Senate Health Committee Passes Final Health Reform Implementation Bills
Wednesday, June 30, 2010
HEALTH ACCESS UPDATE Thursday, July 1, 2010
APPROACHING DEADLINE, KEY HEALTH REFORM BILLS PASS SENATE HEALTH COMMITTEE
* Implementation of Health Reform Makes Progress in California * On Last Policy Hearing of Year, Senate Health Advances Bills to Implement Medi-Cal Waiver, Set Up Exchange, Draw Down Federal Funds, Freeze Rates, and Implement Other Reform Provisions
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This week was the last opportunity to get bills out of health committees this session, which led to a marathon meeting of the Senate Health Committee with over 30 bills to be considered. Fortunately, key bills to implement and improve health reform and some other important ones all made it through.
The bills now go to Senate Appropriations Committee, and need to pass out of the full Senate and legislature by the end of August, in order to be considered by Governor Schwarzenegger for signature or veto.
* MEDI-CAL WAIVER: AB 342 (Perez) is the Assembly vehicle for implementing the "Section 1115" Medicaid Waiver, currently being negotiated between the state and federal government. Senator Alquist allowed short testimony of a broader range of consumer advocates and stakeholders than is normally allowed, as most conveyed the importance of the waiver but still needed to present specific issues to be considered in the amending and refining of the bill language. Areas of concern, as discussed in Assembly Health Committee yesterday, remain bringing in adequate federal funding for safety-net health providers, and the need for consumer protections for seniors and people with disabilities being mandatorily shifted to Medicaid managed care plans. Protections that were sought included ensuring (1) network adequacy, (2) accessibility to seniors and people with disabilities, (3) access to specialists, and (4) in-person assessments. The author (represented by Assemblymember Monning, chair of the Assembly Health Committee) and committee agreed to continue working with advocates to ensure these concerns are addressed.
* EXCHANGE: AB 1602 (Perez) is the Assembly bill that would establish the insurance exchange in California, the centerpiece of health reform that would represent a new way for individuals and small businesses to buy health coverage. The discussion was similar to the one that the Assembly committee engaged in yesterday over SB 227. Consumer advocates supported provisions that would allow the exchange to negotiate on behalf of purchasers for the best price and value; that would institute conflict-of-interest provisions regarding the governance of the exchange; and that would include other consumer-friendly policies. This bill, still in progress as many sought additional amendments, passed along party lines.
* OMBUDSPERSON: AB 2787 (Monning) creates an important protection for consumers by establishing an Office of the California Health Ombudsman as a go-to place for consumers--who will largely be mandated to have insurance coverage by 2014--to address grievances and complaints as well as to access consumer information. The bill would allow the state to draw down federal funds available under haelth reform for this purpose. The current consumer assistance system is a fragmented combination of public and private entities, and the new entity would serve as a cohesive and accessible hub for consumer concerns. At the end of the hearing, Senator Romero requested that the term “Ombudsman” be changed to “Ombudsperson”.
* RATE HIKE MORATORIUM: Assemblymember De La Torre presented 3 bills that reform the insurance market. AB 591 (De La Torre) provides protections to consumers by first imposing a moratorium on rate increases above the average increase in the medical care component of the consumer price index, that allow such increases if plans apply to DMHC or CDI to justify such increases, and lastly, prohibits insurers from raising rates more than once per 12-month period. Industry representatives argued that the consumer price index and cost of providing care was only part of the determination of rate increases, to which Assemblymember De La Torre quoted the CEO of Anthem Blue Cross who testified before Congress that the reason insurers needed to raise rates was precisely because of increased medical care costs and the increase in the CPI.
* GRACE PERIOD: AB 2110 (De La Torre) mandates that insurers allow a 50 day grace period before cancelling coverage for failure to pay premiums. Kaiser Permanente’s current policy is to allow for a 50 day grace period, while other insurers policies range from 10 to 30 days. Assemblymember De La Torre emphasized the importance of keeping people covered, and noted that the repercussions for cancelling coverage can be dire – since some individuals who lose coverage may need to pay exponentially higher rates to get it back, while some are never able to buy insurance again, denied for pre-existing conditions. Senator Leno said he was unable to sympathize with the concerns of insurers given the fact that they continue to rake in record profits in the current economy. Senator Romero even asked the opposition to reconsider their position, calling this a modest measure in these economic times.
* NO COST-SHARING FOR PREVENTATIVE SERVICES: AB 2345 (De La Torre) enacts the provisions of the federal health reform law which prohibits insurers from imposing cost-sharing of any type (premiums, co-pays, deductibles) for preventive services. Removing barriers to preventive services is a key component of federal health care reform as it begins to change the way individuals use health care and the way we spend out health care dollars. In addition to foster a healthier population, investing in prevention can reduce the amount of health care dollars spent on treating more serious and more expensive health conditions.
* COMMUNITY TRANSFORMATION GRANTS: AB 2287 (Monning) would, as Assemblymember Monning described it, begin to fulfill his vision of transforming our health care system from its current “broken bodies” focus to a system that centers on health and wellness. The bill would direct appropriate departments to take full advantage of any opportunities to apply for Community Transformation Grants available as part of the federal health reform law.
* PROMOTORES: AB 2354 (Manuel Perez) directs the Department of Public Health to assess grants available through federal health reform law that might support “promotores” or community health worker programs. The “Promotores” model has demonstrated success in using community based health workers to improve health outcomes in a manner that is accessible and culturally and linguistically appropriate. The bill would also require additional evaluation of the efficacy of these programs.
* EVERY WOMAN COUNTS: AB 1640 (Evans) would restore eligibility requirements for the Every Woman Counts Breast and Cervical Cancer detection programs to those prior to cuts made in December 2009. This would allow women in their 40s, who are also at risk for cancer, to be included in the program. Assemblywoman Evans argued that early detection is critical both because early treatment has better outcomes and can be as much as ten times less expensive than treatment at later stages.
The health reform implementation and improvement bills cleared an important hurdle today. As promising was the sheer number of prevention focused bills considered by the committee. The vision that Assemblymember Monning spoke of today, of a world in which our health care system focuses on health and not sickness, is one that many of us share, and one that we have an opportunity to begin to realize through the federal law and those that we are able to enact here in California.
Anthem Blue Cross today announced rate increases significantly lower than their previous request. As you may remember, the state's largest insurer proposed rate increases up to 39%--increases that got presidential level attention during our national debate on health reform. They eventually had to withdraw them when an independent actuarial review of the rate filing was found to have math errors.
The reduction shows that public scrutiny and regulatory oversight matters. When Anthem Blue Cross didn't think their rate hike would be reviewed, they raised rates up to 39% and didn't even bother to check the math. When Anthem Blue Cross knew their rate filing would get public attention and would need to be justified to regulators, they came back with a significantly lower increase.
This episode is Exhibit A in why we need to institute greater rate review and regulation, as the rule, rather than the exception. Bills like Senator Feinstein's rate authority bill in Congress, and measures at the state level like Assemblyman Jones' bill AB2578 for rate regulation, Senator Leno's SB1163 to draw down federal funds for rate review, and other measures.
Advances on the Implementation of Health Reform...
HEALTH ACCESS UPDATE Wednesday, June 30, 2010
KEY BILLS TO IMPLEMENT HEALTH REFORM PASS ASSEMBLY HEALTH COMMITTEE
* Implementation of Health Reform Makes Progress in California * Governor Signs Bills to Set Up Federally-Funded High-Risk Pools
* Assembly Health Advances Bills to Implement Medi-Cal Waiver, Set Up Exchange * Other Bills Would Standardize Benefits, Draw Down Federal Funds for Rate Review * Single-Payer Health Reform, SB810(Leno), Also Advances
* Report Coming Tomorrow on Today's Key Senate Health Committee
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Yesterday was a big day in advancing health reform in California, both legislatively and adminsitratively. Major legislation on implementing and improving reform was reviewed and passed in Assembly Health Committee; a full report is below. As this is a deadline week for bills to pass policy committees, additional bills are being heard today in Senate Health Committee; a report will be forthcoming shortly.
