INNOVATIONS BY CATEGORY

NATIONAL ASSOCIATION OF INSURANCE COMMISSIONERS STATE INNOVATIONS IN MODERNIZING HEALTH INSURANCE AND EXTENDING COVERAGE TO THE UNINSURED June 2007 THIS PAPER IS A PRELIMINARY DRAFT REPORT ON INNOVATIVE STATE EFFORTS TO REDUCE THE NUMBER OF AMERICANS WITHOUT HEALTH INSURANCE COVERAGE. THIS IS BY NO MEANS AN EXHAUSTIVE TREATMENT OF THE SUBJECT. WE ARE CONTINUING OUR SURVEY OF STATES AND WILL EXPAND AND UPDATE THIS REPORT AS RESPONSES ARE RECEIVED. ANY COMMENTS AND SUGGESTIONS WILL BE WELCOME. Table of Contents INNOVATIONS BY CATEGORY............................................................................................................. 1 ACCESS ...................................................................................................................................................... 1 Child Coverage Initiatives .................................................................................................................... 1 Clinic-Based Care................................................................................................................................. 2 Community Health Centers................................................................................................................... 2 Community Initiatives ........................................................................................................................... 2 High Risk Pools .................................................................................................................................... 3 Medicaid Expansion.............................................................................................................................. 4 Medicaid Reimbursement...................................................................................................................... 6 Mental Health ....................................................................................................................................... 6 Prescription Drug Plan......................................................................................................................... 7 SCHIP Expansion ................................................................................................................................. 7 School-Based Health Centers ............................................................................................................... 9 Telehealth.............................................................................................................................................. 9 ADMINISTRATIVE REFORMS ..................................................................................................................... 10 Electronic Filing ................................................................................................................................. 10 File and Use........................................................................................................................................ 10 Long Term Care Coordination ........................................................................................................... 10 Provider Certification......................................................................................................................... 11 Rate and Form Review........................................................................................................................ 11 Regulatory Checklists ......................................................................................................................... 11 Standard Forms & Processes ............................................................................................................. 11 Uniform Coding .................................................................................................................................. 12 Uniform Provider Credentialing......................................................................................................... 12 INFORMATION........................................................................................................................................... 13 Data Collection................................................................................................................................... 13 Health IT ............................................................................................................................................. 13 Insurer Transparency.......................................................................................................................... 15 Provider Transparency ....................................................................................................................... 16 MANDATES ............................................................................................................................................... 17 Cost Limitations.................................................................................................................................. 17 Mandate Review Commissions............................................................................................................ 17 Mandate-Light Plans .......................................................................................................................... 18 Moratoria............................................................................................................................................ 19 Standard Plans.................................................................................................................................... 19 MARKET REFORM..................................................................................................................................... 19 Auto Insurance Coverage of Medical Costs........................................................................................ 19 Conversion .......................................................................................................................................... 19 Discount Medical Plans...................................................................................................................... 19 Employer Mandate.............................................................................................................................. 20 Excess Surplus .................................................................................................................................... 20 Health Insurance Exchanges .............................................................................................................. 20 Health Savings Accounts..................................................................................................................... 21 Individual Mandate............................................................................................................................. 21 Individual Market................................................................................................................................ 21 Interstate Cooperation ........................................................................................................................ 22 Long Term Care Insurance ................................................................................................................. 22 Market Conduct .................................................................................................................................. 23 Out-of-State Groups............................................................................................................................ 23 Pay-or-Play......................................................................................................................................... 23 Plan Design......................................................................................................................................... 24 i Pooling................................................................................................................................................ 24 Portability ........................................................................................................................................... 26 Prescription Drug Pools ..................................................................................................................... 26 Rating.................................................................................................................................................. 26 Reserving Levels ................................................................................................................................. 27 Small Group Market ........................................................................................................................... 27 Standardized Plans ............................................................................................................................. 30 Systemic Cost Containment................................................................................................................. 30 Underwriting....................................................................................................................................... 30 QUALITY .................................................................................................................................................. 31 Error Reporting .................................................................................................................................. 31 Pay for Performance........................................................................................................................... 31 Quality Measurement.......................................................................................................................... 31 SUBSIDIES................................................................................................................................................. 33 Employer Subsidy................................................................................................................................ 33 Individual Subsidies ............................................................................................................................ 33 Multi-Share Programs ........................................................................................................................ 33 Prescription Drug Discount Cards ..................................................................................................... 35 Reinsurance ........................................................................................................................................ 35 Subsidized Plans ................................................................................................................................. 36 Subsidized Prescription Drug Plans ................................................................................................... 40 Tax Credits.......................................................................................................................................... 40 WELLNESS ................................................................................................................................................ 42 Chronic Care Management................................................................................................................. 42 Diabetes .............................................................................................................................................. 42 Health Management............................................................................................................................ 43 Healthy Lifestyle ................................................................................................................................. 43 Incentives ............................................................................................................................................ 44 Preventive Care .................................................................................................................................. 44 Tobacco Use ....................................................................................................................................... 44 OTHER EFFORTS ....................................................................................................................................... 44 Studies................................................................................................................................................. 44 Systemic Reform.................................................................................................................................. 47 INNOVATIONS BY STATE..................................................................................................................... 50 ALABAMA ................................................................................................................................................ 50 ALASKA.................................................................................................................................................... 50 ARKANSAS ............................................................................................................................................... 52 CALIFORNIA ............................................................................................................................................. 52 COLORADO ............................................................................................................................................... 54 CONNECTICUT .......................................................................................................................................... 56 DISTRICT OF COLUMBIA ........................................................................................................................... 57 FLORIDA ................................................................................................................................................... 58 GEORGIA ............................................................................................................................................... 60 HAWAII .................................................................................................................................................... 61 ILLINOIS ................................................................................................................................................... 61 IOWA ........................................................................................................................................................ 63 KANSAS .................................................................................................................................................... 64 KENTUCKY ............................................................................................................................................... 64 MAINE ...................................................................................................................................................... 66 MARYLAND .............................................................................................................................................. 67 MASSACHUSETTS ..................................................................................................................................... 68 MICHIGAN ................................................................................................................................................ 69 MINNESOTA .............................................................................................................................................. 71 MONTANA ................................................................................................................................................ 71 NEBRASKA ............................................................................................................................................... 72 ii NEW MEXICO ........................................................................................................................................... 72 NEW YORK ............................................................................................................................................... 74 NORTH CAROLINA .................................................................................................................................... 76 OHIO......................................................................................................................................................... 79 OKLAHOMA .............................................................................................................................................. 80 OREGON ................................................................................................................................................... 81 PENNSYLVANIA ........................................................................................................................................ 86 RHODE ISLAND ......................................................................................................................................... 89 SOUTH DAKOTA ....................................................................................................................................... 90 TENNESSEE ............................................................................................................................................... 90 TEXAS ...................................................................................................................................................... 91 VERMONT ................................................................................................................................................. 91 VIRGINIA .................................................................................................................................................. 96 WASHINGTON ........................................................................................................................................... 97 WEST VIRGINIA ........................................................................................................................................ 98 WISCONSIN ............................................................................................................................................... 99 WYOMING .............................................................................................................................................. 100 iii Innovations By Category Access Child Coverage Initiatives Colorado In 2005, the Legislature required health carriers to offer to parents coverage for their children up to age 25 who have the same legal residence as their parent(s) or are financially dependent on their parent(s). Carriers may charge additional premium for a rider or supplemental coverage for such children. Massachusetts Health reform legislation enacted in 2006 requires, beginning January 1, 2007, that insured products covering dependents continue to cover dependents through the earlier of age 26 or two years following loss of dependent status under federal tax rules. Oregon Children’s Group Insurance Plan To improve access to private health insurance coverage for more children, in 2004 Governor Kulongoski developed a Children’s Group Insurance Plan in conjunction with the Oregon Insurance Pool Governing Board. The plan allows employers to provide children’s only coverage to the children of their employees. Oregon Healthy Kids Plan In 2006, Governor Kulongoski introduced the Healthy Kids Plan, which will provide every child in Oregon access to health care. When implemented the plan will be available to all uninsured children up to age 19. The goal of the Healthy Kids Plan is to provide every child in Oregon access to the health care. Key components: Eligible to all uninsured Oregon children up to age 19. All participants will have the same insurance card. Streamline and simplify the enrollment process using existing programs and partnerships with schools, health care providers and NGOs. All children in families with incomes up to 200 percent of the Federal Poverty Level will be eligible for comprehensive coverage through the Oregon Health Plan and Family Health Insurance Assistance Program. Families with incomes between 200 percent and 350 percent of the Federal Poverty Level will be eligible to buy affordable comprehensive group coverage for their children, including mental health and dental benefits; a sliding scale based on family income will determine the size of premiums and co-pays. Families with incomes above 350 percent of the Federal Poverty Level will be eligible to buy a pooled health insurance product for their children, including mental health and dental benefits School-based health centers will expand into five new counties; and at least five more centers will open in the 19 counties that already offer school-based health care. Clinic-Based Care West Virginia Clinic Based Health This is a pilot program that will permit doctors to sell a prepaid service that emphasizes preventive and primary care. It may be sold to groups or individuals and it may only be sold to persons or groups who have not had health insurance in the past twelve months. Community Health Centers Alaska Alaska has worked on improving access to primary health care and prevention services by increasing the number of federally-funded Community Health Centers from 2 to 21 organizations and from 2 to over 120 sites in the last ten years. Community Initiatives New York New York State Health Foundation As part of legislation authorizing the conversion of Empire Blue Cross Blue Shield to a for-profit company, the legislature and the governor created the New York State Health Foundation. The foundation is tasked with a mandate to expand health insurance coverage for those who are unable to afford it, to improve access to care, and to educate people about health issues and was funded by a portion of the state’s proceeds from the conversion. In its first year of grantmaking, the foundation plans to support small-scale demonstration programs by community groups, clinics and schools and to help replicate those programs elsewhere. Washington Community-based health care collaboratives A Community Health Care Collaborative Grant Program was established by House Bill 6459 in 2006 and funded with $1.5 M for the fiscal year beginning July 1, 2006. The program can award grants up to $250,000 to a community-based organization that proposes to increase access for 2 appropriate, affordable health care services. Community-based organizations will target lowincome families and provide at least $2 in matching funds for every state dollar. West Virginia OUCH This local program serves Cabell County in West Virginia by joining together small businesses, providers and uninsured employees in a program to provide basic health care. This program was initiated with federal money from the CAP program and has continued to remain viable after the federal funding ceased. High Risk Pools Alaska Alaska has a high-risk pool with maximum premiums limited to 145 percent of standard health insurance premiums. In recently passed, but as yet unsigned, legislation, Alaska will allow health insurers a 50 percent premium tax offset for their high-risk pool assessments to help reduce the cost of assessments, which could be passed on to consumers. Connecticut Connecticut has a high risk pool, also known as the Health Reinsurance Association (HRA), with maximum premiums limited to 150% of standard small group health insurance premiums. HRA also acts as the alternative mechanism for the individual health insurance market in accordance with HIPAA. HRA provides portability coverage for people who have exhausted COBRA benefits. Colorado Colorado’s high-risk pool for the medically uninsurable, known as CoverColorado, has developed a funding mechanism through the state’s unclaimed property fund to supplement its premium income. In addition, CoverColorado has developed a premium subsidy program to assist persons with their premiums, which are pegged at between 100 and 150 percent of the standard risk rate established by survey of the five largest carriers offering a comparable policy. Florida Passage of legislation establishing The Florida Health Insurance Plan as a high risk plan. (Note that implementation of this plan is pending legislative funding). Maryland Maryland implemented the Maryland Health Insurance Plan, a high-risk pool for medically uninsurable individuals, in 2003. New Mexico The New Mexico Medical Insurance Pool (NMMIP), the state's high-risk pool, provides a variety of plans for high-risk individuals, and further provides premium assistance for income-eligible persons and HIPAA-eligible persons, up to 70% of the premium. See: http://www.nmmip.com Oregon Oregon Medical Insurance Pool In 1987 the Oregon Legislature established the Oregon Medical Insurance Pool and it issued its first policy in July 1990. OMIP provides medical insurance coverage for all Oregonians who are unable to obtain medical insurance because of health conditions. There are currently 15,000 Oregonians enrolled in OMIP. 3 OMIP provides portability coverage for people who have exhausted COBRA benefits and have no other portability options available. OMIP offers coverage for individuals who are eligible to receive a federal tax credit under Section 35 of the Internal Revenue Code (Health Care Tax Credit). Premiums from enrollees cover only about 60 percent of the medical and drug claims costs in the program. The commercial insurance companies that conduct business in Oregon pay an assessment to OMIP, based on their market share, to cover the remaining 40 percent. Premium rates are higher than those charged by the commercial insurance carriers (currently 110 percent of commercial rates) and may be up to 120 percent of commercial rates. South Dakota South Dakota does have a high risk pool that is subsidized by the various stakeholders. In addition to state funding, there is a per member assessment on health and stop loss carriers (currently $.25 per member/per month) and a reduction in reimbursement for participating providers, which has been recent adjusted to 135 percent of Medicaid. The costs are further controlled by a mandatory disease management program that includes significant penalties for noncompliance (reduction to 50 percent coinsurance). The establishment of the risk pool as a substitute for guaranteed issue was critical in stabilizing the individual market and providing coverage for individuals displaced by large scale nonrenewals by carriers exiting the individual major medical market nationwide. Prior to the establishment of the risk pool, the individual market was constricting dramatically and was on the brink of collapse. The risk pool also serves as South Dakota’s individual market alternative mechanism under HIPAA. Tennessee AccessTN AccessTN will offer comprehensive health insurance for uninsurable Tennesseans through a high risk pool. The program will be funded through participant premiums, state appropriations, and industry assessments and will offer two health insurance plans. One plan will be similar to the state employee helaht insurance plan, while the other will be a high deductible health plan with an optional health savings account. Enrollment will begin in late 2006 or early 2007. Washington Washington State Health Insurance Pool The Pool is a high risk pool for 3100 individuals whose potentially high medical expenses screen them from the private individual health insurance. In 2006, the Pool coordinated with the Medicare Prescription Drug Program to reduce spending. West Virginia AccessWV The West Virginia pool used an innovative subsidy scheme whereby the hospitals are taxed to provide the state subsidy for the pool. The pool is available to federally eligible persons and for Trade Act subsidies. Medicaid Expansion Iowa In 2005, the governor signed legislation creating the Iowa Care program, qualifying the state for federal matching funds for indigent care at the University of Iowa Hospitals, Broadlawns Medical 4 Center, and the state’s four mental hospitals. People with incomes below 200 percent of the federal poverty level will be eligible for the program and will pay a premium of up to $75 a month. The program also provides incentives for enrollees to improve their health by losing weight and quitting smoking. Massachusetts As part of its 2006 health reform legislation, the state expanded Medicaid eligibility and increased its outreach efforts to enroll eligible individuals in the program. New Mexico State Coverage Insurance (SCI) Program The SCI Program began enrollment July 1, 2005 through a Medicaid waiver program, which utilizes federal and state funding plus contributions by employers and employees on a sliding scale/income-based basis of $0 to $35 per month. The program serves employees at or below 200% FPL of participating small employers with less than 50 employees and self-employed individuals. Not available to employers who have voluntarily dropped health insurance in the last 12 months or employees who have dropped health insurance voluntarily in the last 6 months. There is a limited benefit package based on a commercial product, not a traditional product. The cost to the employer is approximately $75 per employee per month. See details at: http://nmsci.state.nm.us New York The Health Care Reform Act of 2000 (HCRA 2000) created several health care initiatives designed to work together with the State’s existing Child Health Plus program to reach the uninsured. The Family Health Plus program was created to provide free coverage to very low income adults who earn too much to qualify for Medicaid. Adults aged 19-64 may qualify if their income is less than 100 percent of the Federal Poverty Level, or less than 150 percent of the Federal Poverty Level if they have children. Oregon Oregon Health Plan From 1989-1993, the Oregon Legislature passed a series of laws known collectively as the Oregon Health Plan that: Extended Medicaid coverage to Oregonians with income below the Federal Poverty Level and established a set of benefits based on a prioritized list of health services. Required waivers from CMS. Created the Oregon Health Services Commission to rank medical services from most to least important to the entire population (the “prioritized list”). The prioritized list of more than 700 physical health, dental, chemical dependency and mental health services available through the Oregon Health Plan is maintained by the Health Services Commission. The Legislature sets the funding level to cover a certain number of services on the list but cannot rearrange the list. Vermont Medicaid Access Initiative Since the largest group of the uninsured are eligible for Medicaid but not enrolled, the Catamount Health legislation addresses ways to increase enrollment and retain beneficiaries: 5 Premiums for children enrolled in the Medicaid Dr. Dynasaur program are decreased by 50%. Premiums for adults in the Medicaid VHAP program are decreased by 35%. The Vermont Agency of Human Services and others, using information from the 2005 Vermont Family Health Insurance Survey, will make recommendations for Medicaid enrollment reform to reduce the number of Medicaid-eligible uninsured. Wisconsin BadgerCare BadgerCare extends Medicaid coverage to uninsured children and adults with incomes up to 185 percent of the federal poverty line, with renewal allowed until income exceeds 200 percent of the federal poverty line Medicaid Reimbursement Vermont Medicaid Provider Reimbursement Increases. Significant Medicaid provider underpayments can threaten access to care, and underpayments result in a cost shift to commercial plans that must be paid by commercial health insurance premiums. The Catamount Health legislation will increase Medicaid provider reimbursements in the following manner: evaluation and management services will be paid at Medicare rates in order to support primary care physician practices; incentive payments will be provided to health care professionals participating in the Medicaid care coordination program; and reimbursement increases in the future will be tied to performance measures established by the Blueprint for Health - the Chronic Care Initiative. Mental Health Connecticut In 2000 Connecticut passed legislation which requires individual and group health insurance polices to provide coverage for treatment for mental or nervous conditions at the same level, and subject to limitations no more restrictive than those imposed on coverage or reimbursement of expenses arising from treatment for other medical conditions. Nebraska Behavioral Health Reform In 2004, the legislature adopted, and the governor signed, the Nebraska Behavioral Health Systems Act to reform the state’s behavioral health system by reducing its reliance upon stateowned Regional Centers and providing services in the least restrictive appropriate setting while accessing federal Medicaid dollars. The new system will be designed to serve consumers closer to their home communities and help them live more independent lives with more support. They will be closer to their health care providers, support groups, family and friends in an environment that still provides safety and protection for the individuals and the community. The legislation also addresses the lack of behavioral health services once individuals no longer need the hospital-based inpatient services provided at Regional Centers or local hospitals. The new system will include many levels. Consumers requiring crisis stabilization will access enhanced crisis center services. Community hospitals throughout the state will be able to develop 6 acute psychiatric inpatient and secure residential services with the capacity to have locked units and highly trained staff. Residential rehabilitation services are less restrictive and more appropriate for some persons. Other non-residential community programs can provide services and reduce re-hospitalization. Regional Center beds will stay in place for individuals with high needs, and to provide specific care, such as the sexual offender and forensic programs. Oregon Mental Health Parity In 2005 the Oregon Legislature passed SB 1 which requires group health insurance polices to provide coverage for treatment for chemical dependency, including alcoholism, and for mental or nervous conditions at the same level, and subject to limitations no more restrictive than those imposed on coverage or reimbursement of expenses arising from treatment for other medical conditions. Prescription Drug Plan California Prescription Drug Discount Plan California will institute a plan that will provide discounts on prescription drugs of as much as 40% on brand name drugs and 60% on generic drugs to uninsured Californians with incomes below 300% of the federal poverty level ($60,000 for a family of four). For the first three years of the plan, drug manufacturers have the ability to voluntarily negotiate discounts. If after August 1, 2010 manufacturers do not provide discounts at the benchmark levels, the state may, upon federal approval, tie participation in Medi-Cal to participation in the discount plan. North Carolina In 2006 North Carolina’s Governor created NCRx, a new prescription drug assistance plan that will help low-income seniors participate in the federal Medicare Part D prescription drug program. NCRx became effective January 1, 2007 for those enrolled by December 31, 2006 and qualified. Once an application is approved and the participants are enrolled in a participating Medicare Prescription Drug plan NCRx will pay up to $18 of their monthly premium. SCHIP Expansion Colorado Colorado adopted a childrens’ health plan, Child Health Plan Plus, prior to the establishment of the SCHIP program and has continued the public-private partnership to provide low-cost health insurance to children whose families do not qualify for Medicaid but cannot afford private health insurance. The CHP+ program also covers prenatal care for eligible women. Illinois AllKids In 2005, the Governor signed legislation creating the AllKids program, which will provide coverage for children whose families earn too much to qualify for Medicaid or SCHIP, but not enough to afford private coverage. The program, which has absorbed KidCare, the state’s SCHIP program, is provides care through a primary-care case management system with families paying premiums on a sliding scale based upon their income. The state expects to provide coverage to an additional 50,000 children throughout the state, which will be funded with the premium payments and the savings realized by shifting the current SCHIP and Medicaid populations to primary-care case management. 