State Legislative Update

1
State Legislative Update

• 2006 Regional Meeting Presentation
• by
• Adam Brackemyre, Director of State Affairs
  (Regions 1 2)

2
Regions 1 and 2

• Background information on Adam
• State Updates
• What is NAHU Doing?

3
NAHU Government Affairs

• NAHU Federal Affairs
• John Greene, VP of Congressional Affairs
• Peter Stein, VP of Congressional Affairs
• Tracy Canada, Manager of Political Affairs

• NAHU State Affairs
• Jessica Waltman, VP of Policy Research and State
  Affairs
  
• Adam Brackemyre, Director of State Affairs
• Jennifer Hillert, Director of State Affairs
• Megan Mamarella, Director of State Affairs

4
What Do We Do for You

• Participate in industry meetingsNAIC, NCOIL,
  ALEC, NCSL, etc.
  
• Draft position statements, analyze and comment on
  proposed legislation or regulations or implement
  a grassroots effort.
  
• Brief Capitol Hill staff and committees on
  underwriting and the health insurance market.
  
• Testified before Congress six times in the past
  seven years
  
• Considered experts on many health care issues
  such as HSAs, the Massachusetts Plan, Medicare,
  and LTC partnerships
  

5
The New Guy

• Four years working for health-related trade
  associations
  
• Federal Lobbyist for 3 years
• Health insurance (guaranteed issue, community
  rating)
  
• High-risk pools
• LTC
• Some state affairs duties, too
• Followed most states within regions 1 and 2
• Worked with coalitions opposing Wal-Mart bills
• Followed MA legislation from the start

6
The New Guy

• Midwestern roots (Indiana)
• DePauw University, B.A. Economics
• George Mason University, M.A. Public Policy (in
  progress)

7
I Work for You

• Do we need
• An Operation Shout?
• An op-ed expressing our views?
• To follow or watch specific legislation?
• Information on current law?
• To work with your state lobbyist?
• Call or e-mail me
• I am following your state and want to help

8
Massachusetts

• In April, Gov. Romney signed major health
  insurance reform
  
• The prime reason for the reform was to preserve
  385 million in annual federal Medicaid funding
  
• Individual and business mandates
• The Connector will offer individual policies

9
What We Know

• The Connector will offer nongroup insurance to
  groups of 1-50
  
• The small group market will still exist
• Subsidies will be provided for those earning less
  than 300 federal poverty level
  
• Nobody receiving a subsidy will have a deductible
  (therefore, no HSAs)

10
Connector Commissions

• If an agent brings risk to the Connector, he or
  she shall be compensated
  
• MAHU worked hard to get agent compensation put
  into the legislation
  
• Individuals can also buy directly from the
  Connector
  
• Reportedly, some carriers will price products
  with and without commissions

11
What We Dont Know

• Premium Costs (target was 200/mo)
• Number of Plans Available
• Deductibles and Co-Pays
• Agent Commissions (the Connector sets them)
• Who provides independent advice when someone
  purchasing without an agent has a question or
  problem

12
Massachusetts

• NAHU is closely monitoring this and working with
  MAHU
  
• NAHU sent an informational email to all 20,000
  members
  
• Again, the reform left many important issues to
  the regulatory process
  
• Even now, we dont know many final details

13
Maryland

• Fair Share/ Wal-Mart Bill
• Union-backed legislation that mandates large
  companies to pay a certain percentage of payroll
  on health benefits
  
• The larger Fair Share campaign produced bills in
  30 states last year
  
• The Maryland Assembly overrode Gov. Ehrlichs
  veto to enact it
  
• In July, a federal judge invalided this law

14
Maryland

• One political observer said a bad idea beat no
  idea
  
• Some legislators voted for Fair Share because
  they felt that they had to do something

15
Maryland

• Son of Wal-Mart bill targets all other
  employers
  
• Provide a certain level of health insurance or
  pay a tax
  
• The proposal all small employers must spend 4.5
  percent of payroll on health insurance or pay a
  tax
  
• Tax for non-profits 3 percent
• Paying Medicaid would be cheaper than private
  insurance
  
• Agents compete with government insurance
• What happens when legislatures allow Medicaid buy
  in (far below cost)?

16
Maryland

• By allowing the public to buy into public
  programs, the state will ensure that Medicaid
  costs outpace revenues
  
• The system will collapse
• This opens the door to single-payer

17
City Wal-Mart Legislation

• Some cities are advancing local ordinances to
  mandate big box retailers to pay a minimum wage
  plus benefits
  
• Chicagos bill (other cities have a similar one)
  establishes a 10/hr wage plus 3/hr in benefits
  
• Passed the city council
• Vetoed by Mayor Daley (first veto in 17 years)
• Veto not overridden (happened 8/13)
• Target stopped expansion plans

18
San Francisco

• San Francisco passed a pay or play universal
  health plan
  
• Will treat only city residents, including illegal
  aliens
  
• Cost estimate 200 million annually
• Co-pays and premiums are income-based and
  established on a sliding scale
  
• 20-99 employees- 1.06 per hr/per employee
• 100 or more- 1.60 per hr/per employee