GOVERNOR SIGNS HIGH-RISK POOL BILL: Governor Schwarzenegger signed both SB 227 (Alquist) and AB 1887 (Vilines). establishing the authority and guidelines for a new state-run, federally-funded high-risk pool, consistent with the requirements of federal health care law. Funded by $761 million dollars over the next three and a half years, the new high risk pool will provide health insurance coverage to individuals denied for pre-existing conditions. Coverage would cover at least 65% of a patient's costs, and limits consumers’ out-of-pocket costs. To be set-up alongside the Major Risk Medicaid Insurance Program, the state's existing high risk pool, the new high risk pool will be federally funded but run by the state in order to ensure that the needs of Californians are met by people who are familiar with California.
MAJOR BILLS PASS ASSEMBLY HEALTH COMMITTEE:
The Assembly Health Committee, chaired by Senator Elaine Alquist, considered and approved some expansive bills as well as some more specific ones that would enact significant reforms to the health care system.
* MEDI-CAL WAIVER: SB 208 (Steinberg) is one of two vehicles by legislative leadership for renewing and implementing a new Medicaid waiver, setting rules for the state's Medi-Cal program for the next five year. A new waiver, negotiated between the state and federal governments, would potentially draw down federal funds for both the state's safety-net providers and to provide access to health care for the medically indigent, seniors, and people with disabilities. The waiver is presented as a bridge between the existing Medi-Cal program and the full access expansion that will happen in 2014 as a result of federal reform.
The discussion generally addressed three basic issues with the waiver: (1) the state’s need for federal dollars, (2) expansion of access to care for low-income California through the Coverage Initiatives run by the counties, and (3) shifting seniors and people with disabilities into organized systems of care, including Medicaid managed care plans. Consumer advocates testified to the need for additional consumer protections for these patients, particularly surrounding health plans’ obligation to demonstrate “readiness” to care for the senior and people with disabilities – whether that means beefing up provider networks to insure adequate access to specialists or whether that means insuring that facilities are accessible to those with wheelchairs. Senator Steinberg agreed to continue working with advocates to work out details, and emphasized the importance of coming together with a unified voice in requesting the federal dollars in DC.
* CREATING A NEW HEALTH INSURANCE EXCHANGE: SB 900 (Alquist/Steinberg) is the Senate bill that would set up the insurance exchange as related to the federal health reform law, similar to its Assembly counterpart, AB1602(Perez). Passage of this bill this year will allow for the state to take the necessary time to set up the exchange and be ready to draw down federal subsidies in 2014. Goals of the exchange are to make it easier for consumers to access care by: (1) eliminating risk selection in the individual market, (2) facilitating seamless enrollment mechanisms and administration of subsidies, (3) providing choices between plans and products, and (4) creating an even marketplace with standardized products so that consumers can make informed decisions. Senator Alquist reiterated her strong conviction to creating an exchange that both serves as an active purchaser or rate negotiator and that it is responsive to the needs of consumers.
* STANDARDIZED BENEFITS: SB 890 (Alquist/Steinberg) makes the individual health insurance market more consumer friendly by (1) giving individuals the freedom to change plans, (2) standardizes insurance products to allow for “apples to apples” comparisons, and (3) extending requirements that insurance products cover medically necessary benefits regardless of whether they are regulated by the Department of Insurance or the Department of Managed Health Care. These regulations would ensure that individuals purchasing insurance on the individual market could make informed choices between various standardized plan designs that would cover standard medically necessary benefits. The insurance representatives argued that this bill would prohibit them from designing more affordable products – but failed to point out that their less affordable products often don’t cover the care consumers need. The bill passed on a party line vote.
* SINGLE-PAYER HEALTH REFORM: SB 810 (Leno) also moved out of Assembly Health today with the support of a packed room and overflow gallery. The bill would create a single payer health care system that would cover all California residents. It was met with significant turnout in support. One member of the Gray Panthers testified “I turn 80 this year. I’ve been working on this for 30 years. I hope you pass it.” They passed it despite objections from insurance lobbyists. SB810 is a policy bill, that would allow for the set up of the system. If the bill were signed into law, it would require separate financing.
OTHER BILLS:
* SB 1088 (Price) codifies the federal requirement under health reform law that health plans offering dependent coverage offer coverage to dependents up to the age of 26.
* SB 771 (Alquist) addresses, because “California’s foster children are our children too”, the needs of young adults that age out of the foster care system who either may not have parents, or may not have parents that are able to cover them as dependents under their health insurance policies. Senator Alquist reiterated the importance of providing coverage to young adults because it is often much more challenging for them to qualify for or afford insurance. Federal reform allows young adults aging out of foster care to participate in Medicaid up to the age of 26, but this provision does not go into effect until 2014. This bill would make Medicaid (Medi-Cal) available to these young adults starting January 1, 2011.
* SB 1163 (Leno) would require insurance companies to disclose their rationale for denying coverage, as well as for raising rates. It would require that insurers provide consumers with 180 days notice of rate increases to allow them adequate time to make adjustments or provisions. The bill would also allow the state to take advantage of grant funding available from the federal government for states to set up rate review processes.
* SB 1283 (Steinberg) clarifies existing law and expedites grievances and appeals to the Department of Managed Health Care, ensuring that consumer grievances are addressed in a timely manner.
Tomorrow the Senate Health Committee will meet for the last time this session – and the remainder of the health reform implementation bills will have their shot to move out of committee. Then it’s on to floor votes in August and hopefully, the governor’s desk in September.
BILL FOR READABLE DRUG LABELS STALLS: While several good consumer protection bills did advance yesterday, one bill actively supported by consumer, senior, and community of color advocates stalled yesterday. The Assembly Business and Professions Committee voted to reject AB1390 (Corbett) to require readable prescription drug labels, including 12-point font and the option for translation.
Major bills passed the Assembly Health Committee to both implement and improve health reform today, Tuesday, March 29th.
They include: * SB900 (Alquist), to set up a new Health Insurance Exchange to help Californians get coverage, * SB890 (Alquist), to standardize benefits and provide consumer protections in the individual market * SB208(Steinberg) to implement a new Medi-Cal waiver * SB1163 (Leno), to get federal funds to institute health insurance rate review, * SB1088 (Price) to extend dependent coverage to young adults up to age 26, * SB810(Leno), which starts to set up a universal single-payer health reform
More information and description will be posted shortly...
Bills to Set up new High-Risk Pool Pass Legislature
Monday, June 28, 2010
Today the California Senate voted to pass 2 bills that would set up a "High Risk Pool" for Californians who can not otherwise get insurance due to preexisting conditions.
California currently has a high risk pool that has been severely underfunded, and as a result been unable to serve all of those who need it. It is capped at 7100 Californians, is expensive and has capped benefits, and has a waiting list.
The two bills, SB 227 (Alquist) and AB 1877 (Villines), will draw down $761 million in federal funds, which will allow the state to quadruple our capacity to serve these individuals who have among the highest need for health insurance.
Today’s action by the state legislature facilitates the implementation of yet another component of the federal health reform law and allows tens of thousands of Californians to begin to feel the benefits of health reform.Notably, the implementation of California’s High Risk Pool was the result of a bipartisan effort, with Assemblyman Villines authoring a key piece of legislation, a unanimous vote in the Assembly, and a handful of Republican Senators voting for passage of the bills.
Healthy San Francisco lives! This unique universal health care program has survived challenges from the Golden Gate Restaurant Association all the way to the Supreme Court. Today, the Supreme Court decided not to hear the appeal of the employers, which then allows the Ninth Circuit's decision to stand, to uphold the law.
This action disproves the many skeptics of health reform, who long argued that any attempts at state & local health reform would be pre-empted by the federal law known as ERISA, which regulates employer benefits.
California health reformers were well aware of the constraints of ERISA, when crafting state proposals like SB2, AB 8, and AB x1 1. But they found a path, one that Healthy San Francisco was ultimately able to implement.
It's a good day for San Franciscans, and for health reformers in general.
Another victory! Aetna has withdrawn their proposed rate hikes averaging 19% for patients who pay premiums in the individual health insurance market. Once again, "significant mathematical errors" were found.
