A Trail Guide to Health Care Reform

Roberta Rifkin, Vice President for Government Affairs

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The Map

• The Patient Protection and Affordable Care Act (ACA) was signed into law on March 23, 2010 and provides the way to reform.

• The ACA map is designed to lead us toward:

• A Better Patient Experience;

• Improved Community Health;

and

• Lower Costs.

• Though there are different ways to get there, the destination is the same and we all need to move forward together.

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Three Main Groups Carving Trails to Reform

Federal State Community

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Federal Team is Providing State and Community Teams an Understanding of the Terrain

Coverage

Affordability

Quality

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Federal Team is Leading the Way

Federal Team

• Creates guidance and support for states and communities

• Providing states and communities with tools– Grants– Flexibility– Access

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Landmarks on the Federal Trail - 2014

Individual Mandate

Employer Responsibility

Health Exchange

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Obstacles on the Federal Trail

Legal Challenges:• Supreme Court will be hearing arguments

regarding the following issues:– Constitutionality of individual mandate

and Medicaid expansion– Severability– Anti injunction tax act

• Decision expected in June

Political Challenges

Republican Opposition– “Repeal and Replace”– Defund provisions – Election Issue– Creates State uncertainty

• Implement or wait

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A New Challenge on the Federal Trail

The Budget Control Act of 2011• To raise the debt ceiling by a total of $2.1 trillion Congress must

either

• Congressional vote on a balanced budget amendment; or

• Super Committee proposal for $1.2-$1.5 trillion cuts.

• Without a balanced budget amendment or a proposal from the Super Committee across the board cuts will occur January 2013, including cuts to Medicare, but not Medicaid

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State Trails

Each state has opportunities to chart their own course.

•Grants for Reform

•Health Insurance Exchanges

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New York State Trail

– Federal Grants ($40.8 million)• Exchange Early Innovators• Exchange Planning Grants• Establishment Level 1• Rate Review• Consumer Assistance

– Exchange Legislation• Waiting for Senate to vote

on Exchange bill

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Obstacles on the State Trails

Implementation Challenges:

– Budget shortfalls

– Reconcile ACA with existing state law

– Uncontrolled Costs

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Navigation Challenge: Payment Reform

• Medicaid: over $53 billion for 4.7 million people• Highest Medicaid costs per capita• Governor Cuomo developed a Medicaid Redesign

Team to propose reforms

• Medicaid Redesign Team (MRT):– Short term: 2011-12 budget proposals– Long term: multi year reform proposals

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Navigating the Community’s Trail

Creating a Culture of HealthCommunity Planning

Promoting Health and Self-management

Improving Quality in Health Care Delivery

Expanding Health Information Technology Networks

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Keeping Everyone on the Trail

Recognize and engage within your spheres of influence:

WORK

FAMILY

COMMUNITY PHYSICIANS

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Reaching Our Destination Together

• The Federal team is charting the course

according to the Affordable Care Act.

• The State teams are proceeding along the path

within federal guidelines, but in accordance with

their state’s needs.

• The Community teams are being formed as local

leaders emerge to help guide their residents.

• To ensure that all hikers reach the goals of health

care reform, all team must continue to move

forward together.

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Individual Mandate

•Everyone is required to have health insurance orpay a penalty up to $695 or 2.5% of gross income.

•Medicaid eligibility expanded to 133% of Federal Poverty Level (FPL).

•Premium subsidies and cost sharing available for incomes between 133%- 400% FPL ($14,484/$29,726 to $43,560/$89,400).

•Individuals with a religious conscience exemption are not required to have health insurance.

•Exemptions from the penalty for economic hardship and low income levels.

•Individuals are required to have minimum essential coverage which is defined as coverage under a government program like Medicaid.

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Employer Responsibility

• Employers with at least 50 Full Time Equivalents (FTEs) have a responsibility to provide affordable coverage that meets minimum standards.

• Employers that do NOT offer coverage and at least 1 worker receives a subsidy will pay $2000 times total FTEs minus 30.

• Employers that DO offer coverage will pay a penalty for each worker receiving a subsidy:

Lesser of total employees X $2000 or $3,000 for each employee requiring a subsidy

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Health Exchange

•The exchange is an electronic marketplace for purchasing health coverage.

•Individuals and Small Groups are eligible in 2014.

•Large Groups eligible to join in 2017.

•All plans that are offered through the exchange must be certified as a Qualified

Health Benefits Plans and offer bronze, silver, gold,

platinum, and/or catastrophic plans.

•State-based exchange must be operational by 2014 or the

Federal Government will offer its exchange.

•NY State will face many issues in designing its exchange:

Governance, Financing, Market Dynamics,

Products, Consumer & Employer Experience,

Operations and Technology.