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Health Law and Policy Update

This week's updates

Headlines of the week

Colorado's Health Benefit Exchange Board holds first meeting
Colorado's Health Benefit Exchange board held its inaugural meeting Monday. The Health Benefit Exchange was established by Senate Bill 11-200. Exchanges will be competitive insurance marketplaces, and each state is required to have an exchange running by fall 2013 to assure everyone has access to coverage by Jan. 1, 2014.

Seven of the nine voting members of the board attended this first meeting including Gretchen Hammer (Colorado Coalition for the Medically Underserved), Richard Betts (ASAP Accounting and Payroll), Nathan Wilkes (Headstorms, Inc.), Dr. Michael Fallon (emergency room physician) Eric Grossman (The TriZetto Group, Inc.), Robert Ruiz-Moss (Anthem Blue Cross Blue Shield) and Elizabeth Soberg (UnitedHealthcare). Absent members were Arnold Salazar (Colorado Health Partnerships, LLC) and Steve Erkenbrack (Rocky Mountain Health Plans).

The meeting was largely organizational. The board's discussion included what kind of a board it ought to be, how the board should interact with workgroups already meeting under the existing planning grant, what kind of advisory committees and structure they might create, and funding. There was a brief overview of statutory requirements, a discussion of how the board will organize meetings, and a discussion about how the board will measure success. The board will select a chairperson at its next meeting.

Proposed policies for the board were included in board notebooks, but not available to the public until after the meeting. Hammer pointed out the importance of developing strategies for robust public engagement, and Wilkes talked about the need for openness and transparency. State Sen. Betty Boyd, the prime Senate sponsor of SB 11-200, emphasized the need for a transparent and open process. In testimony, Dede de Percin of the Colorado Consumer Health Initiative raised the issue of the composition of the board and industry dominance. Elisabeth Arenales of the Colorado Center on Law and Policy presented a letter from the Health Advocates Alliance regarding transparency and process. Arenales also raised issues on behalf of CCLP regarding the need to establish bylaws, consult with experts on the requirements of open meetings and records requirements, and establish processes for managing conflicts of interest, particularly given the industry dominance on the board. There was some discussion of those issues following that testimony.

About 50 people attending the meeting were sent to overflow rooms; the audio in one of the overflow rooms was so poor that people left. One person reported people who wanted to present testimony were unable to do so. Ten minutes in the three-hour agenda were allocated for public testimony. Only 30 agendas were available for the public.

Of particular interest are draft policy documents distributed to the board.

The next board meeting is scheduled for 10:30 a.m. to 1 p.m. July 25. Details are on the board's meeting calendar.

The board committed to having enough space and posting materials in advance of the next meeting. It is critical the board establish by-laws and policies that ensure their deliberations and decisions are completely transparent and the public has meaningful opportunities to engage in the process, including before final decisions.

Exchange board composition a continuing concern
The Colorado Center on Law and Policy continues to raise concerns about industry dominance of the board. This week, CoPIRG and the Colorado Consumer Health Initiative called for the resignation of Eric Grossman, a vice president with the TriZetto Group, Inc. TriZetto provides software to insurance plans and benefits administrators. Grossman is the author of an article entitled "There's Gold in the Exchange, Here's How to Stake Your Claim."

Some of the media coverage of the board makeup from the past week:

Former insurance industry executive Wendell Potter blogged this week about Colorado in an article headlined: A Rocky Mountain outrage: Colorado governor, legislators give regular folks short shrift in choice of board members.

Leadership announces appointments to exchange oversight committee
Colorado House Speaker Rep. Frank McNulty today announced appointments to the Legislative Oversight Committee of the state's Health Benefit Exchange, including state Republican Reps. Bob Gardner, Ken Summers and Jim Kerr. Gardner was also appointed to serve as vice-chairman of the committee. Appointing the representatives was required under Senate Bill 11-200, which established the governing structure of the exchange.

All 10 members of the oversight committee have now been appointed. In addition to the three announced today, the members are: Sens. Betty Boyd (D, chairwoman), Irene Aguilar (D), Kevin Lundberg (R) Jeanne Nicholson (D), Ellen Roberts (R), and Reps. Deb Gardner (D) and Beth McCann (D).

Feds issue guidance on exchanges
The Department of Health and Human Services issued proposed regulations Monday offering guidance to states establishing health insurance exchanges under the Patient Protection and Affordable Care Act. There is a 75-day comment period.

