs and American flags protested her appearance before the Tulsa Health Underwriters Association. Her appearance came on the heels of her decision to accept a $54 million federal grant to implement a health insurance exchange. Opponents say creating an insurance exchange is a step toward implementing an unpopular federal health care overhaul law. The House has passed a measure to create an advisory board to help implement an insurance information exchange originally created by lawmakers in 2009. Part of the state’s Insure Oklahoma program to reduce the number of uninsured Oklahomans, the board would identify health insurance plans, what they cover and how much they cost.

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Kansas Health Insurance Aimed At Blocking Health Care Overhaul

Thursday, March 31st, 2011

A Kansas health insurance proposal aimed at blocking part of the federal health care overhaul from taking effect in the state has advanced in both houses of the legislature. Senators voted 26-10 last week to amend a so-called health care “freedom” measure into a bill dealing with the state’s pharmacy laws. The proposal would prohibit state government from forcing any individual or employer to buy health insurance. The House of Representatives previously had passed the same measure with slightly differing language. Critics say the state can’t overrule a federal law, and they note the U.S. Supreme Court will ultimately decide whether the federal law is constitutional. Both houses will now appoint conference committee representatives to reconcile differences between bills so that a single bill can be submitted to the Governor for his signature.

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States Fight Back On Health Care Reform

Tuesday, March 8th, 2011

When the nation’s governors came calling at the White House last week, President Obama greeted his guests with the offer of new flexibility toward implementation of the Patient Protection and Affordable Care Act (PPACA). The President said he is willing to give states an earlier opportunity to opt out of certain key requirements of the law, but only if the states can find their own way to cover as many people without added costs. If Congress agrees to the new approach, states could gain exemptions by 2014 rather than 2017. But a number of governors expressed skepticism that the proposal offers them any real benefits, given the difficulty states would have meeting the President’s caveats. Some prefer to continue to pursue outright repeal. Still, the change in timing means exemptions could be earned in the same year that some of the most controversial provisions of the law go into effect. And, with the governors’ immediate focus on rising Medicaid costs, the proposal reportedly would let states send HHS officials a combined request to alter Medicaid and their approach to health care reform.

Federal
Last week a Florida federal judge clarified (at the request of the Obama Administration) his earlier decision back in January 2011 in which he ruled that the PPACA’s individual health insurance mandate is unconstitutional. He also wrote that the mandate could not be severed from the rest of PPACA and, therefore, the whole law had to be set aside as unconstitutional.  In last week’s rather colorful ruling, the judge chided the government for sitting on its hands for weeks before asking for the clarification. He re-emphasized that the mandate and the whole law are unconstitutional and chastised the government both for failing to appreciate, as a matter of law, that the prior Declaratory Judgment was the “functional equivalent” of an injunction (meaning that the government could not proceed with implementation) and for having the temerity to suggest otherwise. The judge did not stop there, which would have halted all implementation of the PPACA had he done so. He instead decided that the government’s motion to clarify was also a motion to “stay” the imposition of the original ruling, and he granted the stay.  But he conditioned it with the requirement that the government file an appeal within seven days seeking an expedited “fast-track” appellate review, either in the Court of Appeals (11th Circuit) or the U.S. Supreme Court. This filing requirement is the major takeaway from last week’s ruling because it accelerates the timeline for the litigation, to the applause of the state and others who oppose the law. The Administration and the proponents of the law are less happy, since stringing out the ultimate decision would make it more difficult, if not impossible, to dismantle.

With House approval (314 to 112) last week, Congress is well on the way to repealing the 1099 provision of the PPACA, which imposes a costly and burdensome reporting requirement on employers.  Earlier this year, the Senate also voted to repeal the 1099 provision; however, the two chambers are worlds apart with respect to paying for the repeal. While the House version pays for the repeal by revising the rules for repayment of excess premium subsidies down the road, the Senate version doesn’t directly pay for it and only gives OMB the authority to go find the money. A House-Senate Conference (or an unofficial compromise) will be needed to resolve this impasse.