7 Oregon Oregon participates in SCHIP. In 2004, the program was expanded by increasing the asset limit from $5000 to $10,000. Pennsylvania Cover All Kids Children's Health Insurance Program (CHIP) became one of the models for the national SCHIP programs. Pennsylvania's CHIP program is the oldest in the nation. Pennsylvania has continued to be innovative in seeking to expand health insurance coverage (CHIP Cover All Kids, the adultBasic program and the Blue Cross/Blue Shield Community Health Reinvestment Agreement) and assure access to other sources of coverage (such as the HCTC subsidies). Legislation has been introduced to implement Governor Rendell's proposed expansion of Pennsylvania's CHIP to Cover All Kids. This program would extend health insurance coverage to thousands of Pennsylvania's uninsured children whose parents earn too much to qualify for CHIP but who can't afford to purchase insurance for their children. Cover All Kids will guarantee affordable, comprehensive health care coverage for visits to doctors, hospitalization, prescription drugs, vision, home health care, and mental health and substance abuse services. Pennsylvania has one of the highest rates of insured children in the nation at 96 percent and Cover all Kids is designed to extend health coverage to each and every child in Pennsylvania. Tennessee CoverKids CoverKids is Tennessee's SCHIP program and is open to children that live in families with household incomes below 250% FPL. Families above this income level may buy into the program by paying a monthly premium. Washington Cover All Children by 2010 Incrementally cover 100,000 uninsured children by 2010. Reinstated Children’s Health Program in 2005 for non-citizen immigrant children to increase enrollment by 6500 children. West Virginia Coverage Under CHIPS Coverage under CHIPS was authorized to expand to children of families between 200% and 300% of the federal poverty level. Premiums, co-insurance or co-pays for these participants may be charged. Wisconsin BadgerCare SCHIP coverage is offered to parents of children in the SCHIP program if their income is between 100 percent and 185 percent of the Federal Poverty Level. Wyoming The State of Wyoming is seeking a HIFA waiver to cover parents of children in its Kid Care CHIP (SCHIP) program in families up to 200 FPL. The HIFA waiver includes an ESI component and a state plan offering, if ESI is not available. The program name is CHIP 4 Parents. 8 School-Based Health Centers Oregon In 2003 Governor Kulongoski preserved funding for School-Based Health Centers. In 2005 the Governor expanded state funding for SBHC, growing the number of counties with SBHCs from 14 to 19. By the end of 2006 Oregon will have at least 47 certified SBHCs. Telehealth Alaska Alaska has promoted major telehealth initiatives, such as the Small Hospital Teleradiology Project, and has a statewide Regional Health Information Organization, which is supported by the Alaska Telehealth Advisory Council, a state-tribal-private sector collaborative. Colorado Colorado encourages the use of telemedicine and prohibits carriers from imposing face-to-face contact requirements on provides of telemedicine services to rural residents. The state has also established a pilot program under Medicaid removing restrictions on reimbursement of telemedicine services and provide participants with telehealth devices to regularly monitor blood pressure, blood sugar levels, heart and lung sounds, and other factors to address the targeted conditions of congestive heart failure, diabetes and chronic pulmonary disease. Georgia In 2005, Commissioner Oxendine promoted modifications to Georgia law to expand the use of Telemedicine in Georgia, and to clarify and require insurers to recognize these modes of treatment in evaluating coverage and claims. Telemedicine is designed to be an extension of specialty care which combines local and regional providers working cooperatively to evaluate, diagnose, and treat patients. (O.C.G.A. Section 33-24-56.4) Georgia Rural Health Initiative. The Georgia Rural Health Initiative is a comprehensive privately funded program initiated by Commissioner Oxendine in 2004 that includes a statewide telemedicine network, teleradiology sites, and capital investments in rural Georgia healthcare facilities. Nebraska Nebraska is nationally recognized for its efforts to establish a statewide telehealth network. The State of Nebraska will build upon the success of the Nebraska Statewide Telehealth Network and the strength of the partnerships formed during its development as it begins to address issues related to the adoption of electronic health records and health information exchange. Telehealth is the provision of health care, patient education, continuing medical education, and administrative services using telecommunications. Nebraska has established one of the most extensive telehealth networks in the country, connecting the state’s rural hospitals, regional medical centers, public health departments, and the State of Nebraska. The major functions of the Network are to improve quality and access to care, particularly in rural Nebraska; to provide patient, provider and community education; and to provide another communication source in the event of a natural, man-made or terrorist emergency. 9 Administrative Reforms Electronic Filing Alaska Alaska has adopted a file-and-use option for form filings. Only Hospital Medical Service Corporation and Medicare supplement rates are now subject to filing. The state has also recently enacted legislation authorizing participation in the Interstate Insurance Product Regulation Compact. Florida The state has created the Florida's Office of Insurance Regulation Electronic Data Management System for processing all life/health form and rate filings. Michigan Michigan requires insurers who operate in more than one state to utilize the System for Electronic Rate and Form Filing (SERFF), which provides a cost-effective method of handling insurance policy rate and form filings between regulators and insurance companies. The SERFF system is designed to enable companies to send rate and form filings and for states to receive, comment on, and approve or reject them. New York Beginning in September 2003, New York streamlined the approval process by offering an optional expedited process of certification that offered priority over normal submissions. In November 2004, New York began accepting electronic filings of all health insurance products through the NAIC’s System for Electronic Rate and Form Filings (commonly called SERFF). North Carolina North Carolina accepts electronic submissions delivered both via the NAIC’s System for Electronic Rate and Form Filing (SERFF) or NC NoPaPER. Printed-paper form and rate submissions continue to be accepted. However, communications between Life & Health and the Industry are now in the form of electronic e-mail rather than printed-paper mailings. Each filer must provide a valid e-mail address with their filing to facilitate review and communication. File and Use Florida The state has passed legislation to amend the Florida health insurance filing statute to exempt large group rate filings for 51 plus size groups. Unnecessary filings have been eliminated, such as prior approval of rates for employer group plans issued by HMOs. Those carriers actively marketing individual major medical policies will now be able to file and use their rates, enabling the carriers to implement rate adjustments more quickly but still providing needed consumer protection through regulatory rate review. Long Term Care Coordination Michigan In 2005, Governor Granholm issued an executive order that established the Office of Long-Term Care Supports and Services and the Michigan Long-Term Care Supports and Services Advisory Commission. This order established a program to create a single point of entry system to coordinate the services and funding for those Michigan citizens needing some form of long-term 10 care service. The office and the commission were formed to implement the recommendations made in the Modernizing Michigan Medicaid Long-Term Care report issued in 2005. Provider Certification New Mexico In response to complaints from physicians, and pursuant to a State Legislature directive of 2003, the Division of Insurance has amended the Managed Health Care Rule to require provider certification once every three years (instead of the current requirement of once every two years). This is meant to cut down on physician paperwork and to occur concurrently with provider certification required for federal plans. Rate and Form Review South Dakota Reducing regulatory costs have been and continue to be a priority. South Dakota has been very successful in streamlining its policy and rate review processes. Filings on the property/casualty side typically have a one-day turnaround while life and health has maintained a five-day turnaround. Regulatory Checklists Alaska Alaska developed checklists of statutory and regulatory requirements by product in order to assist insurers in complying with Alaska's requirements and shorten state review time. New York To allow consumers access to more competitive insurance products, New York implemented several speed-to-market initiatives that assist insurers in getting their products through the approval process and to the marketplace faster. New York developed product checklists and outlines for each individual health product that provides insurers with a consolidated list of all statutory and regulatory requirements for a specific product filing in one place as well as an outline for each product that provides detailed explanations for reference. Use of these tools shortens the State’s approval process by assuring more complete and accurate filings. North Carolina North Carolina has developed product checklists for each type of health insurance product that provides insurers with a consolidated list of all statutory and regulatory requirements for a specific product filing. These regulatory checklists are available from our website for all products of life and health insurance. Use of these tools shortens the State’s approval process by assuring the filings are more complete and accurate when initially submitted. Standard Forms & Processes Alaska Alaska recently adopted regulations requiring the use of the NAIC Uniform Transmittal Document and has implemented the NAIC product coding matrix. These allow for uniform coding and tracking of filings and improve efficiency of the filing and approval process. Alaska regulations require use of a uniform claim form including use specific information that must be included on prescription drug cards in order for more efficient claim processing and more prompt payment of claims. 11 Alaska law requires insurers to pay clean claims within 30 days and requires payment of interest penalties on late payment of claims in order to encourage prompt payment of claims Colorado Colorado has adopted several administrative reforms intended to reduce transaction costs in the health coverage system. These include uniform claim form requirements, prompt payment regulations, and assignment of payment provisions. In addition, Colorado has established (effective 1-1-2007) a uniform small group application form. Washington The Washington Healthcare Forum is a coalition of health insurance carriers, providers, and purchasers. It has standardized forms and processes to streamline claims processing and eligibility determination. Uniform Coding New York Uniform Coding and Uniform Statistical Plan In response to concerns raised by providers, the New York Insurance Department has been meeting with provider and payer representatives to create a new regulation that would establish uniformity in the use and application of codes in the processing of health care claims to avoid claim delay. This regulation would also require every accident and health insurer and HMO to annually file with the superintendent a statistical report showing a classification schedule of its premiums, losses and related expenses on all kinds or types of accident and health insurance business subject to the insurance law and such other information as the superintendent may deem necessary. The intent is to establish a uniform statistical plan for the health insurance industry, where there is currently no consistency in the methods of data collection, classification (other than by aggregated lines of business), and reporting. Uniform Provider Credentialing Colorado Colorado has established a uniform provider credentialing form. Kentucky Established and required the use of a uniform application for the credentialing and recredentialing of health care providers. The uniform application is required to be used by all health insurers and the state’s Medicaid Program. The Office adopted guidelines and the actual form used by the Council for Affordable Quality Healthcare. North Carolina Since 1997, requirements have been in place for all managed care insurers, health maintenance organizations (HMO) and preferred provider health benefit plan insurers (PPO) to have a policy and procedure for credentialing of providers necessary to meet the needs of insured members. In 2002, North Carolina established and required the use of a uniform provider credentialing application form for the credentialing and re-credentialing of health care practitioners. The uniform application is required to be used by all HMOs and PPOs and the state’s Medicaid Program for the credentialing of licensed health care practitioners. The uniform credentialing application form is available from our website with additional questions and answers information. 12 Vermont The Department of Banking, Insurance, Securities and Health Care Administration will prescribe a uniform provider credentialing form for use by hospitals and health insurance companies on January 1, 2007. Information Data Collection Alaska Alaska collects health insurance premiums, claims, and count information by product annually. This information is used to determine insurer assessments for the state's high risk pool, to assist consumers in shopping for health insurance, and for market analysis and policymaking. Data collected from the survey is published annually in the Division of Insurance's annual report. Massachusetts As part of its overall health reform efforts, the 2006 law created the Health Care Quality and Cost Council composed of private and public representatives, to establish statewide goals for improving health care quality, containing health care costs, and reducing racial and ethnic disparities in health care and to collect and disseminate comparative cost, quality, and related information for consumers, health care providers, health plans, employers, policymakers and the general public. New Mexico Separate Agency to Collect Health Data The New Mexico Health Policy Commission collects health data from various state sources, organizes and analyzes the data for the purpose of assisting in the performance of health planning and policymaking functions. The data is also published in a form that is meant to be useful for consumers in making informed decisions regarding health care; and for the purpose of administering, monitoring and evaluating a statewide health plan. Health IT Florida The Governor’s Health Information Infrastructure Advisory Board is working toward making Health information readily available in a digital format improving health care due to wider availability of this information across health care providers and health care facilities. This is a statewide initiative. Maine The Maine Quality Forum is developing a statewide IT project which would allow any healthcare provider – with the patient’s consent – to access the patient’s complete medical records. Michigan Recently effective legislation created the Health Information Technology Commission within the Michigan Department of Community Health to facilitate and promote the design, implementation, operation, and maintenance of an interoperable health care information infrastructure in Michigan. 13 Michigan In December 2005, Governor Granholm convened the Michigan Health Information Network (MHIN) to begin building the foundations of a statewide health information network to advance the use of information and communication technologies. The MHIN is a collaboration of health care stakeholders and is already at work integrating the latest technology into Michigan’s medical networks. Pilot programs in mid-Michigan, Southeast Michigan, and the Upper Peninsula are already underway. This network will significantly reduce both duplicative services and mistakes made by health care professionals due to lack of access to a patient’s current health information, cut administrative costs, and create overall cost savings. Ohio The State of Ohio is currently formulating a statewide health insurance information strategic plan, which would be a roadmap for Ohio's health care and health insurance industries to adopt standardized health information technology and systems to exchange health information. Vermont The Department of Banking, Insurance, Securities and Health Care Administration, in collaboration with the Vermont Information Technology Leaders (VITL - a public-private partnership) is developing a statewide, integrated, electronic health information infrastructure for the sharing of health information among health care facilities, health care professional, public and private payers, and patients. 1 The Medication History Pilot Project will reduce the risk of adverse drug events, improve the quality of health care for many Vermonters, and save health care costs. The project will be used as the first step towards a comprehensive, state-wide health record system. Vermont The Multi-payer Data Collection project. Health care providers, hospitals and insurers need a comprehensive health information system in order to improve the quality and cost-effectiveness of the health care system. Modeled after programs in Maine and New Hampshire, the Department of Banking, Insurance, Securities and Health Care Administration is directed to design the data collection program, and to begin program implementation. Washington Inland Northwest Health Services has implemented a state-of-the-art electronic patient record system that secures and shares over 2.4 million patient records for more than 30 hospitals. The electronic records system has made the delivery of health care services safer and less expensive. Health information standard architecture A Health Information Infrastructure Advisory Board is tasked with developing a strategy for adoption and use of electronic medical records and health information technology consistent with national standards and that promote interoperability. West Virginia The West Virginia Health Information Network will implement and operate a statewide network to facilitate the use of health care information. 1 VITL - 18 V.S.A. section 9417; http://vitl.net/ndex.htm 14 Insurer Transparency Florida Creation of website providing Floridians the ability to compare and search the benefits and premiums for small employer health plans offered in the state. The Small Employer Sample Rate Search website gives small employers the ability to view and compare small group major medical health insurance rates for standard, basic and high deductible health plans currently available in the state. Small businesses can enter the employees that they employ in various categories and calculate an estimated monthly cost for their company. The site can be accessed at https://appst.fldfs.com/sercs/. A website that will provide easy access to Medigap policy pricing, plan options, and insurer quality of service information is being developed to provide a positive, interactive internet-based outreach tool that will allow consumers to compare various plans and pricing, therefore, allowing for a more informed choice and decision about their health care and health insurance options. The expected launch date is July 2008. Oregon Senate Bill 501, passed in 2005, requires health insurers to report certain financial data to the Insurance Division. This information will be published by the Division on a searchable website (www.oregoninsurance.org/insurer/rates_forms/industry_reports/industry_reports.html) in July 2006 and will allow the insurance-buying public to more easily compare insurers in terms of specified factors including premium trends, administrative costs, and net income. Oregon The Division is proposing a legislative concept for the 2007 legislative session that will require insurance companies to provide more specific information to their policyholders about the cost implications of their health care decisions. The concept also proposes that the Division define “usual, customary, and reasonable” and establish standards and guidelines for the use of UCR for coverage or reimbursement of medical expenses. Rhode Island The legislature is currently debating a legislative proposal which would create a structure for mandating the disclosure of premium increase factors to purchasers. Vermont Consumer Price and Quality Information System A major factor in the success of consumer driven health care plans is consumer access to good price and quality information. Good information is especially important, as more benefit plans require higher levels of out of pocket spending by consumers. The Catamount Health legislation is intended to address this issue by directing the Department of Banking, Insurance, Securities and Health Care Administration to adopt rules for health insurers to provide transparent price and quality information so that consumers are empowered to make economically sound and medically appropriate decisions. Washington The Washington State Office of Insurance Commissioner will make health insurance carrier financial performance data available to consumers (House Bill 2500). Web-based summaries of 15 health care services and administrative data will be made accessible through consumer-friendly formats. Provider Transparency Oregon Oregon PricePoint: http://www.orpricepoint.org In 2005 the Oregon Association of Hospitals and Health Systems introduced Oregon PricePoint, a web site that allows health care consumers to receive basic, facility-specific information about hospital services and billed charges. A basic query allows users to check billed charge and utilization information for 64 types of hospitalizations, representing about half of all hospital stays in Oregon. A comprehensive query offers users the ability to obtain information about all types of hospital stays in Oregon. Ohio Every hospital in Ohio is required to report to the health department the charges associated with the top sixty diagnosis-related groups most frequently treated on an inpatient basis by each hospital. This information is made available to the public by the health department. Legislation moving through the Ohio general assembly would require insurers to establish and maintain systems whereby their customers can obtain information about potential out-of-pocket costs for services performed by in-network providers. Oregon The Oregon Insurance Division is currently working with several stakeholder groups interested in improving transparency in the health care marketplace. Hospital costs are a key focus of this effort because these costs are the single largest component of health insurance premiums and continue to grow faster than many other costs, and because the public currently has limited information about hospital costs and how the rates charged to insurance customers relate to other rates. This information will be published on a searchable website later this year. Rhode Island The legislature is currently debating a legislative proposal which would create a structure for mandating the disclosure of procedure prices to consumers. 16 Mandates Cost Limitations Maryland Maryland's small group market limits the actuarial cost of mandated benefits required as part of Maryland's Comprehensive Standard Health Benefit Plan to 10 percent of the average wage of Maryland workers. As a result, the benefit cost is reviewed annually and benefits may be altered or reduced to meet the cost limitation. As a result of review, the prescription drug benefit mandated in the small group market has been reduced to meet required cost constraints. Maryland does rank at the top of the list for mandates. While the General Assembly has slowed the introduction of additional mandates in the large and individual markets considerably, none have been repealed. Mandate Review Commissions Arkansas The state legislature formed a mandate commission in 2001 to assess the annual impact of state laws requiring insurers to cover specific services and benefits on health care and health care insurance costs. The Commission is to review existing medical, financial and social impacts mandated benefits impose, if any, on health plans, and report its findings to a variety of legislative committees before November 1 of each year. After the 2001 session, the Commission was unable to meet to conduct business because not all of the initial appointments had been made. Until April 11, 2006, in fact, the Commission has never held its first meeting, or been fully composed of initial appointees to conduct business. In the 2005 session, the Legislature enacted that increased the powers of the Mandate Commission to require it to review and to report to a legislative committee to whom a bill is referred containing a mandated health within 45 days of receiving the bill. Colorado Since 2003, Colorado has had a Commission on Mandated Health Insurance Benefits to develop and provide the Legislature with information about mandated insurance benefits and proposed mandated benefits. The Commission is charged with reviewing, assessing and reporting on legislation referred to it, and providing information and recommendations to the Governor, standing legislative committees, and the Division of Insurance on mandated benefits and the Standard health benefits plan. Connecticut In 2000, Connecticut Insurance Department filed a report to the Connecticut General assembly regarding the Feasibility of Permitting the Sale in Connecticut of Group Standardized Major Medical Expense Coverage that Allow Individuals or Employers to Augment such Coverages with Optional Benefits. The report concluded that a low cost major medical plan with optional benefits is not a feasible option in Connecticut; employers were not interested in reducing benefits and providers were concerned about the effect of low option plans. Georgia Legislative Health Mandate Assessment Review Beginning in 1989, Georgia law required that health insurance benefit bills undergo a systematic assessment review as they made their way through the legislative process. The goal was to 17 provide the Georgia General Assembly, with expert commentary on the public interest and the potential effects on the market, the premium, administrative and other costs and operational impacts. The idea is to weigh costs versus benefits as part of the evaluation of newly proposed mandates as legislation makes its way through processes leading to potential passage. (O.C.G.A. Section 33-24-60 through 33-24-67) Mandate-Light Plans Arkansas Arkansas Health Insurance Consumer Choice The AR Health Insurance Consumer Choice Act allows individual and group health insurance consumers the alternative of choosing between buying an HMO or health insurance policy with state mandated health benefits and one without them. Each employee/certificate holder of a group health benefit plan will receive a written notice about the mandated benefits that he or she will be missing out on (assuming the group policyholder has selected a less expensive health plan that lacks some or all of the mandated benefits). The amendment also calls for this notice to be in the form and manner as determined by the Commissioner. Colorado The state has enacted legislation allowing employers to purchase “basic health benefit plans” that exclude coverage for: low-dose mammography, mental illness, hospice care, alcoholism, prostate cancer screening, and general anesthesia for dental procedures for dependent children. Florida Passage of legislation authorizing the creation of Health Flex Plans for uninsureds whose income does not exceed 200% of current poverty level. Georgia In 2005, Georgia adopted modifications to its small group and individual health insurance laws to allow insurers to optionally offer to small employers and individuals a product (sometimes described as “mandate-lite”) that contains a smaller set of required, key health insurance mandates. The law also requires a side-by-side offer of and disclosure about a more traditional product with the full spectrum of required health mandated benefits. (O.C.G.A. Chapter 33-60) Kentucky Basic Health Benefit Plans Allowed insurers to offer to small employer groups and associations basic health benefit plans that: • • Exclude state mandated benefits; and Provide limited coverage (physician, hospital, Rx, home health, preventive and emergency care only). Texas The state has enacted legislation, effective January 1, 2004, that allows insurers and HMOs to sell a standard health insurance policy that does not offer or provide state-mandated benefits. West Virginia Individual Limited Health Benefit 18 This program permits insurers to sell individual health insurance plans that do not contain the state mandated benefits. Only individuals who have not been insured for the past twelve months are eligible. Group Limited Benefits Health Plan This program permits insurers to sell group health insurance plans to cover temporary, seasonal and part-time employees who have not had access to a group plan in the past twelve months. Moratoria Kentucky Imposed a statutory moratorium on legislating new state mandated benefits for three years with the exception of any new federally mandated benefits. Standard Plans Kentucky Allowed the standard health benefit plan to be an optional product offered by an insurer, rather than a mandatory product. Market Reform Auto Insurance Coverage of Medical Costs Michigan Since 1973, Michigan has required all drivers to purchase no-fault auto insurance, which includes lifetime, unlimited coverage of medical and rehabilitation costs for injuries arising from the operation or use of a motor vehicle as a motor vehicle. Conversion Florida Florida enhanced its conversion law to require small group standard plan. Discount Medical Plans Connecticut Effective July 1, 2005, Connecticut General Statutes §38a-479qq - §38a-479rr required Medical Discount Plan (MDP) Organizations to be licensed with the Insurance Department. A MDP organization is defined as a person that: (A) establishes a medical discount plan, (B) contracts with providers, provider networks, or other MDP organization to provide health care services at a discount, and (C) determines the fees charged to members for the plan. Specifically excluded from licensing requirements are health insurers, health care centers, hospital service corporations, medical service corporations, or fraternal benefit society licensed in this state or any affiliate of such health insurer or center. 19 Florida The legislature adopted legislation regulating discount medical plan organizations to ensure that rates are fair and equitable. Employer Mandate Hawaii In 1971, Hawaii passed the Prepaid Health Care Act that requires all employers to purchase insurance for their employees. Employee contributions are capped at 1.5 percent of their wages. Excess Surplus Pennsylvania Blue Cross/Blue Shield Plan Surplus Determination and Order In February 2005, the Pennsylvania Insurance Department issued a Determination and Order addressing the surplus levels of the four Blue Plans in the Commonwealth. This Determination, for the first time, established a model for evaluating the appropriateness of the surplus levels of these non-profit entities, and set levels at which the surpluses are presumed sufficient or inefficient. Any Blues Plan determined to have a sufficient surplus is prohibited from using risk and contingency rate factors (i.e. profit/surplus building factors in their premium rates). The Department found that three Plans had sufficient surpluses. This meant that premium rates for these Blues Plans were constrained as a result of this Determination, keeping them more affordable for consumers. Washington The Washington State Office of Insurance Commissioner (OIC) is investigating whether health insurance carriers are holding excessive surpluses. Health Insurance Exchanges Massachusetts Commonwealth Health Insurance Connector The state’s recent health insurance reform bill created the Commonwealth Health Insurance Connector, to connect individuals and small businesses with health insurance products. The Connector certifies and offers products of high value and good quality. Individuals who are employed are able to purchase insurance using pre-tax dollars. The Connector allows for portability of insurance as individuals move from job to job, and permits more than one employer to contribute to an employee’s health insurance premium. The Connector is to be operated as an authority overseen by a separate, appointed Board of private and public representatives. Michigan In a new initiative in Michigan that is slated to be operational in 2007, health care will be provided through private market insurance products offered by a newly created “Exchange” to an affordable plan for individuals and families. The Exchange will facilitate enrollment, certify plans, administer premium subsidies for low-income enrollees, coordinate with employers to collect premiums, and leverage pre-tax contributions in order to reduce cost. 20 Health Savings Accounts Connecticut Connecticut allows carriers, including HMOs, to offer high deductible health plans Florida Florida has required offering a high deductible health plan that is compatible with federal HSA or HRA requirements to 1-life groups during the required August open enrollment period. Massachusetts The state’s recent health reform legislation allows HMOs to offer high deductible health plans in conjunction with health savings accounts. North Carolina North Carolina tax treatment of HSAs is identical to federal tax treatment. Ohio With additional demand for consumer driven health insurance products, Ohio law was amended to give HMOs flexibility with respect to copays and deductibles. To make sure consumers are not price-gouged when paying for health care costs out of pocket or with a savings account, legislation is moving through the Ohio legislature to ensure consumers get their health plan's negotiated rate when paying for medical services out of pocket or with a savings account. Ohio law was also amended to make certain Ohio insurers, including HMOs, can offer high deductible health plans linked to HSAs. Ohio also took steps to make certain Ohioans utilizing HSAs receive the same favorable treatment under state tax law as they do under federal tax law. Individual Mandate Massachusetts Create the nation's first individual mandate to purchase health insurance, effective July 1, 2007, which will be enforced through the tax code; Individual Market Georgia Renewal Offering Requirements (HB 1456) Passed in 2006, and applying to individual major medical products, the purpose of this legislation is to give consumers more information regarding additional options available to them at renewal and help insureds respond to premium rate changes. This legislation placed certain notice requirements on insurers offering individual health products: (1) Section 33-29-21.1 provides that when a dependent child reaches age of termination of coverage that the insurer must offer a policy of accident and sickness most nearly similar to prior coverage or offer a lesser coverage benefit plan without being subject to any additional underwriting; and (2) Section 33-29-9(b), which requires insurers to allow their individual major medical or comprehensive health customers, at renewal, to modify policy benefits and/or deductible levels, or to change coverage to a comparable product offered by the insurer without being subject to any additional underwriting. 