1. State Coverage Initiatives Chiquita Brooks-LaSure June 15, 2007

2. States Coverage Initiatives are at Different Stages of Proposal and Implementation
Minnesota
Pennsylvania
Massachusetts
Illinois
California
Vermont
Proposed
Implemented
Governors released proposals in January 2007
Governor’s proposal released in March 2007
Competing proposals in legislatures
Supporting legislation introduced
Implementation Underway
Coverage begins September 2007
Individual mandate effective July 2007

3. Common Mechanisms States Use to Expand Insurance Coverage
Insurance Market Reforms
Premium Assistance
Public Program Expansions
New Health Plan Offerings
Purchasing Pools
Insurance Regulation Reform
State Coverage Initiatives
Individual Mandates
Employer Penalties
State Financing
Chronic Care & Quality Initiatives

4. Some States Are Adopting Individual Mandates to Require Residents to Purchase a Minimum Level of Coverage
Individual Mandate MA
All residents required to have comprehensive coverage, including prescription drugs VT
None PA
Phased-in mandate for individuals with incomes >300% FPL CA
All residents must have a minimum level of coverage (up to $5,000 deductible and max OOP limit of $7,500) MN IL

5. Premium Assistance Subsidizes the Cost of Private Coverage for Low-Income Individuals
PA Available for ESI or Individual Coverage MA
Residents with incomes <300% FPL
ESI & Individual Coverage VT PA
Individual coverage only CA
Residents with incomes <250% FPL MN IL
Residents with incomes <400% FPL

6. Insurance Exchanges and Standardized Benefit Plans Are Intended to Create More Affordable Coverage Options
Insurance Market Reforms MA
Insurance exchange offering new plans for individuals and small businesses VT
New standardized health plan for individuals PA
New standardized health plans for individuals and small businesses CA
Insurance exchange offering new plans for individual coverage MN
Insurance exchange for individual coverage IL

7. Most States are Penalizing Employers That Do Not Offer Coverage to Offset Program Costs
Employer Penalties MA
$295 per uninsured FTE* per year – excludes firms with <10 employees VT
$365 per uninsured FTE* per year – firms may exclude a decreasing number of employees from the penalty each year PA
3% payroll tax – excludes firms with <50 employees CA
4% payroll tax – excludes firms with <10 employees MN
None IL
3% payroll tax – excludes firms with <10 employees
*FTE stands for full-time equivalent employee.

8. Several States Are Expanding Public Programs to Cover Low-Income Residents
Public Program Expansion MA
Medicaid eligibility expansion for children ( % FPL); eliminate wait list VT
None PA CA
Expand Medicaid eligibility to all adults under 100% FPL and increase eligibility to 300% for children (regardless of immigration status) MN
Expand Medicaid buy-in program for adults and children IL
Expand Family Care eligibility to 400% FPL for working parents without access to ESI

9. Many States are Including Quality Improvement Initiatives in Their Coverage Proposals
Chronic Care & Quality Initiatives MA
Healthy lifestyles program; Greater cost and quality reporting; Aims to reduce disparities VT
Develop a model for chronic care management and prevention in the state; Expanded provider education PA
Wellness, prevention, and chronic care initiatives; Improve hospital quality and reduce errors; Develop HIT initiative CA
Healthy lifestyles program; Improve quality in health facilities; Extensive HIT initiative; Build consumer tools for transparency MN
Preventive care requirements for new plans; Work toward greater HIT adoption in the state IL
Develop a state plan to increase wellness and improve chronic care management; Increase consumer accountability & transparency

10. State Funding Mechanisms and Estimates of Program Costs Vary Widely
State Financing
Annual Cost (As Reported by State)
State
Federal
Employer Penalty
Other Assessments
Other Taxes MA
$1.4B 
Hospitals & Insurers VT
$45M
Tobacco PA
$255M CA
$12B
Hospitals & Physicians MN
$44M IL
$2.1B
Tax on businesses earning >$2M/yr.