The anticipated government shut-down on March 4 was put off last week when both chambers passed (and the President signed) a two-week extension of a continuing resolution to keep the government officially funded until March 18.  This particular resolution actually cuts federal spending for the current fiscal year by $4 billion, which means that the House Republican savings target of $60 billion for FY 2011 is now down to $56 billion. Congress could very well bump along with such short-term resolutions throughout the spring. But at some point, the Republicans in the House and the Democrats in the Senate will have to permanently fund FY 2011 and get on with the FY 2012 budget, which is supposed to be in the works right now.
Multiple health-care-related hearings were held on Capitol Hill last week. In testimony before the House Energy and Commerce Committee, Mississippi Gov. Haley Barbour voiced support for funding Medicaid with block grants, under which the federal government would give states a set dollar amount for Medicaid rather than paying a percentage of costs. Under this system, states would have “total flexibility” to manage their Medicaid programs, according to Barbour.  The panel’s Democrats were quick to dismiss the idea of block grants, saying the change would harm vulnerable beneficiaries. Karen Ignagni, the President and CEO of America’s Health Insurance Plans, testified before the House Ways and Means Committee Subcommittee on Oversight Health Plan Programs to Combat Fraud, Waste, and Abuse. Her testimony addressed two issues: how health plans’ fraud detection units are using cutting-edge techniques to identify practices leading to substandard care – including overuse, underuse, or misuse of medical treatment; and suggestions for improving fraud detection and prevention in both public and private programs.  Part of her testimony also focused on the medical loss ratio (MLR) regulation, which she said will hurt the insurance industry’s efforts to detect and prevent fraud.

The Government Accounting Office (GAO) last week released a study that shows “nearly 10 percent all Medicare payments are fraudulent or otherwise improper, and the government isn’t doing enough to stop them.”  The Medicare “fraud margin” is 9 percent, nearly triple the profit margin for the health plan industry (3.58 percent). The GAO also provided correspondence to the Hill on Medicare Private Sector Initiatives to Bundle Hospital and Physician Payments for an Episode of Care.  As one of the five largest national payers, Aetna insuranceae was interviewed and provided relevant materials. The GAO found that ongoing private sector bundling initiatives that achieve savings are an important consideration, in light of Medicare’s financial challenges. Bundled payments are feasible for Medicare, but there are several obstacles to overcome — such as manual claim processing systems, resistance to limiting provider choice and the lack of standard definitiions.

States

With the California health insurance deadline for the introduction of legislation during the 2011 session looming, and now passed. several health care-related measures were reintroduced, such as a single payer/universal care bill, prior approval and rate regulation, and mandatory autism coverage. In addition, a host of bills are in play that take another step toward implementing federal reform but appear to be inconsistent with PPACA. As in past years, legislators have proposed a host of new mandated benefits – 15 in total. They include several new ones, including the proposed elimination of step therapy for pain medications, fertility preservation services and forensic medical evaluations. The state’s mandate commission is reviewing the cost and public benefit of each of these proposed mandates and will issue a report that should be publicly available by the end of March.

Democratic Senator Irene Aguilar, the sponsor of a Colorado health insurance single-payer bill, engaged in a verbal confrontation last week with a representative of the Colorado Association of Industry and Commerce regarding the potential impact of her bill on employment in the state. Subsequent to a rally on the steps of the Capitol, the bill was voted out of committee, 4 to 3, along party lines. The bill has little hope in the Republican-controlled House and may not reach the Senate floor without some Republican support.

As in the past two years, the Connecticut Health Insurance Committee approved Speaker Chris Donovan’s bill called An Act Establishing the Connecticut Healthcare Partnership. This bill would open the expensive state employee health plan to small businesses, nonprofits and other groups. The goal is to attract a number of new employee groups to the state employee plan – nearly all of whom already have health insurance. In addition, the new state-run health plan would compete directly against the private marketplace. Given the high benefit levels, state employee plans are among the most expensive in the state. As such, this bill would not offer small businesses any real cost relief, achieve intended cost savings or increase the number of people with insurance. It could lead to substantial cost increases for taxpayers. The 11-9 committee vote was mostly along party lines, with most Democrats supporting the measure (except Sen. Joan Hartley and Rep. Linda Schofield), and all Republicans opposing it. This bill passed in 2008 and again in 2009, but was vetoed both times by former Governor M. Jodi Rell.

