Agenda - 10-12-2010 - Board of Health Meeting

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DETAILED SUMMARY OF AFFORDABLE HEALTH CARE FOR AMERICA ACT HEALTH CARE REFORM INSURANCE REFORMS: Insurance reforms. Prohibits insurance rating based on health status orpre-existing conditions, and limits age rating to 2:1. Prohibits annual or lifetime limits on medical spending. Grandfathers current individual policies. Applies these reforms to the entire market (inside and outside the Exchange), although employers have afive-year grace period to come into compliance. Establishes important consumer protections, including internal and external appeal requirements, provider network adequacy requirements, and greater transparency by insurance companies. Exchange. Creates a new marketplace called the national "Health Insurance Exchange", with an option for states that agree to meet federal standards to run their own exchange. U.S. Territories will also have the option of operating an exchange if they meet all of the insurance reforms and requirements as established by this Act. Eligibility. People are eligible to enter the Exchange and purchase health insurance on their own as long as they are not enrolled in employer sponsored insurance, Medicare or Medicaid. The Exchange is also open to businesses, starting with small firms and growing over time. Firms with twenty-five or fewer employees are permitted to buy in the Exchange in 2013, firms with fifty or fewer employees in 2014, and firms with at least one hundred employees in 2015 with discretion to the Commissioner to open the Exchange to larger businesses in that year and the future. Benefits. Outlines broad categories of covered services in the law, and creates a Health Benefits Advisory Commission, with physicians and other expert members, to help the Secretary of HHS define the essential benefit package. Cost-sharing varies by four tiers ranging in actuarial value (AV) from 70 percent to 95 percent ("basic," "standard," "premium," and "premium plus"). In other words, in a 70 percent plan, the plan pays 70 percent of the costs and an individual would pay the other 30 percent of expenses on average. The fourth tier plan ("premium plus") will offer additional benefits such as adult dental or vision, gym memberships, or private hospital rooms. All plans will limit annual out-of-pocket expenses for enrollees at a maximum of $5,000 for an individual and $10,000 for a family, with lower levels for lower- and middle-income families. Public health insurance option. The bill establishes a public health insurance option available within the Exchange to ensure choice, competition and accountability. Like other private plans, the public option must survive on its premiums. The Secretary of Health and Human Services will administer the public option and negotiate rates for providers that participate in the public option. The public health insurance option is provided startup administrative funding, but it is required to amortize these costs into future premiums to ensure it operates on a level playing field with private insurers. New health insurance options. The legislation authorizes start-up loans to assist states with the creation of health insurance co-operatives as an additional option. It also permits states to enter into agreements to allow for the sale of health insurance across state lines when the state legislatures agree to such compacts. Grants are also awarded to help states with this endeavor. Prepared by the Committees on Ways & Means, Energy & Commerce, and Education & Labor 1 October 29, 2009 24