MICHIGAN ASSOCIATION OF HEALTH PLANS Michigan Academy of Physician Assistants: MAPA 2013 Spring Conference Affordable Care or Sticker Shock: Where do we end up? March 22, 2013 Rick Murdock Executive Director Michigan Association of Health Plans 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Affordable Care or Sticker Shock Presentation Outline Background on MAHP Who gets Care now? Reform Issues Facing the Insurance Industry Provider Issues/Concerns Likely Recommendations in the Legislature 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS MAHP: Who We Are MAHP Mission is to provide leadership for the promotion and advocacy of high quality, affordable, accessible health care for the citizens of Michigan. MAHP represents 15 health plans covering all of Michigan and 45 related business and affiliated organizations MAHP Member Health Plans provide coverage for nearly 2.8 million Michigan citizens—nearly one in every three citizens in Michigan MAHP Health Plans employ about 8,000 persons—all of whom pay taxes in Michigan. MAHP members collect and use health care data, supports the use of “evidence based Medicine “ and facilitate disease management and care coordination in order to provide cost-effective care. 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MAHP Member Health Plans: MAHP: Who We Are MAHP Member Health Plans: - Coventry Cares of Michigan2,3 -Grand Valley Health Plan 1 Health Alliance Plan 1,3 -Meridian Health Plan2,3 HealthPlus of Michigan 1,2,3 -McLaren Health Plan1,2 Midwest Health Plan2,3 -Molina Healthcare of Michigan2,3 Paramount Care of Michigan 1 -Physicians Health Plan 1,2 Priority Health 1,2,3 -ProCare Health Plan 2 Total Health Care 1,2 -United Healthcare1,2,3 Upper Peninsula Health Plan 2,3 Key : 1 = Commercial Health Plan 2= Medicaid Health Plan 3= Medicare Advantage or Medicare Special Needs Plan 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Coverage for Michigan Citizens (Millions) 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Support for Affordable Care Act Party Affiliation 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS Health Care Reform Medicaid Expansion Health Insurance Exchange Insurance Reform 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Qualified Health Plans Issuers Plans Bronze – 60% actuarial value Silver – 70% actuarial value Gold – 80% actuarial value Platinum – 90% actuarial value Catastrophic plans 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Essential Health Benefits 1- Ambulatory patient services. 2- Emergency services. 3- Hospitalization. 4- Maternity and Newborn Care. 5- Mental health and substance use disorder services, including behavioral health treatment. 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Essential Health Benefits (cont.) 6- Prescription drugs. 7- Rehabilitative and habilitative services and devices. 8- Laboratory services. 9- Preventive and wellness services and chronic disease management. 10- Pediatric services, including oral and vision care. 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Employer Responsibility Must provide health insurance to FT employees of large groups Minimum value – no less than 60% AV Affordable – cost to employee for self-only coverage cannot exceed 9.5% of household income Minimum value calculator enables employers to test 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Exchange Determines Eligibility In addition to enrolling individuals in plans on the exchange, exchange determines eligibility for: Medicaid – up to 138% of FPL SCHIP (MiChild) Premium tax credits Reduced cost-sharing 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS Premium Tax Credit Amount of tax credit is based on the premium for the 2nd lowest cost silver plan and varies by income: 133-150% FPL … 3-4% of income 150-200% FPL … 4-6.3% of income 200-250% FPL … 6.3-8.05% of income 250-300% FPL … 8.05-9.5% of income 300-400% FPL … 9.5% of income 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS Provider Concerns Provider Capacity: Primary Care Access for consumers Medical Home Linkage to Community Resources Personal Wellness Options Information Technology EMR Electronic Billing/referrals/ --All Payer Data Base --Common Processes (Claims Status, Eligibility, etc) 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

Provider Concerns Using Technology (Where we can do better) 20% of patients records not transferred in time for appointment 25% of patients tests to be re-ordered One in three hospitalized patients “harmed” during stay One in five Medicare Patients re-admitted within 30 days 63% of patients don’t know their health care costs and 10% never find out One/third of health care expenditures doesn’t improve health (Institute of Medicine/Best Care) 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS (www.mahp.org) http://www.mahp.org/federalreform.htm 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS 16

MICHIGAN ASSOCIATION OF HEALTH PLANS Insurance Premium Underlying Cost Pressures For Health Insurance 4.6% overall increase 2010 to 2011 16.2% of per capita spending from individual out of pocket 4.8 % increase in inpatient spending 6/8 % increase in outpatient spending 4.5% increase in professional per capita spending 1 % increase in prescription spending 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS Insurance Premium Cost Pressure under ACA 2.3 % Premium tax beginning in 2014 3.5% surcharge on premiums for Insurance Exchange Limits on Medical Underwriting (Age/Smoking/Geography) Benefit Design compared to current coverage Penalties (Individual and Business) 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS Recommendations Reimbursement Issues Reimbursement Reform (Parity?) Cost Shifting Concerns (Gov’t Payers, Autos, Self-pay)—how to address? Tax Issues (how to finance Medicaid) Continued review of scope of practice rules 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS

MICHIGAN ASSOCIATION OF HEALTH PLANS For more information on health reform, please visit MAHP’s website (www.mahp.org) http://www.mahp.org/federalreform.html 2/2/2019 MICHIGAN ASSOCIATION OF HEALTH PLANS 20