This started back when the double-digit rate hikes of Anthem Blue Cross of California got attention during the health reform debate. After basically rubber-stamping them as regulators have customarily done, Insurance Commissioner Steve Poizner then ordered an independent review of the rates, but given the very limited authority given California regulators, few thought it would make a difference. But in fact, the independent actuary found math errors and other problems, leading Anthem Blue Cross, California's biggest insurer, to withdraw the proposed rate increase.
This shows the need for greater scrutiny of all rate filings, and for expansion of rate review and rate regulation. California is eligible for federal funds to conduct more aggresive reviews of rate filings. Earlier this week, the Senate Health Committee passed AB2578(Jones and Feuer) to give California regulators broader ability to approve and reject unjustified rate hikes.
These math problems only add up to one conclusion: we need greater oversight over the insurance industry, and we need it now.
Health Information Exchanges are Coming to California
Thursday, June 24, 2010
California is just starting to spend $38 billion dollars in federal stimulus dollars to set up an electronic exchange mechanism that allows patients, doctors, hospitals, laboratories and specialists to share a patient's health information electronically while preserving and protecting the safety and security of this information. When this electronic health exchange is fully in place, it will mean that health care practitioners will have immediate access to complete, and accurate information about patients' relevant medical history, medications, and tests.
If you or a family member fell ill or had an accident while on vacation away from home, consider how you would communicate in an unfamiliar setting with a new doctor what prescription drugs you were taking, reliably answer general health history questions, describe current health circumstances. If you had to seek emergency medical treatment or were referred to a specialist, you would want the health professionals taking care of you to know quickly what chronic conditions you have, what medications you are taking, what procedures you have undergone, so they can give you the best, most appropriate emergency care, even if they are not your regular family doctor. Health information exchanges would support that kind of access to information to promote good care and limit costs.
Can health information exchanges be a good thing? What are the benefits?
They can help reduce costs because there is less duplication of tests and treatments,
They can avoid medical errors,
They can help to improve the quality of the patient's health care, resulting in better health outcomes,
They can limit adverse interactions among different prescriptions, treatments or tests by different doctors,
They can reduce health disparities among populations,
They can help evaluate the comparative effectiveness of treatments and medical practices,
They can improve the coordination of care,
They can help measure the quality and performance of physicians and hospitals,
They can improve the privacy and security of personal health information, and
They can enable patients to know more about their health status and be a more informed health care consumer.
To ensure we realize those benefits with California's health information exchange, an unprecedented group of leading consumer, health, and civil rights organizations established a set of key principles over the last six months. These principles were designed to guide California's policymakers, providers, and other stakeholders in the implementation of the health information exchange and enable them to assess whether their patients' needs are being met. These organizations include AARP, ACLU, the California Pan-Ethnic Health Network (CPEHN), Consumers Union, The Children's Partnership, The Pacific Business Group on Health (PBGH), and Health Access California, among others.
These principles advocate for the design of the technology and services to meet the needs of all consumers, including people who speak languages other than English or people with disabilities, ensure the privacy and security of patients' health information, prevent the misuse of patient data, promote the greater health literacy among patients, providers, and public health officials, and enforce the protections for patients and specific communities.
We think health information exchanges are a good development, especially as they are set up in California to adopt these consumer-focused founding principles. We look forward to the unfolding of this new era of patient empowerment and access to information--and better, more efficient, and less costly health care.
posted by Elizabeth C Abbott | Permalink | 1:28 PM
Big day in Senate Health on insurer oversight...
HEALTH ACCESS UPDATE Thursday, June 24, 2010
KEY INSURANCE RATE & BENEFIT BILLS PASS SENATE HEALTH COMMITTEE
* Key Bills Would Regulate Rates, Limit Frequency of Rate Hikes, Set Up New High-Risk Pool * Requirements on Maternity & Mental Health Coverage Pass * Another Bill Would Help With Affordable Premiums for Children With Pre-Existing Conditions
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Yesterday was a big day in Senate Health Committee, chaired by Senator Elaine Alquist, as legislators considered a number of key bills to provide new patient protections for California consumers, and especially to implement and improve health reform.
Most of the bills were authored by the Assemblymembers, having passed the full Assembly, with the exception of SB 227 (Alquist), the bill about the "high-risk pool" that was reformulated in the context of federal health reform.
All the key health reform bills considered cleared Senate Health Committeee, some with more ease than others. Below are a selection of those that were debated in committee yesterday:
HELP FOR THOSE WITH PRE-EXISTING CONDITIONS
HIGH RISK POOL: SB 227 (Alquist), in conjunction with AB 1887 (Vilines). establishes the authority and guidelines for a new state-run, federally-funded high-risk pool, consistent with the requirements of federal health care law. The new high risk pool will provide health insurance coverage to individuals denied for pre-existing conditions. Coverage would cover at least 65% of a patient's costs, and limits consumers’ out-of-pocket costs. To be set-up alongside the Major Risk Medicaid Insurance Board, the state's existing high risk pool, the new high risk pool will be federally funded but run by the state in order to ensure that the needs of Californians are met by people who are familiar with California. The bill passed and heads to the Senate floor immediately.
CHILDREN WITH PRE-EXISTING CONDITIONS: AB 2244 (Feuer) “This is about assuring that kids have health care,” Assemblyman Feuer said, presenting this bill for consideration. It requires guaranteed issue of health insurance to children in 2011 and adults in 2014. The bill phases out premium variance so that children newly eligible for insurance pay no more than 120% of the standard risk rate up to 2012 and no more than 110% starting January 1, 2010. Perhaps finding it difficult to argue with assuring health care for kids, the industry representatives opposed to the bill again asked that Senators not take action, and instead await further federal regulations. Democratic Senators supported the bill, indicating they didn’t come to Sacramento to sit on their hands and wait for the federal government on all policy issues.
RESCISSIONS: AB 2470 (De La Torre) President Obama said it, the Congress said it, and countless others echoed one of the most basic mantras of health reform “no one should lose their health coverage when they get sick” – that is what health coverage is for. This bill outlaws the practice of rescissions and establishes an independent review process for health plan decisions to cancel or rescind coverage. In presenting the bill, Senator Gloria Romero described the importance of the independent review process as a recourse for consumers when their plans are cancelled or rescinded, “so that health plans don’t get to act as judge and jury”. The bill passed with the minimum 5 votes needed over the opposition of insurers and of the Department of Managed Health Care, which argued that the independent review process was too costly and didn’t justify the expense for the interim period between now and 2014.
RESCISSION FINES: AB 2540 (De La Torre) The bill prohibits “postclaims underwriting”, the practice of health insurers cancelling coverage retroactively after claims are submitted. The bill increases the fines on insurers who engage in this practice. The bill enjoyed swift passage out of committee.
BENEFITS
MENTAL HEALTH PARITY: AB 1600 (Beall) provides parity for mental health services. It requires health plans and health insurance policies to cover medically necessary treatment of mental illness under the same terms and conditions as physical illness – including maximum lifetime benefits, co-payments, deductibles, etc. The insurers predictably opposed this mandate, and further argued that the bill would impair consumers’ freedom to choose what they wanted to buy. Assemblymember Beall pointed out the an extremely high number of people with mental illnesses end up using public programs and/or funding either through the Mental Health system or by more expensive means – when they end up in emergency rooms or jails. By not covering mental health, insurers are in effect shifting the costs associated with their policy holders to the taxpayers. Beall also made mention to the fact that the bill encompasses drug and alcohol services – which he argued have a positive impact on the economy by improving worker productivity.
MATERNITY COVERAGE: AB 1825 (De La Torre) requires every individual or group health insurance policy to cover maternity services – including prenatal care, ambulatory care maternity services, involuntary complications, neonatal care, inpatient hospital maternity care, labor and delivery, and postpartum care. Senator Negrete-McLeod presented the bill and presented the shocking statistic that right now only 19% of plans in the individual market offer maternity coverage, a sharp decline from the 82% that offered them just 6 years ago. The bill had Blue Shield of California as a supporter, whose representative argued that maternity care to be a fundamental health need. By not covering maternal care, the Blue Shield representative said, insurers undermine the basic premise of insurance – to pool risk related to fundamental health needs. Other industry representatives did not share that view, and urged Senators not to act until further federal regulation was available. Senator Negrete-McLeod spoke on behalf of the thousands of women and children who can not wait until federal law is in full force in 2014, she urged passage of the bill.
