House Ways and Means, Energy and Commerce and Health, Education and Labor committees have come to some agreement on a $1.7 trillion bill to provide universal health care and require that all citizens obtain health care insurance.

In a four page circular released June 9, 2009, the House committees outline the “Key Features of the Tri-Committee Health Reform Draft Proposal in the U.S. House of Representatives.”

For a copy of the actual circular use this link: http://waysandmeans.house.gov/media/pdf/111/tri.pdf

Summarizing the circular, is the following:

The house ways and means committee explains their commitment to health care reform that will:

• Reduce costs
• Protect current coverage
• Preserve choice of doctors, hospitals and health plans
• Ensure affordable, quality health care for all.

Plan Overview

• Allow people to keep their current coverage and to minimize disruption of the current health care system.
• Provide for investment the health care workforce and improve access to primary care.
• Invest in disease prevention and public health care programs.
• Establish a new Health Care Exchange system that provides States the opportunity to create State or regional exchanges in addition to any national exchange for the purpose of comparing and enrolling in health care plans.
• Establish “shared responsibility” among individuals, employers and government. Shared responsibility includes a mandate that individuals would “share responsibility” via a per month fee for every month they go uncovered. This fee would be collected via the federal tax system.
• Outlay a sliding scale of “credits” to help low and middle income individuals and families afford coverage.
• Push through health care delivery reforms to “reduce costs, maintain fiscal sustainability, and improve quality.”
• Lastly, the House measures propose to expand federal authority in order to curb waste, fraud and abuse.

Workforce Investments

• Include expansion of the National Health Services Corps.
• Assist in training of primary care physicians and increase the influx of individuals entering health professions, including primary care, nursing and public health.
• Support workforce diversity.
• Add scholarships and student loans to individuals seeking to study in needed health care professions and health care shortage areas.

Prevention and Wellness Efforts

• Expand Community Health Centers
• Eliminate cost sharing in preventive services benefits.
• Create “community-based” programs to deliver wellness and prevention services.
• Promote collection on a community wide basis for new data gathering efforts in order to identify and address racial, ethnic and any other health disparities.
• Seek to strengthen public health departments on a State, local, territorial and a tribal level.

Insurance Market Reforms

• Prohibit insurers from excluding coverage due to pre-existing conditions and/or engaging in other discriminatory practices.
• Eliminate rating based on gender, health status, occupation and place limits on age rating.
• Establish a new Health Insurance Exchange (or Gateway) to provide a transparent marketplace for individuals to compare and enroll among private insurers as well as a new public health insurance option.
• Seek to attain administrative simplification and standardization so as to reduce administrative costs across all providers and plans.

Affordability and Access Provisions

• Create a sliding scale of “affordability credits” to help individuals and families purchase insurance through the Exchange. Credits would be eligible for individuals and families who are within 400% (500% in the Senate version) of the federal poverty level. The report makes the note that the average cost of family coverage today is 14% of a family’s income at 400% of poverty.) View the 2009 Federal Poverty Guidelines at: http://www.coverageforall.org/pdf/FHCE_FedPovertyLevel.pdf
• Expand Medicaid for the “most vulnerable, low income populations” (Up to 150% of poverty in the Senate version). Increase reimbursement rates to bolster access to to primary care services under the Medicaid program.
• Place caps on out of pocket maximums in benefit plans in order to curb bankruptcies due to medical expenditures.

Public (Government) Health Insurance Option

• “Enhances transparency and accountability by creating a new public health insurance option within the Exchange to offer and ensure competition.”
• This option is “self-sustaining” and is intended to compete evenly with private insurers.
• Employees and individuals will be free to choose between public and private options in the Health Care Exchanges.

Benefit Levels

• Independent advisory on a both public and private level will assess and recommend “standards” for benefit packages.
• Create varying levels of standardized benefits and cost sharing arrangements. Additional benefits will be available in higher cost plans.
• Establish a “phase-in” period in order to bring employer based plans up to benefit quality standards.

Shared Responsibility

• Once market reforms and affordability credits are in place, individuals are “responsible for having health insurance” with exceptions in cases of hardship.
• Employers can choose between providing health insurance for workers or “contributing funds” on behalf of their uncovered workers.
• The Federal Government is responsible for making health insurance affordable via “affordability credits,” insurance market and industry reforms, as well as oversight of insurance companies.
• Protect small businesses by exempting small, low-wage companies and adding a new “small business tax credit” for firms providing health care coverage.