21 Massachusetts The recent health reform legislation will merge the individual and small group insurance markets in July 2007 Oregon In the 1990s the Oregon Legislature adopted a series of reforms to promote the affordability and availability of health insurance for individuals and small employer groups. The Legislature focused on these market sectors because they were the primary areas with access problems. In 2003 the Legislature relaxed some individual and small group regulations. • • • • The individual health insurance market is an underwritten market; however, insurers can deny coverage only through use of a standard health statement. Insurers may impose waivers of coverage on preexisting conditions for up to 24 months (six month exclusions were allowed previously). Insurers may restrict an individual’s choice of health plans. Applicants who are denied coverage or offered restricted coverage are eligible for the Oregon Medical Insurance Pool (OMIP), the state’s high-risk pool. South Dakota South Dakota’s approach to rate banding in the individual markets has been to generally follow the format found in the 1993 NAIC small group model. Specifically, the state’s framework includes a +/- 30 percent maximum deviation from the index rate with a cap of 5:1 for the individual market. The success in keeping the uninsured rate low is at least in part due to providing adequate flexibility in rating so as to make rates sufficiently affordable to attract the younger healthier population without pricing the higher risks out of the market. Lifestyle continues to be an acceptable case characteristic to allow carriers to implement disease prevention and wellness programs. Interstate Cooperation Kentucky Interstate Reciprocal Health Benefit Plan Compact Kentucky is exploring the creation of an interstate compact for health benefit plans with surrounding states. Purpose of Compact: • • • • To promote the interest of consumers purchasing health benefit plan coverage; To develop uniform minimum standards for health benefit plan products covered under the compact (while ensuring that the standards established in Kentucky law and regulations are maintained and protected); To improve coordination of regulatory resources and expertise between state insurance departments regarding the setting of uniform minimum standards; and To perform these and such other related functions as may be consistent with the state regulation of the business of insurance. Long Term Care Insurance Connecticut Connecticut has a Long Term Care Partnership program which allows individuals to protect personal assets from Medicaid spend down. 22 Florida The Long-Term Care Partnership Program provides seniors with incentives to purchase more affordable Long-Term Care Insurance by allowing them to protect their personal assets in an amount equal to the benefits provided by their policy from Medicaid spend-down requirements. It also provides existing policyholders with viable options in the event of unaffordable rate increases that were previously only available to new policies. Included are several limitations on the amount of a rate increase that can be imposed on policyholders. All policies must have a two year contestable period and any challenges the insurer has to the policy must be raised during the first two years. After two years the only reason the policy can be cancelled by the insurer is for nonpayment of the premium. Elderly policyholders are protected from skyrocketing rate increases and unfair post-claims underwriting business practices. Rates are determined by pooling experience of all affiliated insurers. An insurer cannot charge existing policyholders more than it charges new policyholders for the same benefits. North Carolina The Long-Term Care Partnership Program provides incentives to purchase Long-Term Care Insurance by allowing insureds to protect their personal assets from Medicaid spend-down requirements in an amount equal to the benefits provided by their policy. North Carolina Department of Insurance is currently participating with the North Carolina Department of Health and Human Services in the development of the Long-Term Care Partnership Program for North Carolina, making any changes to regulations necessary for the program. Products in the market place already are satisfactory for use in the partnership program. It is anticipated the North Carolina program will be completed in the 2007 legislative session. Market Conduct Rhode Island The Office of the Health Insurance Commissioner (OHIC) is completing an examination assessing market conduct of the insurers in the adjusted-community-rated small group market. Out-of-State Groups Florida The legislature passed out-of-state group legislation to provide consumer protections and rate regulations. Pay-or-Play California Voters narrowly defeated a “play or pay” initiative that would have required employers with 20 or more employees to pay into a purchasing pool if they do not provide health coverage for their employees. The requirement on employers with between 20 and 49 employees would not have been effective until tax credits are enacted. Employers with less than 20 employees would have been exempt. The legislation also sought federal approval to expand its use of Medicaid funds to help lower-income workers purchase insurance through their employer. Massachusetts The recently enacted health reform legislation imposes an annual assessment of $295 per full-time employee upon employers who fail to provide insurance to their workers and to make a reasonable 23 contribution to that coverage and imposes an additional surcharge on companies that do not provide insurance when their employees access free care. Plan Design Michigan Recent legislation revised the manner in which HMOs may impose copayments/coinsurances for basic health services. In addition, recent changes in the law regulating HMOs allow them to offer contracts with no limitations on deductibles. This legislation was enacted to give HMOs greater flexibility in contract design. Proponents of the legislation argued it was needed to meet employer demands. Individual purchasers of HMO products may find products with higher deductibles and copayments to be more affordable and choose this type of coverage over the risk of carrying no coverage at all. Pooling Alaska Alaska allows unrelated employers and self-employed individuals to form an association for the purposes of obtaining insurance (a purchasing cooperative concept) and also has small group rating bands. Arkansas Health Insurance Purchasing Groups A health insurance purchasing group ("HIPG") is a vehicle through which employers can obtain health insurance for themselves and their employees. Employers join a HIPG and obtain fullyinsured coverage through an Arkansas-licensed health insurance carrier. The HIPG may offer a plan this is not subject to state mandated health benefits. Arkansas currently has one HIPG. Colorado In 2003, the Colorado General Assembly established a pilot program for Multiple Employer Welfare Arrangements (MEWAs) permitting the establishment of both self-funded and fullyinsured MEWAs. Florida The state requires all like health insurance forms to be pooled in order to stabilize rates and promote equitability among insurers and has passed legislation authorizing Small Employer Health Alliances. Georgia HPPC (Health Plan Purchasing Cooperative) In 1997,Georgia law was modified to allow regional non-profit Health Plan Purchasing Cooperatives to be formed by coalitions of employers who wanted to band together as a true group (and not as an association) to seek purchasing and bargaining power in obtaining group health insurance. (O.C.G.A. Chapter 33-30A) Small Group Pooling In 1990, the General Assembly supported a series of reforms and new requirements which were placed upon carriers to pool all the experience of small group health cases under 50 lives, to limit the use of substandard rating of individuals, to avoid declinations and waivers and to otherwise operate more fairly and more in line with traditional principles of insurance risk spreading. Georgia modified its law and rules in 1997 and 1998 to become consistent with HIPAA requirements, and modified rules again in 2002 to reflect other changes and refinements based on 24 market conduct examination findings from several carriers in the Georgia small group health market. (O.C.G.A. Section 33-30-12 and Rule Chapter 120-2-10-.12) Michigan The state’s Multiple Employer Welfare Arrangement (MEWA) statute was amended in 1999 to allow businesses broader access to the ability to join together to provide health benefits to employees. New Mexico New Mexico Health Insurance Alliance The New Mexico Health Insurance Alliance (HIA) was created in 1994 by the State Legislature to provide increased access to voluntary health insurance for small businesses, self-employed and qualified individuals. As part of the Health Information Systems Act, the HIA is also part of a joint public-private initiative to develop a statewide health information network to reduce duplicative data collections and reporting. All health insurers and managed health care plans must be members of the alliance. For additional details, see: http://www.nmhia.com/index.htm Small Employer Insurance Program (SEIP) This program began in July 2006 to enroll employers, including non-profits, with 50 or fewer employees that have not offered insurance benefits in the previous 12 months to buy insurance with a $100,000 annual member cap on benefits, through a state-sponsored and administered program. Includes enrollment, counseling and placement process through the New Mexico Department of Human Services. See details at: http://www.state.nm.us/gsd/rmd/seip.html New York Association Coverage for Sole Proprietors New York State enacted an additional reform in 2002 to address the waning availability of health insurance for sole proprietors. Legislation required insurers that sell to groups through associations to make the same coverage available to sole proprietors who are members of the association. Prior to this legislation, insurers were not required to sell group coverage to sole proprietors. The legislation permits the insurers to impose a premium rate differential if actuarially justified. Ohio Ohio amended its Ohio's small employer health care purchasing alliance statute to allow additional types of groups to form purchasing alliances to assist small employers to purchase health coverage from licensed carriers. In 2001, there were 8 health care purchasing alliances in Ohio. This number has grown to 31 purchasing alliances today, covering over 300,000 Ohioans. Legislation is also moving through the Ohio legislature to allow insurers to treat alliances covering small businesses as a separate class of business, which is currently not allowed under Ohio law. This change will provide insurers with more flexibility to meet the needs of specific alliances. Ohio conducted an actuarial study to make certain this change would not adversely impact Ohio's small group markets. Texas Texas enacted legislation in 2003 that allows small businesses to form health purchasing groups. These groups must include at least 10 different employers and must purchase insurance through a licensed insurer. An insurer may not provide coverage to more than one purchasing group in each county. Virginia 25 Virginia enacted legislation in 2006 that authorizes the establishment of cooperatives for the purpose of offering, providing or facilitating the provision of coverage for health care services to participating small employers. A small employer health group cooperative is deemed to be a single entity for purposes of negotiating the terms of coverage and establishing premium rates. Wyoming Recently removed the state ban on employers grouping together solely for purpose of purchasing insurance. Portability Oregon All health insurance carriers must provide portability coverage to anyone leaving group coverage. Portability coverage must be offered regardless of health status and must be pooled with the carrier’s group coverage for rating purposes. For individuals moving into the state, or who otherwise do not have portability coverage available, portability coverage is offer through the Oregon Medical Insurance Pool (OMIP). For individuals who use the OMIP as their portability coverage option, the premiums are an approximate average of what the commercial carriers charge for their portability products in Oregon. Prescription Drug Pools Oregon Oregon Prescription Drug Program (OPDP) In 2003 the Oregon Legislature authorized the formation of the OPDP, a prescription drug purchasing pool, to help increase access to prescription drugs by the uninsured and lower costs for state and city governments to help them stay within budgeted goals. Eligible Uninsured Individuals: Oregonians who are at least 54 years of age, have income that is no more than 185 percent of the Federal Poverty Guidelines and who have not had private insurance with prescription coverage for at least 6 months. Eligible Public Sector Groups: Government agencies, cities and counties are eligible to join the pool. West Virginia Pharmaceutical Cost Management Council A pharmaceutical council and joint purchasing arrangement has been formed to control costs of pharmaceuticals. Rating Connecticut Connecticut requires prior approval of all HMO rates, as well as Medicare supplement and long term care. In addition, small group carriers must file an annual actuarial certification which states compliance with Connecticut small group rating reform. 26 Florida Require all health insurance companies to file annual rate certification to ensure that they are charging adequate and reasonable rates. Massachusetts The recent health reform legislation will merge the individual and small group insurance markets in July 2007. The statute also amended the rating factors that may be used in rating coverage in the merged individual/small group market, permitting the use of tobacco use and wellness discounts for individuals/small groups that can certify that they do not use tobacco products or follow certain wellness programs. Michigan Michigan's non-profit health care corporation is restricted to only use industry and age in determining premiums within a geographic area. Health maintenance organizations can only use industry, age, and group size in determining premiums. Commercial carriers may only use industry, age, group size, and health status in determining premiums. Michigan has rating restrictions based in relation to the company's index rate. The rate cannot vary by more than 35% of the index rate for Health Maintenance Organizations and nonprofit health care corporations. Commercial insurers’ rates cannot vary by more than 45% of the index rate. Reserving Levels Rhode Island The Office of the Health Insurance Commissioner (OHIC) is completing an examination of establishing targeted reserve level ranges for domiciled carriers. Small Group Market Alaska Alaska adopted small group legislation in 1993 consistent with the NAIC model regulation. These laws require insurers to offer coverage to small employers and their eligible employees. Insurers must offer a basic and a standard plan and must also offer any plan they currently market to small employers in the state. Insurers are allowed to underwrite and rate groups based on allowable characteristics, but the premium rates are banded (upper and lower limit on the premium rates for similar groups) which helps rates remain more affordable for higher risk groups. Connecticut Small group market reforms include community rating by class, guarantee issue requirements in the 1–50 market, as well as guaranteed renewability. Rating classifications include: gender, age, industry, group size, family composition, area and administrative expenses related to association business. Colorado Colorado enacted comprehensive small group health insurance reforms in 1993. Within these reforms, Colorado’s small group marketplace extends from sole proprietors (known as Business Groups of One) through employers with no more than 50 employees. In the small group marketplace, carriers are required to offer both a Basic and a Standard policy design that are established in regulation and revised every two years based upon a Division of Insurance survey of carriers. The Basic plan is intended to approximate the lowest level of coverage in small group benefit plans and can be one of four plan design options at the choice of the small group carrier: 27 “Mandate-lite” policy which does not include coverage for mammography, mental illness, hospice care, alcoholism, prostate cancer screening and general anesthesia for dental procedures for children; Health Savings Account (HSA)-eligible high deductible health plan; Mandate-lite HSA-eligible high deductible health plan; and Mandate-lite HSA-eligible high deductible health plan that provides benefits for medically evidence-based care, limited benefits for elective inpatient and surgical care, limited medication used primarily for cost-effective chronic disease management, and maternity care (currently under development by a statutorily created advisory committee to be implemented for policies effective 1-1-2008). The Standard plan is to approximate the average level of coverage in the small group marketplace. Small group rates in Colorado started as community rated with nine geographic areas and the only allowed case characteristics being age, geographic rating and family composition. In 2003, rating flexibility was adopted by the Legislature allowing carriers in the small group market to rate a group up ten percent or down 25 percent from the modified community rate for the small group market based on claims experience, health status and standard industrial classification. There is an additional rating capability of 15 percent (with the up 10/down 25 percent cap) for individuals based upon their tobacco use. In addition to the rating flexibility, to curtail small employers from jumping in and out of the small group guaranteed issue marketplace, carriers may impose an up to 35% rate-up from the modified community rate for 12 months on small employers who were selffunded or insured through other than a small group plan (with certain exceptions) who re-enter the small group market. Florida Small Group Market Reforms: Revision of small group age brackets to 5-year age bands. Modified community rating for small groups with 10+ lives. +/-15.0% adjustment to small group rates for claims experience, health +status, or duration of coverage. 10.0% cap for adjustments to renewal +cases. 1-life load that cannot exceed 1.5 times the 2-50 small group rate. Guaranteed issue requirements in the small group market. Maryland Maryland's small group market is designed to create pooling. Maryland's law requires all insured small group policies to be part of the small group market. Maryland's market is guaranteed issue, imposes rating bands, and limits rating factors to age and geography. Unlike some other states, there are no medically underwritten plans permitted in Maryland's small group market. Maryland does not include any limitation on the ability to come in and out of the market through preexisting condition exclusions or waiting periods if an employer drops coverage or waits to pick up coverage. 28 Massachusetts The recent health reform legislation will merge the individual and small group insurance markets in July 2007. The statute also amended the rating factors that may be used in rating coverage in the merged individual/small group market, permitting the used of tobacco use and wellness discounts for individuals/small groups that can certify that they do not use tobacco products or follow certain wellness programs. North Carolina Since 1997 small employer is defined as any employer with no more than 50 eligible employees, including a self-employed individual. In 2006, significant changes were made to modernize North Carolina’s Small Group Act: Small employer carriers are permitted to utilize different deductibles and co-payment levels, including a high deductible, in their Basic and Standard health plans with the Commissioner’s prior approval. The Commissioner was given the ability to periodically review the approved designs and update them to reflect current market trends. Small employer carriers were given the option to utilize two alternative plans in lieu of the Basic and Standard health plans (two most popular plans by premium volume or two representative plans that reflect some actuarial equivalence to their book of business). Any election a small employer carrier makes under this section is in effect for two years. If the small employer carrier elects to offer the alternate plans and also chooses to terminate existing Basic and Standard plans, then the carrier must provide affected employers the new alternate plans as replacement coverage. The alternate plans must also be guaranteed available to self-employed individuals. Small group rating laws were amended to re-introduce industry as a permissible demographic factor (within limits), expand the experience bands from ± 20% to ± 25%, and redefine geographic area to mean a medical care system. Age (5-year bands) and gender are and have been the other permissible rating factors. Oregon In the 1990s the Oregon Legislature adopted a series of reforms to promote the affordability and availability of health insurance for individuals and small employer groups. The Legislature focused on these market sectors because they were the primary areas with access problems. In 2003 the Legislature relaxed some individual and small group regulations. Initial rating standards in the small employer group market allowed for a 3:1 rate band which was later restricted to 2:1. The 2003 legislation relaxed small group rating standards temporarily moving from a 2:1 rate band to a 2.5:1 band which will sunset in 2007. Coverage in the small employer market is guaranteed issue, and carriers offering health plans in the small employer group market must offer all of their small employer plans to any group requesting coverage. Small group coverage must be offered regardless of health status. Age, family composition, benefit level, and geography (within a defined area) of the employer are the only factors that may be considered in the SEHI premium rates. Prohibited factors in the SEHI (2-25) market include health status, group size, industry, claims history, gender, and duration. Rating restrictions do not apply to employer groups with 26-50 employees. 29 South Dakota South Dakota’s approach to rate banding in the small group market has been to generally follow the format found in the 1993 NAIC small group model. Specifically, the state’s framework includes a +/- 25 percent maximum deviation from the index rate with a cap of 3:1 based on age for the small group. The success in keeping the uninsured rate low is at least in part due to providing adequate flexibility in rating so as to make rates sufficiently affordable to attract the younger healthier population without pricing the higher risks out of the market. Lifestyle continues to be an acceptable case characteristic to allow carriers to implement disease prevention and wellness programs. Standardized Plans New York In 1996, to ensure New Yorkers in the individual market could access comprehensive health insurance coverage, New York required all HMOs in the State to offer two standardized comprehensive health insurance benefit packages in the individual marketplace. One is a straight HMO product that requires enrollees to use doctors within the HMO’s network and the other is a point of service option. In 2000, a state funded reinsurance mechanism was created to assist in stabilizing the premiums for these products. This mechanism removes the risk of certain high cost claims by reimbursing the HMOs for claims paid between $20,000 and $100,000 in a calendar year on behalf of a given enrollee. Approximately 80,900 benefit from this program. Systemic Cost Containment Maine Systemic cost containment is one of the goals of the Dirigo program. Bad debt/charity care costs are expected to decrease as more people are insured. Hospitals, healthcare providers, and insurers have agreed to voluntary revenue caps, and regulatory changes have been made to the existing Certificate of Need process for reviewing proposed hospital projects. Vermont Individuals and businesses who pay commercial health insurance premiums pay additional premium because of the shifting of costs attributable to the uncompensated care of the uninsured, and attributable to Medicaid and Medicare underpayments. The Department of Banking, Insurance, Securities and Health Care Administration will undertake several cost shift initiatives, including: Requiring hospitals to account for Medicaid reimbursement increases in their annual budgets established by the Department. Standardizing hospital bad debt and free care policies. Developing procedures to account for changes in uncompensated care and Medicaid reimbursement when the Department approves health insurance rates. Underwriting New York New York has taken a comprehensive approach to attacking issues regarding the availability and affordability of health insurance coverage. New York is one of few states in the nation to have open enrollment and pure community rating. New York passed open enrollment and community rating legislation in 1992 to facilitate access to health insurance by individuals and small groups. In New York, all individuals and small groups applying for health insurance coverage must be 30 accepted without regard their age, sex, health status or occupation and premium rates may not vary based on these factors. Market stabilization pools were created to help to spread the costs of insuring the sickest individuals among all carriers participating in the individual and small group markets. Quality Error Reporting Pennsylvania Pennsylvania Patient Safety Authority The Patient Safety Authority is an independent state agency charged with taking steps to reduce and eliminate medical errors by identifying problems and recommending solutions that promote patient safety in hospitals, ambulatory surgical facilities, birthing centers and certain abortion facilities. The Authority has implemented PA-PSRS, the mandatory statewide Pennsylvania Patient Safety Reporting System. More than 400 healthcare facilities subject to medical malpractice law reporting requirements are submitting reports through PA-PSRS, making Pennsylvania the first state in the nation to require the reporting of both actual events and "near misses". Vermont The Catamount Health legislation authorizes the Vermont Department of Health to develop a Patient Safety Surveillance and Improvement System, designed to improve patient safety, eliminate adverse events, and support quality improvement efforts by Vermont hospitals. Improved quality of care and cost savings are anticipated from implementation of the system. Information on hospital adverse events and infections will be reported to the public on an annual basis through hospital community reports. Pay for Performance Massachusetts Increase Medicaid reimbursement, contingent on providers' abilities to meet performance benchmarks, including in the area of reducing racial and ethnic health disparities. Quality Measurement Maine Maine Quality Forum The Maine Quality Forum promotes safe practices among hospitals through a certification program which measures hospitals against national standards. The forum provides information on the quality of care at various hospitals on its website and assists the Legislature on quality of care legislation, such as the need for hospital nurse/patient ratios. Ohio Ohio recently established the "Hospital measures advisory council" which is a public body that will recommend performance measures for hospital inpatient and outpatient services. The council will establish hospital performance measures; create a system for collecting, reporting and auditing data; and report the results to the public on a risk adjusted basis. 31 Oregon Oregon Hospital Quality Indicators: http://www.oregon.gov/DAS/OHPPR/HQ/index.shtml The Oregon Hospital Quality Indicators represent a first but important step for Oregon in measuring, and ultimately improving, the quality of health care in the state with a first focus on hospital services. The indicators were derived from hospital discharge data and are based the number of admissions for various procedures and the death rates associated with certain procedures and conditions. The quality indicators are divided into two categories: Volume Indicators are a count of hospital admissions for a given procedure. Counts admissions for rare and specialized procedures for which scientific research suggests that performing more of the procedure often leads to better patient outcomes. Volumes are compared to a threshold number identified by the Agency for Healthcare Research and Quality as the point at which improved patient outcomes have been observed. Death Rate Indicators count the number of patients admitted for a specific procedure or condition who died in the hospital divided by the total number of patients admitted for that procedure or condition. The death rates for each hospital are adjusted for factors including age, sex, and severity of condition. Pennsylvania Pennsylvania Health Care Cost Containment Council (PHC4) PHC4 has been recognized as a national leader in measuring and reporting on outcomes and quality of care. PHC4 issues regular reports on health care service outcomes and cost. They have undertaken a number of projects including measuring and reporting on Hospital Acquired Infections (HAI). Pennsylvania was the first state to issue reports on the cost of HAIs and their impact on patients, providers and payers. PHC4 found that the patient safety and financial impact of hospital-acquired infections is larger than originally reported. The measurement and assessment of HAIs along with quality improvement initiatives with organization such as the Pittsburgh Regional Health Care Initiative are helping improve the quality of care for all Pennsylvanians. Washington The Puget Sound Health Alliance is a regional partnership of employers, physicians, hospitals, patients, health plans, and other leaders who share a vision of a state-of-the-art health care system that achieves better care, healthier people, and affordable costs. The Alliance was formed toward the end of 2004 and is patterned after successful collaborative efforts in the San Francisco Bay Area, Minneapolis-St. Paul, Boston and other areas. The Alliance has established initial goals for information, incentives, and the support for improvement of the health care services delivered in the Puget Sound area. 32 Subsidies Employer Subsidy Vermont Employer Sponsored Insurance Premium Assistance Program Adults currently enrolled in the Medicaid VHAP program who have access to an approved employer-sponsored insurance (ESI) plan will be required to participate in the ESI plan, with public subsidies from the Premium Assistance Program. The transfer of Medicaid enrollees to ESI plans will result in financial savings for the Medicaid program. In addition, any Vermont resident who has been uninsured for at least 12 months, who has household income under 300% FPL, and who has access to an approved employer-sponsored insurance plan, will be eligible for premium assistance to help them participate in the ESI plan. Individual Subsidies Montana For those small businesses that do not currently provide coverage for their employees, Insure Montana provides a monthly assistance payment for both the employer and the employee’s portion of the health insurance premium. This assistance will pay the cost of an employee’s health insurance when the employer has not offered insurance in the past, but begins to do so through a new State Health Insurance Purchasing Pool or through a qualified Association Plan. About 60% of the available funding is designated to make these Employee Assistance Payments and Employer Premium Incentives. Rhode Island The state continues to manage its nationally-recognized Rite Care program for low income children and families, and Rite Share, which subsidizes the purchase of employer health insurance by Rite Care-eligible enrollees. Wisconsin BadgerCare subsidizes the premiums of eligible employer-sponsored health coverage for workers with incomes up to 185 percent of the federal poverty line, renewable until income exceeds 200 percent of the federal poverty line. Multi-Share Programs Kansas In 2005, Governor Sebelius signed legislation that will allow the state to develop a program that will combine federal and state subsidies with contributions from small employers and eligible employees in order to purchase health insurance on their behalf. Employees with low and modest wages will qualify for subsidies if their employer has not offered them health insurance or if they could not afford offered coverage. Kentucky Insurance Coverage, Affordability, and Relief to [small] Employers (ICARE) Description of Program: 33 Effective January 1, 2007, this program will provide a healthcare incentive payment to employer groups who have not provided health benefit plan coverage to their employees within a twelve (12) month period and to employer groups who have an individual with a high-cost condition. The ICARE program will be piloted for a four-year period in the small group market and will be limited to those employer groups with 2 to 25 employees, including employer-organized associations. This program will be capped, since funding is limited, and would be available to individuals on a first-come, first-served basis. Covered Population: • Employees and their dependents ages 0-64 with income up to 300 percent of the Federal Poverty Level (FPL). Qualified Health Benefit Plans: • Qualified health benefit plans eligible for an incentive payment include a consumer driven health benefit plan, a basic health benefit plan, and an enriched health benefit plan approved by the Office of Insurance. Incentive Payments: • • • For employer groups who have not provided health benefit plan coverage to their employees in the previous twelve (12) month period, an amount of $40 per month which will be reduced annually in increments of $10 at the time of renewal. For employer groups who have an individual with a high-cost condition, an amount of $60 per month which will be reduced annually in increments of $15 per month at the time of renewal. Employers must pay at least 50 percent of the premium amount of the cost of a qualified health benefit plan and must meet the insurer’s participation requirements in order to qualify for an incentive payment. Insurer Requirements: • • • All insurers doing business in the small group market are required to participate in the ICARE program. Insurers are required to conduct a health risk assessment for each employee enrolled in the ICARE program. Insurers are required to offer a wellness program, case management services, and disease management services. Estimated Number of Actual Participants: • Based upon funding of $20 million, the estimated number of individuals that could be served is approximately 20,000 - 24,000. Michigan There has been an expansion in local initiatives to improve access to health care and to address the uninsured in Michigan. Coalitions of city and county officials, hospital and physician leaders, philanthropists, and community activist are working to help their uninsured and low-income 34 neighbors. Muskegon Access Health, in Muskegon, Michigan, is one example of a “three-share plan” in which employers, employees and the community each pay about one-third of the cost of the program. Muskegon Access Health is considered one of the pioneer community programs. Oklahoma The Oklahoma Employer/employee Partnership for Insurance Coverage “O-EPIC” Oklahoma has been aggressively working to improve access to health care over the past few years creating a new program to assist small businesses in providing health insurance to their employees. The O-EPIC Premium Assistance Program will pay part of the health plan premiums for eligible employees working for qualified Oklahoma small businesses (with 50 or fewer employees), for those employees who are at 185% of the federal poverty line. The O-EPIC Individual Plan is designed as a safety net for people who cannot access private health coverage through their employer. This plan extends coverage to uninsured self-employed individuals, workers whose employers do not provide health coverage, workers who are not eligible to participate in their employer’s health plan, sole proprietors not eligible for small group health coverage, and the unemployed who are currently seeking work. The Oklahoma Insurance Department has recently entered into a partnership with the Oklahoma Health Care Authority (the O-EPIC administrator) to provide staff support to bridge the gap between the Health Care Authority and the insurance community in terms of marketing and administrative support in order to enhance the success of the program. Tennessee CoverTN CoverTN will offer affordable, portable, basic health coverage to working Tennesseans. The program will be open to individuals with household income below 250% FPL and to employees of qualified small businesses with fewer than 25 employees. Monthly premiums averaging $150 will be equally divided between the state, employees, and willing employer participants, and will vary based upon age, weight, and use of tobacco products. The benefit plans will emphasize preventative services, and will begin enrolling participants in early 2007. Prescription Drug Discount Cards Ohio Ohio created the Best Rx program, which is a prescription drug discount card program for low income and older Ohioans. Reinsurance Florida Recent, unsuccessful legislative attempt to pass the “Healthy Florida” a health insurance subsidy program for small businesses. The program was to be a state subsidized reinsurance mechanism or a stop-loss subsidy which would have reimbursed health plans for 90% of claims paid between $5,000 and $75,000 on behalf of a member in a calendar year. New York Healthy NY The Health Care Reform Act of 2000 created the Healthy NY program. The Healthy NY program is one of the first market-based initiatives in the country designed to reach the uninsured. It 35 provides a lower-cost health insurance option for uninsured small businesses, sole proprietors and individuals who do not have access to employer coverage. State financial assistance is focused on bringing the product to a price point that will permit vulnerable individuals and small businesses to purchase the coverage on their own behalf. Healthy NY offers a streamlined, yet comprehensive, benefit package designed for affordability. Healthy NY also utilizes a stop loss mechanism, similar to the one used with the individual market, in order to remove the premium impact of some of the risk for high-cost claims. State funded stop loss funds reimburse the health plans for 90 percent of claims paid between $5,000 and $75,000 in a calendar year on behalf of an enrollee. Claims experience of small businesses, sole proprietors and individuals is pooled together in determining premium rates, and the stop loss reimbursement must be factored into the rates as well. Small businesses, sole proprietors and individuals all pay the same premium. Premium rates can vary by health plan and by rating region. Because a high percentage of the uninsured in New York State are workers in small firms, Healthy NY targets vulnerable small businesses. Small businesses with 50 or fewer employees can purchase Healthy NY if: (1) they are located in New York; (2) at least 30 percent of their employees earn wages of $34,000 (adjusted annually) per year or less; and (3) they have not provided health coverage in the prior 12 months. In addition, the small business must meet certain participation rules and contribute at least 50 percent of the employee premium. Healthy NY is also available to sole proprietors and individuals with incomes too high to qualify for the State’s Family Health Plus program. Individuals and sole proprietors must meet employment standards, be ineligible for employer-provided insurance or Medicare, and have a household income at or below 250 percent of the Federal Poverty Level. In addition, they must have either been uninsured for 12 months or have lost their insurance for certain reasons. Healthy NY began in 2001 and it has already reached over 250,000 people. In 2006, new enrollments in the program have averaged nearly 7,300 each month. The state continues to examine new options for improving Healthy NY, and is working with the industry to introduce a consumer driven high deductible health plan option designed for use with a tax advantaged Health Savings Account in 2007. This product will benefit from the streamlined Healthy NY benefit design, the state funded Healthy NY stop loss reimbursement mechanism and access to a portable, tax-advantaged Health Savings Account. North Carolina North Carolina’s General Assembly has shown interest in the Healthy NY model, obtaining an actuarial study of a proposal to adopt it in North Carolina, but has not so far taken legislative action. Rhode Island The legislature is currently debating a health legislative proposal which would establish a reinsurance program to subsidize the purchase of Select Care for low wage businesses. Subsidized Plans Alabama The state worked with BlueCross BlueShield of Alabama to develop open enrollment for a plan that includes a $1,000 deductible at $143 per month. Includes one-year preexisting condition exclusion and no underwriting. 