INSURANCE RATES
RATE REGULATION: AB 2578 (Jones and Feuer) The legislation requirers insurers to apply for approval before enacting rate increases starting January 1, 2012. Assemblymember Jones explained that this bill would be similar to an extension of Proposition 103, a voter-approved measure that requires state approval for rate increases in auto, home, and casualty insurance. Why, he asked, should health insurance be the exception? Senator Leno emphasized that health insurance is “a matter of life and death” and the voters have already agreed that insurance should be regulated.
The committee heard compelling testimony from Mr Fred Taylor, a small business owner who had provided comprehensive health benefits for his employees and their dependents for over 2 decades. However, Mr Taylor testified, it has been getting more and more difficult to continue to do so with insurance rate increases that went far beyond the rate of inflation 6 years ago his premiums were increased 96% and just this year they went up another staggering 75%. Without any regulation or intervention, he is forced to consider various cost cutting measures and looking at insurance that covers less.Testimony in support also included a range of consumer, labor, and health organizations. It passed committee with five votes.
FREQUENCY OF RATE HIKES: AB 2042 (Feuer) Prohibits insurers from raising rates more than once a year. This bill was on the agenda as “Vote Only” per discussion of amendments last week. It moved out of committee with 6 votes.
DISCOUNTS FOR UNINSURED
FAIR PRICING: AB 1503 (Lieu) requires physicians providing emergency services in hospitals to implement a discount payment policy for qualifying patients. Current law prevents hospitals from overcharging uninsured patients; however that law currently does not extend to the separate bills from emergency room doctors and others that patients get alongside the hospital bill. This legislation requires that emergency room physicians and others offer discounts to uninsured patients up to 350% FPL in accordance with prices determined by the FAIR Health database of physician charges and payments. This bill passed with Senators Alquist, Cedillo, Leno, Negrete-McLeod, Pavley, and Romero voting yes.
We're not the only one who focused on the three-month mark since the passage of health reform. This week, President Obama announced new regulations to implement new patient protections to be in effect later this year.
...today, I’m announcing that the Departments of Health and Human Services, Labor and Treasury are issuing new regulations under the Affordable Care Act that will put an end to some of the worst practices in the insurance industry, and put in place the strongest consumer protections in our history -- finally, what amounts to a true Patient’s Bill of Rights.
This long-overdue step has one overriding focus, and that’s looking out for the American consumer. It’s not punitive. As I said when I met with the insurance executives, it’s not meant to punish insurance companies. They provide a critical service. They employ large numbers of Americans. And in fact, once this reform is fully implemented a few years from now, America’s private insurance companies have the opportunity to prosper from the opportunity to compete for tens of millions of new customers. We want them to take advantage of that competition.
Now, what Americans expect in return is a greater level of accountability and fairness and security. We expect to get what we pay for. And these rights guarantee just that -- basic rules of the road that will make America’s health care system more consumer-driven and more cost-effective, and give Americans the peace of mind that their insurance will be there when they need it -- give Amy that piece of mind that her insurance will be there when she needs it.
So, starting in September, some of the worst abuses will be banned forever. No more discriminating against children with preexisting conditions. No more retroactively dropping somebody’s policy when they get sick if they made an unintentional mistake on an application. No more lifetime limits or restrictive annual limits on coverage. Those days are over.
And I’m pleased to say that some insurance companies have already stopped these practices. When news reports indicated that a company was dropping coverage for women diagnosed with breast cancer, my administration called on the industry to end the practice immediately -- don’t wait until September. And soon after, the entire industry announced that it would comply with the new law early and stop the practice of dropping people’s coverage when they fall ill and need it most.
...But it is important to have these steps in places to protect consumers from unjustifiable rate increases. In fact, many states are already exercising their review authority. We’re already seeing a wave of change that’s lifting up consumers and leveling the playing field. Maine rejected a proposed 18 percent rate hike there. Pennsylvania is investigating premium increases made by nine of the state’s largest insurers. New York recently passed a law granting the state the authority to review and approve premium increases before they take effect. And we’re working with other states and the state insurance commissioners here today to support similar efforts.
Secretary Sebelius has urged them to investigate other rate hikes. We’ve set up a new Office of Consumer Information and Insurance Oversight to help. And we’ll provide grants to the states that run the best, most innovative oversight programs to protect their consumers.
And beginning next year, insurance companies will be required to spend at least 80 or 85 percent of health care dollars where they should be spent -- on health care and on efforts to improve its quality. Not on profits, not on bonuses, not on administrative costs that don’t make people healthier.
“You had me at Poway” and other drama in Assembly Health
Tuesday, June 22, 2010
Assembly Health considered a number of Senate bills today, including SB 971 (Pavley) which sets standards for the handling of blood clotting products. The President of the Poway Hemophilia Society testified in support.Vice Chairman Nathan Fletcher, who represents Poway, supported the bill saying “you had me at Poway”.
Discussion over some of the other bills was less jovial, with consumer advocates, industry representatives, and Members from both sides of the aisle engaged in heated debate over prescription drug labeling, timely access for school children, smoking cessation, and other issues.
SB 1200 (Leno) addresses the issue of timely access to care for children who may need to receive routine care or treatments at school during the school day.Significant numbers of California school children require regular timely access to routine care such as insulin shots during the school day.Currently, Medi-Cal reimburses school nurses or other health professionals for providing those services to children enrolled in Medi-Cal.However, private insurers do not provide any reimbursements for covered services that are provided by school health professionals.Because private insurers are not providing reimbursements for the delivery of these services at the time that they are needed, (that they would otherwise reimburse say, on a weekend), they are in effect not providing these children timely access to care.
Opponents contended that asking insurers to pay for covered services that are provided by school nurses is no more than an attempt to force health insurance companies to contribute to the public school system.Proponents argue that it is not right for insurers to not cover their policyholders as soon as they step foot on the school yard.
The bill passed along party lines and moves on to Appropriations.
SB 1390 (Corbett) attempts to require readable prescription drug labels. The bill would require that drug labels be printed in 12 point font, and that translation services be provided to Limited English Proficient (LEP) patients in order to reduce the devastating human and financial costs that can be associated with misuse or misdosage of prescription drugs. This is a follow up from SB472, an earlier law by Senator Corbett.
Heated debate centered around disagreement over the series of events that led to the current (inadequate) Board of Pharmacy standards for prescription labeling, that were supposed to implement the needs and concerns of consumers as expressed in the stakeholder process for the earlier SB 472.Opponents further argued against providing translated materials to patients due to concerns about accuracy.Assemblymember Strickland claimed that translations could be “wrong,” and that “no one” could possibly verify accuracy of translations.
But sometimes the simplest arguments are the best, and Betsy Imholz from the Consumers Union made it:“Save money, save lives”. SB 1390 also passed along partisan lines.
Other lively debates resulted in close passage of 2 bills by Senator Leland Yee, SB 220 requiring health plans to cover smoking cessation and SB 1106 which would require that patients who get drug samples also receive the same drug information that is provided to patients who get their drugs from pharmacies.
THREE MONTHS SINCE PASSAGE OF NEW HEALTH LAW, CALIFORNIANS BEGIN TO SEE THE BENEFIT, BUT MUCH MORE WORK NEEDED TO FULFILL ITS PROMISE
* New Health Access Report Documents Early Impacts for California Consumers * Many Benefits Coming Online in Next Weeks and Months * State Legislation Pending to Implement and Improve the New Health Law for California
Read Our Health Access Blog for Updates from Policy Committees, Budget News, Etc. Also Join Us on Facebook! Follow Us on Twitter!
Three months ago, on March 23, 2010, President Barack Obama signed the Patient Protection and Affordable Care Act (PPACA), a historic comprehensive federal health care reform law. Through the next ten years, the law will put in place policies to provide new consumer protections and new oversight and rules for insurers; make coverage affordable for individuals, families, and small businesses; and encourage efforts to tame the costs of health care, with benefits for both our economy and our federal deficit.
The PPACA is unique in that some of its provisions are going into effect this year, even as other elements start to phase in over the next several months and years. Californians are already beginning to feel the effects of reform, including getting additional consumer protections from the most abusive insurance company practices; feeling more secure about their current coverage; and receiving help to afford coverage.
