Interestingly, a new Yahoo Finance analysis of quarterly financial data shows that the health plan sector of the health care system ranked only 143rd out 215 in terms of profit margin.

Federal

In yet another political statement, a Republican-controlled House Committee last week approved legislation to repeal the maintenance of effort (MOE) requirements for the state Medicaid and CHIP programs. The requirements, which prohibit states from reducing Medicaid eligibility for adults until 2014 and for children until 2019, were passed as part of the Affordable Care Act (ACA) and the federal stimulus bill.  Republicans view the MOE provision as one more example of big government telling the states what to do for yet another entitlement program.  Repealing the provision would reduce Medicaid/CHIP enrollment and save $2.1 billion over 10 years, but it will likely not become law given the Democratic Senate and White House. Its only chance of adoption would be as part of a really big compromise deal on the budget and deficit later this year.

States

CONNECTICUT: State legislators plan to pass a consensus bill creating a Connecticut Health Insurance Exchange by the end of session on June 8. Three exchange bills have cleared committees and differ largely in the make up of their boards.  The Administration supports SB 921 which creates a governance framework for the Exchange, establishing a quasi-public authority with a 13 member board that includes industry representation. The board is charged with making recommendations to the Governor and legislature on Exchange policy issues by January 1, 2012.

The rate review bill is still active and if enacted would: require a lengthy notice timeline for proposed increase, and a public hearing for any increase over 10%; authorize the Healthcare Advocate and the Attorney General to be parties to any hearing; define “excessive” to include consideration of such factors as commissions, transfer of funds to holding or parent company, the rate of return on assets or profitability compared to similar filers, and a “reasonable” profit margin.  Due to the $2.3M annual cost to the state, it does not currently have the support of the Administration. However, a negotiated bill is likely to pass this session.

INDIANA: The legislature has adjourned, and its accomplishments this session include passing a bill that makes changes to eligibility levels in the Medicaid program and ACA-conforming Indiana health insurance law — including coverage of children to age 26, grievances, and rescissions.  The new law also prohibits any requirement that any state resident purchase coverage under a health plan, but it allows residents to delegate to their employers the authority to purchase or decline to purchase coverage under a health plan. The legislature also passed legislation that requires insurance reimbursement for certain services provided by a licensed athletic trainer under the athletic trainer’s scope of practice.  The law also prohibits an insurer from requesting a substitution of a treatment (drug, device or therapy) from an insured’s physician or contacting an insured concerning certain substitutions. The legislature also passed changes to the School Corporation Health Insurance Act that specify new requirements and recommendations for school corporation employee health insurance coverage programs.

KANSAS: The legislature adjourned last week after the Senate approved a budget late Thursday night and the House followed suit in the early hours of Friday morning. The two chambers also agreed to blend 12 health-related bills into a single measure, House Bill 2182. Of interest to Aetna and its customers, the new bill includes a statutory version of the Health Care Freedom Act, which states that no person, provider or employer can be forced to participate in any health care system or to purchase Kansas health insurance. Other provisions would require pharmacy auditors to give advance notice, adopt a (still unfunded) Health Information Technology Act, require changes to the DOI internal and external review procedures (consistent with ACA), require an increase in the high-risk pool’s cap and the addition of children as participants, and prohibit abortion coverage with a separate coverage rider.

MAINE: The Senate voted 24-10 to approve the Individual and Small Group Market Reform bill with several amendments. The bill now goes to the House for concurrence and possibly further amendments. The amended version would:

Expands and alters community rating bands over five years, allowing insurance policies to be more accurately priced according to various risk factors “to the extent permitted by the federal Affordable Care Act” (in amended version);
Establishes a reinsurance program for high cost individuals using existing funding sources, ACA funds as permitted, and a covered lives assessment (capped at $4 for the pool, and $2 for the pool’s net losses, if any, in the amended version);
Allows individuals to purchase insurance in four other states (NH, RI, CT and MA);
Conforms state loss ratios to federal standards;
Repeals the standardized State Health Plan;
Loosens the geographic access standards by allowing insurers to offer incentives to members to use providers based on cost and quality;
Provides a wellness tax credit for employers with 20 or fewer employees;
Permits the creation of captive health insurance associations, and allows smaller businesses (up to 50 employees) to band together purchase insurance.