25,000 people enrolled in the plan in 2 months. 36 District of Columbia The District of Columbia has created the DC Healthcare Alliance to provide direct coverage for uninsured DC residents with incomes below 200 percent of the Federal Poverty Level. Coverage is provided free of charge using providers that contract with the District. Illinois Illinois Covered On March 4, 2007, Illinois Governor Rod Blagojevich announced his Illinois Covered proposal aimed at providing affordable coverage to the uninsured and at helping middle-income families and small businesses that are currently enrolled in health insurance plans. The plan also aims to reform the existing healthcare system to improve quality and require more accountability. Illinois Covered Choice Illinois Covered Choice is a new, affordable insurance product offered by the state to be purchased through employers or individuals. State-supported reinsurance, among other pro-consumer changes, will make this product more affordable than products currently on the market. Under Illinois Covered Choice, small businesses and individuals whose employers do not offer coverage will have access to new, comprehensive insurance plans with affordable rates. The new product will be offered through private insurance companies, and will provide comprehensive coverage, including inpatient and outpatient care, prescription drugs, and physician visits. Any individual who does not have access to employer-sponsored insurance will be eligible to purchase Illinois Covered Choice insurance at affordable rates that vary by income, irrespective of their health. Any small business with 25 or fewer employees that agrees to contribute at least the minimum required percentage of its employees' premiums may purchase group coverage through Illinois Covered Choice at cheaper prices than they currently get for comparable good quality coverage. Their employees will get premium assistance through Illinois Covered Rebate to lower the cost even more. Illinois Covered Rebate: Illinois Covered Rebate can be used for coverage purchased through Illinois Covered Choice or for employer-sponsored plans, if the employer contributes at least 70% of the premium for an individual. Families earning between 100 percent and 400 percent of the federal poverty level ($20,000 to $80,000 for a family of four) will be eligible for discounts on the cost of health insurance they obtain through their employer. For those whose employers contribute to their health insurance premiums, Illinois Covered Rebate will cap health insurance premiums at a rate that is affordable for the employee, and the state will work with the insurance company to cover the difference between the discounted premium and the actual rate for the employee portion: • • Annual premiums for families earning between 100 percent and 250 percent of FPL ($20,000 to $50,000 for a family of four) will be capped at 1.5 percent of annual income for individual coverage, or 3 percent of annual income for family coverage; Annual premiums for families earning between 250 percent and 400 percent of FPL ($50,000 to $80,000 for a family of four) will be capped at 2.5 percent of annual income for individual coverage, or 5 percent of annual income for family coverage. For those buying their own health insurance through Illinois Covered Choice, they will also receive a rebate to cap their health insurance premiums at an affordable rate. 37 • • Annual premiums for a family earning between 100 percent and 250 percent of FPL ($20,000 to $50,000 for a family of four) will be capped at 2.5 percent of annual income for individual coverage and 5 percent of income for family coverage; Annual premiums for families earning between 250 percent and 400 percent of FPL ($50,000 to $80,000 for a family of four) will be capped at 3.5 percent of annual income for individual coverage or 7 percent of annual income for family coverage. Illinois Covered Assist: While programs like Medicaid and FamilyCare provide coverage to many low-income adults, there are 302,000 poor adults in Illinois who do not have access to coverage because they do not have children, or their children are grown and no longer dependent on them. Through Illinois Covered Assist, these adults will be able to get health coverage. People living below the poverty level (up to $10,210 for an individual or $13,690 for a couple) who do not qualify for Medicaid and do not have access to employer-sponsored coverage will be eligible for free comprehensive coverage through Illinois Covered Assist with low co-pays. Those living below the poverty level who do have access to employer-sponsored coverage can have their premiums covered by the state. FamilyCare Expansion: The state's FamilyCare program has enabled more than 500,000 low-income working parents to get health coverage through the state, but thousands more earn just above the current threshold and do not have access to coverage through their employers. Under his "Illinois Covered" plan, the Governor proposes increasing eligibility for FamilyCare to 400 percent of the federal poverty level. By expanding FamilyCare eligibility from 185 percent of the federal poverty level to 400 percent FPL, or from $35,000 for a family of four to $80,000, close to 150,000 more working parents who are uninsured and do not have access to employer-sponsored insurance would be able to get healthcare. Those making up to 400 percent of the federal poverty level who do have access to employersponsored insurance will be able to get premium relief through Illinois Covered Rebate. Maine DirigoChoice The DirigoChoice insurance product was developed by the Dirigo Health. Anthem Blue Cross Blue Shield won a competitive bidding process to administer the product, which provides comprehensive coverage with deductibles to small groups, sole proprietors, and individuals. People with household incomes under 300 percent of the Federal Poverty Level can receive subsidies on premiums and deductibles. Enrollment as of 3/1/06: 9,743 members. Massachusetts The Commonwealth Care Health Insurance Program is a subsidized insurance program or individuals who cannot afford private coverage, but do not qualify for Medicaid. 38 Michigan The Michigan First Health Plan, slated to be operational by April 2007, will subsidize uninsured adults under 200 percent of the Federal Poverty Level (FPL) who are not eligible for Medicaid or other health care coverage. In Michigan, approximately 550,000 of the 1.1 million uninsured are under 200 percent of FPL. As the plan is expanded, individuals above 200 percent of FPL could have the opportunity for a more modest subsidy. Michigan Since 1985, Michigan has used Blue Cross Blue Shield of Michigan (BCBSM), a non-profit health care corporation, as its market of last resort for health insurance. BCBSM must offer coverage to any Michigan resident who isn’t in jail for health care fraud. BCBSM currently provides community-rated major medical coverage to 120,000 non-group and group conversion subscribers on average for about $300 per month for a single person, as well as community-rated individual Medigap coverage to 220,000 subscribers at a Plan C cost of $90 per month. The group conversion and individual Medigap rates are supported by cost transfers of over $150 million per year from BCBSM group subscribers and BCBSM’s surplus. Minnesota The state created the MinnesotaCare program which provides care through managed care plans for children and families with incomes up to 275 percent of the Federal Poverty Level. Premiums are charged based on income. Pennsylvania adultBasic Program The adultBasic program provides subsidized basic health insurance coverage to uninsured adult Pennsylvanians earning less than 200% of the federal poverty level. Coverage includes hospitalizations (unlimited days), physician services (primary care and specialists), emergency services, diagnostic tests (e.g. x-rays, mammograms and laboratory tests), maternity care and rehabilitation and skilled care. The state pays the majority of the cost with enrollees paying a $33.50 per month premium and minimal service co-payments. The adultBasic program was launched in 2002 and, as of May 2006, over 50,000 Pennsylvanians are covered under it. This program is currently funded solely by state dollars. In February 2005, the Pennsylvania Insurance Department executed the Community Health Reinvestment Agreement (CHRA) with the four Pennsylvania Blue Plans (Highmark Inc., Independence Blue Cross, Capital BlueCross, and Blue Cross of Northeastern Pennsylvania). This Agreement commits the Blue Plans to make an annual investment to provide affordable basic health care coverage to low income and uninsured Pennsylvanians through a state-sponsored program, currently adultBasic, and also commits the Blue Plans to fund health care-related services in their communities. Over the life of the CHR Agreement, which runs through 2010, the state anticipates the Blue Plans will commit a total of nearly $1 billion to community health reinvestment. In 2005, the first year of the Agreement, the four Blues paid nearly $150 million in CHRA funds. 60% of that amount, or $86.3 million was paid to the state for use in the adultBasic program. These additional funds enabled the adultBasic program to provide subsidized basic health care coverage to an additional 5,500 uninsured adult Pennsylvanians. The remaining 40% was used by each Blue Plan for subsidies for individual and senior health insurance products, funding local clinics for low income individuals, and other community health care-related expenditures. Rhode Island The legislature is currently debating a health legislative proposal which would establish a regulatory process for the development of Select Care - an affordable health plan for small businesses priced at a targeted percentage of median income. 39 Vermont Catamount Health A separate insurance pool was created for the purpose of offering a low cost health insurance product for uninsured Vermonters. Lower costs are anticipated based on estimates concerning the claims costs of the uninsured relative to the claims costs of the general population, and based on reimbursement rates established in the law that are lower than commercial rates (but 10% higher than Medicare rates). A comprehensive benefit plan will be provided with the Catamount Health policy, a policy modeled after a preferred provider organization plan with a $250 deductible. Cost sharing will not apply to chronic care management and preventive services. Catamount Health policies will be offered to the uninsured by Blue Cross Blue Shield of Vermont and by health maintenance organizations beginning October 1, 2007. Catamount Health Premium Assistance Program A Vermont resident who has been uninsured for at least 12 months, who is not eligible for a public insurance program such as Medicaid, and who does not have access to employer-sponsored insurance may apply for financial assistance to purchase a Catamount Health policy. Individual premium contributions are income-sensitive, ranging from $60 per month for individuals with household income under 200% FPL, to $135 per month at 275-300% FPL, to the full cost of Catamount Health for individuals with household income over 300% FPL. Washington The Washington Health Care Authority’s Basic Health Plan subsidizes premiums for 100,000 individuals with income up to 200 percent of the Federal Poverty Level. In 2006, funding was increased to cover 6500 individuals. Small Employer Health Insurance Partnership State-subsidized enrollment of low-income employees into designated small group health plans. Subsidies will be available no sooner than July 1, 2007. West Virginia Small Business Health Insurance Plan This plan is available only to small businesses that have not offered insurance to their employees in the past year. It is offered through private insurers and the employer must pay at least fifty percent of the premium. The plan makes use of the Public Employees Insurance Agency’s provider reimbursement rates to provide a product with a premium that is 20-25 percent lower than private market rates. Subsidized Prescription Drug Plans Tennessee CoverRx CoverRx will replace the pharmacy assistance program for TennCare disenrollees and will support the Mental Health Safety Net. The program will also be open to uninsured individuals with incomes below 250% FPL. It will utilize a mostly generic formulary with select brand name medications. Participants will not be charged a premium, but will pay a co-pay when they fill a prescription. A wrap-around discount will apply to medications not on the formulary. Tax Credits Georgia Health Coverage Tax Credit (HCTC) Effective in mid-2006, Georgia approved a special program to provide a guaranteed issue, individual health product with HCTC premium assistance. The product is available to those 40 persons who qualify for Federal Advance or other Tax Credits because they were displaced from jobs under the Trade Assistance Adjustment Act and is also available when persons become eligible because their Pension Plans fail and their health coverage is being provided through the Pension Benefit Guaranty Corporation. The Office of Commissioner of Insurance was informed by the U.S. Department of Labor and IRS authorities that in 2005, perhaps as many as 9,000 Georgians might qualify under the Trade Adjustment Act. Pennsylvania Pennsylvania took the lead nationally in implementing the Health Coverage Tax Credit (HCTC) program to assure the availability of the federal HCTC subsidy for trade displaced workers and retirees who lost their health insurance coverage when the federal PBGC took over their company pension programs. The Governor's Office negotiated with the state's Blue Cross and Blue Shield plans to assure that qualified HCTC coverage was available beginning in April 2003. Pennsylvania's efforts to implement the HCTC program have been recognized nationally and state eligible individuals' enrollment and participation in the HCTC program is one of the highest in the country. Montana Insure Montana provides incentives for small businesses to provide health insurance for their employees. For small business currently providing coverage for their employees, the program provides a refundable state income tax credit to employer. It also provides additional tax credits when employers pay for insurance for the employee’s spouse or their dependants. Approximately 40% of the available funding per year is designated to the Employer Tax Credit. North Carolina HCTC HCTC-qualified plans in North Carolina include COBRA and State Continuation (where available), coverage through the spouse’s employer (subject to certain limitations), individual coverage that was in effect for 30 days before losing coverage through the employer, and “Statequalified” individual plans offered by private insurers. Currently Blue Cross Blue Shield of North Carolina is the only carrier who has chosen to offer State-qualified HCTC coverage, and by agreement with the Governor’s office, caps the risk-factor for these individuals at 2.0 when developing premiums for their coverage. A proposed high-risk pool would also be open to persons eligible for the HCTC. Small Business Health Insurance Tax Credit Recently enacted law created a small business health insurance tax credit for certain small employers that pay at least 50 percent of their employee’s health care coverage premiums. The health care coverage must be equal to or exceed the minimum provisions of the basic health care plan of coverage recommended by the Small Employer Carrier Committee as required by law. In conjunction with North Carolina’s Department of Revenue (DOR), the Department of Insurance has developed procedures to facilitate the insurance aspect of the tax credit for the state’s small employers, small employer carriers and DOR. The tax credit is effective beginning with the 2007 tax year for small employers that qualify with the DOR. 41 Wellness Chronic Care Management Colorado Through the implementation of statewide disease management pilot programs, the state has improved care and controlled costs for Medicaid beneficiaries with asthma, schizophrenia, diabetes, high-risk infants, and women with breast and cervical cancer. Disease management has been a very successful tool in the Colorado Medicaid program for reducing costs while enhancing the health of individuals. Illinois Improve Quality and Hold Down Costs: The State will work with consumers and Illinois healthcare providers on a Roadmap to Health strategy to improve the overall healthcare system. A statewide consensus plan will be developed for promoting wellness and managing chronic conditions. Since 70 percent of overall healthcare costs are for chronic diseases, this component is essential for bringing down overall healthcare costs for businesses and consumers alike. The roadmap will also include expansion of existing initiatives and the creation of new initiatives to build and improve overall healthcare capacity. Vermont The Blueprint for Health - the Chronic Care Initiative. Due to a combination of an aging population, increased prevalence of obesity, and poor lifestyle habits, the needs of Vermonters with chronic conditions (such as diabetes, cardiovascular disease, and depression) will be the primary driver of the demand for health care for the foreseeable future. Since the cost of treating individuals with chronic conditions (25% of Vermonters) accounts for about 75% of health care spending, Vermont has decided to invest significant public funds in the redesign of the health care system to improve the quality and cost-effectiveness of care for those with chronic conditions. The Blueprint, under the direction of the Vermont Department of Health, will focus on (a) patient self-management; (b) provider practice change consistent with evidencebased standards for chronic care; (c) community activation and support to address physical inactivity and obesity, which are risk factors for many chronic diseases; (d) a chronic care information system; and (e) health system design - the development of common performance measures and clinical guidelines for chronic conditions, and the linking of financing mechanisms and insurance reimbursement with the attainment of chronic care treatment goals. In addition, the Office of Vermont Health Access will develop a chronic care management program, consistent with the policies and standards established by the Blueprint for Health, for the 20% of Vermonters who are insured under a Medicaid-funded program. Washington The Washington State Department of Health has implemented the Group Health Chronic Care Model, which improves treatment of diabetes and cardiovascular disease through implementing treatment guidelines and electronic health registries, in 140 clinic systems. Diabetes Tennessee ProjectDiabetes The Diabetes and Health Improvement Act of 2006 established the Tennessee Center for Diabetes Prevention and Health Improvement, aimed at combating the proliferation of type 2 diabetes by administering two grant programs. The first program provides grants to high schools to promote 42 the understanding and prevention of diabetes. The second set of grants will be awarded to providers of services related to the prevention and/or treatment of diabetes. They will target evidence-based programs focusing on new or expanded populations and innovative approaches to the disease. Health Management Pennsylvania Pennsylvania Employee Benefit Trust Fund (PEBTF) Get Healthy Program PEBTF is the state employee's health insurance trust fund. A year ago the state began charging employees 0.5% of their salary for their health insurance coverage. This employee premium is waived if employees participate in the Get Healthy program. The program is intended to help employees manage their own health and the health of their families. Better health management can reduce overall program costs. Participants complete a Health Risk Assessment questionnaire. If the employee or their spouse is found to have an actual or potential health condition they may be assigned to a health coach for further assistance. If either is found to be healthy they can participate in a wellness or preventive care program (generally on-line). Ongoing participation in the program is required to maintain the health insurance premium waiver. Healthy Lifestyle Alabama Alabama has enacted a fitness program, “Walking Works,” which encourages people to walk at least 30 minutes per day. It expects the program to save $77 million per year. Michigan Michigan’s Surgeon General has initiated a “Michigan Steps Up” initiative, which includes a focus on encouraging health behaviors through moving more, eating better, and not smoking. Michigan citizens have utilized the resources available on the Michigan Steps Up website, creating more than 10,000 personal health plans and more than 1,000 risk appraisals. Governor Granholm has a plan to extend these efforts and develop public-private partnerships to foster a culture of physical activity, prevention and wellness. New Mexico New Mexico Healthier Weight Council Created in 2006 as the first statewide collaboration of partners organized specifically to address overweight and obesity in New Mexico. This is a statewide collaborative of over 150 partners, and was coordinated by NM Department of Health, Physical Activity & Nutrition Program for Healthier Weight; the University of New Mexico Prevention Research Center, with funding from the U.S. Centers for Disease Control. See details at: http://www.health.state.nm.us/obesity.html Vermont Vermont has recognized that public health concerns such as those relating to overweight and poor nutrition are major drivers in the incidence of chronic disease incidence, and in increased medical inflation. The Community Health and Wellness grant program will focus the state’s public health resources in promoting healthy behavior and disease prevention across the lifespan of the individual, including the promotion of good nutrition and exercise for children, community recreation programs, elderly wellness, lead poisoning abatement, obesity prevention, maternal and child health and immunization, and tobacco prevention and cessation programs. Washington Healthiest State in the Nation Campaign 43 The Washington Health Foundation is urging healthy lifestyles, lowering the number of uninsured individuals, and effective uses of health care services to make Washington the healthiest state in the nation. Incentives Florida The state has passed legislation providing for premium rebate based on healthy lifestyles. Michigan Legislation is currently under consideration by the Michigan Legislature to provide cost incentives to employers, employees, and individuals to pursue healthier lifestyles. Health plans may be able to realize savings in claims costs and pass those savings on to the parties that pay the premiums. The 10 percent cap on the amount of rebate or discount that is designated in the legislation will help alleviate concerns that health plans will use the wellness programs as a marketing tool without any real impact on the claims. While the 10 percent cap provides a real incentive, it is reasonable in its assessment of the potential influence a wellness program would have on actual claims costs and actual savings to the health plan. Vermont Healthy Choices Insurance Discount The Catamount Health legislation authorizes the Department of Banking, Insurance, Securities and Health Care Administration to adopt regulations permitting health insurers to establish premium discounts or other economic rewards for insureds in Vermont’s community rated nongroup and small group markets. Premium discounts will be available for those who participate in programs of health promotion and disease prevention. Preventive Care Oregon In 2005 the Legislature mandated health insurance coverage for certain cancer screenings Tobacco Use Maryland In 2005, Maryland mandated a benefit for treatment of smoking cessation in the individual and large group markets. Other Efforts Studies Alaska Alaska has obtained a State Planning Grant to do comprehensive assessment (through household survey, employer survey, focus groups, key informants interviews, and analysis of economic 44 indicators and data on personal health expenditures, assessment of impacts of lack of insurance, economic roles played by health care facilities and providers. The Governor of Alaska created the Alaska Health Care Strategies Planning Council in February 2007. The Council is charged with developing a statewide plan which will identify short-term and long-term strategies to effectively address issues of access to, and cost and quality of health care for Alaskans. Colorado In 2006, the Legislature formed a Health Care Reform Commission to study and establish health care reform models for expanding coverage, especially for the underinsured and uninsured, and to decrease health care costs for Colorado residents. The 24 member commission is to conduct its study and complete a final report with recommendations to the General Assembly by November 30, 2007. New Mexico Health Coverage for New Mexico Committee The 2005 State Legislature created a 23 member "Health Coverage for New Mexico Committee" to select criteria and models of universal health care coverage for New Mexico for a costcomparison analysis, along with an analysis of the costs of maintaining the status quo. The committee chose 3 models, and has contracted with Mathematica to analyze the proposals. The cost analysis must be completed in the summer of 2007, with the intent that results will form the basis for proposed legislation for 2008. Models must address, among other issues, coverage for all New Mexicans regardless of ability to pay or income level, and clearly identified funding sources, while maximizing federal dollars. North Carolina HRSA Grant – Studying Ways to Cover the Uninsured The North Carolina Department of Health and Human Services in 2004 received a grant and worked collaboratively with the North Carolina Institute of Medicine and Department of Insurance to devise a plan to reduce the number of uninsureds. The top recommendations cited in the report on the study were: • • • • • Additional state funding to support and expand the healthcare safety net, to provide healthcare services to the uninsured; Promotion of personal responsibility for leading a healthy lifestyle and the inclusion of healthy lifestyle promotion in state policies; Develop of a limited-benefit Medicaid expansion for low-income parents; Creation of a subsidized health insurance product targeted to small employers with 25 or fewer employees, low-income sole proprietors, and low-income individuals who had not previously offered health insurance coverage; and Creation of a high-risk pool for individuals with pre-existing health conditions. High Risk Pool Study Grant and Legislation During the 2006 session of the North Carolina General Assembly a bill was introduced that would have created a “qualified high risk pool” as defined in Section 2744(c)(2) of the Public Health Service Act to provide coverage to federally eligible and high risk individuals, as well as to individuals eligible for the HCTC. The bill contemplated the creation of a high risk pool that would have provided coverage and premium rates consistent with the NAIC Model Health Plan for Uninsurable Individuals Act. The bill passed the House by an overwhelming majority (11010) vote late in the session but due to time constraints and the complexity of establishing a high risk pool, was not heard by the Senate before the General Assembly adjourned the 2006 session. 45 The North Carolina Department of Insurance in September 2006 received from CMSA a grant for the North Carolina High Risk Pool Feasibility Study. This study, the report on which was released in March 2007, will assist policymakers in making informed decisions regarding adoption of a high risk pool as an appropriate mechanism to provide insurance to federally eligible and high risk individuals. Three bills to establish a high risk pool were introduced in the North Carolina House and Senate in 2007, and the issue is receiving active consideration Oklahoma Summit on the High Cost of Health Insurance Insurance Commissioner Kim Holland initiated a Summit on the High Cost of Health Insurance in 2005 to address the rising cost of health insurance in Oklahoma. The Summit brought together all the major stakeholders impacted by rising health care costs including businesses, hospitals and physicians, policy makers and government agencies, the insurance industry, and health policy experts from across the country. From this forum, four working task forces were created focusing on the key areas of Access, Consumer Education and Information, Finance, and Quality and Performance. These four task forces worked to develop policy initiatives to address the twenty percent of Oklahomans without health insurance. In November 2006, Commissioner Holland hosted part II of the Summit to examine and present the Task Force policy recommendations. At this event the policy proposals were analyzed by a panel of national and state health policy experts and a second panel comprised of state legislators. The reactor panels addressed the economic, political, and technical feasibility of each recommendation. Finally, through a working lunch Oklahoma citizens prioritized the recommendations from a consumer perspective. The recommendations that survived this process were prioritized into a top ten list. Currently, four of the recommendations are being moved forward in legislation before the Oklahoma Legislature and a new task force has been created to move the remaining recommendations forward. Oregon Oregon Health Policy Commission The 2003 Oregon Legislature passed House Bill 3653, creating the Oregon Health Policy Commission (OHPC), to develop and oversee health policy and planning for the state. The Commission identifies and analyzes health care issues affecting the state and makes policy recommendations to the Governor and the Legislature. The Commission partners with health care experts and stakeholders around the state to develop projects focused on improving Oregonians’ health status and access to effective and efficient health care services. In 2006 Governor Kulongoski directed the Oregon Health Policy Commission to: Write a blueprint for building a sustainable system that provides access to affordable health care to every Oregonian. Set measurable goals for health care system change. Recommend ways to pay for the system. Pennsylvania The Governor's Office of Health Care Reform is currently developing a coordinated plan using a HRSA planning grant to review Pennsylvania's health care system with the goal of assuring that accessible and affordable quality health care coverage is available for all Pennsylvanians. As part of the preparation for this process the Pennsylvania Insurance Department conducted a state specific study of health insurance coverage in Pennsylvania. This study provides information about health insurance coverage, demographic and employment characteristics and the financial 46 barriers to health care for Pennsylvania residents. In addition, the Administration performed an indepth review and analysis of health insurance coverage issues, including premium rating issues, for small employers and their employees. This information is critical as the state develops strategies and initiatives to assure that all Pennsylvanians have access to affordable, quality health care coverage. Washington Blue Ribbon Commission on Health Care Cost and Access The Blue Ribbon Commission was created in 2006 to recommend a “sustainable five-year plan for improving access to affordable health care for all Washington residents” by December 1, 2006. Insurance Commissioner Kreidler is a member of the Blue Ribbon Commission along with Governor Gregoire, eight legislators and four agency executives. The Commission is co-chaired by Governor Gregoire and Senator Thibaudeau, a past-chair of the Senate Health & Long-term Care Committee. West Virginia Interagency Health Council An interagency health council has been established to comprehensively study and make recommendations to the legislature about the health care system in West Virginia. Wisconsin A governor appointed, eleven member, Healthcare Commission has been in place for some three years and is studying all aspects of health care financing and delivery, infrastructure, health professional recruitment and retention, medical errors and electronic medical records and Wyoming specific to solutions to incrementally cover the uninsured. The commission has subcommittees; the Access and Affordability subcommittee and the Rural Health Care Delivery subcommittee. Systemic Reform California On January 8, 2007 Governor Schwarzenegger unveiled a comprehensive health care reform initiative, to bring accessible, efficient and affordable health care to every Californian. His plan aims to address the state’s broken health care system and the hidden tax that every insured Californian pays to subsidize the uninsured. Individuals, government, doctors and hospitals, insurers and employers all have equal responsibility for realizing these reforms. Governor Schwarzenegger’s initiative is based on three building blocks: Prevention and wellness; coverage for all Californians; and affordability and cost containment. These building blocks rest on shared responsibility by individuals, government, doctors and hospitals, insurers and employers. California cannot reduce costs, increase coverage, restore emergency care or achieve the long-term cost savings that greater statewide health can achieve without the equal participation of every player. Under the Governor’s proposal: All Californians: • Must have a minimum level of insurance to ensure that those with insurance no longer pay for the uninsured. Individuals will be responsible for securing health coverage for themselves and their children and contributing to paying for their coverage. 