1. Implementing Massachusetts Health Reform Families USA Brian Rosman (rosman@hcfama.org) Health Care For All (www.hcfama.org) January 2007

2. Presentation Outline What Is Health Care For All MA Health Reform History – Why Third Wave? Round 3: Chap. 58 Acts of 06 – What Passed? Insurance Connector: Subsidized Coverage – CCHIP MassHealth Expansions & Restorations Individual and Employer Responsibility Insurance Market Reforms Quality, Costs, Health Disparities and more Why and How Did Chapter 58 Happen? Whats Happening with Implementation? Is Chapter 58 a National Model? Whats the Emerging Political Window of Opportunity for Health Care Access Reform?

3. Health Care For All: Who We Are Just Massachusetts We Run Health Policy Coalitions Affordable Care Today (ACT!!) Childrens Health Access Coalition (CHAC) Racial & Ethnic Health Disparities Action Network (DAN) Oral Health Advocacy Task Force Private Market Consumer Coalition Emerging projects on e-Health and Quality We Run Programs to Help Consumers Consumer Helpline (telephone/email), Outreach & Enrollment, Health Law Advocates We Communicate to Inform Everyone www.hcfama.org, email updates, Blog (blog.hcfama.org) www.hcfama.orgblog.hcfama.org

4. Brief History of MA Health Reform 1988: Universal Health Care Law $1680 Pay or Play Employer Mandate Delayed three times/Repealed 1996 CommonHealth, Student Insurance Mandate, Medical Security Plan (unemployed), Healthy Start (pregnant) 1996: MassHealth Waiver Expansion law Medicaid->MassHealth; Enrollee growth from 670,000 (95) to 1,020,000 (01) Uninsurance Drop: 680,000 to 365,000 Coverage for all children – CMSP Senior Pharmacy Program Both reform waves inspired national action 1988 Leads to state-based innovations 1996 Leads to Creation of SCHIP

5. April 12, 2006: Chapter 58

6. Medicaid Expansions and Restorations MassHealth ( = Medicaid waiver): Childrens coverage expands to 300% fpl from 200% fpl MassHealth enrollment caps lifted Essential, CommonHealth, HIV Optional Benefits Restored: dental, dentures, eyeglasses, other adult services New smoking cessation and wellness benefits $3M outreach/enrollment grants $270M ($90 per year) rate hikes to hospitals and physicians Years 2/3 tied to Pay for Performance/Racial Ethnic health disparities benchmarks Bottom Line: 53,000 new enrollees since July – half kids, half adults

7. Chapter 58 – Insurance Connector and Commonwealth Care Insurance Connector set up as quasi-public authority – 10 member board Provides Commonwealth Care - subsidized coverage for below 300% fpl Provides Commonwealth Choice – non- subsidized affordable coverage for individuals and small business Defines individual mandate

8. Subsidized Coverage Commonwealth Care: subsidized coverage for uninsured adults below 300% of poverty Rules: No employer coverage available in past 6 months COBRA or non group OK Legal residents OK, even Medicaid ineligible private coverage – offered by 4 Medicaid MCOs www.macommonwealthcare.com

9. Subsidized Coverage Below 100%: No premium, no deductibles Medicaid Drug copays ($1 / $3) comprehensive benefits, including dental No major issues 34,000 enrolled, mostly from charity care program (Uncompensated Care Pool)

10. Subsidized Coverage 100% - 300%: Sliding scale premiums, no deductibles commercial copays ($10 - $30) comprehensive benefits, but no dental Enrollment just getting started Were pushing to add dental To be decided: employee buy-in for those with employer coverage Top Issue: are premiums too high?

11. Subsidized Coverage Premiums for lowest cost plan (per month): 100%-150% $18 ($9,800 - $14,700) 150%-200% $40 ($14,700 - $19,600) 200%-250% $70 ($19,600 - $24,500) 250%-300% $106 ($24,500 – $29,400) note: income amounts rounded

13. Individual Responsibility Individual Mandate Beginning 7/1/07, all residents 18+ must obtain health insurance coverage. Penalty if no coverage on 12/31/07 Penalties assessed if affordable coverage is available 2007: loss of personal tax exemption 2008+:tax penalty=½ cost of affordable plan per month Issue: what is affordable? Coalition doing focus groups, research. Decision this spring. What is Minimum Creditable Coverage? that meets mandate. Initial proposal: $1,500 deductible, generics only. We issued policy guidance.

14. Employer Responsibility Employer Mandate Fair Share Employer Contribution Employers (11+ workers) who dont offer fair and reasonable coverage must pay $295 per worker Definition of fair and reasonable neither: either pay 25% of premium, or cover 33% of workers Were filing bill for 50% of premium, 50% of workers, include part-timers ERISA issue????? Employers must facilitate Section 125 cafeteria plan for pre-tax health insurance, or pay Free Rider Surcharge

15. Non-Subsidized Coverage Commonwealth Choice Plans for individuals and small business 3 levels: high, mid and minimum creditable coverage Tough new issues for us to learn: List billing Brokers and intermediaries Actuarial equivalents etc... Starts July 1

16. Chapter 58– Insurance Market and Other Reforms Small/Nongroup Insurance Market Reforms Non-group (individual) market will merge with small group market on 7/1/07. Study commission found non-group goes down 15%, small group up 1.5% Young adults (19-25) can stay on parents plans for 2 years after lose dependency Reduced-benefit plans for 19-25 year olds Other Reforms $20M Public Health/Prevention Restorations Diabetes, cancer, infection control, more Quality and Cost Council Sets cost and quality benchmarks Produces website with data/findings Racial/Ethnic Health Disparities Council Statewide Disparities Council Pay for Performance benchmarks Computerized Prescription Order Entry – $5 million

17. How Do the Pieces Fit Together? Percent of States Total Uninsured Targeted by different approaches

18. Coalition Role After Bill Passes Coalition continues strong. ACT! is now ACT!! Monitoring implementation – central source of information Administrative advocacy with Connector and state agencies (Division of Insurance, Medicaid) Introduced legislation with 15 provisions Its never over

19. Is Chapter 58 a National Model…? Reasons why not… Different makeup of uninsured population Lower proportion of uninsured Lower proportion of lower-income uninsured Highly regulated insurance market Guaranteed issue, prohibition on medical underwriting, modified community rating Essential protections for individual responsibility Robust Safety Net/Deep Federal Financing Reasons why… Individual/Employer/Government responsibility Confronting the affordability challenge Less a policy blueprint/More a political one

20. Medicare Medicaid Employer Coverage IndividualMandate Medicaid Expansions Employer Responsibility Insurance Market Reforms Affordable Products Young Adult Products Connector Commonwealth Care

21. Where From Here? State Actions – 2007-08 New, invigorated conversation CA, CO, CT, MI, MO, NY, OH, RI, WA, WI, IL… 10 states now Democratic Gov and leg (was 3) Congressional Action – 2007-08 SCHIP expires 9-30-07 Medicare issues Access – is there room on the agenda? 2008 Presidential Campaign Changed dynamic for all Democrats Changes dynamic for all Republicans Different kind of conversation in 2008