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Health Law and Policy Update: More Coloradans have health insurance

This week's updates

Headlines of the week

More in Colorado have health insurance, new Census Bureau figures show
More Coloradans have health insurance despite rising poverty across the state, according to numbers the U.S. Census Bureau released Tuesday. The Colorado Fiscal Policy Institute, a project of the Colorado Center on Law and Policy, released a fact sheet noting some of the significant numbers. Among the findings:

  • The share of people lacking health insurance in Colorado, known as the state's rate of "uninsurance," decreased 2.4 percent from 2006-07 to 2009-10. That includes a 5.1 percent decrease in the rate of uninsurance for children.
  • Medicaid has played a key role in expanding health coverage, increasing enrollment to an additional 4 percent of the state's population since 2006-07 and to an additional 7.2 percent since the beginning of the decade.

"And yet some in Washington want to slash Medicaid, which would make it even harder for children to get the care they need, for people with disabilities to get help that allows them to live independently, and for many of us to see a doctor when we need to," said CCLP Executive Director Christine Murphy said in a news release. "That's the wrong way to reduce the deficit. Now more than ever, we need to protect programs that are working as intended to catch those who would otherwise be left behind in these recession-ravaged times."

Federal court in Pennsylvania rules parts of health reform unconstitutional
A federal district court in Pennsylvania ruled this week three provisions of the Patient Protection and Affordable Care Act are unconstitutional: the individual mandate, the guarantee issue provision and the prohibition on denying coverage to people with pre-existing conditions. The court upheld the remainder of the law.

It is the only court to rule specific provisions of the act other than the individual mandate are unconstitutional. The ruling continues a mixed record in federal cases on the nation's health reform law. Two federal appeals courts have upheld the law (the 6th Circuit on the merits and the 4th Circuit on procedural grounds); and one federal appeals court, the 11th Circuit, found the individual mandate unconstitutional but upheld the remainder of the act. Three federal district courts have said the individual mandate is unconstitutional, and one of those (Florida) said the entire act is invalid. Three federal district courts have found the mandate and the act constitutional.

In the Pennsylvania case, Judge Christopher Conner wrote the Commerce Clause of the U.S. Constitution does not authorize the imposition of a lifetime requirement to purchase health insurance. He also said the individual mandate is so integrally linked to two key provisions of the act- the guarantee issue provision and the prohibition on denying coverage for pre-existing conditions - that those provisions are also invalid. In part, his reasoning is based on his analysis that the individual mandate is a partial funding mechanism for insurance companies so they can reasonably comply with the two provisions.

"Absent the individual mandate ... enforcement of these guarantee issue and preexisting condition exclusions will likely drive insurers from the market threatening the stability of the health insurance market," ," Conner wrote.

The individual mandate is important in structuring a guarantee issue requirement and eliminating pre-existing condition exclusions. If people can jump in and out of the marketplace when they get sick, they have less incentive to purchase health insurance when they are well. Insurance depends on spreading risk; you pay in now and take out when you get sick. If everyone with insurance is sick, plans may run out of money to pay claims. On the other hand, Congress eliminated pre-existing condition exclusions for children without an individual mandate. That provision of the act took effect last fall, and the mandate does not take effect until Jan. 1, 2014.

Initially, a number of Colorado companies pulled out of the individual child marketplace as a result of the requirement, but three nonprofit health plans -- Rocky Mountain Health Plans, Kaiser, and the San Luis Valley Health plan -- stayed in. A bill passed this past legislative session structuring the market so that most plans felt they would be able to participate going forward.

Based on the experience with child-only plans in Colorado, it is possible to require the elimination of pre-existing condition exclusions without an individual mandate. If the Pennsylvania case is appealed, it would be heard in the 3rd Circuit Court of Appeals.

In the meantime, since three federal appellate courts have now ruled on the act, the health reform law is likely well on its way to review by the U.S. Supreme Court.