47 • Have a responsibility to purse good health. The Governor’s plan outlines a comprehensive prevention policy that encourages and rewards healthy behaviors; supports new efforts to fight diabetes, smoking and obesity; and reduces medical errors. Government: • • • Will return $10-15 billion to doctors and hospitals by increasing federal reimbursement for Medi-Cal. Will provide subsidies for low-income families to buy health coverage through a new purchasing pool. Will expand Medi-Cal to poor adults and expand Healthy Families/Medi-Cal to all children in families earning less than $60,000 annually. Employers: • Those with 10 or more employees who choose not to offer health coverage will contribute 4 percent of payroll toward the cost of employees’ health coverage. Companies with less than 10 employees—a full 80 percent of businesses in California— are exempt. The 4 percent fee will prevent employers of ten or more from dropping their health care coverage in light of the state’s program. • Health Plans and Insurers: • Must guarantee individuals access to coverage in the individual market, spend 85 percent of every premium dollar on patient care and make “Healthy Actions” benefits available to promote healthy behaviors. The Governor’s initiative is projected to expand the state’s insurance pool by 4-5 million and give insurers fair compensation for their services. Doctors and Hospitals: • • Will be relieved of costs associated with caring for the uninsured and will receive significantly increased Medi-Cal rates—eliminating the need for any cost shifts or hidden tax. Will receive $10-$15 billion—and in turn, will contribute a portion back to universal coverage. Physicians will contribute 2 percent of revenues and hospitals will contribute 4 percent, ensuring some of the savings stays in the system to support total coverage and increased Medi-Cal rates to providers. Have a responsibility to provide affordable, quality care, partner with patients to improve wellness and health outcomes; and share in cost savings. • By engaging individual Californians, businesses, the state and federal government, health care providers and insurers, the Governor’s plan is designed to: • • • • Reduce the hidden tax by containing health-care costs and ensuring the insured no longer pay for the uninsured. Lower costs by fairly compensating hospitals, making health coverage available to every Californian and fighting chronic illnesses. Support better care by reducing medical errors, restoring emergency care, and developing innovative health information technology applications. Promote a healthier California by ensuring that everyone has access to health coverage, promoting affordability and rewarding good health choices. 48 Oregon Archimedes Movement http://www.archimedesmovement.org Former Oregon Governor John Kitzhaber is leading a grassroots movement to change the basic way of viewing health and how healthcare will be administered and delivered in the future. The Archimedes Movement will seek waivers from the federal government to replace the current Medicaid and Medicare systems. The Movement seeks to create a smarter, more up-to-date system that makes tax dollars go further, promotes health, and ensures that a basic level of effective health care is available to everyone. 49 Innovations by State Alabama Subsidies: The state worked with BlueCross BlueShield of Alabama to develop open enrollment for a plan that includes a $1,000 deductible at $143 per month. Includes one-year preexisting condition exclusion and no underwriting. 25,000 people enrolled in the plan in 2 months. Wellness: Alabama has also enacted a fitness program, “Walking Works,” which encourages people to walk at least 30 minutes per day. It expects the program to save $77 million per year. Alaska Small Group Market Alaska adopted small group legislation in 1993 consistent with the NAIC model regulation. These laws require insurers to offer coverage to small employers and their eligible employees. Insurers must offer a basic and a standard plan and must also offer any plan they currently market to small employers in the state. Insurers are allowed to underwrite and rate groups based on allowable characteristics, but the premium rates are banded (upper and lower limit on the premium rates for similar groups) which helps rates remain more affordable for higher risk groups. Pooling Alaska allows unrelated employers and self-employed individuals to form an association for the purposes of obtaining insurance (a purchasing cooperative concept) and also has small group rating bands. High Risk Pool Alaska has a high-risk pool with maximum premiums limited to 145 percent of standard health insurance premiums. In recently passed, but as yet unsigned, legislation, Alaska will allow health insurers a 50 percent premium tax offset for their high-risk pool assessments to help reduce the cost of assessments, which could be passed on to consumers. 50 File and Use Form Filings Alaska has adopted a file-and-use option for form filings. Only Hospital Medical Service Corporation and Medicare supplement rates are now subject to filing. The state has also recently enacted legislation authorizing participation in the Interstate Insurance Product Regulation Compact. Standard Forms and Processes Alaska recently adopted regulations requiring the use of the NAIC Uniform Transmittal Document and has implemented the NAIC product coding matrix. These allow for uniform coding and tracking of filings and improve efficiency of the filing and approval process. Alaska regulations require use of a uniform claim form including use specific information that must be included on prescription drug cards in order for more efficient claim processing and more prompt payment of claims. Alaska law requires insurers to pay clean claims within 30 days and requires payment of interest penalties on late payment of claims in order to encourage prompt payment of claims Regulatory Checklists Alaska developed checklists of statutory and regulatory requirements by product in order to assist insurers in complying with Alaska's requirements and shorten state review time. Data Collection Alaska collects health insurance premiums, claims, and count information by product annually. This information is used to determine insurer assessments for the state's high risk pool, to assist consumers in shopping for health insurance, and for market analysis and policymaking. Data collected from the survey is published annually in the Division of Insurance's annual report. Community Health Centers Alaska has worked on improving access to primary health care and prevention services by increasing the number of federally-funded Community Health Centers from 2 to 21 organizations and from 2 to over 120 sites in the last ten years. Telehealth Alaska has also promoted major telehealth initiatives, such as the Small Hospital Teleradiology Project, and has a statewide Regional Health Information Organization, which is supported by the Alaska Telehealth Advisory Council, a state-tribal-private sector collaborative. Comprehensive State Assessment Alaska has also obtained a State Planning Grant to do a comprehensive assessment (through household survey, employer survey, focus groups, key informants interviews, and analysis of economic indicators and data on personal health expenditures) of the impacts of lack of insurance, economic roles played by health care facilities and providers. Other Efforts The Governor of Alaska created the Alaska Health Care Strategies Planning Council in February 2007. The Council is charged with developing a statewide plan which will identify short-term and long-term strategies to effectively address issues of access to, and cost and quality of health care for Alaskans. 51 Arkansas Mandate Review Commission The state legislature formed a mandate commission in 2001 to assess the annual impact of state laws requiring insurers to cover specific services and benefits on health care and health care insurance costs. The Commission is to review existing medical, financial and social impacts mandated benefits impose, if any, on health plans, and report its findings to a variety of legislative committees before November 1 of each year. After the 2001 session, the Commission was unable to meet to conduct business because not all of the initial appointments had been made. Until April 11, 2006, in fact, the Commission has never held its first meeting, or been fully composed of initial appointees to conduct business. In the 2005 session, the Legislature enacted that increased the powers of the Mandate Commission to require it to review and to report to a legislative committee to whom a bill is referred containing a mandated health within 45 days of receiving the bill. Health Insurance Purchasing Groups A health insurance purchasing group ("HIPG") is a vehicle through which employers can obtain health insurance for themselves and their employees. Employers join a HIPG and obtain fullyinsured coverage through an Arkansas-licensed health insurance carrier. The HIPG may offer a plan this is not subject to state mandated health benefits. Arkansas currently has one HIPG. Arkansas Health Insurance Consumer Choice The AR Health Insurance Consumer Choice Act allows individual and group health insurance consumers the alternative of choosing between buying an HMO or health insurance policy with state mandated health benefits and one without them. Each employee/certificate holder of a group health benefit plan will receive a written notice about the mandated benefits that he or she will be missing out on (assuming the group policyholder has selected a less expensive health plan that lacks some or all of the mandated benefits). The amendment also calls for this notice to be in the form and manner as determined by the Commissioner. California Systemic Reform On January 8, 2007 Governor Schwarzenegger unveiled a comprehensive health care reform initiative, to bring accessible, efficient and affordable health care to every Californian. His plan aims to address the state’s broken health care system and the hidden tax that every insured Californian pays to subsidize the uninsured. Individuals, government, doctors and hospitals, insurers and employers all have equal responsibility for realizing these reforms. Governor Schwarzenegger’s initiative is based on three building blocks: Prevention and wellness; coverage for all Californians; and affordability and cost containment. These building blocks rest on shared responsibility by individuals, government, doctors and hospitals, insurers and employers. California cannot reduce costs, increase coverage, restore emergency care or achieve the long-term cost savings that greater statewide health can achieve without the equal participation of every player. Under the Governor’s proposal: 52 All Californians: • • Must have a minimum level of insurance to ensure that those with insurance no longer pay for the uninsured. Individuals will be responsible for securing health coverage for themselves and their children and contributing to paying for their coverage. Have a responsibility to purse good health. The Governor’s plan outlines a comprehensive prevention policy that encourages and rewards healthy behaviors; supports new efforts to fight diabetes, smoking and obesity; and reduces medical errors. Government: • • • Will return $10-15 billion to doctors and hospitals by increasing federal reimbursement for Medi-Cal. Will provide subsidies for low-income families to buy health coverage through a new purchasing pool. Will expand Medi-Cal to poor adults and expand Healthy Families/Medi-Cal to all children in families earning less than $60,000 annually. Employers: • Those with 10 or more employees who choose not to offer health coverage will contribute 4 percent of payroll toward the cost of employees’ health coverage. Companies with less than 10 employees—a full 80 percent of businesses in California— are exempt. The 4 percent fee will prevent employers of ten or more from dropping their health care coverage in light of the state’s program. • Health Plans and Insurers: • Must guarantee individuals access to coverage in the individual market, spend 85 percent of every premium dollar on patient care and make “Healthy Actions” benefits available to promote healthy behaviors. The Governor’s initiative is projected to expand the state’s insurance pool by 4-5 million and give insurers fair compensation for their services. Doctors and Hospitals: • • Will be relieved of costs associated with caring for the uninsured and will receive significantly increased Medi-Cal rates—eliminating the need for any cost shifts or hidden tax. Will receive $10-$15 billion—and in turn, will contribute a portion back to universal coverage. Physicians will contribute 2 percent of revenues and hospitals will contribute 4 percent, ensuring some of the savings stays in the system to support total coverage and increased Medi-Cal rates to providers. Have a responsibility to provide affordable, quality care, partner with patients to improve wellness and health outcomes; and share in cost savings. • By engaging individual Californians, businesses, the state and federal government, health care providers and insurers, the Governor’s plan is designed to: • • Reduce the hidden tax by containing health-care costs and ensuring the insured no longer pay for the uninsured. Lower costs by fairly compensating hospitals, making health coverage available to every Californian and fighting chronic illnesses. 53 • • Support better care by reducing medical errors, restoring emergency care, and developing innovative health information technology applications. Promote a healthier California by ensuring that everyone has access to health coverage, promoting affordability and rewarding good health choices. Pay or Play Initiative Voters narrowly defeated a “play or pay” initiative that would have required employers with 20 or more employees to pay into a purchasing pool if they do not provide health coverage for their employees. The requirement on employers with between 20 and 49 employees would not have been effective until tax credits are enacted. Employers with less than 20 employees would have been exempt. The legislation also sought federal approval to expand its use of Medicaid funds to help lower-income workers purchase insurance through their employer. Prescription Drug Discount Plan California will institute a plan that will provide discounts on prescription drugs of as much as 40% on brand name drugs and 60% on generic drugs to uninsured Californians with incomes below 300% of the federal poverty level ($60,000 for a familly of four). For the first three years of the plan, drug manufacturers have the ability to voluntarily negotiate discounts. If after August 1, 2010 manufacturers do not provide discounts at the benchmark levels, the state may, upon federal approval, tie participation in Medi-Cal to participation in the discount plan. Colorado Small Group Reforms Colorado enacted comprehensive small group health insurance reforms in 1993. Within these reforms, Colorado’s small group marketplace extends from sole proprietors (known as Business Groups of One) through employers with no more than 50 employees. In the small group marketplace, carriers are required to offer both a Basic and a Standard policy design that are established in regulation and revised every two years based upon a Division of Insurance survey of carriers. The Basic plan is intended to approximate the lowest level of coverage in small group benefit plans and can be one of four plan design options at the choice of the small group carrier: • • • • “Mandate-lite” policy which does not include coverage for mammography, mental illness, hospice care, alcoholism, prostate cancer screening and general anesthesia for dental procedures for children; Health Savings Account (HSA)-eligible high deductible health plan; Mandate-lite HSA-eligible high deductible health plan; and Mandate-lite HSA-eligible high deductible health plan that provides benefits for medically evidence-based care, limited benefits for elective inpatient and surgical care, limited medication used primarily for cost-effective chronic disease management, and maternity care (currently under development by a statutorily created advisory committee to be implemented for policies effective 1-1-2008). The Standard plan is to approximate the average level of coverage in the small group marketplace. Small group rates in Colorado started as community rated with nine geographic areas and the only allowed case characteristics being age, geographic rating and family composition. In 2003, rating flexibility was adopted by the Legislature allowing carriers in the small group market to rate a 54 group up ten percent or down 25 percent from the modified community rate for the small group market based on claims experience, health status and standard industrial classification. There is an additional rating capability of 15 percent (with the up 10/down 25 percent cap) for individuals based upon their tobacco use. In addition to the rating flexibility, to curtail small employers from jumping in and out of the small group guaranteed issue marketplace, carriers may impose an up to 35% rate-up from the modified community rate for 12 months on small employers who were selffunded or insured through other than a small group plan (with certain exceptions) who re-enter the small group market. Administrative Process Reforms Colorado has adopted several administrative reforms intended to reduce transaction costs in the health coverage system. These include uniform claim form requirements, prompt payment regulations, and assignment of payment provisions. In addition, Colorado has established a uniform provider credentialing form, and (effective 1-1-2007) a uniform small group application form. To facilitate consumer comparison of health benefits offered by different carriers and under differing policies, Colorado requires all carriers to develop and provide when requested Benefit Description Forms outlining the coverages/benefits under a policy. Colorado encourages the use of telemedicine and prohibits carriers from imposing face-to-face contact requirements on provides of telemedicine services to rural residents. The state has also established a pilot program under Medicaid removing restrictions on reimbursement of telemedicine services and provide participants with telehealth devices to regularly monitor blood pressure, blood sugar levels, heart and lung sounds, and other factors to address the targeted conditions of congestive heart failure, diabetes and chronic pulmonary disease. Expansion of Coverage to the Uninsured Colorado’s high-risk pool for the medically uninsurable, known as CoverColorado, has developed a funding mechanism through the state’s unclaimed property fund to supplement its premium income. In addition, CoverColorado has developed a premium subsidy program to assist persons with their premiums, which are pegged at between 100 and 150 percent of the standard risk rate established by survey of the five largest carriers offering a comparable policy. In 2003, the Colorado General Assembly established a pilot program for Multiple Employer Welfare Arrangements (MEWAs) permitting the establishment of both self-funded and fullyinsured MEWAs. Colorado adopted a childrens’ health plan, Child Health Plan Plus, prior to the establishment of the SCHIP program and has continued the public-private partnership to provide low-cost health insurance to children whose families do not qualify for Medicaid but cannot afford private health insurance. The CHP+ program also covers prenatal care for eligible women. In 2005, the Legislature required health carriers to offer to parents coverage for their children up to age 25 who have the same legal residence as their parent(s) or are financially dependent on their parent(s). Carriers may charge additional premium for a rider or supplemental coverage for such children. Since 2003, Colorado has had a Commission on Mandated Health Insurance Benefits to develop and provide the Legislature with information about mandated insurance benefits and proposed mandated benefits. The Commission is charged with reviewing, assessing and reporting on legislation referred to it, and providing information and recommendations to the Governor, 55 standing legislative committees, and the Division of Insurance on mandated benefits and the Standard health benefits plan. In 2006, the Legislature formed a Health Care Reform Commission to study and establish health care reform models for expanding coverage, especially for the underinsured and uninsured, and to decrease health care costs for Colorado residents. The 24 member commission is to conduct its study and complete a final report with recommendations to the General Assembly by November 30, 2007. Medicaid Enhancements Through the implementation of statewide disease management pilot programs, the state has improved care and controlled costs for Medicaid beneficiaries with asthma, schizophrenia, diabetes, high-risk infants, and women with breast and cervical cancer. Disease management has been a very successful tool in the Colorado Medicaid program for reducing costs while enhancing the health of individuals. Colorado has established a consumer directed attendant support (CDAS) program under which Medicaid recipients are given greater control and personal responsibility over their attendant services. This consumer-directed option for the physically disabled under the state Medicaid program allows consumers to employ, train, or in other ways manage the person who provides his or her attendant support, and provides incentives to more efficiently use taxpayer dollars. Mental Health In 2000 Connecticut passed legislation which requires individual and group health insurance polices to provide coverage for treatment for mental or nervous conditions at the same level, and subject to limitations no more restrictive than those imposed on coverage or reimbursement of expenses arising from treatment for other medical conditions. Connecticut High Risk Pool Connecticut has a high risk pool, also known as the Health Reinsurance Association (HRA), with maximum premiums limited to 150% of standard small group health insurance premiums. HRA also acts as the alternative mechanism for the individual health insurance market in accordance with HIPAA. HRA provides portability coverage for people who have exhausted COBRA benefits. Electronic Rate and Form Filing Connecticut accepts filings submitted via the System for Electronic Rate & Form Filing (SERFF) as well as paper filings. No priority is given to carriers utilizing SERFF. Mandate Review Commission In 2000, Connecticut Insurance Department filed a report to the Connecticut General assembly regarding the Feasibility of Permitting the Sale in Connecticut of Group Standardized Major Medical Expense Coverage that Allow Individuals or Employers to Augment such Coverages with Optional Benefits. The report concluded that a low cost major medical plan with optional benefits 56 is not a feasible option in Connecticut; employers were not interested in reducing benefits and providers were concerned about the effect of low option plans. Discount Medical Plans Effective July 1, 2005, Connecticut General Statutes §38a-479qq - §38a-479rr required Medical Discount Plan (MDP) Organizations to be licensed with the Insurance Department. A MDP organization is defined as a person that: (A) establishes a medical discount plan, (B) contracts with providers, provider networks, or other MDP organization to provide health care services at a discount, and (C) determines the fees charged to members for the plan. Specifically excluded from licensing requirements are health insurers, health care centers, hospital service corporations, medical service corporations, or fraternal benefit society licensed in this state or any affiliate of such health insurer or center. Health Savings Accounts Connecticut allows carriers, including HMOs, to offer high deductible health plans. Long Term Care Insurance Connecticut has a Long Term Care Partnership program which allows individuals to protect personal assets from Medicaid spend down. Rating Connecticut requires prior approval of all HMO rates, as well as Medicare supplement and long term care. In addition, small group carriers must file an annual actuarial certification which states compliance with Connecticut small group rating reform. Small Group Market Small group market reforms include community rating by class, guarantee issue requirements in the 1–50 market, as well as guaranteed renewability. Rating classifications include: gender, age, industry, group size, family composition, area and administrative expenses related to association business. District of Columbia Subsidized Plan The District of Columbia has created the DC Healthcare Alliance to provide direct coverage for uninsured DC residents with incomes below 200 percent of the Federal Poverty Level. Coverage is provided free of charge using providers that contract with the District. 57 Florida Market Reforms Passage of the Small Employer Health Care Access Act Passage of individual, large group, small group, long term care, health savings account and health reimbursement account legislation to be compliant with the Health Insurance Portability and Accountability Act passed in 1997. Enhancements to Florida’s conversion law to require small group standard plan Guaranteed issue requirements in the small group market. The Long-Term Care Partnership Program provides seniors with incentives to purchase more affordable Long-Term Care Insurance by allowing them to protect their personal assets in an amount equal to the benefits provided by their policy from Medicaid spend-down requirements. It also provides existing policyholders with viable options in the event of unaffordable rate increases that were previously only available to new policies. Included are several limitations on the amount of a rate increase that can be imposed on policyholders. All policies must have a two year contestable period and any challenges the insurer has to the policy must be raised during the first two years. After two years the only reason the policy can be cancelled by the insurer is for nonpayment of the premium. Elderly policyholders are protected from skyrocketing rate increases and unfair post-claims underwriting business practices. Rates are determined by pooling experience of all affiliated insurers. An insurer cannot charge existing policyholders more than it charges new policyholders for the same benefits. Required offerings of standard and basic health plans as well as a high deductible health plan that is compatible with federal HSA or HRA requirements to 1-life groups during the required August open enrollment period. Initiatives to Facilitate Pooling Require all like health insurance forms to be pooled in order to stabilize rates and promote equitability among insurers. Require all health insurance companies to file annual rate certification to ensure that they are charging adequate and reasonable rates. Revision of small group age brackets to 5-year age bands Modified community rating for small groups with 10+ lives +/-15.0% adjustment to small group rates for claims experience, health +status, or duration of coverage. 10.0% cap for adjustments to renewal +cases. 1-life load that cannot exceed 1.5 times the 2-50 small group rate. 58 Initiatives to Subsidize Health Insurance Passage of legislation establishing The Florida Health Insurance Plan as a high risk plan. (Note that implementation of this plan is pending legislative funding). Recent, unsuccessful legislative attempt to pass the “Healthy Florida” a health insurance subsidy program for small businesses. The program was to be a state subsidized reinsurance mechanism or a stop-loss subsidy which would have reimbursed health plans for 90% of claims paid between $5,000 and $75,000 on behalf of a member in a calendar year. Initiatives to Reduce Regulatory Costs Passage of legislation authorizing the creation of Health Flex Plans for uninsureds whose income does not exceed 200% of current poverty level. Creation and implementation of Florida's Office of Insurance Regulation Electronic Data Management System for processing all life/health form and rate filings. Passage of legislation to amend the Florida health insurance filing statute to exempt large group rate filings for 51 plus size groups. Initiatives to Increase Competition Passage of legislation authorizing Small Employer Health Alliances. Initiatives to Promote Efficiency in Health Care Governors Health Information Infrastructure Advisory Board is working toward making Health information readily available in a digital format improving health care due to wider availability of this information across health care providers and health care facilities. This is a statewide initiative. Initiatives to Promote Healthy Lifestyles Passage of legislation providing for premium rebate based on healthy lifestyles. Other Initiatives Passage of legislation regulating discount medical plan organizations to ensure that rates are fair and equitable. Passage of out of state group legislation to provide consumer protections and rate regulations. Insurer Transparency Creation of website providing Floridians the ability to compare and search the benefits and premiums for small employer health plans offered in the state. The Small Employer Sample Rate Search website gives small employers the ability to view and compare small group major medical health insurance rates for standard, basic and high deductible health plans currently available in the state. Small businesses can enter the employees that they employ in various categories and calculate an estimated monthly cost for their company. The site can be accessed at https://appst.fldfs.com/sercs/. A website that will provide easy access to Medigap policy pricing, plan options, and insurer quality of service information is being developed to provide a positive, interactive internet-based outreach tool that will allow consumers to compare various plans and pricing, therefore, allowing for a more informed choice and decision about their health care and health insurance options. The expected launch date is July 2008." 59 GEORGIA Telemedicine In 2005, Commissioner Oxendine promoted modifications to Georgia law to expand the use of Telemedicine in Georgia, and to clarify and require insurers to recognize these modes of treatment in evaluating coverage and claims. Telemedicine is designed to be an extension of specialty care which combines local and regional providers working cooperatively to evaluate, diagnose, and treat patients. (O.C.G.A. Section 33-24-56.4) Georgia Rural Health Initiative The Georgia Rural Health Initiative is a comprehensive privately funded program initiated by Commissioner Oxendine in 2004 that includes a statewide telemedicine network, teleradiology sites, and capital investments in rural Georgia healthcare facilities. Pooling HPPC (Health Plan Purchasing Cooperative) In 1997,Georgia law was modified to allow regional non-profit Health Plan Purchasing Cooperatives to be formed by coalitions of employers who wanted to band together as a true group (and not as an association) to seek purchasing and bargaining power in obtaining group health insurance. (O.C.G.A. Chapter 33-30A) Small Group Pooling In 1990, the General Assembly supported a series of reforms and new requirements which were placed upon carriers to pool all the experience of small group health cases under 50 lives, to limit the use of substandard rating of individuals, to avoid declinations and waivers and to otherwise operate more fairly and more in line with traditional principles of insurance risk spreading. Georgia modified its law and rules in 1997 and 1998 to become consistent with HIPAA requirements, and modified rules again in 2002 to reflect other changes and refinements based on market conduct examination findings from several carriers in the Georgia small group health market. (O.C.G.A. Section 33-30-12 and Rule Chapter 120-2-10-.12) Tax Credit Health Coverage Tax Credit (HCTC) Effective in mid-2006, Georgia approved a special program to provide a guaranteed issue, individual health product with HCTC premium assistance. The product is available to those persons who qualify for Federal Advance or other Tax Credits because they were displaced from jobs under the Trade Assistance Adjustment Act and is also available when persons become eligible because their Pension Plans fail and their health coverage is being provided through the Pension Benefit Guaranty Corporation. The Office of Commissioner of Insurance was informed by the U.S. Department of Labor and IRS authorities that in 2005, perhaps as many as 9,000 Georgians might qualify under the Trade Adjustment Act. Mandate-Lite Plan In 2005, Georgia adopted modifications to its small group and individual health insurance laws to allow insurers to optionally offer to small employers and individuals a product (sometimes described as “mandate-lite”) that contains a smaller set of required, key health insurance mandates. The law also requires a side-by-side offer of and disclosure about a more traditional product with the full spectrum of required health mandated benefits. (O.C.G.A. Chapter 33-60) Mandate Review Legislative Health Mandate Assessment Review 60 Beginning in 1989, Georgia law required that health insurance benefit bills undergo a systematic assessment review as they made their way through the legislative process. The goal was to provide the Georgia General Assembly, with expert commentary on the public interest and the potential effects on the market, the premium, administrative and other costs and operational impacts. The idea is to weigh costs versus benefits as part of the evaluation of newly proposed mandates as legislation makes its way through processes leading to potential passage. (O.C.G.A. Section 33-24-60 through 33-24-67) Individual Market Reform Renewal Offering Requirements (HB 1456) Passed in 2006, and applying to individual major medical products, the purpose of this legislation is to give consumers more information regarding additional options available to them at renewal and help insureds respond to premium rate changes. This legislation placed certain notice requirements on insurers offering individual health products: (1) Section 33-29-21.1 provides that when a dependent child reaches age of termination of coverage that the insurer must offer a policy of accident and sickness most nearly similar to prior coverage or offer a lesser coverage benefit plan without being subject to any additional underwriting; and (2) Section 33-29-9(b), which requires insurers to allow their individual major medical or comprehensive health customers, at renewal, to modify policy benefits and/or deductible levels, or to change coverage to a comparable product offered by the insurer without being subject to any additional underwriting. Hawaii Employer Mandate In 1971, Hawaii passed the Prepaid Health Care Act that requires all employers to purchase insurance for their employees. Employee contributions are capped at 1.5 percent of their wages. Illinois SCHIP Expansion AllKids Program In 2005, the Governor signed legislation creating the AllKids program, which will provide coverage for children whose families earn too much to qualify for Medicaid or SCHIP, but not enough to afford private coverage. The program, which has absorbed KidCare, the state’s SCHIP program, is provides care through a primary-care case management system with families paying premiums on a sliding scale based upon their income. The state expects to provide coverage to an additional 50,000 children throughout the state, which will be funded with the premium payments and the savings realized by shifting the current SCHIP and Medicaid populations to primary-care case management. Subsidized Plan Illinois Covered On March 4, 2007, Illinois Governor Rod Blagojevich announced his Illinois Covered proposal aimed at providing affordable coverage to the uninsured and at helping middle-income families 61 and small businesses that are currently enrolled in health insurance plans. The plan also aims to reform the existing healthcare system to improve quality and require more accountability. Illinois Covered Choice Illinois Covered Choice is a new, affordable insurance product offered by the state to be purchased through employers or individuals. State-supported reinsurance, among other pro-consumer changes, will make this product more affordable than products currently on the market. Under Illinois Covered Choice, small businesses and individuals whose employers do not offer coverage will have access to new, comprehensive insurance plans with affordable rates. The new product will be offered through private insurance companies, and will provide comprehensive coverage, including inpatient and outpatient care, prescription drugs, and physician visits. Any individual who does not have access to employer-sponsored insurance will be eligible to purchase Illinois Covered Choice insurance at affordable rates that vary by income, irrespective of their health. Any small business with 25 or fewer employees that agrees to contribute at least the minimum required percentage of its employees' premiums may purchase group coverage through Illinois Covered Choice at cheaper prices than they currently get for comparable good quality coverage. Their employees will get premium assistance through Illinois Covered Rebate to lower the cost even more. Illinois Covered Rebate: Illinois Covered Rebate can be used for coverage purchased through Illinois Covered Choice or for employer-sponsored plans, if the employer contributes at least 70% of the premium for an individual. Families earning between 100 percent and 400 percent of the federal poverty level ($20,000 to $80,000 for a family of four) will be eligible for discounts on the cost of health insurance they obtain through their employer. For those whose employers contribute to their health insurance premiums, Illinois Covered Rebate will cap health insurance premiums at a rate that is affordable for the employee, and the state will work with the insurance company to cover the difference between the discounted premium and the actual rate for the employee portion: • • Annual premiums for families earning between 100 percent and 250 percent of FPL ($20,000 to $50,000 for a family of four) will be capped at 1.5 percent of annual income for individual coverage, or 3 percent of annual income for family coverage; Annual premiums for families earning between 250 percent and 400 percent of FPL ($50,000 to $80,000 for a family of four) will be capped at 2.5 percent of annual income for individual coverage, or 5 percent of annual income for family coverage. For those buying their own health insurance through Illinois Covered Choice, they will also receive a rebate to cap their health insurance premiums at an affordable rate. • • Annual premiums for a family earning between 100 percent and 250 percent of FPL ($20,000 to $50,000 for a family of four) will be capped at 2.5 percent of annual income for individual coverage and 5 percent of income for family coverage; Annual premiums for families earning between 250 percent and 400 percent of FPL ($50,000 to $80,000 for a family of four) will be capped at 3.5 percent of annual income for individual coverage or 7 percent of annual income for family coverage. 