Health law provisions kicking in; States prepare for high-risk insurance pool implementation

Three months after health reform was enacted, state leaders are beginning to make decisions about implementing the new law, Politico reports: "With the messy politics of health reform, the burden of balancing state budgets and the goal of expanding health coverage, lawmakers at the state level have had mixed reactions."

For instance, the Texas governor has pledged to fight the new law while Michigan's governor established a coordination council to speed up implementation. "Members of at least 39 state legislatures have proposed legislation to limit or oppose all or part of the federal law within its state boundaries, according to the National Conference of State Legislatures. In many of those states, the legislative session has already ended without action." Some states, however, have passed laws to limit or oppose the health law, while others are requiring voters in their states to decide on such action this year. "Some states will have to change state law to expand the Medicaid program to fit the federal requirements. Others will have to change their high-risk pools, for instance" (Haberkorn, 6/29).

The Modesto (Calif.) Bee: In the next three months, several provisions will take effect, including expanded young adult coverage, tax credits for small businesses, a ban on denying people with pre-existing conditions from health coverage and $250 rebates for seniors in the so-called Medicare prescription drug "doughnut hole," which are already being mailed. "The federal benefits are starting to materialize as economic hard times force states such as California to continue cutting health care services for people who can't afford to purchase coverage. For example, proposals for closing the state budget deficit threaten to increase costs and reduce access to care for people in the state's Medi-Cal program" (Carlson, 6/28).

Kansas Health Institute News Service: In the meantime, health insurers say "at least as many questions" remain "as answers about the new federal health reform law. ... Much of [the] detail work has been left for rule making by the U.S. Department of Health and Human Services in consultation with the National Association of Insurance Commissioners. Both those bureaucracies have been working at an unusually quick pace since the law was signed about 90 days ago to craft rules and guidelines." Insurers are busy trying to respond to the new rules and law though they say much remains uncertain about what is coming. "Blue Cross, [Matt All, vice president of public policy and human development at Blue Cross and Blue Shield of Kansas] said and other major insurers are predicting that the majority of insurance plans after 2014 will be sold through the exchanges" (Shields, 6/28).

Kaiser Health News: KHN's Mary Agnes Carey and Politico's Sarah Kliff talk about the latest developments on Capitol Hill, including extra Medicaid money for states and a move to extend the COBRA subsidy. Kliff said that the Department of Health and Human Services "has a very, very busy week." HHS officials are this week launching a federal high-risk pool and a federal web portal to provide health insurance information to consumers (6/28). KHN provides a video and a transcript.

CNN Money: High-risk pools scheduled to open Thursday are the biggest program implemented so far under the health reform law. "Many states already fund their own programs to help people with pre-existing conditions get insurance. The federal program will make such coverage available nationwide. The U.S. Department of Health and Human Services said that 30 states and the District of Columbia will use the money to create new high-risk pools or supplement existing ones. The remaining 20 states chose not to participate, so HHS will run those programs through a private third-party administrator." Participants must have been uninsured for the last six months and have a pre-existing health condition (Pepitone, 6/29).

In Pennsylvania, people may be able to buy insurance in the pools for "as little as $283 per month," according to The Philadelphia Inquirer. "The $160 million, federally funded program will cover hospital and doctors' visits, prescriptions, mental-health services, and diagnostic tests for up to 5,600 Pennsylvanians. The state, which currently has no program for high-health-risk individuals, received federal approval of its plan Friday, and on Monday said it would seek proposals from companies to handle claims administration and customer service." Nationwide, $5 billion has been appropriated for use in the pools (Von Bergen, 6/29).

In California, the state legislature narrowly passed two bills Monday to allow that state to get $761 million in federal subsidies to help the state create a high-risk pool, The Associated Press reports. "The state Senate passed the bills Monday. They now go to Gov. Arnold Schwarzenegger, who is expected to sign them into law" (Bussewitz, 6/29). 

The Hill: Republicans are unhappy with how things are developing in the high-risk pools. "The office of Rep. Dave Camp (Mich.), senior Republican on the House Ways and Means Committee, said the program is 'woefully underfunded,' threatening health coverage for hundreds of thousands of patients. The state-based pools ... were supposed to be created by last Monday, but are running behind schedule. … Last week, 28 Senate Republicans wrote to Health and Human Services Secretary Kathleen Sebelius with the same concerns, arguing that the CBO findings are proof that the pools 'will fail to provide the assistance promised by supporters of the new law.' The letter was spearheaded by Sen. Mike Enzi (Wyo.), the senior Republican on the Senate Health Committee" (Lillis, 6/28).

Utah's insurers are also preparing for what they'll be responsible for as health reform is implemented, The Salt Lake Tribune reports. "But soon, all health insurers - nonprofit and for-profit alike - will be held to the same standard. Starting Jan. 1, 2011, national health reform will require commercial insurers to spend at least 85 cents of every premium dollar on medical claims for large employer groups. For small group and individual plans, the figure is 80 cents. It's a threshold that most Utah insurers already meet or exceed." The so-called medical loss ratio is a major part of health reform to be implemented early next year (Stewart, 6/29).