19
Maine

• Maine passed The Dirigo Health Act in 2003
  authorizing a new program that would
  
• Save everyone money by enrolling all 130,000
  uninsured in Dirigo within 5 years
  
• Reduce health insurance costs
• Lower-income workers receive subsidies
• Savings are identified, recaptured and sent back
  to the program
  
• The process of identifying savings is
  controversial and may be reformed

20
Maine

• Two years later, program should have 50,000
  uninsured enrolled, but
  
• Sales are 90-95 behind schedule
• 93 million spent to save 5.4 million bad
  debt
  
• The majority of Dirigo enrollees were previously
  insured

21
Maine

• Maine has a regulatory environment similar to
  Massachusetts
  
• Small group 1-50
• Expensive individual market (rates to increase
  20)
  
• Dirigo reform offered little market reform
• Mandates and rating laws still apply
• We learned subsidizing an expensive policy
  design doesnt save money

22
Vermont

• Catamount Health
• High-deductible private insurance
• Subsides available up to 300 FPL
• Chronic Care Initiative (thru Medicaid)
• If 96 are not insured by 2010, then the
  legislature will consider an individual mandate
  

23
Vermont

• Employers will pay a quarterly assessment
  equaling 1 per day per total number of full-time
  equivalent (FTE) employees, if the employer
  
• Does not offer health insurance
• Only offers health insurance to some employees
  (assessment is on those who are not eligible for
  an employers insurance)
  
• Has uninsured employees
• The employer may exempt a maximum of eight FTEs
  from the assessment in fiscal years (FY) 2007
  2008 six in FY 2009 and four in FY 2010

24
New Jersey

• Governor Corzine will shortly unveil a plan to
  substantially reduce the number of uninsured
  
• Stated that by increasing state spending by 15
  million, the plan will cover 750,000 uninsured
  residents
  
• Very few details have been released
• NAHU is very concerned about this

25
New Jersey

• Were waiting for the final details
• NAHU has begun drafting op-ed and can place them
  when necessary
  
• The proposal will probably contain business
  mandates, so we will have strong allies

26
California

• In California, the House and Senate passed SB
  840, which would have established a single-payer
  system for California
  
• The proposal was not funded and was not enacted
• Vetoed by the governor

27
TennCare Reforms

• Access TN High Risk Pool
• Cover Kidscreates SCHIP program in TN
• Cover TN
• Voluntary partnership among the state, individual
  and willing employer
  
• Available guaranteed-issue to previously
  uninsured with household income up to 250 FPL
  
• Plans are portable and cover basic services
• Plans are estimated at 150 per month and vary
  based on age, tobacco use and obesity

28
Trivia

• The programs first year costs were 3 billion
• The legislative body predicted that 24 years
  later, the program would cost 12 billion
  
• The cost will not be greater than our present
  (inefficient) and wasteful fee-for-service
  system Legislator
  
• Any guesses?

29
Medicare

• 1966 cost 3 billion
• 1990 cost 107 billion
• Cost was 700 percent higher than projected
• Medicare A grew at 15 percent/ year
• 1975 budget increase spending by 30 percent
• Medicare B followed the same growth patterns

30
Single-Payer Problems

• Overpromise and overspend
• Set prices below demand demand explodes
• Cut reimbursement and raise taxes (Medicaid)
• Ration by some means
• Waiting lists?
• Limited prescription access?

31
Single-Payer Budgeting

• Tax revenues will be thrown into one pot
• Health care dollars will compete with education,
  law enforcement, etc
  
• The system will always be underfunded
• Thus, people will wait for treatment

32
Englands National Health Service

• By 2008, NHS patients will have to wait no more
  than 18 weeks for hospital treatment.
  
• The '18 week pathway' will cover the entire
  waiting time from a GP's referral to the start of
  treatment.
  
• To help NHS organizations meet the target, a new
  framework has been published. It includes details
  of national projects to speed up waiting times,
  and outlines the key responsibilities of all
  healthcare staff.
• Five years ago, it was not uncommon to wait six
  months for an outpatient consultation and
  eighteen months for inpatient treatment.
  
• Patients can now expect maximum waits of 26 weeks
  for inpatient appointments and MRI and CT scans,
  and a maximum wait of 13 weeks for a first
  outpatient consultation.

33
Hey Wait a Minute

• One million Britons are waiting for admission to
  National Health Service hospitals and shortages
  force the NHS to cancel as many as 100,000
  operations each year
• In Canada more than 800,000 patients are
  currently on waiting lists for medical procedures
  
  
• Roughly 90,000 New Zealanders are facing similar
  waits
  
• In Sweden, the wait for heart surgery can be as
  long as 25 weeks, while the average wait for
  hip-replacement surgery is more than a year

Source Michael Tanner The Great Wait National
Review Online 9/13/06
34
Single Payer

• Why I bring this up
• NAHU is preparing for single payer proposals for
  next year
  
• We have formed a committee and I am participating
  (Single Payer Truth Squad)
  
• The Fall elections look to be favorable for
  government-directed health care fans
  
• Look for ballot proposals (California)
• Were following PA and CT closely

35
Contact information

• If you would like to reach me
• Phone [phone]
• Email abrackemyre_at_nahu.org