Health Law and Policy Update
This week's updates:
- CHP+ premium bill, which would hurt children, advances to governor
- New law requires child-only health policies
- State exchange bill passes House, heads to governor
- Groups defend Medicaid against cuts
- Examining state options for administering Medicaid
- Proposal would let states restrict Medicaid and CHIP eligibility
- Consumer-friendly labeling of health coverage considered
- How insurers influence health reform regulations
- What you can do
Headlines of the week
CHP+ premium bill, which would hurt children, advances to governor
The Colorado House this week adopted a measure that would add monthly premiums to the Child Health Plan Plus (CHP+) program for families with incomes between 206 percent and 250 percent of the Federal Poverty Level. Senate Bill 11-213 is on its way to the governor. The Colorado Center on Law and Policy opposes the bill for three reasons:
- An estimated 20 percent of children in the effected income group, almost 2,500 kids, will drop off the program, losing their health insurance coverage.
- The Department of Health Care Policy and Financing (HCPF) has said it is unable to reprogram the Colorado Benefits Management System to accommodate the change for 18 months. To do so earlier would disrupt the current schedule of changes, many of which are necessary, they say, to improve timely and accurate delivery of benefits to eligible people.
- Making the change would be expensive and administratively burdensome. According to HCPF, it will cost the state money. To the extent any savings are realized, it's as a result of moving children out of insurance coverage.
The bill is bad for the state, and bad for kids. We'll keep you posted on the governor's decision.
New law requires child-only health policies
Health insurance companies that offer individual policies in Colorado will be required to provide at least one child-only benefit plan under a bill Gov. John Hickenlooper signed April 29. Senate Bill 11-128 came in response to many insurance companies exiting the child-only market last year. That move was an attempt to avoid compliance with a provision in the Patient Protection and Affordable Care Act that prohibited insurance companies from denying coverage to children with pre-existing conditions for new plans issued after Sept. 23, 2010. Only Kaiser Permanente, Rocky Mountain HMO and San Luis Valley HMO -- all nonprofits - continued to offer child-only plans following implementation of the requirement.
The Colorado Division of Insurance on Thursday announced an emergency regulation to implement SB11-128 titled Mandatory Open Enrollment Periods for Carriers Issuing Child-Only Plans.
"The new law provides a structure so that Colorado children have options and can purchase individual health insurance," said Interim Insurance Commissioner John J. Postolowski said in a news release. "The emergency regulation provides specific guidance about child-only open enrollment for the remainder of 2011."
This year, the open enrollment period for child-only polices will be Aug. 1 to 31. For subsequent years, the legislation sets the open enrollment periods for child-only policies to the months of January and July. Coverage obtained during an open enrollment period becomes effective 30 days after the end of the open enrollment period. More information about child-only policies is on the Division of Insurance website.
Coverage of the insurance companies' abandonment of child-only policies was in the Sept. 3 edition of Health Law and Policy Update.
State exchange bill passes House, heads to governor
While the Colorado House of Representatives voted in favor of Senate Bill 11-200 creating a Colorado Health Benefit Exchange, the U.S. House of Representatives voted to repeal funding to state-based health insurance exchanges in yet another effort to undermine the federal health reform law. Health insurances exchanges are an important coverage component of health reform. The exchanges will be competitive marketplaces where consumers can easily compare and shop for health coverage. Under federal health reform, the exchanges will also be where eligible consumers can access premium tax credits that will help make coverage more affordable.
Colorado's bill passed on third and final reading in the House on Wednesday. The Senate concurred with House amendments and re-passed the bill Thursday. The bill now goes to the governor for his signature.
Groups defend Medicaid against cuts
Families USA and nearly 150 other groups sent a letter to Congress asking members to resist attacks on Medicaid including a spending cap or converting it to a block-grant program. The text of the letter:
We, the undersigned organizations, urge you to oppose proposals that arbitrarily cut Medicaid and shift a fiscal burden to the states. Ultimately, the proposals would transfer the burden to seniors who depend on the program for long-term care, people with disabilities, communities of color and low-income women, children and families.
Such harmful cost shifting includes (1) converting the program to a block grant; (2) setting a cap on overall federal spending that inevitably results in reducing federal Medicaid spending over time; and (3) rolling back protections that currently ensure health coverage is not diminished. These cost-shifting proposals have little or nothing to do with containing health care spending. Rather, they simply shift the risk to states as health costs go up - and subsequently move the burden onto the shoulders of those who are least able to bear it.
We recognize the need to make responsible decisions about reducing the deficit. But capping Medicaid or converting the program into a block grant is not a real solution. Shifting the costs from the federal government to states and families does nothing to address the underlying problem of rising health care costs overall. We are eager to work with you to find smarter, more efficient ways to respond to budgetary problems.
Examining state options for administering Medicaid
A new paper from the Kaiser Family Foundation sets out the policy considerations around core federal requirements and state options in administering Medicaid. The paper is timely as many states are considering adjustments to their Medicaid programs to address budget concerns. Medicaid will expand considerably in 2014 as a provision of the national health reform kicks in that requires a minimum eligibility threshold of 133 percent of the Federal Poverty Level.
A complete restructuring of Medicaid by turning it into a block grant program is one of many highly irresponsible proposals in a federal budget proposal introduced last month. The Colorado Center on Law and Policy examined that proposal in detail in an issue brief.
Proposal would let states restrict Medicaid and CHIP eligibility
Companion measures introduced in the U.S. House and Senate this week would repeal a provision of the Patient Protection and Affordable Care Act that requires states to maintain eligibility standards for Medicaid and the Children's Health Insurance Program (CHIP). The result would be more people becoming uninsured as states scale back eligibility for low-income children, parents, seniors and people with disabilities,
"Repeal of the maintenance-of-effort provision also would slow economic growth and job creation," the Center on Budget and Policy Priorities said a Feb. 24 paper.
The health reform law says states must maintain current eligibility standards for Medicaid for adults until Jan. 1, 2014, and for children in the CHIP program through Oct. 1, 2019. The provision is meant to ensure people don't lose insurance while the law is being implemented.
Kaiser Health News compiled a roundup of news coverage of the proposal. The Colorado Center on Law and Policy discussed the July 22, 2010, edition of Health Law and Policy Update. A paper from Georgetown University Health Policy Institute Center for Children and Families also discusses the issue.
Consumer-friendly labeling of health coverage considered
In an effort to help consumers understand the costs and terminology associated with purchasing health insurance, federal health reform requires new so-called coverage facts labels. Various formats for the coverage labels are being considered and consumer-tested. Two of the proposals are on the Kaiser Health News website, and an article from that organization explains more.
The labels will be two pages long and included at the end of the new, easier-to-understand benefits summary consumers will receive when purchasing insurance. The labels will provide pricing for three health scenarios (maternity care, diabetes care, and breast cancer) based on national averages and allow purchasers to make comparisons using a standard format.
How insurers influence health reform regulations
In a blog post this week, former health insurance executive Wendell Potter raises questions about the very strong health insurance industry effort to influence regulations implementing the Patient Protection and Affordable Care Act, and the effect that might have on consumer access to care.
Health Care Director
Health Care Attorney
Released May 6, 2011