The Governor and Commissioner of Georgia Health Insurance are considering issuing an executive order that would create an Exchange Review Board. The Board would then consider and possibly develop legislation to implement a state insurance exchange in 2012. A bill is expected to be filed creating this advisory committee and is supported by the Governor’s office. The Governor may then follow with an executive order. Also, Aetna insurance expects an MLR waiver request to be filed by the DOI sometime this month.

The Department of Louisiana Health Insurance has indicated it will file an MLR waiver request this week despite indications from the Governor’s office that he does not approve of the request.

The Senate Appropriations Subcommittee on Oklahoma Health Insurance and Human Services passed a bill last week that would create a website to permit Oklahomans to see approximate pricing information for medical procedures and pharmaceutical products. The bill requires the Insurance Department, in collaboration with the State Department of Health, to establish and maintain an online health care information system that permits consumers to see pricing information from different types of providers and pharmaceuticals. The bill states that the purpose of the website is to serve as a resource for insurers, employers, providers, purchasers of health care and state agencies to continuously review health care utilization, expenditures and performance. It would also enhance the ability of consumers and employers to make informed, cost-effective health care choices. The bill would require that the presentation of data in the system allow for comparisons in the context of geography, demographics, general economic factors and institutional size.

Also of interest is a bill passed by the Senate Rules Committee last week that would allow Oklahoma to opt out of federal health care reform requirements. The bill asserts state control in the regulation of health care, would create a compact between certain states and would set forth formulas for figuring the right to federal funds for each member state. The bill also would create the Interstate Advisory Health Care Commission and establish membership requirements and duties of the commission. Primarily the commission would assist the legislatures of member states in the regulation of health care. It states the formation of this compact is contingent upon approval from the U.S. Congress. Democrats in Oklahoma’s Senate opposed the bill, some saying that it would force Oklahoma to rely on other states for regulating Oklahomans. Both bills will continue through the legislative process, which is scheduled to end in late May.

Rep. John Zerwas’ bill authorizing the creation of a state Texas health insurance exchange encountered mostly smooth sailing last week when it was heard by the House Insurance Committee. Going by the name of the Connector in the bill, the primary purpose of the exchange is to prepare Texas for changes in health insurance markets set to roll out in three years as part of federal health system reform. One important change in the new bill language presented at the hearing was the absence of an individual mandate to buy an insurance product. Groups expressing support for the bill included the Texas Association of Business and the Texas Hospital Association, among others. The bill was left pending by the Committee and will likely see more changes before it is brought to a vote. The Texas legislature continues in its regular session until June 1, 2011.

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Posted in aetna health insurance, california health insurance, colorado health insurance, connecticut health insurance, georgia health insurance, health care overhaul, health care reform, health insurance exchange, individual health insurance mandate, louisiana health insurance, obama care, oklahoma health insurance, texas health insurance | No Comments »

Individual Health Insurance Reform Intense Debate

Tuesday, February 22nd, 2011

When House Republicans voted Friday to block funding for health care reform implementation (see below), it was with the knowledge that most Americans disapprove of the tactic. A new CBS News poll shows 55 percent of Americans disapprove of the defunding effort while just 35 percent support it. The poll also shows, however, that the Patient Protection and Affordable Care Act (PPACA) continues to be unpopular overall. Just 21 percent think the law will make the health care system better while 23 percent believe it will make things worse. Perhaps most interesting of all is that 44 percent are unsure of what the law does, and they don’t know enough to say what the impact will be. The results seem to suggest the law has gained no traction with the populace in the past year but that voters have a keen sense of fair play in how the issue is addressed.