NEW JERSEY: The legislative proposal put forth by Governor Chris Christie and Senate President Stephen Sweeney to change employee benefits by legislation rather than through collective bargaining continues to get a very cool reception in the Democratic-controlled legislature. The lack of support for the Senate President’s legislation by members of his own party severely limits the bill’s chances of success, given the Democrats’ advantage in both chambers. Reform of public sector health benefits is directly tied to the pending budget, so a resolution is anticipated by early June.

In other legislative news, the Senate advanced legislation to avert an anticipated $300 per employee unemployment insurance tax on employers. This employer tax would be triggered this summer due to the insolvency of the state Unemployment Insurance Fund.  The bill making its way through the legislature would incrementally increase the tax over three years to lessen the immediate financial impact on employers. Also, Commissioner Tom Considine, Department of Banking & Insurance (DOBI), last week expressed the Department’s continuing concern over the implementation of ACA.  He specifically cited the timeline for establishing a state health insurance exchange as a concern.

NEW YORK:  The Senate Insurance Committee and the Senate Banking Committee Chairs each announced that their committees will be considering the nomination of Governor Cuomo’s Chief of Staff Ben Lawsky to be the Superintendent of the newly merged entity for Banking and Insurance to be known as the Department of Financial Services. Prior to joining the Cuomo Administration, Lawsky was a federal prosecutor and special assistant in then-Attorney General Cuomo’s office. He is also a former judiciary counsel to Senator Chuck Schumer. Mr. Lawsky is expected to be confirmed by both Committees. The merged entity would then have a separate Deputy Superintendent for Banking and one for Insurance serving under Lawsky. Those would be appointed positions and do not require Senate confirmation.

With only 16 session days left, there is speculation that the state will not pass enabling legislation for a health insurance exchange. New York can apply for a five-year grant under ACA to create an exchange but only if it has passed key state legislation. Setting up the exchange will be expensive, which is why consumer advocacy groups want New York to be able to access the federal grant money. According to an April 20 state document on planning the exchange, New York anticipates spending at least $52.7 million on planning the exchange between fiscal years 2011 and 2014. The state received a $27.4 million federal Early Innovator Grant award and anticipates receipt of at least another $11.7 million through enhanced federal Medicaid matching funds. The Department of Insurance (DOI) announced it will hold a series of public forums throughout the state in the next two weeks to allow New Yorkers to present their ideas on the design of an exchange.

NORTH CAROLINA: A North Carolina health insurance exchange bill has been accepted and found favorable by first the House Insurance Committee and then the House Appropriations Committee. Committee changes include adding another board member. The bill now also would prohibit the Exchange Authority from imposing penalties and other fees on individuals who cancel enrollment because they become eligible for other coverage options.

OKLAHOMA: The Department of Insurance’s newly created Oklahoma health insurance Exchange Workgroups on Enrollment/Eligibility and Funding both met last week. The Funding group discussed sustainability models and recommendations, as well as the NAIC White Papers on exchange funding. Aetna presented feedback, specifically noting that funding for insurance exchanges should not be limited to insurance assessments and instead should be as broad-based as possible. Exchanges should evaluate all available funding sources to support continuing administrative and operational expenses, including available grants, fees, assessments and taxes. The groups also discussed pending legislation that would create the framework for an exchange, which is still making its way through the legislative process. The session is scheduled to adjourn by May 27, and many now assume an exchange will not be created legislatively until the next legislative session in the spring of 2012.

PENNSYLVANIA: The Senate has unanimously confirmed Governor Tom Corbett’s nomination of Michael Consedine for the post of Pennsylvania health Insurance Commissioner. The vote followed the Senate Banking and Insurance Committee’s unanimous approval of the nomination.  Consedine, who has headed the Insurance Department as Acting Insurance Commissioner since January, previously served as a partner at the law firm of Saul Ewing, where he was Vice Chair of its Insurance Practice Group.  Prior to joining Saul Ewing 12 years ago, Commissioner Consedine served as Insurance Department Counsel.

TEXAS: The House of Representatives gave final approval last week to legislation that extends the life of the Texas Department of Insurance and sets tighter guidelines for the review of rate increases. One key amendment is a page of language that would provide the state some flexibility to proceed on planning for a Texas health insurance exchange. The measure was amended during debate to allow 3-Share programs to be considered qualified health plans even though ACA does not appear to allow for that. The bill now moves to the Senate for Committee debate and floor approval prior to the scheduled adjournment date of May 30.

