1. Markets, Mergers and Exchanges: Considerations for State Consumer Advocates Kevin Lucia Georgetown University Health Policy Institute

2. Market Regulation Current Problems Current Problems –Health insurance markets dysfunctional –Too often coverage is not accessible, affordable, adequate Consumers vulnerable when sick Consumers vulnerable when sick –Consumers face health discrimination –Different rules state-to-state, market-to-market, product-to-product Differences are exploited to avoid high cost individuals and groups Differences are exploited to avoid high cost individuals and groups AHP example AHP example –Oversight, enforcement weak at all levels Current Problems Current Problems –Health insuranc e markets dysfunct ional –Too often coverag e is not accessib le, affordab le, adequat e –Consum ers face health discrimi nation –Differen t rules state-to- state, market- to- market, product- to- product Differe nces are exploit ed to avoid high cost individ uals and groups Differe nces are exploit ed to avoid high cost individ uals and groups –Oversig ht, enforce ment weak at all levels

3. Market Regulation Federal Proposals Federal Proposals –Guaranteed issue, no pre-ex, modified community rating –Standard for minimum benefit, maximum cost sharing –Marketing rules, minimum loss ratios, vastly stronger disclosure/transparency Senate market rules not air tight Senate market rules not air tight –Wellness loophole permits underwriting –Possible market rule loopholes for non- QHPs, student health insurance, etc.

4. Merging Markets Individual and small group markets Individual and small group markets Eventual goal is single risk pool Eventual goal is single risk pool –Common benefits and rules –Reduce possibility of risk segmentation Tricky: Tricky: –Transitional winners and losers when merging dissimilar markets –Lack of group market subsidies to offset –Employers still have option to self-insure Timing is key Timing is key

5. Merging Markets States States –Worth evaluating –Market reforms first Senate proposal Senate proposal –Option –Advantage in harmonized rules –Analyze mix of risk post-reform –Timing is key

6. Health Insurance Exchange Offers an organized marketplace for the purchase of health insurance Offers an organized marketplace for the purchase of health insurance –Easier for consumer to compare options –Reduce administrative/marketing costs –Improved accountability/transparency –Administer subsidies –More consumer assistance –Improved competition Distinguish from market regulation Distinguish from market regulation

7. Health Insurance Exchanges Functions Functions –Certify and de-certify health plans –Negotiate with health plans –Provide venue for easy apples-to- apples shopping experience –Administer federal subsidies –Consumer assistance with eligibility, navigation Must function well in standardized way Must function well in standardized way

8. Other Advocacy Opportunities NAIC NAIC –Private Organization –Members-State DOI Commissioner –Model laws and Regulations

9. NAIC and Health Care Reform Expected role during implementation Expected role during implementation –Guidance to states –Consult with HHS

10. NAIC Consumer Representative Program Follow NAIC proceedings Follow NAIC proceedings Attend meetings Attend meetings NAIC conference calls NAIC conference calls Submit written testimony Submit written testimony Help set agenda Help set agenda Direct voice for consumers heard by state commissioners Direct voice for consumers heard by state commissioners