Health Insurance and You!

During the past few months, we have covered the story of the Community Living Assistance Services and Supports (CLASS) program, health reform’s program for long-term care insurance. While it was being debated and in the months following its enactment, various groups and analysts expressed doubts about whether the program could pay for itself. (Last year’s health overhaul required CLASS to be solvent for at least 75 years, explains Igor Volsky of Think Progress). Last October, echoing those worries, the Obama administration decided to drop the program.

Now, the formal repeal of CLASS is proceeding through the legislature. In November, the House Energy and Commerce Committee voted in favor of repeal. And yesterday, writes Sam Baker of The Hill, the House Ways and Means Committee voted the same way. The next step is a House floor vote, which will take place next month.

While Congressional Republicans are largely against the program and the health reform law in general, Mr. Baker says, Democrats say that CLASS targeted a serious problem – the fact that most Americans are unprepared for the expenses of long-term care – and that while this particular program was not viable, the government should continue to search for an alternative that is more financially sound.

Although CLASS was dropped, not everyone supported its outright repeal, Mr. Volsky elaborates. Many of those who supported the intent of the program were against its repeal, arguing that it could instead be modified and its financial model strengthened. But those in favor of repeal believe that it needed to be removed formally and legally, rather than simply abandoned, Mr. Baker writes.

Neither home care nor nursing home residency are covered by Medicare. While CLASS is no longer an option for those who may need long-term care, a variety of affordable long-term care insurance plans are available on the individual market. If you’re interested, our reference page on long-term care is a good place to get started.

During the past couple of weeks, much public attention (and TV airtime) has been devoted to the Republican Party debates. Kaiser Health News has compiled videos and transcripts of the candidates discussing health care and health insurance issues, and below, we use those resources to summarize what each candidate had to say. In alphabetical order:

Newt Gingrich

• On health cost control: Former Speaker Gingrich supports the Ryan/Wyden health bill, which expands consumers’ options for Medicare. He would also push for improved surveillance of health criminals, citing data that Medicare and Medicaid lose $100 billion per year to theft.

Jon Huntsman

• On health cost control: Gov. Huntsman agrees with Paul Ryan’s budget, which would cut the budget by about $6.2 trillion over ten years and would affect all programs, including Medicare and defense. He also supports means-testing for entitlement programs, including Social Security and Medicare, among the wealthiest Americans.

Ron Paul

• On contraception: Rep. Paul explains that the Fourth Amendment protects’ privacy, which can be extended to contraception, and the Interstate Commerce Clause protects the right to sell contraceptives across state lines.
• On health insurance: Paul believes that seniors should have the same variety of health coverage that other adults have – including a similar range of comprehensiveness and cost. Later in the same debate, Paul distinguishes between entitlements and rights, stating that the only type of right is the one to liberty.

Mitt Romney

• On contraception: Gov. Romney states that no state wants to ban contraception, and that he can’t imagine any state doing so. As to whether states have the right, he does not know and considers the question irrelevant. However, he does believe that the Supreme Court should overturn Roe v. Wade, the landmark 1970s abortion case.
• On health cost control: Romney supports shrinking the size of government and its spending in order to reduce costs. By cutting health reform, he says, the government would save $95 billion per year and businesses would save as well.

Rick Santorum

• On contraception: Sen. Santorum believes that while privacy is protected under the Constitution, Roe v. Wade is not about privacy and should be overturned.
• On health cost control: Santorum supports means-testing for entitlement programs such as and reducing subsidies for the wealthiest Americans. He also believes that in order to reduce dependency, food stamps, Medicare, and housing programs should no longer be entitlements, and should instead be managed by the states as block grants. Beneficiaries should be required to work and should only receive benefits for a limited time.
• On health insurance: Santorum has supported health savings accounts for many years, in order to make the private sector health care system more “bottom-up” and consumer-based. He cites the Medicare Advantage program and Medicare Part D, which have transformed Medicare, as more examples of the premium support model he believes in.

See video and transcript on contraception (ABC News/Yahoo debate).

See video and transcript on other issues (Meet the Press debate).

Whether or not Supreme Court cases should be televised has been debated many times over the years. And since the Bush vs. Gore presidential election case in 2000, no Supreme Court case has had the level of public interest as the fate of 2010’s Affordable Care Act, for which five and a half hours of oral arguments were recently scheduled for March 26-28 of this year.

Now that the arguments have been scheduled, speculation has sprung up again about whether the case will be shown on TV. Recent surveys show the public leaning towards yes. One poll by USA Today and Gallup, reports Joan Biskupic of USA Today, found that 72% of respondents supported allowing cameras for the health reform arguments, with a majority supporting broadcast of Supreme Court arguments in general. Similarly, writes Joe Palazzolo of the Wall Street Journal’s Law Blog, a poll of the blog’s readers found that 55.6% favored televising the arguments.