Governor Rick Perry signed legislation last week that the state’s largest physician organization promoted as a bill that will help rural communities recruit physicians. Sponsored by Sen. Robert Duncan and by Rep. Garnet Coleman in the House, the bill was approved in the House last week and was then signed almost immediately by Governor Perry. The new law will allow critical access hospitals, sole community hospitals, and hospitals in counties of 50,000 or fewer to employ physicians. Most of these hospitals are run by local governments. Texas is one of the first states to statutorily pass clinical protections for physicians who choose employment.

WASHINGTON: Governor Chris Gregoire signed the Health Benefit Exchange bill creating the exchange as a public-private partnership, with operations set to begin in January 2014. The exchange governing board will include nine members recommended by each legislative caucus and appointed by the Governor. Board members will include those with actuarial expertise and representatives of small business, consumer advocacy and identified areas of the health care system. Health insurer representation is not excluded nor specifically required but would be included on a technical advisory committee.

The new law requires the Washington Health Care Authority and the Legislative Joint Select Committee on Health Reform Implementation to apply for federal grants, develop an operational budget, and devise a plan to achieve financial sustainability by 2015.  A work plan and report on operational considerations are both required, addressing topics such as the role of the exchange in aggregating funds, whether to implement a basic health plan option, whether to merge risk pools, certification of and standards for participating plans, and implementation of effective risk management methods.

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.

Federal
Group customers offering Medicare Advantage and prescription drug coverage got some good news from the Centers for Medicare & Medicaid Services last week. Last November, CMS announced that group customers would no longer be allowed to offer a Medicare Advantage-only plan alongside a stand-alone prescription drug plan and that as of January 2012 the customer would have to offer an integrated Medicare Advantage-Prescription Drug Plan (MA-PDP). This set off a scramble to get ready for 2012, which would have been a very difficult, if not impossible, timeframe. Aetna health insurance began working with employers and trade groups to reverse or delay the CMS rule. Last week, CMS issued a favorable ruling to suspend indefinitely its November 2010 decision and not require an MA-PDP as the employer’s only option.

There were two important court developments last week related to health care reform and the constitutionality of the PPACA’s individual health insurance mandate, with more to come in the next week or two. First, a federal judge in Florida two weeks ago invalidated the mandate, striking down the whole statute with a declaratory judgment but stopping short of issuing an injunction directing the conduct of the parties. At the same time he said the declaratory judgment was the “functional equivalent” of an injunction.  The plaintiffs (many of the states) have publicly stated that the law no longer applies to them while the defendant (the federal government) has stated that nothing changes until appellate review is complete.  Last week, the Florida judge ordered legal briefs on this issue and is expected to rule shortly on the impact of his prior ruling on the parties involved.  Second, early last week, as expected, the U.S. District Court for the District of Columbia upheld the constitutionality of the PPACA’s individual mandate, making it the third court to so rule. But the score is 3-2, and this is a best of seven series that won’t be settled before at least one Circuit Court decision and an essential Supreme Court opinion are rendered. Both could be well down the jurisprudential road.

States
A California health insurance bill that would bring state tax law into conformity with new federal tax rules governing the health coverage of adult children passed the Assembly Revenue and Taxation Committee by a unanimous vote last week. This conformity is important to employers, plans, and families because it exempts employee contributions toward covering certain adult children from state personal income taxes. It would also reduce a potential administrative burden for employers. Aetna insurance worked with its trade associations and joined a diverse group of interested parties, including labor, to help achieve a bipartisan outcome. The bill is expected to be fast-tracked and may be heard in Assembly Appropriations in the coming weeks.

In Colorado health insurance the newly released 2010 Annual Health Insurance Report of the Commissioner of Insurance contains a wealth of information — much of it collected from the insurance industry for 2009 — about the cost of health insurance and the factors that drive individual and group premiums in the state. The report notes that an estimated 15.7 percent of Coloradans had no health insurance in 2010, which is a slight improvement over 2009. More than 61 percent of Coloradans were covered by either commercial health insurance or a self-insured employer plan, compared to 54 percent in other states nationwide. Roughly 84 percent of premiums collected in 2009 by carriers went directly to the cost of providing health care services; 13.87 percent of premiums was used for administrative expenses and producer commissions. Not all coverage is regulated by the state — just over 40 percent of Coloradans had coverage regulated by the division of Insurance.