Here are benefits from the new health law that Californians are already experiencing.
Making Prescription Drugs More Affordable for Seniors Seniors who currently fall into the coverage gap or “donut hole” in the Medicare Part D prescription drug coverage program have started receiving rebate checks in the amount of $250. California will benefit more than any other state as California seniors who fall into the donut hole spend $381,636 out-of-pocket for prescription drugs. Already, 80,000 checks have been mailed to date, and more will go out as more seniors reach the coverage gap. Approximately 382,000 California seniors will receive checks.
New Coverage Options for Young Adults Some young adults are now newly getting coverage under their parent’s plans. Previously, over 30% of young adults do not have health insurance, while 47% report being uninsured at some point last year. Young adults up to age 26 will be able to remain covered under their parents’ health plans, officially starting after September 2010. Wellpoint/Anthem Blue Cross, UnitedHealth, and other insurers have started to implement this piece of reform early. As important, some California employers such as Apple and many school districts, have also agreed to extend their family benefits to young adults up to age 26 earlier than September.
Security for Californians on Medi-Cal and Healthy Families Over 8 million Californians have more security that they will keep the coverage they have under Medi-Cal or Healthy Families, due to “maintenance of effort” requirements in the new federal law. These prohibit California from cutting eligibility and enrollment in these programs (although cuts are still proposed within these programs.) The law also provides the opportunity for more federal funds for California, as is being negotiated in a new Medi-Cal waiver between the state and federal governments.
Helping Small Businesses Cover Their Employees Small businesses now have an incentive to cover (or continue to cover) their workers. While many small business owners say that they would like to provide insurance to their workers, the cost can be prohibitive. Californians are less likely than Americans in other states to be offered employer based coverage. A 2009 survey of California small business owners, 55% reported that they did not provide coverage for their workers, 97% of them said that they could not afford to. Effective immediately upon passage of the health reform law, small businesses were able to take advantage of tax credits up to 35% of premiums.
The Ending of Unjustified Rescissions On April 28th, the association of health insurers wrote to Congress indicating they would move by May 2010 to stop the practice of rescissions, where coverage is retroactively denied even after the patient had been paying premiums for months. Rescissions had already decreased in California due to increased media and regulatory oversight, but the federal law sets an even higher standard for any insurer to revoke coverage based on problems in the patient’s initial health questionnaire. While the federal provision goes into effect in September, insurers indicate they are abiding by the new law now.
Rate Hikes Start to Get More Scrutiny Leading up to passage, the health reform debate spotlighted the proposed rate increases of up to 39% by Anthem Blue Cross of California. That led to the California Department of Insurance conducing a more vigorous, independent review of the company’s filing, which revealing various errors that led the Anthem Blue Cross to withdraw those rate hikes. This benefit may be duplicated soon: Insurance Commissioner Poizner is conducting independent review of rate hikes of other major California insurers. And the federal government has announced grants to states ($1 million to start) to help states conduct further reviews of insurance rates. There are other benefits already online as well, such as tax credits for small biotech firms for biomedical research for therapeutic discoveries for cancer and other diseases.
Coming Attractions
The next benchmark date for implementation of federal health care reform is September 23, 2010. At that time a whole host additional provisions will go into effect. But even before that, Californians will start to feel additional benefits, from new options and protections to new funding for key services and programs.
New Information to Assist Consumers Choosing Coverage On July 1st, the U.S. Department of Health and Human Services is slated to unveil a new and evolving website that will help consumers figure out their current (and future) choices in the health insurance marketplace. Later this year, the Department will release funds targeted to help consumers navigate the health care system, and provide ombudsman services. Over the next several years, California will set up a new Health Insurance Exchange will provide a more consumer-friendly market for health coverage.
Guaranteed Issue for Children with Pre-Existing Health Conditions Insurers announced compliance with the federal prohibition on insurers denying children with pre-existing conditions access to their parents’ insurance, or denying treatment associated with the preexisting conditions. An estimated 576,500 children in California have pre-existing conditions. This provision (which is required to go into effect by September 23, 2010) will help ensure coverage for vulnerable children and protect their families from medical debt and bankruptcy due to medical bills.
New Options for Adults with Pre-existing Health Conditions An estimated 6.5 million Californians under the age of 65 have preexisting health conditions, and up to 396,000 have been denied coverage from insurance companies at any cost. Up to $761 million in federal dollars will be available to California to cover adults with preexisting conditions through 2014 when guaranteed issue regulations and the health insurance exchange goes into effect. This would be a quadrupling of the capacity of our current high-risk pool, limited to 7,100 people and $40 million of funding. California’s Managed Risk Medical Insurance Board (MRMIB) is working on creating a federally funded high-risk insurance option for those who have been denied coverage due to preexisting conditions.
Help to Businesses for Covering Early Retirees Slated to start as early as this week, a new reinsurance program will provide financial assistance to employers and union-based plans around the country, to assist in the costs of covering early retirees ages 55-65, retroactive to the start of the program. Reinsurance has been successfully used by a number of states to lower premiums for small businesses. Savings for the plans will be required to be used to lower costs for the enrollees.
Resources for Clinics, Workforce Development, Prevention Efforts, and More The U.S. Department of Health and Human Services has announced grant programs worth millions of dollars in investment, including in support for community clinics; $250 million in efforts to increase clinicians and other primary care providers; and $250 million in strategies to encourage health and health prevention, including funding public health infrastructure, research and tracking, and public health training. This is all on top of investments made in the economic recovery act of last year. As the process moves forward, California communities and institutions will be the recipient of hundreds of millions of dollars of these funds in the next few months.
Federal Incentives for States to Review Insurance Company Rates Insurance rate increases in California received national attention during last year’s health reform debate. On June 7, 2010 the Department of Health and Human Services announced a grant program that would provide grants in the amount of $1 million to innovate, improve and enhance their efforts to review insurance company rate increases. In the first round of funding, states have access to $1 million in start up costs to create mechanisms for reviewing insurance company rate increases. A second round of grant funding will be available starting fiscal year 2011.
Insurance Regulations that Protect Consumers Insurance practices that put profits before people have left millions of Californians unable to receive necessary health care, or with medical debts that have led to personal bankruptcy and home foreclosure. Five important regulations impacting existing insurance plans (including those who may benefit from certain “grandfather clauses”) that go into effect on September 23, 2010 are: * Insurers will be prohibited from imposing a lifetime limit on coverage. * Insurers will be prohibited from cancelling or rescinding coverage when beneficiaries get sick or when mistakes on applications are discovered (rescissions). * Insurers providing dependent coverage must extend coverage to children up to the age of 26. * Insurers are prohibited from denying coverage to children under the age of 19 with preexisting conditions (applies to the large employer market) * Insurers will adhere to a cap on annual limits on coverage as a first step toward the prohibition of annual limits in 2014 (applies to the large employer market)
Additional protections that go into effect for new insurance plans are: * All recommended preventive services must be provided with no cost sharing. * Additional protections such as the right to choose Primary Care Providers, Pediatricians, access to Ob/Gyn services without referrals, and access to emergency services out of network.
Implementing and Improving Health Reform in California
The work to fulfill the promise of the health reform law in California has just really begun, with legislation and regulations to both implement and improve upon the federal law. Here in California, the legislature has already begun work on a series of bills that would implement and improve upon the federal health care reform law at home.
* Creating a Consumer-Friendly & Transparent Individual Insurance Market. Both legislative leaders have bills to implement health reform, including ones to set up a new health insurance exchange in California, and Governor Schwarzenegger has indicated he is interested in signing such a bill. AB 1602 (Perez) and SB 900 (Alquist/Steinberg) would establish a new health insurance exchange, and health advocates want to ensure that it is transparent, consumer-friendly, and allows the exchange to negotiate for the best price and value for the families in it.