Federal
To keep the government operating for fiscal year 2011 (September 2010 through September 2011), Congress has been passing a series of continuing resolutions (CR) that continue the funding for a set period of time. The current CR runs out the first week in March, so the House last week passed yet another CR, shipped it off to the Senate and headed out of town for a President’s Day recess. Included in the just-passed CR are provisions that would de-fund parts of the 2010 individual health insurance reform law, such as prohibiting the use of federal funds to pay government employees to work on or to implement the PPACA.  The Senate will surely reject this CR because of both the de-funding provisions and the $61 billion in spending cuts for the current fiscal year. Congress will once again confront a looming funding deadline when it returns from recess in a week.

While there is increasing health-related “action” in Congress, such as the de-funding effort and the soon-to-be successful effort to repeal the 1099 requirement, the implementation process within the agencies continues unabated. This is where the real action is, with post-regulation guidance likely to be issued on several fronts in the very near future. Sub-regulatory guidance is expected to touch on the following areas or answer certain questions: 1) Whether group plans, as of 2012, will be allowed to offer a Medicare Advantage-only plan alongside a stand-alone PDP;  2) whether and how insurers have to report PBM administrative costs for medical loss ratio (MLR) purposes;  3) FAQs on the parameters (e.g., national vs. state-by-state reporting) of an insurer’s MLR requirement for ex-pat business;  4) revised rules on already-issued claims and appeals rules; and  5) clarification of the length and breadth of the types of “new business’ that can be sold under a limited benefits plan or mini-med waiver. All of these items will have a bearing on operations at Aetna health insurance and Golden Rule insurance.

States
The Obama administration has awarded $241 million in grants to seven states to develop a health insurance exchange. Developing the technology to make such a virtual marketplace work is expected to be costly, however. Administration officials hope the grants awarded last week will allow a few states to build systems as “early innovators” that others will be able to adopt. The states receiving grants, which were appropriated by the law last year, are: Kansas ($31.5 million), Maryland ($6.2 million), Massachusetts ($35.6 million), New York ($27.4 million), Oklahoma ($54.6 million), Oregon ($48.1 million) and Wisconsin ($37.8 million). A sign of the sometimes odd nature of health care politics, Kansas, Oklahoma and Wisconsin have Republican governors who have complained bitterly about the new law and are challenging its constitutionality in federal court.

Arizona health insurance Governor Jan Brewer was advised by HHS Secretary Kathleen Sebelius that the maintenance of effort provision of the PPACA does not preclude the state from removing childless adults from the Arizona Health Care Cost Containment System (Medicaid) because the expansion was part of a demonstration project. The Governor and many legislators support this reduction as a means to help address the state’s significant budget deficit. While many view the development as a positive, a legal challenge at the state level is possible because the coverage expansion resulted from a ballot initiative. Also, the health insurance exchange bill was voted out of the House Banking and Insurance Committee by a 4-2-1 margin. Discussion was robust, with Republican members questioning the need to take any action in light of pending litigation against the PPACA. The view that the bill should continue to move to the floor for a full vote prevailed.

The Connecticut health insurance Committee held a hearing last week on a bill that would require public hearings on rate increases. The bill would compel hearings in some cases, and would give the state attorney general and health care advocate the right to argue on behalf of consumers at the hearings and call witnesses. In addition, the bill would change existing law, which states that rates can’t be “excessive”, by defining excessive as “unreasonably high.” Industry representatives said the legislation would conflict with federal reform laws, add administrative burden on the Insurance Department and, ultimately, increase costs. Keith Stover, lobbyist for the Connecticut Association of Health Plans, testified that rates already have to be actuarially sound and that medical insurance costs are, in fact, increasing. The Insurance Department said lawmakers should hold off on changes until incoming Commissioner Thomas Leonardi reviews the plan.