62 Illinois Covered Assist: While programs like Medicaid and FamilyCare provide coverage to many low-income adults, there are 302,000 poor adults in Illinois who do not have access to coverage because they do not have children, or their children are grown and no longer dependent on them. Through Illinois Covered Assist, these adults will be able to get health coverage. People living below the poverty level (up to $10,210 for an individual or $13,690 for a couple) who do not qualify for Medicaid and do not have access to employer-sponsored coverage will be eligible for free comprehensive coverage through Illinois Covered Assist with low co-pays. Those living below the poverty level who do have access to employer-sponsored coverage can have their premiums covered by the state. FamilyCare Expansion: The state's FamilyCare program has enabled more than 500,000 low-income working parents to get health coverage through the state, but thousands more earn just above the current threshold and do not have access to coverage through their employers. Under his "Illinois Covered" plan, the Governor proposes increasing eligibility for FamilyCare to 400 percent of the federal poverty level. By expanding FamilyCare eligibility from 185 percent of the federal poverty level to 400 percent FPL, or from $35,000 for a family of four to $80,000, close to 150,000 more working parents who are uninsured and do not have access to employer-sponsored insurance would be able to get healthcare. Those making up to 400 percent of the federal poverty level who do have access to employersponsored insurance will be able to get premium relief through Illinois Covered Rebate. Expanded Adult Dependent Coverage: In order to give parents more flexibility in helping their children maintain health coverage into adulthood, the Governor's Illinois Covered plan will increase the young adult dependent age to 30. Currently, most plans disqualify dependents for family coverage once they reach age 22 or 23. Improve Quality and Hold Down Costs: The State will work with consumers and Illinois healthcare providers on a Roadmap to Health strategy to improve the overall healthcare system. A statewide consensus plan will be developed for promoting wellness and managing chronic conditions. Since 70 percent of overall healthcare costs are for chronic diseases, this component is essential for bringing down overall healthcare costs for businesses and consumers alike. The roadmap will also include expansion of existing initiatives and the creation of new initiatives to build and improve overall healthcare capacity. The State will also build upon recent efforts to improve patient safety, promote electronic medical records, improve access to information on quality of care and reduce administrative costs. Iowa Medicaid Expansion In 2005, the governor signed legislation creating the Iowa Care program, qualifying the state for federal matching funds for indigent care at the University of Iowa Hospitals, Broadlawns Medical 63 Center, and the state’s four mental hospitals. People with incomes below 200 percent of the federal poverty level will be eligible for the program and will pay a premium of up to $75 a month. The program also provides incentives for enrollees to improve their health by losing weight and quitting smoking. Kansas Multi-Share Program In 2005, Governor Sebelius signed legislation that will allow the state to develop a program that will combine federal and state subsidies with contributions from small employers and eligible employees in order to purchase health insurance on their behalf. Employees with low and modest wages will qualify for subsidies if their employer has not offered them health insurance or if they could not afford offered coverage. Kentucky Interstate Reciprocal Health Benefit Plan Compact Explore the creation of an interstate compact for health benefit plans with surrounding states. Purpose of Compact: To promote the interest of consumers purchasing health benefit plan coverage; To develop uniform minimum standards for health benefit plan products covered under the compact (while ensuring that the standards established in Kentucky law and regulations are maintained and protected); To improve coordination of regulatory resources and expertise between state insurance departments regarding the setting of uniform minimum standards; and To perform these and such other related functions as may be consistent with the state regulation of the business of insurance. Multi-Share Program Insurance Coverage, Affordability, and Relief to [small] Employers (ICARE) Description of Program: Effective January 1, 2007, this program will provide a healthcare incentive payment to employer groups who have not provided health benefit plan coverage to their employees within a twelve (12) month period and to employer groups who have an individual with a high-cost condition. The ICARE program will be piloted for a four-year period in the small group market and will be limited to those employer groups with 2 to 25 employees, including employer-organized associations. 64 This program will be capped, since funding is limited, and would be available to individuals on a first-come, first-served basis. Covered Population: Employees and their dependents ages 0-64 with income up to 300 percent of the Federal Poverty Level (FPL). Qualified Health Benefit Plans: Qualified health benefit plans eligible for an incentive payment include a consumer driven health benefit plan, a basic health benefit plan, and an enriched health benefit plan approved by the Office of Insurance. Incentive Payments: For employer groups who have not provided health benefit plan coverage to their employees in the previous twelve (12) month period, an amount of $40 per month which will be reduced annually in increments of $10 at the time of renewal. For employer groups who have an individual with a high-cost condition, an amount of $60 per month which will be reduced annually in increments of $15 per month at the time of renewal. Employers must pay at least 50 percent of the premium amount of the cost of a qualified health benefit plan and must meet the insurer’s participation requirements in order to qualify for an incentive payment. Insurer Requirements: All insurers doing business in the small group market are required to participate in the ICARE program. Insurers are required to conduct a health risk assessment for each employee enrolled in the ICARE program. Insurers are required to offer a wellness program, case management services, and disease management services. Estimated Number of Actual Participants: Based upon funding of $20 million, the estimated number of individuals that could be served is approximately 20,000 - 24,000. Moratorium on Mandated Benefits Imposed a statutory moratorium on legislating new state mandated benefits for three years with the exception of any new federally mandated benefits. Allowed the standard health benefit plan to be an optional product offered by an insurer, rather than a mandatory product. 65 Uniform Provider Credentialing Established and required the use of a uniform application for the credentialing and recredentialing of health care providers. The uniform application is required to be used by all health insurers and the state’s Medicaid Program. The Office adopted guidelines and the actual form used by the Council for Affordable Quality Healthcare. Basic Health Benefit Plans Allowed insurers to offer to small employer groups and associations basic health benefit plans that: Exclude state mandated benefits; and Provide limited coverage (physician, hospital, Rx, home health, preventive and emergency care only). Maine Dirigo Health Reform Initiative to expand access, improve quality, and contain costs Goal 1: Expand Access The DirigoChoice insurance product was developed by the Dirigo Health Agency (a new State agency). Anthem Blue Cross Blue Shield won a competitive bidding process to administer the product, which provides comprehensive coverage with deductibles to small groups, sole proprietors, and individuals. People with household incomes under 300 percent of the Federal Poverty Level can receive subsidies on premiums and deductibles. Enrollment as of 3/1/06: 9,743 members. Goal 2: Improve Quality The Maine Quality Forum was established (a new State agency). It promotes safe practices among hospitals through a certification program which measures hospitals against national standards. It provides information on the quality of care at various hospitals on its website. It is developing a statewide IT project which would allow any healthcare provider – with the patient’s consent – to access the patient’s complete medical records. 66 It assists the Legislature on quality of care legislation, such as the need for hospital nurse/patient ratios. Goal 3: Contain Costs Bad debt/charity care costs are expected to decrease as more people are insured. Hospitals, healthcare providers, and insurers have agreed to voluntary revenue caps. Regulatory changes have been made to the existing Certificate of Need process for reviewing proposed hospital projects. The program is funded by an assessment based upon savings in the health care system. In 2005, the Dirigo Health Agency estimated Dirigo-related savings to the health care system and filed its determination with the Superintendent of Insurance for review. In 2005, the Superintendent found $43.7 million in reasonably-supported savings. Insurers and third party administrators have been assessed this amount; they have appealed the legitimacy of this decision in court and in the Legislature. The appeal was denied in Superior Court. In May 2006, the Governor signed an Executive Order creating the Blue Ribbon Commission on Dirigo Health to make recommendations on alternative funding sources. In July 2006, the Superintendent found $34.3 million in reasonably-supported savings; the Dirigo Health Agency Board of Directors voted to table any action to assess this amount until they receive the Blue Ribbon Commission’s recommendations. Maryland Small Group Market Maryland's small group market is designed to create pooling. Maryland's law requires all insured small group policies to be part of the small group market. Maryland's market is guaranteed issue, imposes rating bands, and limits rating factors to age and geography. Unlike some other states, there are no medically underwritten plans permitted in Maryland's small group market. Maryland does not include any limitation on the ability to come in and out of the market through preexisting condition exclusions or waiting periods if an employer drops coverage or waits to pick up coverage. High Risk Pool Maryland implemented the Maryland Health Insurance Plan, a high-risk pool for medically uninsurable individuals, in 2003. Mandated Benefit Cost Limitation Maryland's small group market limits the actuarial cost of mandated benefits required as part of Maryland's Comprehensive Standard Health Benefit Plan to 10 percent of the average wage of Maryland workers. As a result, the benefit cost is reviewed annually and benefits may be altered or reduced to meet the cost limitation. As a result of review, the prescription drug benefit mandated in the small group market has been reduced to meet required cost constraints. Maryland does rank at the top of the list for mandates. While the General Assembly has slowed the introduction of additional mandates in the large and individual markets considerably, none have been repealed. 67 Initiatives to Promote Healthy Lifestyles In 2005, Maryland mandated a benefit for treatment of smoking cessation in the individual and large group markets. Massachusetts On April 12, the governor signed legislation that will institute sweeping new reforms to the state's health care system. The legislature has been engaged in intensive negotiations for the past several months to hammer out final legislation in time to satisfy federal requirements that the state make substantial progress in reducing the ranks of the uninsured in order to qualify for a renewal of its Medicaid waiver. As adopted by the legislature, the bill would: Merge the individual and small group insurance markets in July 2007; Create the Commonwealth Health Insurance Connector, to connect individuals and small businesses with health insurance products. The Connector certifies and offers products of high value and good quality. Individuals who are employed are able to purchase insurance using pre-tax dollars. The Connector allows for portability of insurance as individuals move from job to job, and permits more than one employer to contribute to an employee’s health insurance premium. The Connector is to be operated as an authority overseen by a separate, appointed Board of private and public representatives. Create the nation's first individual mandate to purchase health insurance, effective July 1, 2007, which will be enforced through the tax code; Create a subsidized insurance program, the Commonwealth Care Health Insurance Program for individuals who cannot afford private coverage, but do not qualify for Medicaid. Impose an annual assessment of $295 per full-time employee upon employers who fail to provide insurance to their workers and to make a reasonable contribution to that coverage; Impose an additional surcharge on companies that do not provide insurance when their employees access free care; Allow HMOs to offer high deductible health plans in conjunction with health savings accounts; Expand Medicaid eligibility and increase outreach efforts to enroll eligible individuals in the program; and Increase Medicaid reimbursement, contingent on providers' abilities to meet performance benchmarks, including in the area of reducing racial and ethnic health disparities. The governor exercised his line-item veto authority to cancel several provisions of the legislation. On May 4, the legislature overrode the majority of those vetoes: The $295 per-employee assessment on employers who fail to provide insurance to their workers; 68 The expansion of a public health council to advise the commissioner of public health; The extension of dental benefits and wellness programs to Medicaid beneficiaries; and A provision requiring the administration to submit its reasoning to the legislature prior to making any changes in the financing or regulation of or operation of mental health benefits for Medicaid beneficiaries; Vetoed provisions that were not overridden by the legislature were: A provision giving Medicaid eligibility to “special status aliens” who have been in the United States for less than five years without permanent status regardless of the income of their sponsor; and A requirement that the Secretary of HHS consult with the legislature in seeking a section 1115 Medicaid waiver based upon the reform bill. Michigan Rating Michigan's non-profit health care corporation is restricted to only use industry and age in determining premiums within a geographic area. Health maintenance organizations can only use industry, age, and group size in determining premiums. Commercial carriers may only use industry, age, group size, and health status in determining premiums. Michigan has rating restrictions based in relation to the company's index rate. The rate cannot vary by more than 35% of the index rate for Health Maintenance Organizations and nonprofit health care corporations. Commercial insurers’ rates cannot vary by more than 45% of the index rate. The state’s Multiple Employer Welfare Arrangement (MEWA) statute was amended in 1999 to allow businesses broader access to the ability to join together to provide health benefits to employees. Connector In a new initiative in Michigan that is slated to be operational in 2007, health care will be provided through private market insurance products offered by a newly created “Exchange” to an affordable plan for individuals and families. The Exchange will facilitate enrollment, certify plans, administer premium subsidies for low-income enrollees, coordinate with employers to collect premiums, and leverage pre-tax contributions in order to reduce cost. Subsidized Plan The Michigan First Health Plan, slated to be operational by April 2007, will subsidize uninsured adults under 200 percent of the Federal Poverty Level (FPL) who are not eligible for Medicaid or other health care coverage. In Michigan, approximately 550,000 of the 1.1 million uninsured are under 200 percent of FPL. As the plan is expanded, individuals above 200 percent of FPL could have the opportunity for a more modest subsidy. Since 1985, Michigan has used Blue Cross Blue Shield of Michigan (BCBSM), a non-profit health care corporation, as our market of last resort for health insurance. BCBSM must offer coverage to any Michigan resident who isn’t in jail for health care fraud. BCBSM currently provides 69 community-rated major medical coverage to 120,000 non-group and group conversion subscribers on average for about $300 per month for a single person, as well as community-rated individual Medigap coverage to 220,000 subscribers at a Plan C cost of $90 per month. The group conversion and individual Medigap rates are supported by cost transfers of over $150 million per year from BCBSM group subscribers and BCBSM’s surplus. Electronic Filing Michigan requires insurers who operate in more than one state to utilize the System for Electronic Rate and Form Filing (SERFF), which provides a cost-effective method of handling insurance policy rate and form filings between regulators and insurance companies. The SERFF system is designed to enable companies to send rate and form filings and for states to receive, comment on, and approve or reject them. Long Term Care In 2005, Governor Granholm issued an executive order that established the Office of Long-Term Care Supports and Services and the Michigan Long-Term Care Supports and Services Advisory Commission. This order established a program to create a single point of entry system to coordinate the services and funding for those Michigan citizens needing some form of long-term care service. The office and the commission were formed to implement the recommendations made in the Modernizing Michigan Medicaid Long-Term Care report issued in 2005. Health IT Recently effective legislation created the Health Information Technology Commission within the Michigan Department of Community Health to facilitate and promote the design, implementation, operation, and maintenance of an interoperable health care information infrastructure in Michigan. In December 2005, Governor Granholm convened the Michigan Health Information Network (MHIN) to begin building the foundations of a statewide health information network to advance the use of information and communication technologies. The MHIN is a collaboration of health care stakeholders and is already at work integrating the latest technology into Michigan’s medical networks. Pilot programs in mid-Michigan, Southeast Michigan, and the Upper Peninsula are already underway. This network will significantly reduce both duplicative services and mistakes made by health care professionals due to lack of access to a patient’s current health information, cut administrative costs, and create overall cost savings. Incentives to Promote Healthy Lifestyles Legislation is currently under consideration by the Michigan Legislature to provide cost incentives to employers, employees, and individuals to pursue healthier lifestyles. Health plans may be able to realize savings in claims costs and pass those savings on to the parties that pay the premiums. The 10 percent cap on the amount of rebate or discount that is designated in the legislation will help alleviate concerns that health plans will use the wellness programs as a marketing tool without any real impact on the claims. While the 10 percent cap provides a real incentive, it is reasonable in its assessment of the potential influence a wellness program would have on actual claims costs and actual savings to the health plan. Michigan’s Surgeon General has initiated a “Michigan Steps Up” initiative, which includes a focus on encouraging health behaviors through moving more, eating better, and not smoking. Michigan citizens have utilized the resources available on the Michigan Steps Up website, creating more than 10,000 personal health plans and more than 1,000 risk appraisals. Governor Granholm has a plan to extend these efforts and develop public-private partnerships to foster a culture of physical activity, prevention and wellness. 70 Other Initiatives Recent legislation revised the manner in which HMOs may impose copayments/coinsurances for basic health services. In addition, recent changes in the law regulating HMOs allow them to offer contracts with no limitations on deductibles. This legislation was enacted to give HMOs greater flexibility in contract design. Proponents of the legislation argued it was needed to meet employer demands. Individual purchasers of HMO products may find products with higher deductibles and copayments to be more affordable and choose this type of coverage over the risk of carrying no coverage at all. Since 1973, Michigan has required all drivers to purchase no-fault auto insurance, which includes lifetime, unlimited coverage of medical and rehabilitation costs for injuries arising from the operation or use of a motor vehicle as a motor vehicle. Multi-Share Program There has been an expansion in local initiatives to improve access to health care and to address the uninsured in Michigan. Coalitions of city and county officials, hospital and physician leaders, philanthropists, and community activist are working to help their uninsured and low-income neighbors. Muskegon Access Health, in Muskegon, Michigan, is one example of a “three-share plan” in which employers, employees and the community each pay about one-third of the cost of the program. Muskegon Access Health is considered one of the pioneer community programs. Minnesota Subsidized Plan The state created the MinnesotaCare program which provides care through managed care plans for children and families with incomes up to 275 percent of the Federal Poverty Level. Premiums are charged based on income. Montana Insure Montana Insure Montana is two-part program that provides incentives for small businesses to provide health insurance for their employees. For small business currently providing coverage for their employees, the program provides a refundable state income tax credit to employer. It also provides additional tax credits when employers pay for insurance for the employee’s spouse or their dependants. Approximately 40% of the available funding per year is designated to the Employer Tax Credit. For those small businesses that do not currently provide coverage for their employees, Insure Montana provides a monthly assistance payment for both the employer and the employee’s portion of the health insurance premium. This assistance will pay the cost of an employee’s health insurance when the employer has not offered insurance in the past, but begins to do so through a new State Health Insurance Purchasing Pool or through a qualified Association Plan. About 60% of the available funding is designated to make these Employee Assistance Payments and Employer Premium Incentives. 71 Nebraska Behavioral Health Reform In 2004, the legislature adopted, and the governor signed, the Nebraska Behavioral Health Systems Act to reform the state’s behavioral health system by reducing its reliance upon stateowned Regional Centers and providing services in the least restrictive appropriate setting while accessing federal Medicaid dollars. The new system will be designed to serve consumers closer to their home communities and help them live more independent lives with more support. They will be closer to their health care providers, support groups, family and friends in an environment that still provides safety and protection for the individuals and the community. The legislation also addresses the lack of behavioral health services once individuals no longer need the hospital-based inpatient services provided at Regional Centers or local hospitals. The new system will include many levels. Consumers requiring crisis stabilization will access enhanced crisis center services. Community hospitals throughout the state will be able to develop acute psychiatric inpatient and secure residential services with the capacity to have locked units and highly trained staff. Residential rehabilitation services are less restrictive and more appropriate for some persons. Other non-residential community programs can provide services and reduce re-hospitalization. Regional Center beds will stay in place for individuals with high needs, and to provide specific care, such as the sexual offender and forensic programs. Telehealth Nebraska is nationally recognized for its efforts to establish a statewide telehealth network. The State of Nebraska will build upon the success of the Nebraska Statewide Telehealth Network and the strength of the partnerships formed during its development as it begins to address issues related to the adoption of electronic health records and health information exchange. Telehealth is the provision of health care, patient education, continuing medical education, and administrative services using telecommunications. Nebraska has established one of the most extensive telehealth networks in the country, connecting the state’s rural hospitals, regional medical centers, public health departments, and the State of Nebraska. The major functions of the Network are to improve quality and access to care, particularly in rural Nebraska; to provide patient, provider and community education; and to provide another communication source in the event of a natural, man-made or terrorist emergency. New Mexico Health Coverage for New Mexico Committee The 2005 State Legislature created a 23 member "Health Coverage for New Mexico Committee" to select criteria and models of universal health care coverage for New Mexico for a costcomparison analysis, along with an analysis of the costs of maintaining the status quo. The committee chose 3 models, and has contracted with Mathematica to analyze the proposals. The 72 cost analysis must be completed in the summer of 2007, with the intent that results will form the basis for proposed legislation for 2008. Models must address, among other issues, coverage for all New Mexicans regardless of ability to pay or income level, and clearly identified funding sources, while maximizing federal dollars. For details on criteria selected, see: http://legis.state.nm.us/lcs/lcsdocs/HCNM-RFP-163600.pdf Division of Insurance: Consumer Relations In 2007, the Division of Insurance formed a task force to review and revise the current Managed Health Care Rule, implemented in 1997, and the Grievance Procedures Rule, promulgated following passage of the Patient Protection Act in 1998, and last revised in 2004. The first priority for the task force will be to determine whether and how insurers utilizing Preferred Provider Organizations will be regulated. Currently New Mexico has a Preferred Provider Arrangements statute, but no accompanying rules providing consistent guidance for regulators. Promote Efficiency in Health Care In response to complaints from physicians, and pursuant to a State Legislature directive of 2003, the Division of Insurance has amended the Managed Health Care Rule to require provider certification once every three years (instead of the current requirement of once every two years). This is meant to cut down on physician paperwork and to occur concurrently with provider certification required for federal plans. The Governor's "Insure New Mexico!": Initiatives to Subsidize Health Insurance The New Mexico Medical Insurance Pool (NMMIP), the state's high-risk pool, provides a variety of plans for high-risk individuals, and further provides premium assistance for income-eligible persons and HIPAA-eligible persons, up to 70% of the premium. See: http://www.nmmip.com Health Insurance for Small Employers, Self-Employed and Individuals The New Mexico Health Insurance Alliance (HIA) was created in 1994 by the State Legislature to provide increased access to voluntary health insurance for small businesses, self-employed and qualified individuals. As part of the Health Information Systems Act, the HIA is also part of a joint public-private initiative to develop a statewide health information network to reduce duplicative data collections and reporting. All health insurers and managed health care plans must be members of the alliance. For additional details, see: http://www.nmhia.com/index.htm; Small Employer Insurance Program (SEIP) This program began in July 2006 to enroll employers, including non-profits, with 50 or fewer employees that have not offered insurance benefits in the previous 12 months to buy insurance with a $100,000 annual member cap on benefits, through a state-sponsored and administered program. Includes enrollment, counseling and placement process through the New Mexico Department of Human Services. See details at: http://www.state.nm.us/gsd/rmd/seip.html State Coverage Insurance (SCI) Program 73 The SCI Program began enrollment July 1, 2005 through a Medicaid waiver program, which utilizes federal and state funding plus contributions by employers and employees on a sliding scale/income-based basis of $0 to $35 per month. The program serves employees at or below 200% FPL of participating small employers with less than 50 employees and self-employed individuals. Not available to employers who have voluntarily dropped health insurance in the last 12 months or employees who have dropped health insurance voluntarily in the last 6 months. There is a limited benefit package based on a commercial product, not a traditional product. The cost to the employer is approximately $75 per employee per month. See details at: http://nmsci.state.nm.us Public Health Promotion New Mexico Healthier Weight Council Created in 2006 as the first statewide collaboration of partners organized specifically to address overweight and obesity in New Mexico. This is a statewide collaborative of over 150 partners, and was coordinated by NM Department of Health, Physical Activity & Nutrition Program for Healthier Weight; the University of New Mexico Prevention Research Center, with funding from the U.S. Centers for Disease Control. See details at: http://www.health.state.nm.us/obesity.html Separate Agency to Collect Health Data The New Mexico Public Health Commission collects health data from various state sources, organizes and analyzes the data for the purpose of assisting in the performance of health planning and policymaking functions. The data is also published in a form that is meant to be useful for consumers in making informed decisions regarding health care; and for the purpose of administering, monitoring and evaluating a statewide health plan. New York Speed to Market Initiatives To allow consumers access to more competitive insurance products, New York implemented several speed-to-market initiatives that assist insurers in getting their products through the approval process and to the marketplace faster. New York developed product checklists and outlines for each individual health product that provides insurers with a consolidated list of all statutory and regulatory requirements for a specific product filing in one place as well as an outline for each product that provides detailed explanations for reference. Use of these tools shortens the State’s approval process by assuring more complete and accurate filings. In addition, beginning in September 2003, we also streamlined the approval process by offering an optional expedited process of certification that offered priority over normal submissions. In November 2004, New York began accepting electronic filings of all health insurance products through the NAIC’s System for Electronic Rate and Form Filings (commonly called SERFF). Uniform Coding and Uniform Statistical Plan In response to concerns raised by providers, the New York Insurance Department has been meeting with provider and payer representatives to create a new regulation that would establish uniformity in the use and application of codes in the processing of health care claims to avoid claim delay. This regulation would also require every accident and health insurer and HMO to 74 annually file with the superintendent a statistical report showing a classification schedule of its premiums, losses and related expenses on all kinds or types of accident and health insurance business subject to the insurance law and such other information as the superintendent may deem necessary. The intent is to establish a uniform statistical plan for the health insurance industry, where there is currently no consistency in the methods of data collection, classification (other than by aggregated lines of business), and reporting. The Availability of Health Insurance / Reaching the Uninsured New York has taken a comprehensive approach to attacking issues regarding the availability and affordability of health insurance coverage. New York is one of few states in the nation to have open enrollment and pure community rating. New York passed open enrollment and community rating legislation in 1992 to facilitate access to health insurance by individuals and small groups. In New York, all individuals and small groups applying for health insurance coverage must be accepted without regard their age, sex, health status or occupation and premium rates may not vary based on these factors. Market stabilization pools were created to help to spread the costs of insuring the sickest individuals among all carriers participating in the individual and small group markets. In 1996, to ensure New Yorkers in the individual