* Setting Minimum Standards. Federal health reform sets some basic standards for coverage, so that consumers have the security of knowing their coverage will be there for them when they need it. SB 890 (Alquist/Steinberg) goes beyond the minimums and standardizes and simplifies the individual insurance market, so that consumers can understand their coverage choices, make apples-to-apples comparisons, and have the security that coverage does not have hidden loopholes, or lifetime and/or annual caps on coverage. Other bills put in place federal coverage standards early, allowing are market to better transition to reform. AB 786 (Jones) also sets a minimum standard that requires coverage of doctor and hospital care and an overall limit on out-of-pocket costs, eliminating deceptive “junk” insurance. AB 1825 (De La Torre)requires most health plans to cover maternity services. AB 1600 (Beall) requires most health plans to provide coverage for the diagnoses and treatment of a mental illness.
* Children’s Coverage: Several bills focus on different aspects of children’s coverage. While federal law prohibits children with pre-existing conditions to be denied coverage by insurers, AB 2244 (Feuer) also limits premium increases based on health status, phasing in modified community rating for children under age 19 in the individual market. SB 1088 (Price) would align state law with the federal law in requiring group health, dental, and vision plans to allow dependent children to continue on their parents’ coverage through age 26. AB 2477 (Jones) would, as required to get federal fund, prevent the state from adopting mid-year status reports in Medi-Cal that serve a barriers to continuous eligibility for children 19 years of age and younger.
* Providing Access for Those with Pre-Existing Conditions: Two bills, SB 227 (Alquist) and AB 1887 (Villines) would authorize California’s MRMIB to apply and get the $761 million in federal funding for the purpose of the state establishing a new “high-risk” pool for Californians who are denied for pre-existing conditions. Also, AB 2490 (De La Torre) would implement the federal law regarding rescissions, including establishing a third party review of any insurer’s attempt to retroactively deny coverage on grounds of intentional fraud.
* Regulating Insurance Company Rates: Federal law encourages greater rate review, and AB 2578 (Jones) would require approval by the Department of Managed Health Care or the Department of Insurance of an increase in the amount of premium, co-payment, coinsurance, deductible or other charges under a health plan. SB 1163 (Leno) would allow the state to apply for funds to institute rate review in California.
* Other Consumer Protections: * SB 56 (Alquist) to facilitate public health insurance options by authorizing county-organized health plans to form joint ventures. * SB 316 (Alquist) to institute a stronger medical loss ratio like in federal law, to ensure premium dollars go to patient care rather than administration and profit. * AB 2042 (Feuer) to prohibit insurers and HMOs from increasing premiums, cost sharing or benefits more often than once a year. * AB 2110 (De La Torre) to extend the grace period for paying premiums, so late payers don’t find themselves uninsured and uninsurable. * AB 2787 (Monning) would draw down federal funds to establish the Office of the California Health Ombudsman to educate consumers on their rights and responsibilities with respect to health coverage, assist consumers with enrollment in health care coverage, and resolve problems getting premium tax credits.
Conclusion
While the biggest changes from the federal health reform law don’t kick in until January 2014, Californians are already beginning to feel the first benefits of the new law, and many more improvements to the state’s health system will come online in the next weeks and months.
California has much to do to take advantage of the opportunities and challenges of the new health reform law, both in the transition and then to fully take advantage of the 2014 implementation--from the new rules preventing insurers from denying patients due to pre-existing conditions, to the dramatic expansion of coverage to over four million Californians through fully-federally funded expansions of Medi-Cal, and the new availability of affordability subsidies for low- and moderate-income families.
Health Access will produce future reports to update on the progress, to both inform Californians about what they may be entitled to, and to alert policymakers to additional actions needed to implement and improve health reform, all toward the goal of an improved and more affordable health system.
This week, we'll mark the three-month point since the March 23 signing of the Patient Protection and Affordable Care Act (PPACA), and we'll have lots about the impact it is already having, and the benefits to come.
This and other accounts are important history and a great read, but I fear such inside reports may downplay the importance of the work done on the outside--the years of work to get health reform as a top concern, the leadership taken by key organizations and the selfless stances taken by key groups, the grassroots organizing by many across the country--to get this done. I hope that as this history is written, those components are taken into account and given their due.
But leadership matters, and it is instructive that this would not have happened without Speaker Nancy Pelosi, Senate Majority Leader Harry Reid, and in particular, President Barack Obama. Cohn downplays how much Obama was committed to health reform as a candidate--from his work in the Illinois legislature as chair of the health committee, to his decision to invest more than half of his fall advertising on health issues.
But Cohn confirms part of an incredible story: how President Obama stuck with health reform against the advice of the majority (if not most, if not all) of his advisors, on at least three separate occasions: * After his winning the White House, but when others argued that given the economic crisis and other issues, health reform would take too much attention; * After the August where so-called "tea party" activists worked to disrupt Congressional town hall meetings; and * After the Scott Brown election in Massachusetts, which left the Senate below 60 votes and many members spooked about moving forward with reform; In each of these moments, he was urged to abandon the effort to reform the health system, or significantly scale it back. But he stuck with his guns, and led the Congress to go with him.
Regardless of some policy disagreements along the way, the President and the White House deserve credit for sticking to the effort, as Californians start to see the benefits roll out.
Many advocates and industry representatives attended the public board meeting of the Managed Risk Medical Insurance Board yesterday as they debated and discussed what one important new feature of the federal health care reform legislation would look like. And we have tentative details, some of which were reported in the Sacramento Bee by Carrie Peyton Dahlberg.
Although California has had a high risk pool for many years, it has not provided much of an alternative for people who could not purchase health insurance. That is because the California pool was expensive to enroll in, would only permit enrollment of 7,100 Californians (out of estimates of California's "uninsurable" population of as many as 300,000 people), and had annual limit of $75,000 that could be paid for benefits per enrollee per year. Considering that Californians who wanted to enroll in the high risk pool had not been able to buy insurance, often because they had a pre-existing condition, it would be very easy to spend the annual cap on payments to pay for treatment of many chronic, but serious conditions or any acute episode of care that involved specialists and lengthy hospitalizations.
That's why there has been such interest in finding out the new rules under federal health care reform for the federal high risk pool. In addition, this program would be one part of the transition to the health care reform measures that start in 2014, such as the exchange where individuals and small businesses can purchase good health care coverage at competitive prices. There are lots of questions to be answered and the federal rules for the states have yet to be issued (and even the authority for California to operate a federal high risk pool is pending in the legislature.)
However, at the public meeting yesterday, the California approach became clearer. The Managed Risk Medical Insurance Board (who also administer the California Healthy Families Program for low income children) considered alternative approaches and the details of what the plan would look like. Here's what they settled on from among nine options: their initial decision was a choice to offer a plan that has a $1500 calendar year deductible with the enrollee required to pay for 15% of covered charges as co-insurance. There would be an out-of-pocket limit each year of $2500 that the consumer had to pay. But there would be no annual or lifetime benefit limits.
And here's the good part:they took a typical consumer who lives in San Francisco who belongs to California's high risk pool to compare pricing. That hypthetical person now pays $915 a month for pretty limited insurance in the high risk pool; when this starts under the federal rules (expected to be late summer, early fall this year) they would pay $575 a month. That means a reduction of $340 less per month for better benefits. While there would be better coverage at a lower cost, the amount of money set aside for this program would cover many more people--although not everyone who would be eligible in the state. But it's be some good steps foward.
Everyone should stay tuned as details emerge and the authority is granted by the legislature for this program to start. It's a good first step for all Californians!
In order to ensure that health insurers are charging accurate rates to their individual customers, Commissioner Poizner announced today that any rate change filings by top health insurers will undergo an additional level of actuarial analysis as part of the California Department of Insurance's regulatory review.
"My job as Insurance Commissioner is to ensure that consumers get treated fairly and charged accurate prices," said Commissioner Poizner. "When we retained an outside actuary to review Anthem Blue Cross' rate filing, we found that Anthem had attempted to increase its rates by 50 percent more than state law allows. By subjecting insurer rate filings to this additional level of scrutiny, California consumers will know that all major insurers are adhering to the state's requirement that 70 percent of premiums are spent on medical benefits."
The top health insurers in the individual market are Anthem Blue Cross, Aetna, Health Net, and Blue Shield and cover approximately 90% of the individual health insurance market.