The Public Health and Insurance committees held a joint hearing on the SustiNet public option bill, the insurance exchange bill, the “pooling” of all public employees bill (to be known as the Connecticut Health Partnership) and a bill to allow the state to pool state employee and Medicaid pharmaceutical purchasing. The most important development of the day was the Malloy Administration’s written testimony. The state’s Budget Director Ben Barnes was not only tepid toward SustiNet as a whole, he was quite clear that the SustiNet bill gives too much budgetary power to a quasi-public agency (almost $8 billion in state health spending) and raises questions about SustiNet’s cost and savings projections. He pointed out that certain Medicaid concepts in the bill are against federal law, including allowing the agency to set Medicaid rates.. Speaker of the House Chris Donovan sat with Hartford Mayor Segarra, and they advocated strongly for the Speaker’s “pooling” bill to allow cities and towns to buy into the state’s health insurance plan. It eventually would allow small businesses and nonprofit organizations to buy in (also part of the SustiNet plan). This bill was vetoed in 2008.

Georgia health insurance John Price, an Aetna insurance local market head, Southeast Region, has been appointed to Commissioner Hudgens health insurance advisory group to help provide the Commissioner with expertise on health insurance issues. Also, the Commissioner of the Department of Community Health announced Friday that the current Managed Medicaid contracts (Wellcare, Amerigroup, Centene) will be extended for 12 months while the new Governor reviews the program.

Ohio health insurance Pooling of Ohio public school district employee health plans will be considered by the General Assembly. A study found that there is the potential for $138 million in savings if the state leverages the greater buying power of pooling 191,000 employees enrolled in 613 public school district health plans. Seventy-two percent of Ohio school districts purchase employee health insurance through consortia, but they are typically composed of 10 or fewer districts and do not result in savings, the study found. The report also calls for the state to find ways to encourage school districts to pursue lower-cost, high-deductible health insurance plans that could reduce district costs up to another 37 percent over current employee health care plans.  As Ohio struggles with the economic downturn and an $8 billion budget deficit, limiting collective bargaining rights is also front and center in the Statehouse so that the Administration ultimately may change the structure of pensions and health care benefits.

Texas health insurance Lt. Gov. David Dewhurst and Sen. Jane Nelson have reintroduced two health care-related bills that died in the House in 2009. One would bring “outcomes-based payments” to Texas’ Medicaid and the Children’s Health Insurance Programs. The other would allow private insurers, major employers and government employees’ insurance plans to experiment with new financial approaches, such as accountable care organizations (ACO). ACOs are an arrangement in which doctors and hospitals share risk, and potential savings, for bringing care costs below targeted levels. The legislation would begin rewarding the state’s health care industry for preventive care and treatments that are coordinated to prevent duplication and waste. The bills will be referred to a committee and debated by both the Senate and House during the current legislative session, ending in late May.

Senators tasked with taking a close look at the Medicaid program got a dose of the difficulties involved in trimming services in a state where services considered optional turn out to be not so optional. They heard testimony on multiple examples of how Medicaid cuts would affect people in the system. Because of the restrictions contained in the federal health care reform law, budget planners have less latitude in where to look for cuts in the Medicaid program. The Senate subcommittee will eventually pass on its recommended budget solutions to the Finance Committee charged with approving an overall budget that makes up a shortfall of more than $20 billion this session.

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Posted in aetna health insurance, arizona health insurance, connecticut health insurance, georgia health insurance, golden rule insurance, health care overhaul, health care reform, health insurance exchange, health insurance plan, individual health insurance, medical insurance, ohio health insurance, texas health insurance | No Comments »

Individual Health Insurance Legislative Update January

Wednesday, January 5th, 2011

The Department of Health & Human Services (HHS) has released a proposed regulation that would institute a new review process for requests by individual health insurance companies for rate increases.

The proposed rule, announced Dec. 20, 2010, would institute a new review process that may be administered by states if HHS determines that they have an “effective” rate review program, or by HHS if a state process is not considered effective. HHS expects to implement the new process by July 2011.

HHS proposes that this process become effective for rates filed or in use on or after July 1, 2011, in the individual health insurance and small group markets. This rule would not apply to grandfathered or excepted benefits.

In states that are determined to have an “effective” rate review program, HHS will defer to the state to determine whether a rate increase is unreasonable. However, the state must still report to HHS its determination – whether reasonable or unreasonable – and include a rationale for making its decision.