The Colorado Trust, a private grant making foundation, has issued a brief called The Economic Impact of Health Reform in Colorado that projects, as a result of national health care reform, insurance premiums will be nearly $2,000 less per year for individuals and nearly $4,000 less for family coverage by 2019. The projections are in part due to slower health care cost growth. Indeed, costs are expected to grow 5.5 percent to 17 percent less in Colorado by 2019 than without reform. Even after accounting for the costs of financing health care reform, this research projects that the state’s economic output will be nearly 1 percent more in 2019 than without reform, and 19,000 new jobs would be added as a result of coverage expansion.

The Connecticut Health Insurance Exchange Planning Committee held its first meeting under the new Administration of Governor Malloy last week.  Jeannette DeJesus, Department of Public Health Deputy Commissioner and the Governor’s Special Advisor on Health Care Reform led the meeting and stated that Senator Crisco’s insurance exchange legislation is the Administration’s proposal, based largely on the NAIC model act. Speaker Chris Donovan also has introduced an exchange bill in the House. Both proposals call for the establishment of a quasi public governing structure but differ on some timelines and board representation. DeJesus said the Administration would work with the House and solicit input form residents and stakeholders around the state to resolve the differences. Passage of a consensus bill is critical to the state’s ability to access Level II federal funding by June 30th. If legislation is not passed, DeJesus said that Connecticut will fall behind in its planning process. The state recently was awarded a $35.6 million federal grant aimed at helping New England states develop a state-of-the-art, online gateway to health insurance options. While Connecticut and other New England states are directly participating, the project is centered at the University of Massachusetts Medical Center in Worcester and the Massachusetts Executive Office of Health and Human Services, supported by the non-profit New England States Consortium Systems Organization. The first meeting of that group will be in March.

Illinois health insurance advocate Governor Pat Quinn signed into law an Aetna-sponsored piece of legislation relating to insurer payments to certain non-participating providers. The bill applies to individual or group accident and health insurance carriers. Effective on June 1, 2011, when an enrollee utilizes a network hospital or ambulatory surgery center and an in-network provider is unavailable for radiology, anesthesiology, pathology, neonatology or emergency department services, the carrier is to ensure that the enrollee shall not incur greater out-of-pocket costs than for participating providers. The enrollee cannot be balance billed by the provider past the insurers’ in-network rate for these non-participating provider services. In addition, the insurer may pay the billed amount or attempt to negotiate the reimbursement with the out-of-network provider. In the event that the insurer and physician cannot agree on a reimbursement amount, either party can initiate binding arbitration within 30 days of receipt of an explanation of medical benefit. The bill is a major victory for consumers.

Kansas health insurance as a result of budget shortfalls, greater political attention is being paid to the significant cost of state Medicaid programs, and Gov. Sam Brownback has said he wants to get rid of the fee-for-service model. The governor has made redesigning Medicaid a priority in his proposed budget, Dispensing with the fee-for-service model would mean using marketplace tools, such as pharmacy benefit managers, to negotiate lower dispensing rates at pharmacies and communicate with physicians about generics. The Kansas Medicaid program could save $62 million in the next decade by using pharmacy benefit managers and other market-based tools, according to a recent study by The Lewin Group. Missouri could save $282 million. Bryan O’Neal, the assistant director of pharmacy at The Kansas Hospital, recently testified that the real opportunity for savings is getting clinical data and cost of medications in front of doctors at the time of prescribing. He recommended using electronic prescription systems, which allow doctors to see patients’ current medications and drug allergies as well as cost and clinical data. More than 500 pharmacies and 2,400 clinicians in Kansas use e-prescribing systems. But some have said legislation working its way through the Kansas and Missouri Senates could undermine the states’ e-prescribing systems by limiting information and discouraging physicians from using them. The bills would establish a separate set of standards for Medicaid and prohibit the use of “intervening parties” or pharmacy benefit managers. The Kansas bill came under fire during a Feb. 10 committee hearing. The lone proponent of the bill at the hearing was a pharmacy representative.