Somewhat disappointing are the proposed regulations on the composition of state exchange boards. The draft regulations say "(e)xchanges are intended to support consumers, including small businesses, and as such, the majority of the voting members of governing boards should be individuals who represent their interests." The regulations propose that board members represent consumer interests by ensuring that "membership not consist of a majority of representatives of health insurance issuers, agents, or brokers, or any other individual licensed to sell health insurance." The draft regulations do not preclude the situation that has arisen in Colorado, where an industry insider sits on the board along with industry representatives and in combination, industry interests comprise the majority of the board. States are not precluded, however, from being more restrictive than the federal regulations. Colorado's statute requires that the majority of Colorado's board not be "directly affiliated" with the industry.

CCLP intends to comment on the proposed regulations and will share its analysis.

Find additional coverage from The Commonwealth Fund, Kaiser Health News and The Washington Post.

Children with special health needs hit hard if Medicaid cut
Medicaid is the single largest payer of health care services for children with special health care needs, which leaves those children especially vulnerable if the program is cut, according to a report released this week by the Georgetown Center for Children and Families and Family Voices.

Special health care needs include conditions such as autism, cancer, cerebral palsy, complex genetic disorders and epilepsy. About 14 percent of children nationwide have special health care needs. About a third of those, or 3.6 million children, rely on Medicaid's comprehensive benefit and cost-sharing protections.

"Children have the most to lose in the budget debate if Medicaid takes the brunt of the budget cuts because they make up a disproportionate share of Medicaid beneficiaries," The Hill reports. "Children and youth with special health care have more at stake in the deficit debate than any others."

Family Voices has a Colorado chapter that serves parents and families of children with special health care needs.

Insurance commissioners decline to endorse Rogers bill on medical loss ratios
The National Association of Insurance Commissioners (NAIC) decided this week not to endorse a bill that would remove broker commissions from the calculation for medical loss ratio (MLR). The bill is HR1206, the Rogers bill. NAIC's executive committee made the decision Tuesday despite a taskforce within the organization voting to endorse the legislation. Consumer advocates supported the NAIC decision.

Removing broker fees from the medical loss ratio calculation would weaken the provision of the Patient Protection and Affordable Care Act that requires insurers to spend 80 or 85 percent of premium dollars on the provision of health care services. It would also reduce the amount insurers would be required to return to customers in rebates if they exceed the medical loss ratio.

The discussion about MLRs is not over. NAIC intends to talk to the Department of Health and Human Services (HHS) about regulatory options to limit the financial effect of the medical loss ratio on brokers. Broker groups also intend to seek regulatory action from HHS, including a potential delay of the inclusion of broker fees in the medical loss ratio.

Coverage of the decision is available from The Hill and Kaiser Health News.

Advancing the debate

Preventive care at Colorado's Community Health Centers saves money
Medicaid participants who receive care at Colorado's Community Health Centers are about a third less likely than those with private providers to have emergency department visits, inpatient hospitalizations or preventable hospital admissions, according to a study published this month in Health Affairs.

The study was conducted by the Colorado Department of Health Care Policy and Financing.

"Hospital and emergency room visits are more expensive than primary health care visits, and primary care visits can address health conditions before they become emergencies and can often prevent the need for more costly care altogether," Polly Anderson, policy director of the Colorado Community Health Network said in a news release.

What's next

CCHI hosting forum on the exchange next week
The Colorado Consumer Health Initiative is hosting a town hall meeting on the state's Health Benefit Exchange on July 21 from 2:30 to 4 p.m. at Volunteers of America, 2660 Larimer St. in Denver.

Joan Henneberry, director of the Colorado Health Exchange Planning Grant, will give a brief update about all the various working groups focused on the exchange, as well as future plans for stakeholder engagement. Also invited are exchange experts Lorez Meinhold, deputy policy director to Gov. John Hickenlooper, and Sen. Betty Boyd and Rep. Amy Stephens.

RSVP by July 20 to Chloe Benson at chloe@cohealthinitiative.org or 303-839-1261.

Health Law and Policy Update is issued weekly by the health staff of the Colorado Center on Law and Policy. Subscribe by e-mail or read previous editions.

Health Care Director
Elisabeth Arenales

Health Care Attorney
Adela Flores-Brennan

Special Counsel
Ed Kahn

Communications Director
Perry Swanson

Released July 15, 2011