Minimum Creditable Coverage Policy Committee Meeting January 19, 2007
2 Minimum Creditable Coverage Establish the floor below which insurance products will not meet requirements of individual mandate Offer products that: –Protect beneficiaries from catastrophic costs –Promote access to routine preventive care
3 Minimum Creditable Coverage Balance premium affordability with potential out-of-pocket costs Encourage preventive care Cover core medical services
4 MCC Exclusions Fee schedule based coverage Limits per sickness/illness/annual/lifetime
5 MA Non-Group Market (pre-merger) 45,200 lives covered as of 12/31/05 –> 40% age 50 or older –< 20% under age 30 Limited options –HMO or PPO, with or without Rx coverage –Over 85% enrolled in HMO products –Over 18,000 buy products w/out Rx coverage 4,500 purchase high deductible PPO –$5,000/$10,000 deductibles (ind./fam.)
6 National Non-Group Market AHIP non-group survey conducted in 2004 Broader and younger age distribution than MA market –> 35% under age 35 –< 30% age 50 or older 85% enrolled in PPOs –Average deductibles ~ $2,000 –20% co-insurance in network –40% co-insurance out-of-network –Out-of-pocket maximums between $3,500 and $4,000
7 MA Small Group Market (pre-merger) 759,000 lives covered as of 12/31/05 Over 85% enrolled in HMO products Approximately 10% purchase policies with a deductible –Average deductible is less than $1,000 In-network co-insurance is virtually non-existent Average office visit co-payment -- $15-$20 Inpatient admission co-payment is $250 –Increase in number of policies with $500 co-payment
8 National Small Group Market From 2006 AHIP SurveyPPOHMO Product preferences57%39% % with annual deductible94%40% Average deductible (ind.)$849$471 % with annual out-of-pocket maximum 94%80% Average annual out-of- pocket maximum $2,743$1,763
9 National Small Group Market PPOHMO % with co-insurance82%31% Average co-insurance17%13% % with lifetime maximum38%17% Average lifetime maximum$4.7M$2.7M Average PCP co-pay$17$19 Average Specialist co-pay$23$25