Michigan health insurance In his first budget, Governor Rick Snyder has proposed that the state’s current HMO-use tax on Medicaid plans be replaced by a 1 percent assessment on paid health claims to raise approximately $400 million. The paid claims would be an obligation on insured and self-insured entities. Details regarding this budget proposal, including operational issues and effective date, are unclear at this time. But the  Michigan budget is predicated on the implementation of this provision. If it fails, then the remaining options will be reductions in Medicaid, largely in provider rates and health plan premiums.

A Missouri health insurance bill that would create a health insurance exchange has been introduced by Representative Chris Molendorp, a Republican and chair of the House Insurance Committee. Despite input from a wide range of stakeholders, the complex bill is not likely to sail through the legislative process quickly or easily. It would 1) establish a health benefit exchange to facilitate the purchase and sale of qualified health plans and qualified dental plans in the individual market, and 2) provide for the establishment of a small business health options program to assist qualified small employers in facilitating the enrollment of their employees in qualified health and dental plans.  The bill would still allow for sales of plans outside the exchange. The exchange would be funded by assessments or user fees charged to health carriers and health benefit plans. The bill would establish the exchange as a quasi-governmental agency within the Department of Insurance, Financial Institutions and Professional Registration (DIFP) and under the direction of a 13-member board of trustees. The governor would appoint five members of the board, including a member from a licensed health insurance carrier. The exchange would also require each health carrier seeking certification as a qualified health plan to submit a justification for any premium increase before implementing that increase. Premium rates and contract language would have to be approved by the director of DIFP. The bill would exempt individuals from the federal PPACA mandate if there is no affordable qualified health plan available through the exchange or the individual’s employer. We expect the bill will be heard in Committee this week, after which drafting and negotiations will continue.

Two North Carolina health insurance exchange bills were filed last week. The bill that will likely move closely mirrors the National Association of Insurance Commissioner model legislation and is expected to be passed as a placeholder for legislation to come in 2012.

The Tennessee health insurance Department of Commerce and Insurance announced its legislative package last week, and it included a rate review bill. The bill is broadly written and gives the Commissioner authority to deny any rebates when the solvency of the company is in question.

The Department of Texas Health Insurance announced last week that it is in the process of reviewing and preparing for implementation of the PPACA MLR and rate review rules. They have invited stakeholders to participate in an informal work session on March 2 to obtain input on these topics. Additionally, since insurance carriers are not required to file rates for small group coverage in Texas, Department staff members are seeking input regarding the best and most efficient method of obtaining premium rate information for the small group market.

The new rates are effective July 1, 2010

Health Care Reform
President Obama Signs Final Health Care Bill into Law:  On Tuesday, President Obama signed into law the package of changes to the newly enacted Patient Protection and Affordable Care Act. Approved over unanimous Republican opposition in both chambers of Congress, this reconciliation bill increases the overall cost of the health care reform legislation by $65 billion, bringing the new total to $940 billion over the next 10 years.

What Does This Health Care Reform Legislation Mean: The biggest changes to the nation’s health insurance system will not take effect until 2014. Some of the changes include: the creation of insurance marketplaces called “exchanges” where people can shop for insurance; rules requiring insurers to accept all applicants, including those with pre-existing conditions; and an expansion of state Medicaid programs. Some additional provisions will become effective immediately while others will kick in later this year.

These are some of the features of the new health care overhaul bill passed through the reconciliation process and slated to begin to take effect in 2010:

• For new sales and subscribers who change policies after March 23, 2010, insurance companies will be required to make additional changes beginning in approximately 6 months, such as removing any member cost sharing for “preventive” benefits (as defined by the legislation). The renewal product requirements beginning for plan years 6 months after enactment include:

• Coverage for dependents up to age 26;

• Removal of limits on lifetime maximum benefits;

• Temporary federal high-risk pools; and

• Tax credits for small group employers.

Health Care Reform Impacts on Premiums: There are concerns that the new taxes on health insurance will likely increase premiums. Members of the news media report that under the health care overhaul , young adults who buy their own individual health insurance will carry a heavier burden of the medical costs of older Americans. This is expected to raise insurance premiums for young people when the plan takes full effect in 2014.

Additional Activities
Several Companies Push to Repeal Provision of Health Care Law: The American Benefits Council, an association representing hundreds of large corporations, urged President Obama and Congressional Democrats to repeal a provision in the health care bill that reduces the tax deductions allowed to companies that provide drug coverage for their retired employees. As a result of this impending provision, companies like AT&T, Caterpillar, Prudential, Deere Co. and 3M have all announced substantial charges against their first-quarter earnings in order to comply with federal accounting rules.