Reforming Health Care Delivery and Ensuring Sustainability

• Use federal health programs (such as CHIP, Medicare, Medicaid and the new public health insurance option) to promote high quality care and reduce inequities.
• Add new payment approaches to promote coordination of care in Medicare and the new public health insurance option using “accountable care organizations.”
• Attack the high rate of health care cost increases, thereby creating savings for reform and fiscal sustainability. Adding a program in Medicare to reduce preventable hospital re-admissions.

Modernize and Improve Medicare

• Replace the currently “flawed” Sustainable Growth Rate (SGR) reimbursement formula in Medicare.
• Increase reimbursement levels for primary care.
• Improve Medicare Part D.
• Implement MedPAC recommendations. (See their website at:http://www.medpac.gov/index.cfm)
• Eliminate over payments to Medicare Advantage beneficiaries.
• Improve upon low income subsidy plans to make Medicare more affordable for low income individuals.
• Remove cost sharing for all preventive benefits.

As mentioned in other earlier posts, there are two sets of committees working on the subject of health care reform or health care “modernization.”

The main bill being proposed originated in Senate, and the House objectives include a general rundown of issues that support or buttress the issues brought to bear in the Senate bill with some differences.

Some of the proposed health care reforms are as follows:

Individual and Group Insurance Markets

Insurers or health plan providers may no longer impose pre-existing condition exclusions. Further, plans will be required to accept all applicants and will be prohibited from increasing rates to insureds based on:

• health concerns
• gender
• claims history
• occupational class

Premiums can still differ from plan to plan, but only based on:

• age of insureds
• rating “area” (region in which coverage is secured)
• value of benefits (actuarial value of benefits selected)
• family structure

Health plans will also be required to provide:

• preventative care
• reimbursement incentives for quality
• coverage for dependent children through age 26
• And, be prohibited from limiting benefits via a lifetime benefit maximum

Establishment of Health Exchanges or Health Benefit Gateways

Proposed is a plan to establish health insurance purchasing clearinghouses on a state wide level. These “Exchanges” or “Gateways” will be used by individuals and groups for the purpose of comparing and enrolling in health care plans. The exchanges will also be used to help citizens enroll in other government sponsored plans such as the Children’s Health Insurance Program (or, CHIP), Medicaid, and other currently established federal health care programs. For buyers, participation in a health exchanges is optional. There will be a government agency that is responsible for determining what premiums are considered to be “affordable” for individuals and families based on various circumstances and income guidelines.

 Cost Sharing

There are three proposed levels of cost sharing available based on individual and family circumstances. They are as follows:

Premium credits will provided for individuals and families up to 500% of the federal poverty level, including a sliding scale based on a range of income.

Medicaid will be expanded to cover individuals and families who qualify as being under 150% of the federal poverty level.

A credit will be available to small employers (with fewer than 50 full time employees) to help those employers provide insurance to employees in groups where employee incomes average $50,000 per year or less.

Mandated Coverage

Individuals will be required to secure coverage or be assessed a fee for every month they are not covered. This fee or “shared responsibility payment” will be assessed via the income tax system. The bill currently does not specify an employer mandate to offer coverage, it does require coverage be secured by individuals. Exemptions will be made in certain areas where qualified coverage may be unavailable. Though the bill does not specify an employer mandate, it does suggest the possibility for a fee being assessed to employers that do not provide coverage. There is a possibility that small employers may be exempt from the fee.

Technological Uniformity

The bill requires an effort to achieve a technological uniformity in enrollment for individuals in state and federal human services programs. Grants will be established to help local governments and/or states develop new ways of adapting toward and achieving simplicity and uniformity in enrollment procedures in various state and federal human services programs.

Long Term Care

Establishes a fund, paid for by beneficiaries, that would help pay for long term care benefits for those who have “functional limitations” and would require long term care services beyond 90 days. The program would provide cash benefits, counselling assistance and advocacy services for enrollees. The plan would be managed by the Secretary of the Treasury. Employers who enroll employees in the plan would be eligible to up to a 25% credit for premiums.

