Healthcare Reform 101: Finding Coverage for Those You Serve

1. Healthcare Reform 101: Finding Coverage for Those You Serve

2. Software Screen

3. Today’s Speaker John CoburnDirector of TrainingHealth & Disability Advocates

4. Patient Protection and Affordability Act and Health Care and Education Reconciliation Act June 2010 Presentation by: John V. Coburn jcoburn@hdadvocates.org Health & Disability Advocates, Chicago, Illinois

5. Themes of Healthcare Reform • “If you got it, we want you to keep it and it may get better.” • “Now, we spend all our time trying to figure out IF those we serve qualify for coverage and how. In the future, for most, it will be a matter of finding out WHICH coverage is appropriate.” • “Everybody has a box. This is a game of figuring out which box and, if there is more than one, which box is best.”

6. If you got it, HCR wants you to keep it. • This new system does not replace the old one but is in addition to the old one. • If you have coverage or a “box”, whether public or private, that box was meant to continue. • Of course, introducing a new system on top of an old system may cause changes. • Coverage of uninsured with enhancements and reforms to current system thrown in is the purpose of this law.

7. Shifting Our Services from “If” to “What” • Currently, millions do not qualify for health insurance in private or public markets. • In new system, advocates will be determining where people fit. • PAPs and charities may respond with eligibility and service changes in this new environment.

8. Finding that Box • Those who work with PAP and other programs with income/asset eligibility should feel right at home in this new system. • Like we have to do now, this is a matter of finding the appropriate coverage to which a person qualifies. • While there still may be gaps, most individuals will be able to find coverage under SOME category. • Categories may have different types and levels of coverage.

9. Areas to Discuss • High Risk Pools • Changes to Medicare Part D • Other Changes to Medicare • Medicaid Expansion and New Insurance Exchange • Private Insurance Changes • Decisions States Will Need to Make

10. High Risk Pool Expansion • For individuals with pre-existing conditions and no insurance for last 6 months. • Premiums same as standard population. • Cost sharing cap of $5950 individual, $11,900 family. • Operates until 2014 when Medicaid expansion and insurance exchanges begin. • Funded with 5 billion. • hhs.gov/ociio/initiative/hi_risk_pool_facts.html

11. Will My State Have a HR Pool? • States have the option to run their own pool or have the feds run the pool for them. • “Rejection of high risk pool” language in media and politics was misleading. • Coverage will be available in every state and the dollar amounts have been allocated.

12. Medicare Part D • Changing of Annual Enrollment Period • Drug Manufacturer Discount During Doughnut Hole • Discounts to Generics during Doughnut Hole • Closing of Doughnut Hole • Uniform Exceptions and Appeals Process

13. Medicare Part D • AIDS Drug Assistance Program and Indian Health Services Count as TROOP • Means-tested Part D premiums • Formulary Requirements for 6 Protected Classes and Others • Elimination of part of tax deduction for employer retiree plans

14. Changes to Medicare Advantage • Open enrollment in January through March eliminated • Freeze in payments to MA plans in 2011. • Plans paid fixed percentage of traditional Medicare. • MA plans must remit a specified sum if don’t maintain medical loss ration of 85%. • Prohibit higher cost sharing for certain services

15. Other Medicare Provisions • Improvements to care coordination through new Federal Coordinated Healthcare Office • Independent Payment Advisory Board • Elimination of cost sharing for certain preventative services and free annual check-up. • Freeze Part B means tested income levels at 2010 through 2019

16. Medicaid Pre-Reform • Medicaid Categorical Eligibility (TANF, SSI) • Medicaid Medically Needy (Spenddown, Incurment, Share of Cost) • Medicaid Buy-In for Workers with Disabilities • Medicaid Waivers • Other Optional Categories • Every State is Different in What is Covered and is Allowed to Use Different Income and Asset Calculations.

17. Medicaid Now Through 2014 • Same categories. • Enhanced federal participation continues as long with restrictions in how eligibility can be changed (“maintenance of effort”). • Option to cover individuals in “newly eligible” category prior to 2014 roll out (explained below) both above and below the 133% FPL.

18. Medicaid Expansion 2014 • In 2014, all up to 133% FPL eligible for Medicaid, called “newly eligible”. • “Newly eligible” must be under 65, not entitled to or enrolled in Medicare A or enrolled in Part B. • Use modified gross income test and no asset test. • Federal government pays for much greater percentage of this expansion. • Could be very important for Medicare waiting period.

19. “Newly Eligible” Medicaid • May not necessarily look like the Medicaid package currently offered for other categories in your state. • Benchmark or “benchmark equivalent” coverage…….still being defined. • Must Include “Essential Benefits”

20. Other Medicaid Changes • Community First Choice Option (enhanced match of 6% to offer home and community based • State Balancing Incentive Program (states submit plans to increase percentage of care provided in community setting)

21. Newly Eligible Essential Benefits • Outpatient and lab services, • Emergency services, • Hospitalization, • Maternity and newborn care, • Pediatric services, including oral and vision care, • Mental health and substance abuse, including behavior health treatment, with parity to physical health services, • Prescription drugs, • Rehabilitative and habilitative services and devices, and • Preventive and wellness services and chronic disease management

22. New Insurance Exchange 2014 • States will establish exchange for individuals and exchange for small businesses. • Most individuals (exceptions include financial hardship, religious exemptions, etc) must obtain insurance or pay fine greater of $695 per person (family max) or 2.5% of income • Premium and cost sharing subsidies are available. • Uniform benefits packages ( must include “essential benefits” and states can add more) with four levels of value.

23. Subsidies on the New Exchange • Premium subsidy available to individuals up to 400% FPL through tax credit. • Premium subsidy tax credit is calculated at that amount that would assures that a person could purchase second lowest cost silver plan (70% actuarial) at certain percentage of income. • Cost sharing subsidy allows people with incomes up to 250% of FPL to purchase higher actuarial value plans with same premium subsidy. • Up to 400% FPL, there is a reduction in out of pocket maximum.

24. Bottom Line: Insurance Options • Medicaid as we know it (SSI, people with disabilities, TANF, kids etc.). • Medicare with reforms. • High Risk Pool until 2014 • Newly Eligible Medicaid up to 133%FPL. • Subsidized Insurance Exchange Product up to 400% FPL • Insurance Exchange Product with No Subsidy.

25. Private Insurance Reforms • Prohibition on pre-existing exclusion for children (2010) • Young adults can stay on parent’s insurance until 26 (2010) • Prohibition on lifetime limits and recissions (2010). • Prohibition on denying coverage based on gender or health status (pre-existing condition). (2014) • Rating variation based on age on 3:1. (2014) • Waiting periods limited to 90 days. (2014)

26. Decisions States Will Need to Make • Participation in High Risk Pool and what it will look like. • Expanding Medicaid prior to 2014. • What “newly eligible” Medicaid will look like. • Offering state exchange product. • If applicable, revising SPAP given changes to Part D. • Education and Outreach opportunities.

27. What Should You Do Now? • Learn what your state plans to do with the high risk insurance pool and determine if your consumers will benefit. • Review Medicare timeline and be prepared for upcoming changes. • Find a state resource to keep you up to date---much can still be different on a state level. • Review helpful website materials to get the general overview down and then start to take specifics, one at a time……..you have time!

28. Questions / Discussion ?

29. Have additional questions? Please contact us at info@rxassist.org