What's new

Bills in Congress would strip health reform protections
Debate continues in Congress over attempts to strip some consumer protections included in the Patient Protection and Affordable Care Act. Among the efforts, H.R. 1206 would gut the health law's requirement governing the share of premium dollars spent on medical care and quality improvement, the medical loss ratio (MLR). Another measure, H.R. 2207, would completely eliminate the medical loss ratio provision in health reform.

Former health insurance executive Wendell Potter posted a blog this week about his recent testimony before Congress on the MLR provision. He also discusses proposed legislation, not yet introduced, that would prohibit enforcement of provisions related to grandfathered health plans and therefore allow them to remain exempt from certain insurance reforms in the law.

Currently, some plans in existence at the time health reform passed can retain a grandfathered status, meaning certain insurance reform provisions in the law do not apply until significant changes are made to the plan. Under the proposed legislation, the prohibition on enforcement means grandfathered plans would never have to comply with certain reforms such as the elimination of annual and lifetime limits, the ability of a parent to cover an adult child as old as 26, the prohibition on rescissions and the prohibition on charging more for people with pre-existing conditions.

Exempla Lutheran physicians file new reply in case challenging hospital transaction
Seven Exempla Lutheran physicians challenging the Exempla Lutheran transaction have filed a reply brief with the Colorado attorney general last week. Earlier this year, they challenged the transaction whereby Community First Foundation ceded control of the Exempla to Sisters of Charity of Leavenworth Health Systems. Details were reported in the Aug. 26 edition of Health Law and Policy Update.

Advancing the debate

Study gives Colorado high marks for long-term support services
Colorado ranks near the best in the nation for its long-term services and supports for older adults, people with physical disabilities and family caregivers, according to a scorecard issued Sept. 8 by The Commonwealth Fund.

The study ranked Colorado No. 7 among the states and the District of Columbia. The study measured affordability and access, choice of setting and provider, quality of life and quality of care, and support for family caregivers. Minnesota ranked No. 1 in the study, while Mississippi performed the worst.

The effects would be considerable if Colorado improved to the level of the best-performing state. Under that scenario, the study estimates:

  • 9,260 more low- or moderate-income adults age 21 and older with activity-of-daily-living disabilities would be covered by Medicaid.
  • 1,695 more new users of Medicaid long term support services would first receive services in home and community based settings instead of nursing homes.
  • 1,944 nursing home residents with low care needs would instead be able to receive long term support services in the community.
  • 436 unnecessary hospitalizations of people in nursing homes would be avoided.

Health reform reduces costs for Medicare recipients, new data show

Nearly half of Colorado's Medicare recipients this year have taken advantage of free preventive care provided for in the Patient Protection and Affordable Care Act, according to data the Centers for Medicare and Medicaid Services (CMS) released Sept. 8.

In addition, more than 14,000 Coloradans on Medicare have received a 50 percent discount on brand-name prescription drugs when they hit a gap in drug coverage, saving a total of $7.7 million so far this year. The discount is part of the health reform law's move to close the "donut hole" in Medicare prescription drug coverage.

"These new benefits are encouraging patients to talk to their doctors about their care, and to get the preventive services they need," CMS Administrator Donald Berwick said in a news release.

What's next

Boomers Leading Change upcoming volunteer orientation
The advocacy group Boomers Leading Change is calling on baby boomers who want to become involved in health care access issues to attend an orientation session set for 1 p.m. Saturday. The session will be followed by a presentation on the impact of poverty on health care access by Tracey Stewart, program manager of the Colorado Center on Law and Policy's Family Economic Security Program. Details are on an event flier.

What you can do

Schedule a presentation on health reform
The experts on our health team are ready to help community associations and other groups sort out the complexities of health reform. A key issue now is creating the Colorado Health Benefit Exchange, and structuring it in a way that benefits consumers. To schedule a presentation, contact Health Care Program Director Elisabeth Arenales.

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

Rice Fellow
Danny Rheiner

Communications Director
Perry Swanson

Released Sept. 16 , 2011