Government/Public Insurance Plan Option

Lastly, the idea has been suggested that a public insurance plan option be created that would compete with private insurers. This public plan would be available to enrollees via the health care exchange or gateway system. The bill itself does contain language regarding a public plan option, see page 43:

(B) INCLUSION.—In making available coverage pursuant to subparagraph (A), a Gateway shall include a public health insurance option.

There is further reference to a government plan option in committee summary notes. The summary suggests that the government plan pay benefits to health care providers at a ten percent premium over established Medicare rates.

To view the 615 page proposed Senate bill directly go to:

http://help.senate.gov/BAI09A84xml.pdf

Check out this June 10, 2009 article on health care reform from the Politico entitled, “Dems Double Down On Health Care.”

http://www.politico.com/news/stories/0609/23560.html

 

A rundown of this article with some additional commentary is basically as follows:

Recently House Speaker Nancy Pelosi (D) and House Majority Leader Steny Hoyer (D) have been pushing hard, lobbying members of their own party in order to avoid infighting over the issue of health care reform. It was division among house Democrats that (at least in part) took down the efforts to reform health care during the Clinton administration.

Democrats now are seeking unity – and reaching out in particular to “rank and file” and moderate Blue Dog Democrats. However, moderate Democrats have been warning leaders not to undermine the private health care market. One important concern relates to the potential ramifications stemming from a “public option” in health care.

Seeing as private insurers have no ability to deficit spend and raise taxes after they do, it seems likely that any government option would have an unfair advantage over private pay plans – even if the ground rules are well established. Any cost forecasts for a public plan would be largely speculative at this point – as happened in Massachusetts, and are more likely to be under priced relative to the reality of actual claims and other costs in the future.

Congressman Henry Waxman (D-Calif.) asks, “Why should private companies object to competition?” Well, it’s not “competition” that they are objecting to. Instead, it’s unfair competition that they are objecting to. Note you don’t see private companies asking for legislation to eliminate their other private competitors.

Key is the issue of the rules associated with the public option. If the public option uses Medicare Rules, then the worry that a government subsidized plan that unfairly competes with private plans, largely becomes a reality. As long as the government option can overspend on the taxpayers dime (or debt – as the case may be), how can private companies hope to compete in the long run?

Already we see more liberal congressional members calling for additional mandates to health care coverage such as mental health benefits and dental insurance. It’s hard to imagine this “add-on” trend not continuing.  It seems likely that the parameters will ever widen in the future, and that we are apt to see  a more and more bloated and expensive plan.

This article states that, having made recent concessions on climate change measures, it is believed that Speaker Pelosi seems – at the moment, anyway – less likely to concede on issues relating to health care reform.

Still, divisions are steep. R. Bruce Josten, who lobbies for the U.S. Chamber of Commerce expresses clear disappointment in the proposed measures. Conversely, Andy Stern, president of the Service Employee’s International Union, commented in support of Kennedy and his fellow committee members for offering such a wonderful plan – that puts the well being of the American people ahead of “profits.”

My take on all of this?

Wow! What has happened to our country that profits and private businesses are seen as the source of so many of our ills? Free-enterprise is now, clearly, on the run.  Even though, it was free-enterprise and the individual will to take risks and succeed that made this country great in the first place! America is supposed to be a place where individuals are rewarded for serving the greater good through private enterprise, hard work and capitalism.

As Zig Ziglar once said, “Help enough people get what they want, and you can have anything you want.” In the minds of many “progressives” today, this idea is now poison. No longer should we allow “… to each according to his ability.” Instead, we’re to become all about “…from each according to his ability,” and to each according to what some progressive politician decides you’re allowed to keep (i.e. does the issue of CEO pay legislation ring any bells?). Let’s hope the pendulum swings back toward our free-enterprise, individual-empowered, capitalist roots sometime soon before we lose ourselves completely.

In case you were wondering, these are the key committees that are working on health care reform.  They are the places to watch for news and information as the issue of health care reform becomes further developed.

http://finance.senate.gov/

http://energycommerce.house.gov/

http://edworkforce.house.gov/

http://waysandmeans.house.gov/

As of this writing, this bill has not been formally introduced in the Senate or the House

http://help.senate.gov/BAI09A84xml.pdf