Health Law and Policy Update
Headlines of the week
Governor proposes delay in provider payments
In an effort to address an additional budget shortfall of $261.7 million in the current fiscal year, Gov. Bill Ritter is proposing a three-week delay in payment to Medicaid fee-for-service providers.
The delay will be spread across three months by implementing one-week delays in April, May and June. The proposal would result in one-time savings of $55 million. A one-month delay in Medicaid managed care payments is expected to yield another $15 million in savings (virtually all of Medicaid mental health is run through managed care, and a small number of Medicaid clients are enrolled in managed care for their physical health as well).
The distinction between fee-for-service and managed care is probably something most Medicaid consumers do not know exists; it matters for providers. The delay will be a delay in the usual amount of time it takes the government to pay a claim after it is submitted for reimbursement.
Three CU regents announce opposition to Amendment 63
Three University of Colorado regents announced Tuesday they oppose Amendment 63 because it could shut down student health services provided at state colleges and universities.
It's just one of many reasons to oppose Amendment 63, a complex, costly and partisan measure that would have none of its intended effects but could severely damage Colorado's ability to ensure residents have access to health care.
For details about the regents' position, read the release on the Colorado Deserves Better website.
Alec Harris of the Colorado Center on Law and Policy was featured on KMGH Channel 7 this week pointing out the cost of lawsuits that would likely follow passage of Amendment 63.
Unscientific survey projects 14 percent insurance cost increases
An unscientific survey found Colorado businesses are expecting their insurance costs to increase 14.4 percent on average next year, The Denver Post reports.
The survey of 143 businesses was conducted by Lockton, an insurance brokerage. Both the amount of a premium and the amount of the burden shouldered by the employee have both increased substantially since 1996.
Insurance rate increases result from many factors including medical inflation, claims, administrative costs and policy changes. The share of rate increases attributable to national health reform is just 0-4 percent, according to the Colorado Division of Insurance.
One important component of the Affordable Care Act (ACA) gives states the ability to monitor and regulate unjustified rate increases. Colorado requires prior approval of rate increases and has expanded its capacity to conduct reviews of proposed rate increases through grants under the ACA, including $1 million awarded recently. Unjustified increases can be denied or refunded to policy holders. Another check on costs is regulation of each company's medical loss ratio, which goes into effect next year.
What's new
29 Colorado companies enrolled in the Early Retiree Reinsurance program
The Affordable Care Act created the Early Retiree Reinsurance program that offers assistance to companies and unions to help them maintain health coverage for their retirees older than 55 who are not yet eligible for Medicare. A handful of Colorado companies and unions have recently been approved to receive federal assistance through the program.
Advancing the debate
In times of budget shortfalls, cutting Medicaid eligibility is not a desirable option
Restricting Medicaid eligibility might look like a tempting way to bridge Colorado's budget shortfalls, but that move would be both fiscally irresponsible and harmful to many Colorado families that need care.
A provision of the Affordable Care Act prevents Colorado from changing Medicaid or CHP+ eligibility rules to make them more restrictive. The provision is effective until 2014 for Medicaid and 2019 for CHP+. Colorado could lose all federal Medicaid funding, about $2 billion, if it made eligibility more restrictive. The requirement helps maintain coverage for those who have it while health reform is being implemented. Thus, it is not possible for Colorado to limit the number of people who are eligible for Medicaid in an effort to reduce program costs.
Under federal reform, Medicaid is the foundation for expanding health care to low-income citizens and legal residents making less than 133 percent of the federal poverty level (about $29,400 for a family of four). Medicaid provides comprehensive benefits at little or no charge, which is extremely important given the low income of Medicaid beneficiaries and their generally poorer health. Medicaid and CHP+ enrollment have performed a vitally important role during the Great Recession by absorbing large numbers of low-income uninsured Coloradans. Ninety-six percent of the cost of expanded eligibility will be covered by the federal government.
Colorado's current eligibility threshold for Medicaid is 100 percent of poverty for children ages 6-19 and parents, and 133 percent of poverty for children younger than 6. Pregnant women and children are eligible for the CHP+ program up to 250 percent of poverty. Nondisabled adults without dependent children are not served by Colorado's Medicaid program, but they will be included in 2012 when Colorado expands eligibility to 100 percent of poverty for that group.
Aurora Sentinel: No good can come from repealing health reform
A sternly worded editorial from the Aurora Sentinel this week made some excellent points about continuing talk of repealing the Affordable Care Act.
"Conservative lawmakers are hugely mistaken if they believe that the country can take any more of the same when it comes to relentless health-care price hikes and service reductions. Something had to give, and giving the health-care industry a break on malpractice reform wasn't going to cut it," the editorial said.
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 Oct. 29, 2010