Insurers Will Comply With Law Regarding Children’s Coverage: This past week, despite vague language in the new health care law regarding coverage of children with pre-existing conditions, insurance companies assured HHS Secretary Kathleen Sebelius that they await clarification and will comply with the law, effective later this year.

Indiana health insurance Joins States’ Lawsuit Against Health Care Bill: In response to the new health care reform legislation, the Attorneys General of several states across the country filed lawsuits arguing against the constitutionality of requiring Americans to purchase health insurance. This week, the state of Indiana joined 13 others in a lawsuit filed last week in a Florida federal court. The 14 states – Indiana, Florida, Alabama, Colorado, Idaho, Louisiana, Michigan, Nebraska, Pennsylvania, South Carolina, South Dakota, Texas, Utah and Washington – will become joint plaintiffs in the suit and split the costs of the legal challenge.

Doctors Group Files Lawsuit to Repeal Health Care Legislation: The Association of American Physicians and Surgeons filed a lawsuit in the U.S. District Court for the District of Columbia against HHS Secretary Kathleen Sebelius and Social Security Administration Commissioner Michael Astrue. Attorneys for the group argue that the insurance mandate is unconstitutional. They also argued against the constitutionality of other provisions saying, “If the bill goes unchallenged, then it spells the end of freedom in medicine as we know it.”

Public Opinion
More Americans Disapprove of President’s Handling of Health Care: In a recent CNN poll, 54 percent of Americans said they disapprove of the way President Obama is handling health care reform, while 45 percent approve. In addition, 56 percent of respondents feel the Democrats’ health care legislation creates too much government involvement in the nation’s health care system.

Americans Unhappy over Health Care Reform Passage: In a recent USA Today/Gallup poll, 50 percent of Americans said the recent passage of health care reform legislation is a bad thing. Further, 55 percent say health care costs in the U.S. will rise as a result of the bill.

Two Polls Offer Different Results:  In a newly released Rasmussen report, 54 percent of Americans favor repealing the recently enacted health care legislation. Further, 49 percent believe the new law will reduce the quality of care, while 60 percent think it will increase the federal budget deficit. In contrast, supporters of reform are touting the recent CNN poll that shows 50 percent of Americans are either fine with the new legislation or would favor seeing more government involvement in health care. In this poll, only 47 percent of Americans favor repealing the bill.

Looking Ahead
Late this week , President Obama traveled to the swing states of Maine and North Carolina to discuss details of the new health care reform law and its effects on unemployment and small business. At the same time, Republicans continue to debate how best to leverage growing discontent over the bill and its implications in the months leading up to the November elections. In the meantime, it’s within federal agencies such as HHS that much of the detail, timing and how-to questions will be worked out going forward.

Some vaccines might not even be available due to such profound budget cuts. Even more changes could be coming along next year. Current North Carolina health insurance plans will provide coverage for vaccinations listed under child preventive care. Visit Easy To Insure ME to compare plans so that your child can get vaccinated for school and help fight against preventable diseases.

There needs to be more doctors in Tyrrell County and current ideas feel that if North Carolina health insurance reform does go through, there will be no doctors in the county to serve the residents. To make matters worse, this nurse practitioner is limited to what she can do according to the American Medical Association. Of course she has the ability and knowledge to do almost anything, but the AMA feels patient care could be jeopardized and only allows the nurse to perform certain health care duties.

This order has been issued because of deceptive advertising and the sales of unauthorized Kansas health insurance. The companies are based out of Tennessee and have been served a cease and desist order from several states.

Consumer complaints allowed the commissioner to take action and recognize who was the cause of the problem. Employees weren’t even licensed in the state. Every person who sells Kansas health insurance must go through the correct licensing procedures and be approved by the state before making any sales or presentations.

States that have filed cease and desist orders against the companies are North Carolina, Missouri, Oklahoma, Connecticut, and Michigan.

North Carolina health insurance carriers must cover mental health conditions like depression, bipolar disorder, paranoia, schizophrenia, anorexia, and obsessive compulsive disorders. This new law will most likely cause an increase in North Carolina health insurance rates. However, other states that have implemented this law reported no health premium increases.