Policy Price

Health care spending projections for the next decade, published in the journal  Health Affairs last week, appeared to have a little something for everyone. Prepared by Medicare’s Office of the Actuary, the report notes that health care spending will increase 0.2 percent faster than previously projected due to the health reform law’s many changes to the system. As a result, The New York Times proclaimed that the “health plan won’t fuel big spending,” causing an annual spending increase of 6.3 percent rather than 6.1 percent. The Christian Science Monitor, on the other hand, warned that reform will definitely cause health insurance costs to rise and that Americans should be on guard for big increases in 2014 when many of the law’s major provisions kick in. Spending on health insurance is expected to increase 12.8 percent in 2014 as millions of uninsured Americans gain coverage. However one interprets the results of the report, it is clear that rising health care costs remain unfinished business.

ARIZONA: The Senate has established an Ad-Hoc Committee on the Impacts of Health Care Reform Implementation. The Committee will hold its initial meeting later this month. The preliminary agenda includes: Arizona Health Care Cost Containment System (Medicaid) requirements; insurance reforms; impacts on health care providers; and tax implications. Members appointed to the committee include AHIP retained counsel, clinical and employer representatives, and representatives of the Goldwater Institute, a conservative think tank.

COLORADO: The Division of Insurance (DOI) has applied for a million health insurance exchange grant. If awarded, the funds will be used for research and developing recommendations for implementation of an exchange. Specific areas mentioned include modeling on adverse selection, value choices, increasing actuarial staff and determining the actuarial effects of benefit packages within an exchange and in the external regulated market. The Department of Regulatory Agencies finalized three regulations that define the standardized electronic identification and communications systems to be used by all health plans operating in Colorado. The regulations are the result of 2008 legislation requiring carriers to use systems certified by the Committee on Operating Rules for Information Exchange (CORE). Carriers must be able to demonstrate their compliance by Sept. 1, 2012.

DELAWARE: The Department of Insurance (DOI) has issued a bulletin regarding recently enacted legislation that prohibits rescissions based on medical claims underwriting. The legislation signed into law by Governor Markell on August 30th prohibits rescission, cancellation, or limitation once an enrollee is covered, except in cases of fraud or intentional misrepresentation of a material fact. Effective Sept. 23, 2010, prior approval by the Commissioner or her designee is required before a health insurer may rescind, cancel or limit existing coverage based on written health or medical information.

LOUISIANA: The DOI has applied for a grant related to health insurance exchanges. Aetna, along with the Louisiana Association of Health Plans, will participate in a meeting with the DOI to discuss the grant and other issues related to health care reform.

NEW JERSEY: The Department of Banking & Insurance (DOBI) last week issued a bulletin providing template contract riders that insurance carriers can use for the large group market and the (non-reform) individual and small employer markets to describe changes to comply with the Patient Protection and Affordable Care Act (PPACA). The rider templates, which may be used by carriers without submission to DOBI for formal review or approval, address the following health benefit plan requirements: Extension of coverage to dependents; annual and lifetime dollar limits; first-dollar coverage of preventive services; limitations on preexisting condition exclusions; and rescissions. A carrier not using the rider template must submit their own forms for DOBI’s formal review and filing, or approval to bring benefit plans into compliance by September 23, 2011.

OKLAHOMA: DOI Commissioner Kim Holland and staff hosted an informational stakeholder meeting last week to discuss the DOI’s plans for creation and implementation of Oklahoma’s exchange under the PPACA. DOI intends to use issue-specific working groups to manage the task going forward. The state’s online Medicaid enrollment process went live September 7 and processed over 2,000 applications with a 60 percent approval rate the first 28 hours. Over 400 apps came from hospitals that provided overwhelmingly positive feedback. This web tool was referenced as a possible “starting point” of the exchange’s eventual infrastructure. The DOI submitted an application for a million Exchange Planning Grant in August and expects to hear a decision from HHS by the end of this month. If