So what are the issues at stake? Those who support televising Supreme Court cases, which include some members of Congress and media leaders, say that it would educate the public and encourage interest in what the Court does. Being able to see cases in their entirety, rather than reading someone else’s summary, would allow individuals to interpret the arguments on their own. Proponents also mention that written transcripts and audio recordings of oral arguments are already available soon after they take place – and in some states, video.

Those who don’t want the health reform case broadcast argue that televising one case would put pressure on the Court to televise other cases. They also worry that politics would enter the picture, and that choice sound bites that don’t necessarily show the whole picture would be taken out of context. Having a camera in the room may change the dynamics between Supreme Court justices, who will know their every move is being watched. In addition, some say that televising arguments would go against the constitutional separation of powers.

As of now, C-SPAN and 46 other media organizations have requested that the Supreme Court allow the case to be broadcast. The Court has not yet responded.

Readers, what is your take on this issue? Should the health reform arguments in March be televised? Should all Supreme Court cases be shown on TV?

Online health insurance exchanges run by the states and federal government are a key part of health reform. But how will these exchanges work? Will an online interface make it easier to enroll, manage your account, and find providers?

Here’s your chance to find out. GetInsured.com, along with several other companies, has developed sample modules for Minnesota’s state-based exchange, designed to give you a sense of what the exchange will look like and an opportunity to offer feedback. As the Minnesota Department of Commerce mentions on its module testing website, the exchanges will allow you to:

• For individuals – determine eligibility and enroll
• For small businesses – determine eligibility and enroll
• View the options and costs of various health plans
• View a list of certified brokers and navigators
• Find information on doctors and hospitals
• Aggregate and pay premiums
• Administer your account

We’ve developed sample modules for individual and small business eligibility, broker and navigator lists, and information on providers. Our demo isn’t fully functional, so you can’t use it to actually enroll in coverage, but we hope you’ll get a good taste of what we’re planning.

So, readers, we urge you to try it out. And please let us know what you think, either in the comments below or through the demo’s survey. Our goal was to create an exchange that is comprehensive, easy and quick to use, and maybe even educational and fun. Did we succeed?

More on the online demos, from Elizabeth Stawicki of Minnesota Public Radio:

• 12/5/11: Minnesotans can test drive health care exchanges starting Monday [text]
• 12/5/11: Health exchange demonstrations online for public review [audio and text]

Last year’s health reform law included a provision that required health insurance companies to spend at least 80% of their income from premiums on medical care and improving quality, with the remaining 20% (or less) for profits and other categories. Insurers that didn’t meet this requirement, known as the medical loss ratio (MLR), had to give back the extra money to their customers.

But what counts as medical care and quality improvement, and what falls under administrative costs? Until this month, insurance brokers and agents had tried to persuade federal officials to exempt their fees from the administrative category. They argued that if insurers cut agent and broker fees, agents could lose their jobs and potential customers would have less access to the experts who help them choose the plan best suited to their needs. Consumers and their advocates disagreed, saying that these fees are by nature administrative and that counting them as medical care would not be fair to consumers who should be receiving rebates.

According to an article by Julie Appleby of Kaiser Health News, the federal officials agreed with the consumers. On Friday, they issued a ruling stating that agent and broker fees won’t count as medical care. In addition, the rebates from insurers who don’t meet the MLR will not be taxed, and so should be issued in the form of lower premiums or another form that is not taxable. Employers receiving rebates will be tasked with using the extra funds in a way that benefits their employees.

Readers, what do you think? Should agent and broker fees count as administrative costs? Would reducing access to brokers have negative effects on the health of plan members?

When the economy is weak, as it is today, luxuries and other extras are usually the first items to be taken out of a family’s budget. Fortunately, according to the results of a recent study, it appears that families don’t count children’s health insurance among those extras; they see it as a necessity.

In fact, children’s health insurance coverage has gone up quite a bit in the past three years.  A report released Tuesday from Georgetown University’s Health Policy Institute found that between 2008 and 2010, the number of uninsured American children went down by 14%, or about one million. Thirty-four states had significant declines in the rate of uninsured kids, and seven had significant increases.

Among the key findings, gleaned from the report’s executive summary and an article on the study by Kelli Kennedy of the Associated Press:

• During the recession, the number of kids living in poverty went up by 19%, but the number of uninsured kids decreased 14%, from 6.9 million in 2008 to 5.9 million in 2010. By 2010, only about 8% of children lacked health insurance.
• Hispanic and Native American children, older children, and very poor families (with incomes below 50% of the poverty level) are less likely to be insured.
• Florida reduced its rate of uninsured children more than any other state, from 667,758 to 506,934, but its rate is still high. Six states account for more than half of the nation’s uninsured kids: Arizona, California, Florida, Georgia, New York, and Texas. The uninsured rate went up most in Minnesota, from 72,493 in 2008 to 84,165 in 2010.

Why the nationwide change? The report’s authors cite health policy changes at the state and national level. In the states, many low-income children are eligible for health insurance coverage through Medicaid and Children’s Health Insurance Programs (CHIP) created in 1997 and more recently reauthorized. Between 2008 and 2010, many states expanded eligibility and outreach for these programs and made them simpler to enroll in.