market could access comprehensive health insurance coverage, New York required all HMOs in the State to offer two standardized comprehensive health insurance benefit packages in the individual marketplace. One is a straight HMO product that requires enrollees to use doctors within the HMO’s network and the other is a point of service option. In 2000, a state funded reinsurance mechanism was created to assist in stabilizing the premiums for these products. This mechanism removes the risk of certain high cost claims by reimbursing the HMOs for claims paid between $20,000 and $100,000 in a calendar year on behalf of a given enrollee. Approximately 80,900 benefit from this program. The Health Care Reform Act of 2000 (HCRA 2000) created several health care initiatives designed to work together with the State’s existing Child Health Plus program to reach the uninsured. The Family Health Plus program was created to provide free coverage to very low income adults who earn too much to qualify for Medicaid. Adults aged 19-64 may qualify if their income is less than 100 percent of the Federal Poverty Level, or less than 150 percent of the Federal Poverty Level if they have children. Healthy NY HCRA 2000 also created the Healthy NY program. The Healthy NY program is one of the first market-based initiatives in the country designed to reach the uninsured. It provides a lower-cost health insurance option for uninsured small businesses, sole proprietors and individuals who do not have access to employer coverage. State financial assistance is focused on bringing the product to a price point that will permit vulnerable individuals and small businesses to purchase the coverage on their own behalf. Healthy NY offers a streamlined, yet comprehensive, benefit package designed for affordability. Healthy NY also utilizes a stop loss mechanism, similar to the one used with the individual market, in order to remove the premium impact of some of the risk for high-cost claims. State funded stop loss funds reimburse the health plans for 90 percent of claims paid between $5,000 and $75,000 in a calendar year on behalf of an enrollee. Claims experience of small businesses, sole proprietors and individuals is pooled together in determining premium rates, and the stop loss reimbursement must be factored into the rates as well. Small businesses, sole proprietors and individuals all pay the same premium. Premium rates can vary by health plan and by rating region. Because a high percentage of the uninsured in New York State are workers in small firms, Healthy NY targets vulnerable small businesses. Small businesses with 50 or fewer employees can 75 purchase Healthy NY if: (1) they are located in New York; (2) at least 30 percent of their employees earn wages of $34,000 (adjusted annually) per year or less; and (3) they have not provided health coverage in the prior 12 months. In addition, the small business must meet certain participation rules and contribute at least 50 percent of the employee premium. Healthy NY is also available to sole proprietors and individuals with incomes too high to qualify for the State’s Family Health Plus program. Individuals and sole proprietors must meet employment standards, be ineligible for employer-provided insurance or Medicare, and have a household income at or below 250 percent of the Federal Poverty Level. In addition, they must have either been uninsured for 12 months or have lost their insurance for certain reasons. Healthy NY began in 2001 and it has already reached over 250,000 people. In 2006, new enrollments in the program have averaged nearly 7,300 each month. The state continues to examine new options for improving Healthy NY, and is working with the industry to introduce a consumer driven high deductible health plan option designed for use with a tax advantaged Health Savings Account in 2007. This product will benefit from the streamlined Healthy NY benefit design, the state funded Healthy NY stop loss reimbursement mechanism and access to a portable, tax-advantaged Health Savings Account. New York State Health Foundation As part of legislation authorizing the conversion of Empire Blue Cross Blue Shield to a for-profit company, the legislature and the governor created the New York State Health Foundation. The foundation is tasked with a mandate to expand health insurance coverage for those who are unable to afford it, to improve access to care, and to educate people about health issues and was funded by a portion of the state’s proceeds from the conversion. In its first year of grantmaking, the foundation plans to support small-scale demonstration programs by community groups, clinics and schools and to help replicate those programs elsewhere. Association Coverage for Sole Proprietors New York State enacted an additional reform in 2002 to address the waning availability of health insurance for sole proprietors. Legislation required insurers that sell to groups through associations to make the same coverage available to sole proprietors who are members of the association. Prior to this legislation, insurers were not required to sell group coverage to sole proprietors. The legislation permits the insurers to impose a premium rate differential if actuarially justified. North Carolina Prescription Drug Plan In 2006 North Carolina’s Governor created NCRx, a new prescription drug assistance plan that will help low-income seniors participate in the federal Medicare Part D prescription drug program. NCRx became effective January 1, 2007 for those enrolled by December 31, 2006 and qualified. Once an application is approved and the participants are enrolled in a participating Medicare Prescription Drug plan NCRx will pay up to $18 of their monthly premium. Electronic Filing North Carolina accepts electronic submissions delivered both via the NAIC’s System for Electronic Rate and Form Filing (SERFF) or NC NoPaPER. Printed-paper form and rate submissions continue to be accepted. However, communications between Life & Health and the 76 Industry are now in the form of electronic e-mail rather than printed-paper mailings. Each filer must provide a valid e-mail address with their filing to facilitate review and communication. Regulatory Checklists North Carolina has developed product checklists for each type of health insurance product that provides insurers with a consolidated list of all statutory and regulatory requirements for a specific product filing. These regulatory checklists are available from our website for all products of life and health insurance. Use of these tools shortens the State’s approval process by assuring the filings are more complete and accurate when initially submitted. Uniform Provider Credentialing Since 1997, requirements have been in place for all managed care insurers, health maintenance organizations (HMO) and preferred provider health benefit plan insurers (PPO) to have a policy and procedure for credentialing of providers necessary to meet the needs of insured members. In 2002, North Carolina established and required the use of a uniform provider credentialing application form for the credentialing and re-credentialing of health care practitioners. The uniform application is required to be used by all HMOs and PPOs and the state’s Medicaid Program for the credentialing of licensed health care practitioners. The uniform credentialing application form is available from our website with additional questions and answers information. Health Savings Accounts North Carolina tax treatment of HSAs is identical to federal tax treatment. Long Term Care Insurance The Long-Term Care Partnership Program provides incentives to purchase Long-Term Care Insurance by allowing insureds to protect their personal assets from Medicaid spend-down requirements in an amount equal to the benefits provided by their policy. North Carolina Department of Insurance is currently participating with the North Carolina Department of Health and Human Services in the development of the Long-Term Care Partnership Program for North Carolina, making any changes to regulations necessary for the program. Products in the market place already are satisfactory for use in the partnership program. It is anticipated the North Carolina program will be completed in the 2007 legislative session. Small Group Market Since 1997 small employer is defined as any employer with no more than 50 eligible employees, including a self-employed individual. In 2006, significant changes were made to modernize North Carolina’s Small Group Act: • Small employer carriers are permitted to utilize different deductibles and co-payment levels, including a high deductible, in their Basic and Standard health plans with the Commissioner’s prior approval. The Commissioner was given the ability to periodically review the approved designs and update them to reflect current market trends. Small employer carriers were given the option to utilize two alternative plans in lieu of the Basic and Standard health plans (two most popular plans by premium volume or two representative plans that reflect some actuarial equivalence to their book of business). Any election a small employer carrier makes under this section is in effect for two years. If the small employer carrier elects to offer the alternate plans and also chooses to terminate existing Basic and Standard plans, then the carrier must provide affected employers the new alternate plans as replacement coverage. The alternate plans must also be guaranteed available to self-employed individuals. Small group rating laws were amended to re-introduce industry as a permissible demographic factor (within limits), expand the experience bands from ± 20% to ± 25%, and redefine geographic area to mean a medical care system. Age (5-year bands) and • 77 gender are and have been the other permissible rating factors. Tax Credits HCTC HCTC-qualified plans in North Carolina include COBRA and State Continuation (where available), coverage through the spouse’s employer (subject to certain limitations), individual coverage that was in effect for 30 days before losing coverage through the employer, and “Statequalified” individual plans offered by private insurers. Currently Blue Cross Blue Shield of North Carolina is the only carrier who has chosen to offer State-qualified HCTC coverage, and by agreement with the Governor’s office, caps the risk-factor for these individuals at 2.0 when developing premiums for their coverage. A proposed high-risk pool would also be open to persons eligible for the HCTC. Small Business Health Insurance Tax Credit Recently enacted law created a small business health insurance tax credit for certain small employers that pay at least 50 percent of their employee’s health care coverage premiums. The health care coverage must be equal to or exceed the minimum provisions of the basic health care plan of coverage recommended by the Small Employer Carrier Committee as required by law. In conjunction with North Carolina’s Department of Revenue (DOR), the Department of Insurance has developed procedures to facilitate the insurance aspect of the tax credit for the state’s small employers, small employer carriers and DOR. The tax credit is effective beginning with the 2007 tax year for small employers that qualify with the DOR. Reinsurance North Carolina’s General Assembly has shown interest in the Healthy NY model, obtaining an actuarial study of a proposal to adopt it in North Carolina, but has not so far taken legislative action. HRSA Grant – Studying Ways to Cover the Uninsured The North Carolina Department of Health and Human Services in 2004 received a grant and worked collaboratively with the North Carolina Institute of Medicine and Department of Insurance to devise a plan to reduce the number of uninsureds. The top recommendations cited in the report on the study were: • • • • • Additional state funding to support and expand the healthcare safety net, to provide healthcare services to the uninsured; Promotion of personal responsibility for leading a healthy lifestyle and the inclusion of healthy lifestyle promotion in state policies; Develop of a limited-benefit Medicaid expansion for low-income parents; Creation of a subsidized health insurance product targeted to small employers with 25 or fewer employees, low-income sole proprietors, and low-income individuals who had not previously offered health insurance coverage; and Creation of a high-risk pool for individuals with pre-existing health conditions. High Risk Pool Study Grant and Legislation During the 2006 session of the North Carolina General Assembly a bill was introduced that would have created a “qualified high risk pool” as defined in Section 2744(c)(2) of the Public Health Service Act to provide coverage to federally eligible and high risk individuals, as well as to individuals eligible for the HCTC. The bill contemplated the creation of a high risk pool that would have provided coverage and premium rates consistent with the NAIC Model Health Plan for Uninsurable Individuals Act. The bill passed the House by an overwhelming majority (11010) vote late in the session but due to time constraints and the complexity of establishing a high risk pool, was not heard by the Senate before the General Assembly adjourned the 2006 session. 78 The North Carolina Department of Insurance in September 2006 received from CMSA a grant for the North Carolina High Risk Pool Feasibility Study. This study, the report on which was released in March 2007, will assist policymakers in making informed decisions regarding adoption of a high risk pool as an appropriate mechanism to provide insurance to federally eligible and high risk individuals. Three bills to establish a high risk pool were introduced in the North Carolina House and Senate in 2007, and the issue is receiving active consideration. Ohio Consumer driven health care With additional demand for consumer driven health insurance products, Ohio law was amended to give HMOs flexibility with respect to copays and deductibles. To make sure consumers are not price-gouged when paying for health care costs out of pocket or with a savings account, legislation is moving through the Ohio legislature to ensure consumers get their health plan's negotiated rate when paying for medical services out of pocket or with a savings account. Health savings accounts Ohio law was amended to make certain Ohio insurers, including HMOs, can offer high deductible health plans linked to HSAs. Ohio also took steps to make certain Ohioans utilizing HSAs receive the same favorable treatment under state tax law as they do under federal tax law. Transparency of health insurance costs Every hospital in Ohio is required to report to the health department the charges associated with the top sixty diagnosis related groups most frequently treated on an inpatient basis by each hospital. This information is made available to the public by the health department. Legislation moving through the Ohio general assembly would require insurers to establish and maintain systems whereby their customers can obtain information about potential out-of-pocket costs for services performed by in-network providers. Health care quality Ohio recently established the "Hospital measures advisory council" which is a public body that will recommend performance measures for hospital inpatient and outpatient services. The council will establish hospital performance measures; create a system for collecting, reporting and auditing data; and report the results to the public on a risk adjusted basis. The State of Ohio is currently formulating a statewide health insurance information strategic plan, which would be a roadmap for Ohio's health care and health insurance industries to adopt standardized health information technology and systems to exchange health information. 79 Purchasing alliances Ohio amended its Ohio's small employer health care purchasing alliance statute to allow additional types of groups to form purchasing alliances to assist small employers to purchase health coverage from licensed carriers. In 2001, there were 8 health care purchasing alliances in Ohio. This number has grown to 31 purchasing alliances today, covering over 300,000 Ohioans. Legislation is moving through the Ohio legislature to allow insurers to treat alliances covering small businesses as a separate class of business, which is currently not allowed under Ohio law. This change will provide insurers with more flexibility to meet the needs of specific alliances. Ohio conducted an actuarial study to make certain this change would not adversely impact Ohio's small group markets. Prescription drugs Ohio created the Best Rx program, which is a prescription drug discount card program for low income and older Ohioans. Oklahoma The Oklahoma Employer/employee Partnership for Insurance Coverage “OEPIC” Oklahoma has been aggressively working to improve access to health care over the past few years creating a new program to assist small businesses in providing health insurance to their employees. The O-EPIC Premium Assistance Program will pay part of the health plan premiums for eligible employees working for qualified Oklahoma small businesses (with 50 or fewer employees), for those employees who are at 185% of the federal poverty line. The O-EPIC Individual Plan is designed as a safety net for people who cannot access private health coverage through their employer. This plan extends coverage to uninsured self-employed individuals, workers whose employers do not provide health coverage, workers who are not eligible to participate in their employer’s health plan, sole proprietors not eligible for small group health coverage, and the unemployed who are currently seeking work. The Oklahoma Insurance Department has recently entered into a partnership with the Oklahoma Health Care Authority (the O-EPIC administrator) to provide staff support to bridge the gap between the Health Care Authority and the insurance community in terms of marketing and administrative support in order to enhance the success of the program. Summit on the High Cost of Health Insurance Insurance Commissioner Kim Holland initiated a Summit on the High Cost of Health Insurance in 2005 to address the rising cost of health insurance in Oklahoma. The Summit brought together all the major stakeholders impacted by rising health care costs including businesses, hospitals and physicians, policy makers and government agencies, the insurance industry, and health policy experts from across the country. From this forum, four working task forces were created focusing on the key areas of Access, Consumer Education and Information, Finance, and Quality and Performance. These four task forces worked to develop policy initiatives to address the twenty percent of Oklahomans without health insurance. In November 2006, Commissioner Holland hosted part II of the Summit to examine and present the Task Force policy recommendations. At 80 this event the policy proposals were analyzed by a panel of national and state health policy experts and a second panel comprised of state legislators. The reactor panels addressed the economic, political, and technical feasibility of each recommendation. Finally, through a working lunch Oklahoma citizens prioritized the recommendations from a consumer perspective. The recommendations that survived this process were prioritized into a top ten list. Currently, four of the recommendations are being moved forward in legislation before the Oklahoma Legislature and a new task force has been created to move the remaining recommendations forward. Oregon Beginning in 1987, the Oregon Legislature passed a series of reform measures creating the Oregon Health Plan (OHP). Through the Oregon Health Plan, the State increased funding to Medicaid and created a system of health care that measured the cost of a procedure against its potential benefits. The OHP model of prioritizing funding through systematically ranking services created a prioritized list of 709 categories of service. The purpose of the prioritized list was to identify the most important services and provide those services to a larger population. While Oregon continues to have a competitive health insurance market with a small number of Oregon insurers providing most of the coverage, and a much larger number of national insurers serving more targeted markets, like other states we continue to see double digit increases in premiums, causing serious problems. In the 1990s the Oregon Legislature adopted a series of reforms to promote the affordability and availability of health insurance for individuals and small employer groups. The Legislature focused on these market sectors because they were the primary areas with access problems. In 2003 the Legislature relaxed some individual and small group regulations. In 2005 the Legislature passed a health insurer transparency bill, mandated health insurance coverage for certain cancer screenings, and passed a comprehensive mental health parity law. Small Employer Health Insurance (SEHI) Market (2-25 employees) Initial rating standards in the small employer group market allowed for a 3:1 rate band which was later restricted to 2:1. The 2003 legislation relaxed small group rating standards temporarily moving from a 2:1 rate band to a 2.5:1 band which will sunset in 2007. Coverage in the small employer market is guarantee issue, and carriers offering health plans in the small employer group market must offer all of their small employer plans to any group requesting coverage. Small group coverage must be offered regardless of health status. Individual Health Insurance Market The individual health insurance market is an underwritten market; however, insurers can deny coverage only through use of a standard health statement. Insurers may impose waivers of coverage on preexisting conditions for up to 24 months (six month exclusions were allowed previously). 81 Insurers may restrict an individual’s choice of health plans. Applicants who are denied coverage or offered restricted coverage are eligible for the Oregon Medical Insurance Pool (OMIP), the state’s high-risk pool. Portability All health insurance carriers must provide portability coverage to anyone leaving group coverage. Portability coverage must be offered regardless of health status. Portability coverage must be pooled with the carrier’s group coverage for rating purposes. For individuals moving into the state, or who otherwise do not have portability coverage available, portability coverage is offer through the Oregon Medical Insurance Pool. For individuals who use OMIP as their portability coverage option, the premiums are an approximate average of what the commercial carriers charge for their portability products in Oregon. Initiatives to Facilitate Pooling Small Employer Health Insurance (SEHI) As noted above, rating in the SEHI (2-25) market is based on a community adjusted rate within a 2.5:1 band. Age, family composition, benefit level, and geography (within a defined area) of the employer are the only factors that may be considered in the SEHI premium rates. Prohibited factors in the SEHI (2-25) market include health status, group size, industry, claims history, gender, and duration. Rating restrictions do not apply to employer groups with 26-50 employees. Oregon Prescription Drug Program (OPDP) In 2003 the Oregon Legislature authorized the formation of the OPDP, a prescription drug purchasing pool, to help increase access to prescription drugs by the uninsured and lower costs for state and city governments to help them stay within budgeted goals. Eligible Uninsured Individuals: Oregonians who are at least 54 years of age, have income that is no more than 185 percent of the Federal Poverty Guidelines and who have not had private insurance with prescription coverage for at least 6 months. Eligible Public Sector Groups: Government agencies, cities and counties are eligible to join the pool. Initiatives to Subsidize Health Insurance Oregon Medical Insurance Pool In 1987 the Oregon Legislature established the Oregon Medical Insurance Pool and it issued its first policy in July 1990. OMIP provides medical insurance coverage for all Oregonians who are unable to obtain medical insurance because of health conditions. There are currently 15,000 Oregonians enrolled in OMIP. 82 OMIP provides portability coverage for people who have exhausted COBRA benefits and have no other portability options available. OMIP offers coverage for individuals who are eligible to receive a federal tax credit under Section 35 of the Internal Revenue Code (Health Care Tax Credit). Premiums from enrollees cover only about 60 percent of the medical and drug claims costs in the program. The commercial insurance companies that conduct business in Oregon pay an assessment to OMIP, based on their market share, to cover the remaining 40 percent. Premium rates are higher than those charged by the commercial insurance carriers (currently 110 percent of commercial rates) and may be up to 120 percent of commercial rates. Oregon Health Plan From 1989-1993, the Oregon Legislature passed a series of laws known collectively as the Oregon Health Plan that: Extended Medicaid coverage to Oregonians with income below the Federal Poverty Level and established a set of benefits based on a prioritized list of health services. Required waivers from CMS. Created the Oregon Health Services Commission to rank medical services from most to least important to the entire population (the “prioritized list”). The prioritized list of more than 700 physical health, dental, chemical dependency and mental health services available through the Oregon Health Plan is maintained by the Health Services Commission. The Legislature sets the funding level to cover a certain number of services on the list but cannot rearrange the list. Oregon’s State Children’s Health Insurance Program (SCHIP) Oregon participates in SCHIP. In 2004, the program was expanded by increasing the asset limit from $5000 to $10,000. Children’s Group Insurance Plan To improve access to private health insurance coverage for more children, in 2004 Governor Kulongoski developed a Children’s Group Insurance Plan in conjunction with the Oregon Insurance Pool Governing Board. The plan allows employers to provide children’s only coverage to the children of their employees. Oregon Healthy Kids Plan In 2006, Governor Kulongoski introduced the Healthy Kids Plan, which will provide every child in Oregon access to health care. When implemented the plan will be available to all uninsured children up to age 19. Initiatives to Promote Efficiency in Health Care Oregon Health Policy Commission The 2003 Oregon Legislature passed House Bill 3653, creating the Oregon Health Policy Commission (OHPC), to develop and oversee health policy and planning for the state. 83 The Commission identifies and analyzes health care issues affecting the state and makes policy recommendations to the Governor and the Legislature. The Commission partners with health care experts and stakeholders around the state to develop projects focused on improving Oregonians’ health status and access to effective and efficient health care services. Other Initiatives Mental Health Parity In 2005 the Oregon Legislature passed SB 1 which requires group health insurance polices to provide coverage for treatment for chemical dependency, including alcoholism, and for mental or nervous conditions at the same level, and subject to limitations no more restrictive than those imposed on coverage or reimbursement of expenses arising from treatment for other medical conditions. Current Transparency Laws and Initiatives Senate Bill 501, passed in 2005, requires health insurers to report certain financial data to the Insurance Division. This information will be published by the Division on a searchable website (www.oregoninsurance.org/insurer/rates_forms/industry_reports/industry_reports.html) in July 2006 and will allow the insurance-buying public to more easily compare insurers in terms of specified factors including premium trends, administrative costs, and net income. Oregon Hospital Quality Indicators: http://www.oregon.gov/DAS/OHPPR/HQ/index.shtml The Oregon Hospital Quality Indicators represent a first but important step for Oregon in measuring, and ultimately improving, the quality of health care in the state with a first focus on hospital services. The indicators were derived from hospital discharge data and are based the number of admissions for various procedures and the death rates associated with certain procedures and conditions. The quality indicators are divided into two categories: Volume Indicators are a count of hospital admissions for a given procedure. Counts admissions for rare and specialized procedures for which scientific research suggests that performing more of the procedure often leads to better patient outcomes. Volumes are compared to a threshold number identified by the Agency for Healthcare Research and Quality as the point at which improved patient outcomes have been observed. Death Rate Indicators count the number of patients admitted for a specific procedure or condition who died in the hospital divided by the total number of patients admitted for that procedure or condition. The death rates for each hospital are adjusted for factors including age, sex, and severity of condition. Oregon PricePoint: http://www.orpricepoint.org 84 In 2005 the Oregon Association of Hospitals and Health Systems introduced Oregon PricePoint, a web site that allows health care consumers to receive basic, facility-specific information about hospital services and billed charges. A basic query allows users to check billed charge and utilization information for 64 types of hospitalizations, representing about half of all hospital stays in Oregon. A comprehensive query offers users the ability to obtain information about all types of hospital stays in Oregon. Ongoing Transparency Initiatives The Oregon Insurance Division is currently working with several stakeholder groups interested in improving transparency in the health care marketplace. Hospital costs are a key focus of this effort because these costs are the single largest component of health insurance premiums and continue to grow faster than many other costs, and because the public currently has limited information about hospital costs and how the rates charged to insurance customers relate to other rates. This information will be published on a searchable website later this year. Future Transparency Initiatives The Division is proposing a legislative concept for the 2007 legislative session that will require insurance companies to provide more specific information to their policyholders about the cost implications of their health care decisions. The concept also proposes that the Division define “usual, customary, and reasonable” and establish standards and guidelines for the use of UCR for coverage or reimbursement of medical expenses. School-Based Health Centers In 2003 Governor Kulongoski preserved funding for School-Based Health Centers. In 2005 the Governor expanded state funding for SBHC, growing the number of counties with SBHCs from 14 to 19. By the end of 2006 Oregon will have at least 47 certified SBHCs. Governor Kulongoski’s Healthy Kids Plan. The goal of the Healthy Kids Plan is to provide every child in Oregon access to the health care. Key components: Eligible to all uninsured Oregon children up to age 19. All participants will have the same insurance card. Streamline and simplify the enrollment process using existing programs and partnerships with schools, health care providers and NGOs. 85 All children in families with incomes up to 200 percent of the Federal Poverty Level will be eligible for comprehensive coverage through the Oregon Health Plan and Family Health Insurance Assistance Program. Families with incomes between 200 percent and 350 percent of the Federal Poverty Level will be eligible to buy affordable comprehensive group coverage for their children, including mental health and dental benefits; a sliding scale based on family income will determine the size of premiums and co-pays. Families with incomes above 350 percent of the Federal Poverty Level will be eligible to buy a pooled health insurance product for their children, including mental health and dental benefits School-based health centers will expand into five new counties; and at least five more centers will open in the 19 counties that already offer school-based health care. Guarantee affordable health coverage for all Oregonians In 2006 Governor Kulongoski directed the Oregon Health Policy Commission to: Write a blueprint for building a sustainable system that provides access to affordable health care to every Oregonian. Set measurable goals for health care system change. Recommend ways to pay for the system. Systemic Reform Archimedes Movement: http://www.archimedesmovement.org Former Oregon Governor John Kitzhaber is leading a grassroots movement to change the basic way of viewing health and how healthcare will be administered and delivered in the future. The Archimedes Movement will seek waivers from the federal government to replace the current Medicaid and Medicare systems. The Movement seeks to create a smarter, more up-to-date system that makes tax dollars go further, promotes health, and ensures that a basic level of effective health care is available to everyone. Pennsylvania Market Reform The Governor's Office of Health Care Reform is currently developing a coordinated plan using a HRSA planning grant to review Pennsylvania's health care system with the goal of assuring that accessible and affordable quality health care coverage is available for all Pennsylvanians. As part of the preparation for this process the Pennsylvania Insurance Department conducted a state specific study of health insurance coverage in Pennsylvania. This study provides information about health insurance coverage, demographic and employment characteristics and the financial barriers to health care for Pennsylvania residents. In addition, the Administration performed an indepth review and analysis of health insurance coverage issues, including premium rating issues, 86 for small employers and their employees. This information is critical as the state develops strategies and initiatives to assure that all Pennsylvanians have access to affordable, quality health care coverage. Expanded Coverage/Making Coverage More Affordable Pennsylvania took the lead nationally in the 1980s with the development and implementation of the Children's Health Insurance Program (CHIP), which became one of the models for the national SCHIP programs. Pennsylvania's CHIP program is the oldest and most successful program in the nation. Pennsylvania has continued to be innovative in seeking to expand health insurance coverage (CHIP Cover All Kids, the adultBasic program and the Blue Cross/Blue Shield Community Health Reinvestment Agreement) and assure access to other sources of coverage (such as the HCTC subsidies). Children's Health Insurance Program (CHIP) Expansion: "Cover All Kids" Legislation has been introduced to implement Governor Rendell's proposed expansion of Pennsylvania's CHIP to Cover All Kids. This program would extend health insurance coverage to thousands of Pennsylvania's uninsured children whose parents earn too much to qualify for CHIP but who can't afford to purchase insurance for their children. Cover All Kids will guarantee affordable, comprehensive health care coverage for visits to doctors, hospitalization, prescription drugs, vision, home health care, and mental health and substance abuse services. Pennsylvania has one of the highest rates of insured children in the nation at 96 percent and Cover all Kids is designed to extend health coverage to each and every child in Pennsylvania. adultBasic Program The adultBasic program provides subsidized basic health insurance coverage to uninsured adult Pennsylvanians earning less than 200% of the federal poverty level. Coverage includes hospitalizations (unlimited days), physician services (primary care and specialists), emergency services, diagnostic tests (e.g. x-rays, mammograms and laboratory tests), maternity care and rehabilitation and skilled care. The state pays the majority of the cost with enrollees paying a $33.50 per month premium and minimal service co-payments. The adultBasic program was launched in 2002 and as of May 2006 over 50,000 Pennsylvanians are covered under it. This program is currently funded solely by state dollars. Community Health Reinvestment Agreement (CHRA) In February 2005, the Pennsylvania Insurance Department executed the Community Health Reinvestment Agreement (CHRA) with the four Pennsylvania Blue Plans (Highmark Inc., Independence Blue Cross, Capital BlueCross, and Blue Cross of Northeastern Pennsylvania). This Agreement commits the Blue Plans to make an annual investment to provide affordable basic health care coverage to low income and uninsured Pennsylvanians through a state-sponsored program, currently adultBasic, and also commits the Blue Plans to fund health care-related services in their communities. Over the life of the CHR Agreement, which runs through 2010, we anticipate the Blue Plans will commit a total of nearly $1 billion to community health reinvestment. In 2005, the first year of the Agreement, the four Blues paid nearly $150 million in CHRA funds. 