Health Law and Policy Update
Headlines of the week
Premium tax credits will benefit nearly half-million Coloradans
Tax credits to help families afford health insurance will benefit an estimated 493,900 Coloradans when they go into effect in 2014, according to a report issued Monday by Families USA.
The credits will be available to uninsured individuals and families with incomes between 133 and 400 percent of the federal poverty level. For a family of four, that's 2010 annual income of $29,325 to $88,200. The tax credits will be refundable, so even families with no tax liability will get help paying for premiums.
The Families USA report estimates two-thirds of tax credit recipients in Colorado will be in families with income of 200 percent to 400 percent of the federal poverty level.
Two influential think tanks last week issued a plan to reduce the federal deficit that includes reducing premium tax credits created under the Affordable Care Act. An analysis by the Center on Budget and Policy Priorities finds that plan would jeopardize health reform. See details in the item below.
Federal judge rules Affordable Care Act constitutional
The Affordable Care Act's requirement for most people to buy insurance starting in 2014 is within Congress' authority because a decision not to buy insurance could affect interstate commerce, a federal judge in Michigan ruled Thursday.
The judge dismissed a lawsuit challenging the constitutionality of the individual mandate to buy health insurance. At least 15 challenges to health care reform are pending in other courts, The New York Times reported.
Kaiser and Rocky Mountain only plans offering child-only policies
The Colorado Division of Insurance said Wednesday it is ready to help families seeking child-only policies in the state, pointing to the two remaining health insurance companies that offer the products.
Several companies quit offering child-only policies Oct. 1, blaming a provision of the Affordable Care Act that prohibits them from denying coverage to children with pre-existing conditions. The move was perplexing to health advocates, who pointed out companies are still allowed to charge more to cover sick children and that dropping all child-only policies also hurts healthy kids. The companies maintained their position even after Insurance Commissioner Marcy Morrison announced emergency regulations providing for an open-enrollment period, which would discourage parents from waiting until their children get sick to seek coverage.
The Division of Insurance issued a statement highlighting the two health insurance companies that continue providing child-only policies: Kaiser Permanente and Rocky Mountain Health Plans.
"If there are others out there who still plan to offer these child-only policies, we'd like to hear about it, so we can refer consumers to them," Morrison said.
Meanwhile, State Sen. Morgan Carroll, D-Aurora, last week said she is considering legislation to compel insurance companies to offer child-only policies, the Denver Business Journal reported.
Some companies delay compliance with Affordable Care Act
The Obama administration has granted waivers to about 30 insurance companies nationwide that allow the them one-year exemptions from some provisions of the Affordable Care Act, The New York Times reported Thursday.
The waivers allow the companies to delay compliance with new rules that phase out annual limits on coverage. Without the waivers, some health plans said their premium rates would rise dramatically and some companies said they might decline to offer health coverage to their workers.
Senator seeks details about McDonald's insurance plans
A kerfuffle erupted this week over a report that McDonald's might drop health coverage offered to 30,000 employees unless the company gets an exemption from a provision of the Affordable Care Act.
McDonald's and the White House said the story, which originally appeared in The Wall Street Journal, was untrue.
According to the report, McDonald's said its insurer cannot meet the Affordable Care Act's requirement that 85 percent of premium dollars be spent on health care, while the rest can go to items such as administration, advertising and profits. The share of premiums spent on care is known as the medical loss ratio.
Despite the company's denial, U.S. Sen. John Rockefeller, D-W.Va., is seeking more information about health insurance policies at McDonald's, according to CQ Politics. Rockefeller has said careful monitoring of medical loss ratios is important for protecting health insurance consumers.
A shorter take on Amendment 63
The Colorado Center on Law and Policy this week released a shorter version of its analysis of proposed Amendment 63, including new analysis of the amendment's potential effects on universities.
Amendment 63 might prohibit Colorado's public universities from requiring their students to maintain health coverage. That could jeopardize funding for student health services and campus mental health services generally.
The longer version of the brief remains available. That analysis found Colorado's Amendment 63 is the most extreme among similar proposals in other states.
7 new Colorado companies enroll in the Early Retiree Reinsurance Program
More Colorado companies are enrolling in the Early Retiree Reinsurance Program, a part of the Affordable Care Act that helps companies and unions maintain health coverage for people age 55 and older who are not yet eligible for Medicare. The program allocates $5 billion nationwide to reimburse participants for medical claims for early retirees and their spouses, surviving spouses and dependents.
Twenty-three companies with Colorado operations have signed up so far. The list includes seven new participants as of an update Oct. 1: Ball Corporation, Chevron Mining Inc., IHS Inc., Rocky Mountain UFCW Unions and Employers Health Benefit Plan, United Launch Alliance LLC, University of Colorado Health and Welfare Trust, and Woodward Governor Company.
Advancing the debate
Deficit-reduction plan could undermine health reform
A deficit-reduction plan published last week by two influential think tanks would jeopardize health reform by driving up the cost of premiums in health insurance exchanges, according to a paper the Center on Budget and Policy Priorities released Wednesday.
Researchers at the Brookings Institution and the New America Foundation wrote the deficit-reduction plan. It calls for reducing health insurance subsidies to moderate-income people participating in the exchanges (to be set up in 2014) and increasing the age of eligibility for Medicare from 65 to 67.
Tax credits created in the Affordable Care Act to help low- and moderate-income families afford to buy health coverage from the exchanges are a key part of making health insurance affordable. That's a foundational principle in the Affordable Care Act, and it's essential to carrying out another of the measure's main features: a mandate that everyone have insurance. Making insurance more expensive would result in more people going without coverage, which would drive up the cost for those who have coverage and cause even more people to leave the insurance marketplace.
Raising the age of eligibility for Medicare would compound the problem, the Center on Budget and Policy Priorities said. People who otherwise would have received health insurance from Medicare will be forced to seek insurance in the exchanges. Insurance companies would be likely to raise rates on everyone to compensate for the additional cost of providing care to older consumers.
What you can do
Schedule a presentation on health reform
Health reform can be confusing. The health staff at the Colorado Center on Law and Policy is ready to help community groups, medical professionals, lawmakers and others understand the complexities of health reform and how it will roll out during the next few years. Please contact us to schedule a presentation.
Health Care Director
Health Care Attorney
Released Oct. 8, 2010