On a national scale, last year’s health overhaul set national standards for CHIP, requiring states to set and maintain certain eligibility levels based on income and make it easier to enroll and get coverage.

Organizers of a campaign to repeal Massachusetts’ individual mandate for health insurance coverage have decided to end their efforts for the time being. Led by Bridget Fay and straightforwardly named “Repeal RomneyCare,” the campaign’s petition gathered only 45,000 signatures, falling short of the 69,000 it needed to get on the ballot of the next state election. They still hope to work with lawmakers to propose the repeal in the future.

According to an article by Martha Bebinger of WBUR’s CommonHealth blog, the advocates failed to gather the required signatures because they had to divide their efforts between the individual mandate repeal and other causes. Specifically, campaign organizers working with Massachusetts Citizens for Life were split between repealing Romney’s overhaul and legalizing assisted suicide, and chose to focus their efforts on the assisted suicide question. Other organizations were involved, but they were not able to gather the required signatures on their own.

The 2012 presidential election also played a role, Ms. Bebinger explains. With Massachusetts Gov. Mitt Romney a top contender for the Republican nomination, conservative supporters of the individual mandate repeal were worried that the campaign may make Romney look bad in a national light.

According to polls, Massachusetts residents still support the state’s health overhaul (now more than five years old), including the individual mandate. Readers, with the issue now being debated on a national scale, do you believe people should be required to maintain insurance coverage? Do you think that states and the federal government have different roles to play when working to increase the number of people with insurance – and if so, who should do what?

For the first time, the U.S. Department of Health and Human Services (HHS) has declared a proposed health insurance premium increase “unreasonable.” The insurer in question, Everence Insurance Co., planned to raise premiums by 11.6% for about 4,800 people working for small businesses in Pennsylvania, according to a blog post by Julie Appleby of Kaiser Health News’ Capsules Blog. An earlier proposed increase by Everence, of about 11% for customers in Montana, was considered reasonable, wrote Noam Levey in a related article for the Los Angeles Times.

When regulated, insurance rate increases generally fall in the domain of the states, not the federal government. And the strictness of states’ laws varies; only about half of states approve or deny requests for rate increases. As part of health reform, however, HHS announced earlier this year that they would review all proposed health insurance rate increases above 10% in states that do not do so themselves.

While HHS can’t legally prevent premium increases that it finds unreasonable, it can require insurers to publicly justify the rate hike, which Everence must now do in the next ten days. With this national-level scrutiny, Mr. Levey writes, the agency hopes to make insurance companies think twice before proposing large increases and be sure the level of increase is fair and necessary.

HHS based its decision on Everence’s estimated spending on medical claims over the past year, which suggest that the insurer would spend 63-67% of premium revenue on medical costs, explains Ms. Appleby. But Everence contends that because it is a small company whose expenses vary a lot from year to year, HHS should look at a longer time period. During the past two years, the insurer estimates that it spent about 82% of premium revenues on medical costs. Health reform requires that proportion to be at least 80%.

Currently, 114 rate increases of at least 10% are under review across the country: 37 by the federal government, two of which have been completed, and 77 by states.

In July, we blogged about two major approaches that states are taking to online health insurance exchanges: active purchasing, where exchanges negotiate contracts with health plans to get the best prices and values for their consumers, and passive or “open” purchasing, where the exchange serves as a centralized source of information on health plans but offers no special deals and allows all insurers to participate. Both approaches have their good and bad sides; while active purchasing may result in better prices, it requires the state to put in much more work, a difficult task in these times of fiscal austerity.

Now, the American Medical Association (AMA) has joined health insurance companies in endorsing the open marketplace approach, according to a new resolution described by Alina Selyukh of Reuters. According to Ms. Selyukh, the AMA delegates voted in favor of exchanges “with strong patient and physician protections in place, to increase competition and maximize patient choice of health plans.” The association worries that an active purchasing strategy could lead to overly concentrated markets in some states (which many states already have). This, they say, could limit negotiations between doctors and insurance companies as well as free competition between health plans.

The resolution is not surprising. In fact, it comes on the heels of a news piece by Emily Berry of the American Medical News, published by the AMA, which describes the low levels of competition in many states’ insurance markets and the AMA’s hope that health insurance exchanges will change that. “The AMA envisions that health insurance exchanges created by the health reform law will have a critical role in expanding insurer competition. Millions of currently uninsured Americans will benefit from having a patient-friendly market with more health insurance choices tailored to meet their needs,” AMA President Peter W. Carmel is quoted as saying. Similar to the KFF study we blogged about last month, the AMA recently found that 83% of the metropolitan areas it studied, and 39 out of 47 states, are highly concentrated.

Readers, which approach do you support, active or passive (open) purchasing? Whose needs matter most as states make this decision: patients, doctors, state governments, insurance companies, others?