Implementing Commercial Insurance Market Aspects of Federal Health Reform:

1
Implementing Commercial Insurance Market Aspects
of Federal Health Reform

• A State Perspective
• Christopher F. Koller
• Health Insurance Commissioner, State of RI
• April 30, 2010

2
Overview

• What we are doing now
• What we need to be thinking about for the future
• States Challenges and Needs

3
Issues Now

• High Risk Pool Grants (5 billion 2010-2013)
• For individuals who currently do not have
  coverage and have a pre-existing condition
• Challenges for states without high risk pool and
  for guarantee issue states
• Commercial Insurance Reforms (Plan years 6 mos.
  after enactment)
• No lifetime limits First-dollar coverage for
  preventive services
• No rescissions Appeals process
• Dependent coverage up to 26 years of age
• No Pre-existing Condition Exclusions for Children
• MLR standards. Rate Oversight
• Challenges Reg promulgation process,
  communications, fit with existing statutes,
  implementation, other mkt impacts. Resources
• Grants for State Ombudsman
• National Web Portal

4
Key Reforms 2014 Implementation

• Market Reforms
• Guarantee Issue and no Pre-existing Condition
  Exclusions in all markets
• Rating Reforms limiting factors to age (31),
  geography, tobacco use and family composition
• 4 Coverage Tiers based on coverage categories and
  cost-sharing
• No annual limits
• State-Based Exchanges for Individual and Small
  Group markets that will provide standardized
  information on insurance choices and help
  consumers enroll in plans

5
State Action for Long Term Reforms

• (Stages of Grief)
• Interagency Planning Groups
• DC Monitoring (use of Membership Assocns)
• Stakeholder Education and Communication
• Exchange Planning
• Goal setting
• Commercial and Medicaid interaction
• Operations
• Eyes on the prize Long term vision for local
  delivery systems (the cost issue) payment
  reform, HIT, benefit design etc.

6
Small Group Premium Variation
NH
VT
WA
MT
ND
MA
NY
OR
RI
SD
ID
MI
CT
WY
NJ
DE
IN
IL
NV
UT
CO
CA
DC
NC
OK
AZ
NM
AL
HI
TX
FL
AK
Rating Band Variability
Community Rating
131 or less
Adjusted Community Rating
13.11 191
No Rating Structure
19.11 251
Note Michigan HMOs and Blue Cross/Blue Shield
are restricted to 3.121 maximum variation. All
others may use 3.96 maximum variation
25.11 or greater
7
Individual Market Rating Rules
WA
MT
ND
MA
OR
ID
SD
RI
CT
WY
NJ
DE
NV
UT
CO
CA
DC
OK
AZ
NM
HI
TX
AK
No Rating Structure
Community Rating
Adjusted Community Rating
Rating Bands
Hybrid Michigan Blue Cross/Blue Shield must use
community rating. There is no rating structure
for other carriers.
8
State Needs and Challenges

• Federalism made real Coming into compliance from
  tremendously different starting points technical
  and political issues.
• Grandfathering of old plans (see briefing
  sheet). Enormous implications good politics
  bad policy.
• New Federal Partnerships - HHS OCIIO.
• Competence is crucial.
• New roles
• Communication and expectations with local
  stakeholders
• Resources Resources Resources