2012 georgia health insurance reform 1. state health insurance reforms the need” state insurance...

2012 Georgia Health Insurance

Reform

1

State Health Insurance ReformsThe Need”

State Insurance Reforms Will Be Needed if:1.PPACA is found unconstitutional, or

2.PPACA is altered by Congressional defunding of Exchange subsidies, or

3.States are given blanket waivers from PPACA by a Presidential Executive Order, or

4.PPACA regulations are indefinitely delayed, or

5.PPACA is repealed through the political process.

The question was never “If..” or “Why Health Reform?”, but “Who?”, “How?”, and “What” to reform.

2

Governor Deal’s Health Insurance Reform Goals

• More Affordable Insurance for Employers(especially small employer groups of fewer then 25)

• Increased Access, Better Options & Affordable Coverage for Individuals(lower the number of uninsureds)

• Improve Economic Viability for Creating and/or Expanding Small Business

(healthy population, productive workforce, lower operating costs)

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Basic Principles for Georgia’s Health Insurance Reforms

1. Free Markets

2. Personal Responsibility

3. Competition

4. Choice, Multiple Options

5. Transparency

6. Level Playing Fields

4

Georgia Insurance Laws

Needed Reform

Key Indicators of Weakness in Pre-PPACA Georgia:

• 1.8 Million Uninsureds and Growing

• Georgia has only 2.2M of 9.6M covered by Fully Insured Group (1.8M) and Individual (.4M) Insurance

• Only 1 in 4 Georgian’s working for Small Companies (under 25 employees) are insured.

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Three Simultaneous Health Insurance Reform Initiatives

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Input to Georgia’s Health Insurance Reform Plan

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Ga. 2008 HSA Legislation

Other State Health Reforms

Current Ga. Health Regs & Legislation

PPACA Citizen Groups Ideas

National Free Market Reform Ideas

Key Provider Stakeholder Issues

Legislators Input

Committee Ideas

Restructuring for a Creative Free Market: “Four Pillars” for Health Reform

1. Regional Health Insurance Coalition* Competition thru interstate reciprocity

2. Private Health Insurance Marketplace(s) * Transparency/Health Literacy

3. “Personal Responsibility” High Risk Pool (PRHRP) * Access to coverage for all

4. Group Conversion Policies * Portability and consistency of coverage and services

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1. Regional Health Insurance Coalition(Increases Competition)

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Single State Marketplace7.1 Million

Regional Marketplace24 Million

Expand on 2010 Legislation From “1-Way” Policy Approvals

to a “Multi-State” Regional Coalition with Reciprocity

Georgia Population 9.6M

Medicaid

Medicare

Other

Gov’t Ins .2 M

Group Ins. .4MCOBRA .1MC of C .1MConv .1M

Indiv.Ins. .3MPrivate Ins 1.0M

Complete Consumer Information & Transparency of Services

GHIM Potential Impact 1.2M

2. Georgia Health Insurance Marketplace(s): GHIM(Improves Transparency, Health Literacy, & Efficiency of

Private Market Distribution System)

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Private Company Examples currently developing HIMs:

Ceridian, Benefit Focus, Concentra, eBix, Benefit Mall, BCBS

The GHIM can increase Privately Insured Georgians from 2.2M to 3.2M

The GHIM can increase Publicly

Insured Georgians from 2.1M to 2.3M

Insurance Application Program Enrollment

Company A(Indiv & <10 life

groups)

Accepted Applications

3. “Personal Responsibility” High Risk Pool(Voluntary Access for All Without an Individual Mandate)

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Insurance Applications

Competitive Private Insurance Market

Company B(Indiv & <10 life

groups)

Accepted Applications

Company C(Indiv & <10 life

groups)

Accepted ApplicationsRejected Apps

Rejected Apps

Georgia Underwriting Authority (GUA)

Rejected Apps

Personal Responsibility High Risk Pool Less Than 3% of Population

Self-sustaining Public/Private entity

Private Carrier Underwriting Standards

Set by Insurers

Rejected Lives Reviewed by GUA to determine if

Uninsurable

Companies Rejecting Lives May not get back the same lives who

are NOT uninsureable

4. Group Conversion Policies(Provides Portability of Coverage Delinked from Employment)

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Individual Conversion Policy

Group Conversion Plan

Consistent Group ServicesNew Individual Services

Plan DesignsProvider Networks

WellnessDisease Management

Decision Support ToolsIncentive Programs

Increasing Insured Lives In Georgia

by 1.2 Million

(Reducing Georgia’s Uninsured Population)

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Strengthening the Free Market Safety Net

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COBRA

Continuation of Coverage

Conversion Policies

Uninsureds

Strengthening the Free-Market Safety Net

Level The Playing Field between Small & Larger Groups

1. Continuation of Coverage equal to COBRA for small groups under 20 lives

2. HSA eligible plan COBRA option for all fully insured group plans.

3. HSA eligible plan COBRA option for all Georgia residents under self-insured group plans.

4. Continuation of coverage for those losing their coverage above age 55 until they are eligible for other coverage (e.g. through another employer) or until eligible for Medicare.