HHS defines an effective state review process based on the following four factors:

* Whether the state receives data and documentation from individual health insurance carriers sufficient to determine whether a rate increase is unreasonable;
* Whether the state effectively reviews the data and documentation submitted by the insurer;
* Whether the state review examines the reasonableness of the assumptions used by the issuer in developing its rate proposal and the historic data underlying those assumptions; and
* Whether the state applies a standard set forth in statute or regulations when making the determination of whether a rate increase is unreasonable.

The proposed trigger for the new review process is if an individual health insurance carrier’s “weighted average increase” is 10 percent or more for the rate filing. HHS lists what analysis must be done by states, which would include looking at reserve needs as well as the “risk-based capital status relative to national standards.”

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Health Insurance Medical Loss Ratio and Exchanges

Wednesday, November 24th, 2010

The Department of Health and Human Services (HHS) has released two new sets of guidelines: the long-awaited regulations governing the Affordable Care Act provision on Medical Loss Ratio (MLR) and the first of a series of guidance and rules to aid states in complying with a health care reform law to set up insurance exchanges by 2014. The MLR regulations, which go into effect in January 2011, require that large group plans spend at least 85 percent and small group and individual health insurance plans at least 80 per cent of premiums on clinical services and activities related to quality of care. Insurers who don’t meet the standards in 2011 will be required to issue rebates for that amount in 2012. We are now evaluating the new regulations and you will be hearing more about both in the near future. Health insurance quotes

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Health Care Reform Overhaul Update

Wednesday, October 20th, 2010

Last week, Health & Human Services Secretary Kathleen Sebelius issued a letter to the National Association of Insurance Commissioners expressing concerns about the approach some carriers have considered for child-only health insurance coverage. In particular, while endorsing the idea of open enrollment periods, she rejected the idea of denying sick children outside the open enrollment period, but accepting healthy kids year-round.

While Congress is in recess until the upcoming elections, we continue to closely monitor activity in Washington, contributing comments on a variety of issues directly as well as through trade organizations. Regulators continue to issue guidance and seek industry input.

Carved-Out Plans

Some employers may have structured their benefit offerings so that one type of plan is available for one group of employees, but another plan for other groups. For example, management may be offered only a PPO, while hourly workers can only take HMO coverage. This is sometimes called a “carved-out plan.” In other cases, “executive medical” policies may provide benefits supplementing the underlying group health plan by covering deductibles, copayments, etc.

Beginning with plan years on or after Sept. 23, 2010, the Affordable Care Act prohibits nongrandfathered fully insured group health plans from discriminating in favor of highly compensated individuals. Specifically, the Affordable Care Act requires that such fully insured plans satisfy the requirements of and rules similar to those of Internal Revenue Code Section (“IRC”) 105(h). Historically, the nondiscrimination requirements of IRC Section 105(h) only applied to self-insured plans.

Recently, the Department of Treasury published Notice 2010-63 requesting comments in preparation for possibly issuing guidance on applying IRC Section 105(h) to fully insured plans. The Notice indicates that group health plans that fail to comply with the nondiscrimination requirements of IRC Section 105(h) are subject to an excise tax of $100 per day per individual discriminated against for each day a plan is noncompliant.

Depending on the facts and circumstances and the nondiscrimination tests applied, some fully insured carved-out and executive-medical type plans may be found to discriminate in favor of highly compensated individuals.

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Health Insurance Quotes for Children

Friday, October 15th, 2010

Health insurance companies are reluctant to offer child only health insurance policies under The Obama administration and new health law. The Affordable Care Act also know as Obama Care, states that all future plans in the individual health insurance market for children age 18 and younger cannot deny coverage to children who have pre-existing conditions.

Some insurers decided to stop quoting and writing new business in the child-only market because of concerns that parents would not quote and enroll children until they get sick. Insurers can charge higher rates for children, which is not prohibited by the Affordable Care Act but is permitted by state law.

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