60% of that amount, or $86.3 million was paid to the state for use in the adultBasic program. These additional funds enabled the adultBasic program to provide subsidized basic health care coverage to an additional 5,500 uninsured adult Pennsylvanians. The remaining 40% was used by each Blue Plan for subsidies for individual and senior health insurance products, funding local clinics for low income individuals, and other community health care-related expenditures. Health Coverage Tax Credit Pennsylvania took the lead nationally in implementing the Health Coverage Tax Credit (HCTC) program to assure the availability of the federal HCTC subsidy for trade displaced workers and 87 retirees who lost their health insurance coverage when the federal PBGC took over their company pension programs. The Governor's Office negotiated with the state's Blue Cross and Blue Shield plans to assure that qualified HCTC coverage was available beginning in April 2003. Pennsylvania's efforts to implement the HCTC program have been recognized nationally and state eligible individuals' enrollment and participation in the HCTC program is one of the highest in the country. Blue Cross/Blue Shield Plan Surplus Determination and Order In February 2005, the Pennsylvania Insurance Department issued a Determination and Order addressing the surplus levels of the four Blue Plans in the Commonwealth. This Determination, for the first time, established a model for evaluating the appropriateness of the surplus levels of these non-profit entities, and set levels at which the surpluses are presumed sufficient or inefficient. Any Blues Plan determined to have a sufficient surplus is prohibited from using risk and contingency rate factors (i.e. profit/surplus building factors in their premium rates). The Department found that three Plans had sufficient surpluses. This meant that premium rates for these Blues Plans were constrained as a result of this Determination, keeping them more affordable for consumers. Quality of Care: Pennsylvania has taken a number of steps to address quality of care issues including the establishment of the Pennsylvania Health Care Cost Containment Council (PHC4) and the Pennsylvania Patient Safety Authority. Pennsylvania Health Care Cost Containment Council (PHC4) PHC4 has been recognized as a national leader in measuring and reporting on outcomes and quality of care. PHC4 issues regular reports on health care service outcomes and cost. They have undertaken a number of projects including measuring and reporting on Hospital Acquired Infections (HAI). Pennsylvania was the first state to issue reports on the cost of HAIs and their impact on patients, providers and payers. PHC4 found that the patient safety and financial impact of hospital-acquired infections is larger than originally reported. The measurement and assessment of HAIs along with quality improvement initiatives with organization such as the Pittsburgh Regional Health Care Initiative are helping improve the quality of care for all Pennsylvanians. Pennsylvania Patient Safety Authority The Patient Safety Authority is an independent state agency charged with taking steps to reduce and eliminate medical errors by identifying problems and recommending solutions that promote patient safety in hospitals, ambulatory surgical facilities, birthing centers and certain abortion facilities. The Authority has implemented PA-PSRS, the mandatory statewide Pennsylvania Patient Safety Reporting System. More than 400 healthcare facilities subject to medical malpractice law reporting requirements are submitting reports through PA-PSRS, making Pennsylvania the first state in the nation to require the reporting of both actual events and "near misses". Healthy Lifestyles: Pennsylvania Employee Benefit Trust Fund (PEBTF) Get Healthy Program PEBTF is the state employee's health insurance trust fund. A year ago the state began charging employees 0.5% of their salary for their health insurance coverage. This employee premium is waived if employees participate in the Get Healthy program. The program is intended to help employees manage their own health and the health of their families. Better health management can reduce overall program costs. Participants complete a Health Risk Assessment questionnaire. If the employee or their spouse is found to have an actual or potential health condition they may be assigned to a health coach for further assistance. If either is found to be healthy they can 88 participate in a wellness or preventive care program (generally on-line). Ongoing participation in the program is required to maintain the health insurance premium waiver. Rhode Island In October of 2005, Governor Carcieri announced a five point health care agenda for the state of Rhode Island with the following goals for 2010: Wellness: to make RI the first “well state” in the country and to cut in half the number of RIers with selected unsafe and unhealthy habits. Balanced Health Care Delivery System: to promote inpatient centers of excellence and a strong system of primary care. Anywhere Anytime Health Care Information: to give the majority of RIers access to health information electronically. Affordable Small Business Insurance: to increase by 10,000 the number of small business employees enrolled in employer-sponsored health insurance. Smart Public Sector Purchasing: to use the state’s leverage to reduce the trend in the costs of the health insurance it purchases and to drive the system changes identified above. Teams of cabinet-level officials and staff have been formed for each of these initiatives, have established objectives and work plans and are proceeding with their work. Critical to the achievement of these goals will be the engagement of commercial health plans in these efforts through the newly created Office of the Health Insurance Commissioner, which has a statutory mandate (among others) to “direct health plans towards policies which result in improved health care system access, efficiency and quality”. In the area of affordable health insurance, The Office of the Health Insurance Commissioner (OHIC) is completing two examinations – one at establishing targeted reserve level ranges for domiciled carriers, and a second assessing market conduct of the insurers in the adjusted-community-rated small group market. OHIC also completed a a survey of RI employers following up 1999 work to assess reactions to rising health insurance premiums. The legislature is currently debating a three part health legislative proposal which would establish: a regulatory process for the development of Select Care - an affordable health plan for small businesses priced at a targeted percentage of median income; a reinsurance program to subsidize the purchase of Select Care for low wage businesses, and a structure for mandating the disclosure of procedure prices to consumers and premium increase factors to purchasers. The state continues to manage its nationally-recognized Rite Care program for low income children and families, and Rite Share, which subsidizes the purchase of employer health insurance by Rite Care-eligible enrollees. 89 South Dakota Facilitate Pooling South Dakota’s approach to rate banding in both the small group and individual markets has been to generally follow the format found in the 1993 NAIC small group model. Specifically, the state’s framework includes a +/- 25 percent maximum deviation from the index rate with a cap of 3:1 based on age for the small group market and a +/- 30 percent maximum deviation from the index rate with a cap of 5:1 for the individual market. The success in keeping the uninsured rate low is at least in part due to providing adequate flexibility in rating so as to make rates sufficiently affordable to attract the younger healthier population without pricing the higher risks out of the market. Lifestyle continues to be an acceptable case characteristic to allow carriers to implement disease prevention and wellness programs. Help Subsidize Health Insurance South Dakota does have a high risk pool that is subsidized by the various stakeholders. In addition to state funding, there is a per member assessment on health and stop loss carriers (currently $.25 per member/per month) and a reduction in reimbursement for participating providers, which has been recent adjusted to 135 percent of Medicaid. The costs are further controlled by a mandatory disease management program that includes significant penalties for noncompliance (reduction to 50 percent coinsurance). The establishment of the risk pool as a substitute for guaranteed issue was critical in stabilizing the individual market and providing coverage for individuals displaced by large scale nonrenewals by carriers exiting the individual major medical market nationwide. Prior to the establishment of the risk pool, the individual market was constricting dramatically and was on the brink of collapse. The risk pool also serves as South Dakota’s individual market alternative mechanism under HIPAA. Reduce Regulatory Costs Reducing regulatory costs have been and continue to be a priority. South Dakota has been very successful in streamlining its policy and rate review processes. Filings on the property/casualty side typically have a one-day turnaround while life and health has maintained a five-day turnaround. Recently unnecessary filings have been eliminated such as prior approval of rates for employer group plans issued by HMOs. Those carriers actively marketing individual major medical policies will now be able to file and use their rates, enabling the carriers to implement rate adjustments more quickly but still providing needed consumer protection through regulatory rate review. Tennessee Help Subsidize Health Insurance CoverTN CoverTN will offer affordable, portable, basic health coverage to working Tennesseans. The program will be open to individuals with household income below 250% FPL and to employees of qualified small businesses with fewer than 25 employees. Monthly premiums averaging $150 will be equally divided between the state, employees, and willing employer participants, and will vary based upon age, weight, and use of tobacco products. The benefit plans will emphasize preventative services, and will begin enrolling participants in early 2007. 90 CoverKids CoverKids is Tennessee's SCHIP program and is open to children that live in families with household incomes below 250% FPL. Families above this income level may buy into the program by paying a monthly premium. AccessTN AccessTN will offer comprehensive health insurance for uninsurable Tennesseans through a high risk pool. The program will be funded through participant premiums, state appropriations, and industry assessments and will offer two health insurance plans. One plan will be similar to the state employee helaht insurance plan, while the other will be a high deductible health plan with an optional health savings account. Enrollment will begin in late 2006 or early 2007. CoverRx CoverRx will replace the pharmacy assistance program for TennCare disenrollees and will support the Mental Health Safety Net. The program will also be open to uninsured individuals with incomes below 250% FPL. It will utilize a mostly generic formulary with select brand name medications. Participants will not be charged a premium, but will pay a co-pay when they fill a prescription. A wrap-around discount will apply to medications not on the formulary. ProjectDiabetes The Diabetes and Health Improvement Act of 2006 established the Tennessee Center for Diabetes Prevention and Health Improvement, aimed at combating the proliferation of type 2 diabetes by administering two grant programs. The first program provides grants to high schools to promote the understanding and prevention of diabetes. The second set of grants will be awarded to providers of services related to the prevention and/or treatment of diabetes. They will target evidence-based programs focusing on new or expanded populations and innovative approaches to the disease. Texas Texas enacted legislation in 2003 that allows small businesses to form health purchasing groups. These groups must include at least 10 different employers and must purchase insurance through a licensed insurer. An insurer may not provide coverage to more than one purchasing group in each county. The state also enacted legislation, effective January 1, 2004, that allows insurers and HMOs to sell a standard health insurance policy that does not offer or provide state-mandated benefits. Vermont Catamount Health - Vermont’s Health Care Reform Plan 91 Introduction. On May 25, 2007, Vermont Governor Jim Douglas signed into law Catamount Health, Vermont’s Health Care Reform Plan. 2 Catamount Health is the product of a collaboration by the Douglas Administration, legislative leaders of the Vermont General Assembly, and the private sector participants in Vermont’s health care system. For Governor Douglas, the key goals of the Plan are: Universal access to affordable health insurance for all Vermonters. Cost containment and improved quality through health care system reform. Promotion of healthy behavior and disease prevention across the lifespan of individuals. Background - Health Care in Vermont. Good data on the demographics of the uninsured in Vermont has helped to focus policy development. 51% of the uninsured in Vermont are eligible for a Medicaid program but are not enrolled in the program. 22% of the uninsured in Vermont have household income greater than 300% of FPL and can afford to purchase health insurance. 27% of the uninsured in Vermont have household income under 300% FPL but are not eligible for a Medicaid program. Vermont has had significant experience using its Medicaid waiver authority to expand coverage for the uninsured. The Dr. Dynasaur program provides Medicaid coverage to all children with household income under 300% FPL, to pregnant women with household income under 200% FPL, and to parents and caretakers with household income under 185% FPL. The Vermont Health Access Plan provides coverage for uninsured adults with household income under 150% FPL. As a result, Vermont has an uninsured rate of 9.8% compared with a national rate of 15.7%, and an uninsured rate for children of 4.9%. 3 Per capita health care costs are lower in Vermont when compared to the U.S., but the spending gap has been narrowing since 1999. Health care spending growth rates in Vermont have exceeded national averages for each of the last six years. 4 Vermont’s Health Care Reform Initiatives. Catamount Health. A separate insurance pool is created for the purpose of offering a low cost health insurance product for uninsured Vermonters. Lower costs are anticipated based on estimates concerning the claims costs of the uninsured relative to the claims costs of the general population, and based on reimbursement rates established in the law that are lower than commercial rates (but 10% higher than Medicare rates). A comprehensive benefit plan will be provided with the Catamount Health policy, a policy modeled after a preferred provider organization plan with a $250 deductible. Cost sharing will not apply to chronic care management and preventive services. Catamount Health policies will be offered to the uninsured by Blue Cross Blue Shield of Vermont and by health maintenance organizations beginning October 1, 2007. Catamount Health is contained in three (3) separate legislative enactments: H8.61, H.895, and Sections 321-343b of H.881; http://www.leg.state.vt.us 3 Vermont Family Health Insurance Survey, 2005. Family Health Insurance Survey, 2005, preliminary reports can be found at: http://www.bishca.state.vt.us/HcaDiv/Data_Reports/healthinsurmarket/2005_VHHIS_Final_080706.pdf 4 The 2004 Vermont Health Care Expenditure Analysis; http://www.bishca.state.vt.us/HcaDiv/Data_Reports/expenditure_analysis/2004EAReport.pdf 2 92 Catamount Health Premium Assistance Program. A Vermont resident who has been uninsured for at least 12 months, who is not eligible for a public insurance program such as Medicaid, and who does not have access to employer-sponsored insurance may apply for financial assistance to purchase a Catamount Health policy. Individual premium contributions are income-sensitive, ranging from $60 per month for individuals with household income under 200% FPL, to $135 per month at 275-300% FPL, to the full cost of Catamount Health for individuals with household income over 300% FPL. Employer Sponsored Insurance Premium Assistance Program. Adults currently enrolled in the Medicaid VHAP program who have access to an approved employer-sponsored insurance (ESI) plan will be required to participate in the ESI plan, with public subsidies from the Premium Assistance Program. The transfer of Medicaid enrollees to ESI plans will result in financial savings for the Medicaid program. In addition, any Vermont resident who has been uninsured for at least 12 months, who has household income under 300% FPL, and who has access to an approved employer-sponsored insurance plan, will be eligible for premium assistance to help them participate in the ESI plan. Medicaid Access Initiative. Since the largest group of the uninsured are eligible for Medicaid but not enrolled, the Catamount Health legislation addresses ways to increase enrollment and retain beneficiaries: Premiums for children enrolled in the Medicaid Dr. Dynasaur program are decreased by 50%. Premiums for adults in the Medicaid VHAP program are decreased by 35%. The Vermont Agency of Human Services and others, using information from the 2005 Vermont Family Health Insurance Survey, will make recommendations for Medicaid enrollment reform to reduce the number of Medicaid-eligible uninsured. Medicaid Provider Reimbursement Increases. Significant Medicaid provider underpayments can threaten access to care, and underpayments result in a cost shift to commercial plans that must be paid by commercial health insurance premiums. The Catamount Health legislation will increase Medicaid provider reimbursements in the following manner: (i) evaluation and management services will be paid at Medicare rates in order to support primary care physician practices; (ii) incentive payments will be provided to health care professionals participating in the Medicaid care coordination program; and (iii) reimbursement increases in the future will be tied to performance measures established by the Blueprint for Health - the Chronic Care Initiative. The Blueprint for Health - the Chronic Care Initiative. Due to a combination of an aging population, increased prevalence of obesity, and poor lifestyle habits, the needs of Vermonters with chronic conditions (such as diabetes, cardiovascular disease, and depression) will be the primary driver of the demand for health care for the foreseeable future. Since the cost of treating individuals with chronic conditions (25% of Vermonters) accounts for about 75% of health care spending, Vermont has decided to invest significant public funds in the redesign of the health care system to improve the quality and cost-effectiveness of care for those with chronic conditions. The Blueprint, under the direction of the Vermont Department of Health, will focus on (a) patient self-management; (b) provider practice change consistent with evidence-based standards for chronic care; (c) community activation and support to address physical inactivity and obesity, which are risk factors for many chronic diseases; (d) a chronic care information system; and (e) health system design - the development of common performance measures and clinical guidelines for chronic conditions, and the linking of financing mechanisms and insurance reimbursement with the attainment of chronic care treatment goals. 93 In addition, the Office of Vermont Health Access will develop a chronic care management program, consistent with the policies and standards established by the Blueprint for Health, for the 20% of Vermonters who are insured under a Medicaid-funded program. Health Information Technology. The Department of Banking, Insurance, Securities and Health Care Administration, in collaboration with the Vermont Information Technology Leaders (VITL a public-private partnership) is developing a statewide, integrated, electronic health information infrastructure for the sharing of health information among health care facilities, health care professional, public and private payers, and patients. 5 The Medication History Pilot Project will reduce the risk of adverse drug events, improve the quality of health care for many Vermonters, and save health care costs. The project will be used as the first step towards a comprehensive, state-wide health record system. Cost Shift Initiatives. Individuals and businesses who pay commercial health insurance premiums pay additional premium because of the shifting of costs attributable to the uncompensated care of the uninsured, and attributable to Medicaid and Medicare underpayments. The Department of Banking, Insurance, Securities and Health Care Administration will undertake several cost shift initiatives, including: Requiring hospitals to account for Medicaid reimbursement increases in their annual budgets established by the Department. Standardizing hospital bad debt and free care policies. Developing procedures to account for changes in uncompensated care and Medicaid reimbursement when the Department approves health insurance rates. Consumer Price and Quality Information System. A major factor in the success of consumer driven health care plans is consumer access to good price and quality information. Good information is especially important, as more benefit plans require higher levels of out of pocket spending by consumers. The Catamount Health legislation is intended to address this issue by directing the Department of Banking, Insurance, Securities and Health Care Administration to adopt rules for health insurers to provide transparent price and quality information so that consumers are empowered to make economically sound and medically appropriate decisions. The Multi-payer Data Collection project. Health care providers, hospitals and insurers need a comprehensive health information system in order to improve the quality and cost-effectiveness of the health care system. Modeled after programs in Maine and New Hampshire, the Department of Banking, Insurance, Securities and Health Care Administration is directed to design the data collection program, and to begin program implementation. Common Claims and Procedures. The Department of Banking, Insurance, Securities and Health Care Administration is charged with adopting regulations designed to simplify the claims administration process, and to lower administrative costs in the health care financing system. The Department will prescribe a uniform provider credentialing form for use by hospitals and health insurance companies on January 1, 2007. Adverse event reporting. The Catamount Health legislation authorizes the Vermont Department of Health to develop a Patient Safety Surveillance and Improvement System, designed to improve patient safety, eliminate adverse events, and support quality improvement efforts by Vermont 5 VITL - 18 V.S.A. section 9417; http://vitl.net/ndex.htm 94 hospitals. Improved quality of care and cost savings are anticipated from implementation of the system. Information on hospital adverse events and infections will be reported to the public on an annual basis through hospital community reports. Community Health and Wellness programs. Vermont has recognized that public health concerns such as those relating to overweight and poor nutrition are major drivers in the incidence of chronic disease incidence, and in increased medical inflation. The Community Health and Wellness grant program will focus the state’s public health resources in promoting healthy behavior and disease prevention across the lifespan of the individual, including the promotion of good nutrition and exercise for children, community recreation programs, elderly wellness, lead poisoning abatement, obesity prevention, maternal and child health and immunization, and tobacco prevention and cessation programs. Healthy Choices Insurance Discount. The Catamount Health legislation authorizes the Department of Banking, Insurance, Securities and Health Care Administration to adopt regulations permitting health insurers to establish premium discounts or other economic rewards for insureds in Vermont’s community rated nongroup and small group markets. Premium discounts will be available for those who participate in programs of health promotion and disease prevention. Financing. The programs of the Catamount Health legislation are funded by: A $.60 per pack increase in the cigarette tax beginning July 1, 2006 An additional $.20 per pack increase in the cigarette tax beginning July 1, 2008. An Employers’ Health Care Premium Contribution assessed on employers. The assessment will be at the rate of $91.25 per quarter ($365 per year) for each FTE “uncovered employee”. The assessment will be imposed for uncovered employees in excess of 8 FTE employees in FY 2007 and 2008, in excess of 6 FTE employees in FY 2009, and in excess of 4 FTE employees in FY 2010 and thereafter. State General Fund appropriations. The Medicaid Global Commitment waiver. Vermont has entered into a Medicaid Section 115 wavier with the following key concepts: (i) the Office of Vermont Health Access (OVHA Vermont’s Medicaid agency) will be considered a Managed Care Organization responsible for most Medicaid spending for services heretofore provided through by different state agencies; (ii) OVHA will have greater flexibility in terms of benefit design and care management programs; and (iii) Vermont can use Medicaid savings to finance programs that benefit the state’s Medicaid population but which would not be eligible for federal financial contribution without the Global Commitment waiver. Contacts for Further Information: Vermont Agency of Administration Susan Besio, Director of Health Care Reform Implementation, 802-828-3322 Vermont Department of Banking, Insurance, Securities and Health Care Administration - 95 John Crowley, Commissioner, 802-828-3301 Christine Oliver, Deputy Commissioner, 802-828-2900 Herbert W. Olson, General Counsel 802-828-4859 http://www.Bishca.state.vt.us Vermont Department of Health Sharon Moffett, Acting Commissioner, 802-863-7280 Office of Vermont Health Access Joshua Slen, Director, 802-879-5900 Virginia Pooling Virginia enacted legislation in 2006 that authorizes the establishment of cooperatives for the purpose of offering, providing or facilitating the provision of coverage for health care services to participating small employers. A small employer health group cooperative is deemed to be a single entity for purposes of negotiating the terms of coverage and establishing premium rates. 96 Washington Initiatives that Have Been Implemented Initiative Basic Health Plan additional enrollment Basic Health Plan subsidizes premiums for 100,000 individuals with income up to 200 percent of the Federal Poverty Level. In 2006, funding was increased to cover 6500 individuals. Result Subsidized enrollment for more low income families. Implemented the Group Health Chronic Care Model in 140 clinic systems. Saved money through federal payment for prescription drugs. Built an infrastructure that supports the delivery of high-quality, costeffective health care services. Lead Agency or Organization Washington State Health Care Authority Washington State Department of Health Board of the Washington State Health Insurance Pool Washington Healthcare Forum and Inland Northwest Health Services, private organizations Washington State Collaboratives Improves treatment of diabetes and cardiovascular disease through implementing treatment guidelines and electronic health registries. Washington State Health Insurance Pool The Pool is a high risk pool for 3100 individuals whose potentially high medical expenses screen them from the private individual health insurance. In 2006, the Pool coordinated with the Medicare Prescription Drug Program to reduce spending. Market efficiencies through regional partnerships The Washington Healthcare Forum is a coalition of health insurance carriers, providers, and purchasers. It has standardized forms and processes to streamline claims processing and eligibility determination. Inland Northwest Health Services has implemented a state-of-the-art electronic patient record system that secures and shares over 2.4 million patient records for more than 30 hospitals. The electronic records system has made the delivery of health care services safer and less expensive. Initiatives Under Implementation Initiative Blue Ribbon Commission on Health Care Cost and Access The Blue Ribbon Commission was created in 2006 to recommend a “sustainable five-year plan for improving access to affordable health care for all Washington residents” by December 1, 2006. Insurance Commissioner Kreidler is a member of the Blue Ribbon Commission along with Governor Gregoire, eight legislators and four agency executives. The Commission is co-chaired by Governor Gregoire and Senator Thibaudeau, a past-chair of the Senate Health & Long-term Care Committee. Expected Result Developing a sustainable plan that contains cost and improves access for all Washingtonians. Lead Agency or Organization Governor and Legislature Cover All Children by 2010 Incrementally cover 100,000 uninsured children by 2010. Reinstated Children’s Health Program in 2005 for non-citizen immigrant children to increase enrollment by 6500 children. Covering all Washington children. Building community capacity to cover low-income, uninsured families. Community-based health care collaboratives A Community Health Care Collaborative Grant Program was established by House Bill 6459 in 2006 and funded with $1.5 M for the fiscal year beginning July 1, 2006. The program can award grants up to $250,000 to a community-based organization that proposes to increase access for appropriate, affordable health care services. Community- Washington State Department of Social and Health Services Washington State Health Care Authority 97 based organizations will target low-income families and provide at least $2 in matching funds for every state dollar. Small Employer Health Insurance Partnership State-subsidized enrollment of low-income employees into designated small group health plans. Subsidies available no sooner than July 1, 2007. Transparency – health insurance financial data The Washington State Office of Insurance Commissioner will make health insurance carrier financial performance data available to consumers (House Bill 2500). Web-based summaries of health care services and administrative data will be made accessible through consumer-friendly formats. Increasing enrollment of lowincome families in small group plans. Supporting the purchase of health insurance. Washington State Health Care Authority Washington State Insurance Commissioner Insurer surplus The Washington State Office of Insurance Commissioner (OIC) is investigating whether health insurance carriers are holding excessive surpluses. Examining whether surpluses are excessive. Renewing authority to regulate rates. Building an infrastructure that supports the delivery of high-quality, costeffective health care services. Washington State Insurance Commissioner Washington State Insurance Commissioner Puget Sound Health Alliance, a private organizations Individual health insurance market Propose legislation to renew Insurance Commissioner authority to review individual health plan premiums. Market efficiencies through regional partnerships The Puget Sound Health Alliance is a regional partnership of employers, physicians, hospitals, patients, health plans, and other leaders who share a vision of a state-of-the-art health care system that achieves better care, healthier people, and affordable costs. The Alliance was formed toward the end of 2004 and is patterned after successful collaborative efforts in the San Francisco Bay Area, Minneapolis-St. Paul, Boston and other areas. The Alliance has established initial goals for information, incentives, and the support for improvement of the health care services delivered in the Puget Sound area. Health information standard architecture A Health Information Infrastructure Advisory Board is tasked with developing a strategy for adoption and use of electronic medical records and health information technology consistent with national standards and that promote interoperability. Healthiest State in the Nation Campaign The Washington Health Foundation is urging healthy lifestyles, lowering the number of uninsured individuals, and effective uses of health care services to make Washington the healthiest state in the nation. Establishes a common, statewide architecture for storing and retrieving health information. Improving the health of Washingtonians. Washington State Health Care Authority Washington Health Foundation, a private organization West Virginia High Risk Pool (AccessWV) The West Virginia pool used an innovative subsidy scheme whereby the hospitals are taxed to provide the state subsidy for the pool. The pool is available to federally eligible persons and for Trade Act subsidies. 98 Small Business Health Insurance Plan This plan is available only to small businesses that have not offered insurance to their employees in the past year. It is offered through private insurers and the employer must pay at least fifty percent of the premium. Coverage Under CHIPS Coverage under CHIPS was authorized to expand to children of families between 200% and 300% of the federal poverty level. Premiums, co-insurance or co-pays for these participants may be charged. Clinic Based Health This is a pilot program that will permit doctors to sell a prepaid service that emphasizes preventive and primary care. It may be sold to groups or individuals and it may only be sold to persons or groups who have not had health insurance in the past twelve months. Individual Limited Health Benefit This program permits insurers to sell individual health insurance plans that do not contain the state mandated benefits. Only individuals who have not been insured for the past twelve months are eligible. Group Limited Benefits Health Plan This program permits insurers to sell group health insurance plans to cover temporary, seasonal and part-time employees who have not had access to a group plan in the past twelve months. Health Information Network This network will implement and operate a statewide network to facilitate the use of health care information. OUCH This local program serves Cabell County in West Virginia by joining together small businesses, providers and uninsured employees in a program to provide basic health care. This program was initiated with federal money from the CAP program and has continued to remain viable after the federal funding ceased. Interagency Health Council An interagency health council has been established to comprehensively study and make recommendations to the legislature about the health care system in West Virginia. Pharmaceutical Cost Management Council A pharmaceutical council and joint purchasing arrangement has been formed to control costs of pharmaceuticals. Wisconsin BadgerCare Through Medicaid and SCHIP waivers, created the BadgerCare program. BadgerCare extends Medicaid coverage to uninsured children and adults with incomes up to 185 percent of the federal poverty line, with renewal allowed until income exceeds 200 percent of the federal poverty line. 99 SCHIP coverage is offered to parents of children in the SCHIP program if their income is between 100 percent and 185 percent of the Federal Poverty Level. Also, BadgerCare subsidizes the premiums of eligible employer-sponsored health coverage for workers with incomes up to 185 percent of the federal poverty line, renewable until income exceeds 200 percent of the federal poverty line. Wyoming Pooling Recently removed the state ban on employers grouping together solely for purpose of purchasing insurance. SCHIP Expansion The State of Wyoming is seeking a HIFA waiver to cover parents of children in its Kid Care CHIP (SCHIP) program in families up to 200 FPL. The HIFA waiver includes an ESI component and a state plan offering, if ESI is not available. The program name is CHIP 4 Parents. Reform Study A governor appointed, eleven member, Healthcare Commission has been in place for some three years and is studying all aspects of health care financing and delivery, infrastructure, health professional recruitment and retention, medical errors and electronic medical records and Wyoming specific to solutions to incrementally cover the uninsured. The commission has subcommittees; the Access and Affordability subcommittee and the Rural Health Care Delivery subcommittee. 100