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Strengthening the Free-Market Safety Net

1. Offer Group Conversion Policies for fully insured plans after federal COBRA or Continuation of Coverage

2. Offer Group Conversion Policy before exhausting time standards for continuation or COBRA benefits.

3. Offer “Group Conversion Policy” with an HSA eligible plan option

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Strengthening the Free Market Safety Net& Improving Access to Health Insurance

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Pre-existing Conditions

Dependent Children

Uninsurables

Rescissions

Strengthening the Free Market Safety Net & Improving Access to Health Insurance

Adopt ERISA Pre-X Conditions(Equalize Insured and Self-Insured)

1. Require Insured Group Pre-X to be the no more restrictive than

ERISA for out-of-network benefits

2. Eliminate Pre-X requirements for Insured Group in-network benefits

Dependent Child Coverage(Similar but Better than PPACA)

3. Allow tax dependents to remain under parent health plans until age 26 (eliminate fulltime student requirement).

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Strengthening the Free Market Safety Net & Improving Access to Health Insurance

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Uninsurables(Georgia Unique Concept)

4. Eliminate the Georgia Assignment Pool and replace it with a “Personal Responsibility” High Risk Pool (PRHRP).

5. Offer PRHRP before exhausting time standards for continuation or COBRA benefits.

Rescissions(Same as PPACA)

6. Allow policy rescissions only for fraud and intentional material misrepresentation.

Strengthening the Free Market Safety Net & Access to Charity Clinics Primary Care for Uninsureds

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There are over 100 clinics in Georgia who serve the uninsured.

Free clinics provide $200 to $400 million dollars' worth of care annually in Georgia.

The State Auditor estimates that 10-20% of all uninsured care (over 90,000 Georgians) occurred within free clinics in 2000.

Access to Free Clinics & Primary Care for Uninsured

1. Allow a Georgia Charity Care Network state tax credit fund (e.g. The Georgia Private School Tax Credit) of up to $2M per year (for 3 years) for planning, development and expansion of the Georgia Charitable Care Clinics.

2. Allow the Georgia Charity Care Clinics collaboration and use of Georgia’s Public Health Facilities

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Expanded, Creative, Competitive Insurance Market

More Affordable Health Insurance (Individual & Small Group)

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Defined Contribution HSA Eligible Plans

Health Reimbursement Only

Section 125 Plans

EPO’s (Equalize w/ staff HMOs)

Reduced Premium Taxes

(Equalize w/ Self-Ins)

Rewards & Incentives

Individual Premium Tax Deductible on Ga.

Returns

Min. 50% OON

List Billing Health StatusBioMetrics

Create More Affordable Individual Policies

Expand on Existing 2008 HSA Eligible Plan Laws

1. Allow Defined Contribution Plans (use “HRA Only) for tax advantaged employer funding of individual policies*

2. Allow Sec. 125 salary deductions for tax advantaged ee Defined Contribution funding of Indiv. policies

3. Allow List Billing of Individual policies 4. Allow Exclusive Provider Organizations (in-network only

PPOs)5. Allow state income tax deductibility of individual health

premiums*

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More Affordable Individual & Small Group Plans

Expand on Existing 2008 HSA Eligible Plan Laws

1. Allow financial rewards for using health risk appraisals, health management, or disease management programs*

2. Allow 30% coinsurance differential limit for non-preferred providers (if least 50%)

3. Allow “Any Willing Providers” into networks

4. Reduce high state and other municipal premium taxes *

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Create More Affordable Small Group Plans

Expand on Existing 2008 HSA Eligible Plan Laws

1. Allow employers with fewer than 10 employees, a $250 tax credit per employee enrolled in HSA eligible plans*

2. Allow a graduated sales tax submittal offset for the first four business years for small businesses of fewer than 10 fulltime equivalent employees, if they provide Comprehensive Medical coverage to employees and pay at least 50% of the cost of employee coverage.

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Healthcare is

Good Business in Georgia

Economic Development (The Business and Impact of Healthcare)

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Healthy Population Investment

Capital

New Business

More Agents, Brokers

More Providers Sound

Hospitals

Increased Hiring

Economic Development

Purchasing Power

There are 174 GHA member hospitals and health systems – most of them tax-exempt nonprofits; 31 of them are for-profit.

By 2020, the economic activity of private practice physicians will increase to nearly 270,000 jobs, $17.8 billion in wages and more than $32 billion in total economic output.

State and local governments will collect $2.8 B in revenue as a result of the economic activity of private practice physicians.

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Insurance Reform,Access, Health, and Productivity

Insurance Means Better Access to Care

Better Access to Care Means Better Treatments

Better Treatments Means Better Health

Better Health Means More Productive Workforce

Tying It All Together

Health Insurance Reform

Improved Health

EconomicDevelopment

Summary of Recommendations for A Georgia Alternative Health Reform Plan

1. Unique “Georgia Solutions”,

2. Four Major Restructuring “Game Changing” Market-based Solutions,

3. More than 30+ Supporting Recommendations

4. Specific Detailed Insurance & Regulatory Improvements, and

5. Recommendations that Meet the Free Market Guiding Principles.

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Building A Better Future for Georgia

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Improved Access to Care

IncreaseAccess to

Public Insurance

Affordable Insurance

Individual Products

Small Group Products

Improved Safety Net

Expanded Free Clinics

Personal Responsibility High Risk Pool

ReformedPrivate

Insurance

Increased Competition

Defined Contributions

NO MAGIC BULLETS

BUT A DARN GOOD START

Supporting Organizations

• Georgia Public Policy Foundation

• Center for Health Transformation

• Physicians for Patient Care• Georgia Tea Party Patriots• NFIB• MAG• Alliant Health• Georgia Charity Care Clinics

Briefed & Input to Plan:

GHA Gov Deal’s Staff

GSMC Ross Mason

Ga CoC Gerry Purcell

Ga DOI

GAHU

Legislators:

Mickey Channell

Josh Clark

Sharon Cooper

Greg Goggins

Judson Hill

2010 House Frosh31