When these insurers file new rates, their filings will be reviewed by outside actuaries. This review is similar to the review of Anthem Blue Cross conducted by Axene Health Partners (AHP), which uncovered significant errors. Currently, AHP is reviewing filings by Aetna and Blue Shield.
This is not the same as a full rate review, much less authority to approve and disapprove rates. For that, we still need to pass bills like AB2578, Assemblyman Dave Jones' rate regulation bill. However, this additional scrutiny is a welcome step in the right direction, and just might turn up the errors that were found in Anthem Blue Cross' filings.
The Senate Health Committee met today to consider a number of Assembly bills. Two bills related to health reform implementation sparked the most robust discussion.
AB 1887 (Villines) is one of 2 bills that would help draw down $761 million in federal funding for a new "high risk" pool. The high risk pool would be administered by MRMIB, and would serve individuals who can not otherwise buy insurance due to pre-existing conditions. The new program serves as a temporary solution until 2014, when federal health reform will require guaranteed issue for adults, regardless of their health status.
Leslie Cummings, Executive Director of MRMIB testified that creating a state high risk pool would allow us to utilize the experience we have gained running MRMIP (the existing high risk pool, the Major Risk Medical Insurance Program) and to be more responsive to the needs of California. AB 1887 passed out of committee on a partisan vote and moves on for a floor vote next week.
AB 2042 (Feuer) limits insurer's ability to raise premiums more than once a year. Insurers attribute annual increases to increased costs, but then frequently give consumers "birthday presents" in the form of age-based increases. The industry argues that steady increases throughout the year protect consumers from "rate shock" they might experience as a result of just one big increase per year. Assemblymember Feuer made the case that limiting increases to once a year provides stability and predictability to consumers and allows them to prioritize and plan their spending, which is especially important in tough economic times. AB 2042 was held pending some technical amendments and will be up for vote without presentation in the next committee meeting.
Senator Elaine Alquist had two bills on the agenda at today’s Assembly Health Committee meeting, SB 56 (Alquist), facilitating joint ventures between country health plans, and SB 227 (Alquist) regarding the temporary federal high risk pool in California, for those denied with pre-existing conditions.
Senator Alquist explained that SB 56 would provide better, more affordable choices to Californians, by allowing county-based plans to integrate and/or offer regional or statewide networks. With their cost-effective provider networks these plans use, and their very low levels of overhead, these local, public health plans have the potential to be a viable coverage alternative for the uninsured. The bills specifically clarify the ability of these county health plans (LA Care, San Francisco Health Plan, Alameda Alliance for Health, etc.) to form joint ventures to serve the uninsured.
Jim Gross representing the county health plans indicated that it would allow them to provide "competition in the marketplace." Beth Capell of Health Access California, said there was a "natural evolution" that parents of children in the Healthy Families plan, for example, could also enroll in the county-based plans that some children are in. She also pointed out this could allow patients in these plans to be able to access providers in other counties, especially if they live in one county but work in another. Willie Pelote, AFSCME, indicated that this concept has been developed over several years in California, and it now is ripe under health reform. Others in support included Planned Parenthood, Congress of California Seniors, and Californians for Disability Rights. The motion was passed with 11 votes and the bill will now move to Appropriations committee.
Next, Senator Alquist brought forth SB 227, which works in companion with Assemblyman Villines’ bill, AB 1887, to set up a federally-funded high risk pool. Senator Alquist indicated that there was $761 million available for the state of California to help cover those denied for pre-existing conditions, through 2014 (when insurer will no longer be able to make such denials.)
Lesley Cummings, executive director of the Managed Risk Medical Insurance Board (MRMIB), which runs the current state "high-risk" pool, spoke first on behalf of the Administration in support of the bill. She said that for the last 18 years California has had a high risk pool, it has been “woefully underfunded,” and she looks forward to the new resources.
Beth Capell testified next stressing the importance of getting the system operational as soon as possible, as federal funds will start to become available on July 1, 2010 (and will be available through Jan 1, 2014). Gary Passmore, of Congress of California Seniors remarked that this bill would be the bridge to health reform in 2014. Other testimony includes CA Hospital Association, CA Medical Association, CA Association of Health Plans, Alzheimers Assocaition, AARP, HealthNet, CA Chronic Care Coalition, Californians for Disability Rights, Academy of Family Physicians, and others.
Assemblyman Jones, fresh off his election as the Democratic nominee for insurance commissioner, added his voice of support as a co-sponsor, and his gratitude to Senator Alquist for “stepping up to the plate.” Chair Monning also thanked the Senator for her work, as well as, everyone else working on implementation. After the bill was passed with a motion of 10 votes and will now move on to the appropriations committee.
Thanks to Nellie Price and Beth Capell for their report from committee.
After a disastrous final ruling last week by the Board of Pharmacy basically gutting an earlier law of hers, Senator Ellen Corbett announced today new legislation to create consumer friendly, readable, prescription drug labels.
Senator Corbett has amended Senate Bill 1390 to require pharmacies to provide language assistance to patients who have limited English proficiency, and use labels printed in a minimum 12 point font size, the suggested standard by the National Association of Boards of Pharmacy.
Medication errors are among the most common medical errors, harming at least 1.5 million people each year. According to the Journal of the American Medical Association, 46 percent of adults cannot understand the information listed on their prescription drug labels.
In 2007, Senator Corbett authored Senate Bill 472, which authorized the Board of Pharmacy to establish patient-centered prescription drug labeling in California. The law required the Board to hold public hearings and implement standards. Despite overwhelming public comments in favor of larger type face, the Board last week adopted regulations for 10 point font, with only the request for 12 point--regulations that do nothing to increase consumer safety.
“The Board had an opportunity to set a national standard for consumer protection. They demonstrated that they are willing to put the pharmaceutical companies’ interests ahead of consumers,” said Senator Corbett. “They may not have heard the public, but I have, and that is why I am introducing this legislation.”
Health Access California was proud to be at the press conference, along with many of our board members who have led on the issues, including the California Pan-Ethnic Health Network (CPEHN), California Alliance for Retired Americans, Consumers Union, California Immigrant Policy Center, and others. “Over 40 percent of Californians speak a language other than English at home, and over 20 percent do not speak English well,” said Marty Martinez, policy director for the CPEHN, a statewide multicultural health advocacy organization. “With our state’s linguistic diversity, we need strong legislative leadership to ensure that all Californians, regardless of the language they speak, are able to receive written instructions about their medications that they can read and understand.”
Senate Bill 1390 will require that by January 1, 2011, pharmacies must provide translation services either in person or through a third party translation service. It will also require that by July 1, 2012 pharmacies must print labels in at least 12 point font.
As amended, SB 1390 will require pharmacies to provide both written and oral translations for all of the materials they provide to patients by January 1, 2013.
While the Board of Pharmacy staff originally suggested regulations requiring 12 point type, the proposal was reversed after Governor Schwarzenegger appointed a new member to the commission who represent the pharmaceutical industry, which tipped the balance of the board.
“California consumers shouldn’t have to read the fine print when it comes to lifesaving medications,” said Betsy Imholz, special projects director, Consumers Union. “Experts and more than a thousand members of the public have spoken in letters to the Pharmacy Board – a minimum 12-point type is what’s required for readability on drug labels. California should respond to this unanimous opinion and lead the way by requiring 12-point type without vulnerable patients having to make a special request for it.”
A Calitics post by Robert Cruickshank shows that voters once again voted to support revenues to fund basic services, whether education, health care, or other needs, in a series of local votes.
It's worth reading, but I have some factual clarifications for the article:
* "Under one scenario, California would be left without a social safety net. The most vulnerable would be most hurt." - This isn't "one scenario...," this is the Governor's one and only budget proposal, to be the only state in the nation to eliminate its welfare-to-work program, and a range of other services. Readers of this blog know the full devastation, to both health and human services.
* "This is a negotiating position: with pension reform, the starkest cuts could be spared.." - Whatever the merits or drawbacks of his pension proposals, it would not have any impact in the budget year. This is Governor Schwarzenegger, as he does on many things, using the budget situation to hold the state hostage for other policy goals.
