Mandatory Employer Assessment Reporting Requirements June 5, 2007 Sheraton Burlington

Agenda for Today  Review legislative action Assessment and other changes  Review Catamount financials Enrollment and Catamount Fund  Preview of 2008 Session What’s left on the table?  Preview of 2007 Summer Study “What should we do next?”

Change to Assessment  Applies to employers who offer coverage to Full-Time but not all employees  Definitions for Exempt employees: PART-TIME workers are individuals who work 30 or fewer hours a week. SEASONAL workers are individuals who: (A) work for an employer for 20 weeks or fewer in a calendar year; and (B) work in a job(s) scheduled to last 20 weeks or less.

Change to Assessment Employers who offer health insurance coverage to all regular, full-time employees do not include in the FTE calculation for the assessment any PART-TIME and SEASONAL workers with health insurance from any source other than Medicaid, VHAP or Catamount

Examples – all offer to FTEs Employee works 32 hours, not offered insurance and covered by other plan ASSESSED Employee works 25 hours, not offered insurance and covered by spouse’s employer plan EXEMPT Employee works 25 hours, not offered insurance and covered by VHAP ASSESSED Employee works 15 weeks a year at seasonal job and is covered by spouse plan EXEMPT Employee works 15 weeks a year at seasonal job and has no other coverage ASSESSED

Other Legislative Action...  New Law prohibits employers from asking job applicants about insurance status Aggrieved can file claim in superior court Fines, penalties, back pay, punitive damages, attorney fees  Mandated insurance coverage for Naturopathic Physicians

Other Legislative Action …  VT Information Technology Leaders (VITL) Additional $700K and directed to “raise” $1 million from hospitals, insurers Authorized to develop statewide health information network (“regional health information organization” RHIO) – like a “VELCO” for health information  Significant ($3m 2007, $1.3m 2008) outreach program for Catamount, VHAP and Medicaid Target: 96% insured by 2010

Cost Impact Study Completed  Study mandated by 2006 session  Report completed Mar 2007  NO HEARINGS OR DISCUSSION by any of the committees or reform commission yet  Research and report by legislative Joint Fiscal Office, Ken Thorpe and legislature’s econ forecasting consultant  Four Key Findings

Cost Impact of Government Funding of Health Care  1)The rapid escalation in health care costs, which is the primary cause of the growing number of uninsured residents, will create enormous future resourcing challenges to the public sector in financing any health care initiative.  2) There is no revenue source available that meets the capacity requirements of past and likely future health care expenditure growth.

Cost Impact – cont.  3) If constant increases in tax rates over time are necessary to meet projected health care costs, it could create additional negative impacts associated with almost any tax source relied upon to fund universal health care.  4) Detailed macroeconomic impacts from various funding options can only be evaluated within the context of specific health care proposals.

Catamount Enrollment Estimated Enrollment by End of FY2010 State ProgramEligible Take-up rate Uninsured Expected to enroll Catamount with subsidy: 13, %7,078 ESI subsidy: 3, %443 Catamount no subsidy (>300% FPL): 11, %3,381 VHAP: 50% of pov: >50% to ESI: 7,989 13,379 10% 23.3% Medicaid Adults: Kids: 4,514 5,202 10% 27.2% 451 1,415 TOTAL ALL PROGRAMS 59,67828%16,684 “Target” of 96% insured by 2010?

Catamount Fund Catamount Fund FY2007FY2008FY2009FY2010 Revenue $ 8,420,100$ 17,968,836$ 23,597,324$ 25,929,924 Expenditures $ 1,904,035$ 13,409,215$ 21,321,728$ 24,025,443 Surplus $ 6,516,065$ 4,559,620 $ 2,275,596$ 1,904,481 Fund Balance $6,516,065$11,075,685$ 13,351,281$15,255,762 Legislative leaders complained about $800K “gap” created by exemption for seasonal and part-time employees from assessment …

Preview of 2008 Session  Eliminate 12-month CH waiting period for categories of currently insured: “Small businesses” Non-Profits Self-Insured Farmers  Allowing divorced spouses to buy-in to employer plan indefinitely following expiration of COBRA

Preview of 2008 Session  Prohibit separate care management for mental health/substance abuse “pure parity” Eliminate pre-authorization, periodic review, “carve out” management by specialty firms (Magellan)  In 2006 passed “Any Willing Provider” to prohibit limitation of MH network size

Preview of Summer Study 2007  Commission on Health Care Reform (4 House, 4 Senate, 2 Gov appt)  Series of hearings: “What Should We Do Next for Reform?”  Staff: Jim Hester (frmr head MVP VT)  $400,000 budget for studies, consultants, expenses 

Commission Members  Sen Jane Kitchel, Co-Chair  Rep Steve Maier, Co-Chair  Rep Harry Chen  Rep Francis "Topper" McFaun  Rep Mark Larson  Sen Ann Cummings  Sen Kevin Mullin  Sen Doug Racine  John Bloomer, Jr.  Walter Freed

Questions? Research, analysis and presentation by Keller & Fuller, Inc. For more employer-focused analysis of health care reform in Vermont, go to