* "Raising taxes during a recession will slow economic growth, he tells me, just when it is starting to pick up a little. He acknowledges that he had to raise taxes last year -- that was when the deficit was $60 billion." -Cutting services, especially those matched by federal dollars, has a far greater economic impact than any tax increase. -Actually, he cut taxes--the vehicle license fee--as his first act in office., creating a structural budget hole we've had since. Undoing this act (and not having the debt created by this cut) would have solved $6-8 billion of the current budget hole. - Despite making the structural budget deficit bigger through permanent tax cuts (including a few billion more in new corporate tax loopholes--in the middle of the budget crisis!), he says he raised revenues--but in fact, they were temporary. So in the long term, he leaves a more out-of-whack budget for California.
It is true that all states went through an awful economic downturn, and California was more impacted than other states. But even considering that national context, the Governor's legacy on the budget is not pretty.
Today the Budget Conference Committee made the first pass through the health part of the budget. The Conference Committee, chaired by Senator Denise Ducheny, works to reconcile the budgets approved by the Assembly and the Senate.
In many cases the two budget had already agreed--most notably, on rejecting the worst of the proposed cuts to Medi-Cal, like the limits on prescriptions and doctor visits for Medi-Cal patients--and so those items were not discussed. (Those proposals are still in the Governor's proposal, and without revenues, those items could be reinserted in final negotiations, but they are not in the current working proposals in the legislature.)
As is often true, this was a first review that left unresolved most of the differences between the Assembly and the Senate: the conference committee will return to these issues later in their deliberations, perhaps next week, perhaps the week after.
Issues resolved:
* Mandatory enrollment of seniors and people with disabilities into Medi-Cal managed care: The committee voted to book savings from this proposal, which is being discussed as part of the Medi-Cal waiver in health policy committees later in the month. The budget item provoked a long discussion where Senator Ducheny said that mandatory enrollment of SPDs into managed care is existing law, from trailer bill language last year. Governor Schwarzenegger's Department of Finance pointed out that Medi-Cal continued to grow at 8% per year and both houses had rejected $500 million in cuts proposed by the Governor. Senator Leno asked about the "standards that will be used to improve care and reduce costs," asking about whether we were going to require people in wheelchairs to go to doctors that were not accessible? He also asked what was the definition of medical home? Assembly Democrats asked if booking the savings were "boxing in" the policy committees before they had finalized the policy proposals but after discussion about whether the savings were an accounting device that did not affect the policy decisions, the conference committee adopted the savings.
* The California discount prescription drug program, which has never been implemented dur to lack of start-up funding, was delayed again another year. The two budget disagreed on when to sunset the program altogether. It was decided to extend the sunset to the year 2015, after the implementation of federal health reform, to evaluate its need then.
Issues left open, that is unresolved:
* Funding for staff to implement the 1115 Medi-Cal waiver. * Extending the hospital provider fee for six months. * Rate freeze for hospitals retroactive to Jan. 1, 2010: This provoked considerable discussion about the vulnerability to litigation. * 10% rate reductions for public and private hospitals. * Medi-Cal eligibility processing: There was a long discussion about methodology for funding county eligibility workers. Apparently Medi-Cal enrollment is up by 1.5 million people while funding for county case workers has remained flat or declined. * Community clinic funding: Both the Assembly and Senate included $10 million in funding for EAPC. The Assembly included an additional $25 million for EAPC, American Indian clinics, migratory worker clinics, and rural clinics--funding that was line-item vetoed by the Governor last year. Assemblyman Blumenthal said they were "resolute" on this funding, given that they felt the Governor went beyond the cut that was agreed upon last year. The Administration made a point about the $1.4 billion in new federal funding for clinics over the next 5 years. Ducheny called clinic funding “the most useful money we spend” but in a difficult budget, she suggested they leave the item open, which they did.
Thanks to Beth Capell for her report from the committee...
Will health reform be an issue in the elections this fall?
According to Democrats, it will be... as a positive, as a way to draw a favorable contrast with those who opposed reform and now seek to repeal it. Here's a new TV ad from the Democratic Party that puts the case starkly:
In California, where the Field Poll confirmed that supporting health reform is the majority position, it will be interesting to see if those Congressional Representatives that opposed health reform will embrace the "repeal and replace" agenda, or if they hedge their opposition. This will be most interesting to see any evolution of opition for the Republicans running for statewide office--gubernatorial candidate Meg Whitman and Senate candidate Carly Fiorina--who have previously endorsed "repeal" positions.
Health care reform will soon provide new options: California is set to get $761 million to help Californians who are "uninsurable," although that is probably a fraction of what is needed until 2014, when insurers will no longer be able to deny coverage.
I am participating in a "LIVE CHAT" online at NOON TOMORROW, Friday at ContraCostaTimes.com/live-chats. I'll be joined by Patrick Johnston, president and CEO of the California Association of Health Plans, so it should be a lively conversation. Join us!
As I write this, the Budget Conference Committee of the California Legislature is now meeting and discussing proposed Medicaid cuts, working to reconcile the proposals from the Assembly and the Senate. We'll have a report later today.
Also, the process involving the Medicaid waiver is also moving along quickly. While the Administration released proposed trailer bill language, the legislature will be considering the matter through a policy process, with the Speaker and the Senate President Pro Tem using their spot bills: AB342(Perez) and SB208 (Steinberg), respectively.
The administration has also submitted a new, more detailed proposal to the federal Centers for Medicare and Medicaid Services (CMS). We expect this new, more formal draft of a waiver proposal to be posted this afternoon on the DHCS website, at: http://www.dhcs.ca.gov/provgovpart/Pages/WaiverRenewal.aspx
Last week's passage of key state health reform implementation legislation mostly focused on the bills--SB900 and AB1602--setting up the California exchange, the new purchasing pool where many Californians--especially those not getting coverage through large employers--will be getting their coverage. California may well be the first in the country to pass a law, post-reform, to create an exchange, in accordance with the new federal law.
But health reform's transformation of how individuals buy coverage should not solely be within the exchange. Many of the consumer protections--from prohibiting denials for pre-existing conditions to setting standard benefits--need to be in the overall market for individuals and small businesses who purchase coverage. In this vein, SB890(Alquist/Steinberg) address the structural flaws in the overall individual market.
Right now, buying coverage as an individual is complex and confusing: it is impossible to know what a plan covers and doesn’t; it is impossible to make apples-to-apples comparisons between plans.
This bill, SB890, implements many of health reform’s consumer protections early, from a strong medical loss ratio so premium dollars go to patient care rather than administration and profit, to basic benefit standards, including maternity coverage.
By standardizing the benefits in the insurance market, consumers can make real apples-to-apples comparisons, forcing insurers to compete on price and quality rather than avoiding sick people. It ensures people know the kind of coverage they are buying, and what that plan actually covers. It prevents consumers from finding out too late that what their ailment isn’t covered. It prevents the worst forms of "junk" insurance, where patients are paying premiums and finding little value in return.
This reform has broad support, from consumer groups like Health Access California, but also including the Medical Association, Hospital Association, and insurers like Kaiser Permanente who believe they can compete under the new rules of reform.
How is this different from bills from previous years, like SB1522 (Steinberg) or the still pending AB786 (Jones)? It builds on the experience in Massachusetts and with Medi-Gap: it has ten specific products, five HMO and five PPO, rather than broad categories. Why? To prevent insurers from using the design of products to select healthier consumers and to discourage consumers with chronic conditions. Think about two similar products, one with generic only drug coverage and one with comprehensive drug coverage. Guess which one the healthy people buy? And which one people with asthma, diabetes, heart disease, etc buy?
Despite what opponents will say, standardizing the benefits actually enables choice. Focus groups and other research shows that too many choices, especially that are complex and poorly understood like the existing marketplace, is paralyzing for the consumer. There's no basis for choice, especially when there are so many variables that are different, and even the terminology is different with distinct definitions.
Standardizing the benefits allows consumers to make meaninful comparisons and choices between health plans from different companies--from Anthem Blue Cross to Aetna to Kaiser--and make a real choice, based on price and quality.
Health reform helps move away from a world where insurers compete based on avoiding taking care of sick people. What SB890 does is take a step to help us closer to the world where they compete based on providing the best value, lowering costs, and encouraging health and prevention.
with a background as a consumer advocate and community organizer on many issues, including health issues for the last ten years in California and New Jersey.
