The U.S. Department of Health and Human Services (HHS) today awarded nearly $49 million to help 48 states and the District of Columbia plan for the establishment of health insurance exchanges. A key part of the Affordable Care Act, starting in 2014, health insurance exchanges - new, competitive, consumer-centered private health insurance marketplaces - will put greater control and greater choice in the hands of individuals and small businesses.
"Today, too many individuals and small businesses are on their own in dealing with insurance companies. They pay higher costs than Americans who get their insurance through big companies or other large employers because they can't pool their costs or spread the risk," said Secretary Kathleen Sebelius. "That's why the Affordable Care Act helps states create exchanges, so individuals and small businesses can band together, have the same purchasing power as those big employers, and get a fairer deal when it comes to their health care. Today, we're providing critical resources to help states take the first step toward creating these competitive marketplaces."
The state-based exchanges will make purchasing health insurance easier by providing eligible consumers and businesses with "one-stop-shopping" where they can compare and purchase health insurance coverage. Americans will have the same health care choices as members of Congress - who will also purchase coverage through the exchanges. Individuals and families purchasing health insurance through exchanges may also qualify for tax credits and reduced cost-sharing depending on their income.
These grants of up to $1 million each will give states the resources they need to conduct the research and planning needed to build a better health insurance marketplace and determine how their exchanges will be operated and governed, including:
. Assessing current information technology (IT) systems and infrastructure and determining new requirements.
. Developing partnerships with community organizations to gain public input into the exchange planning process.
. Planning for consumer call centers to answer questions from their residents.
. Determining the statutory rules needed to build the exchanges.
. Hiring key staff and determining ongoing staffing needs.
. Planning the coordination of eligibility and enrollment systems across Medicaid, the Children's Health Insurance Program (CHIP), and the exchanges.
. Developing performance metrics, milestones and ongoing evaluation.
Although state exchanges are not required to be operational until 2014, these planning grants begin the path toward 2014 when health insurance exchanges will take what is now a very complicated and confusing process and turn it into a simple, easy to navigate experience that benefits consumers, not insurance companies.
The Department of Health and Human Services is working closely with states in implementing the Affordable Care Act. This is just the first round of state planning and establishment grants, which are one of several resources available to states to help with implementation of the Affordable Care Act. Already, 46 states have received resources from the Affordable Care Act to help improve the oversight of proposed health insurance premium increases, take action against insurers seeking unreasonable rate hikes, and ensure consumers receive value for their premium dollars. To learn more about the Affordable Care Act please visit www.HealthCare.gov.
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Showing posts with label exchange. Show all posts
Showing posts with label exchange. Show all posts
Thursday, September 30, 2010
Thursday, July 29, 2010
Many Americans Still Confused About New Healthcare Reform Law and its Provisions
/PRNewswire/ -- Not sure what's in--and not in--the new healthcare legislation signed into law by President Barack Obama in March? You're not alone. More than 2,100 adults were given a list of 18 reform items and asked to identify what's included and what's not included in the law. Only four items were correctly identified by the majority of those polled.
Most (58 percent) know that the reform package will prohibit insurers from denying coverage to people because they are already sick; 55 percent know the law permits children to stay on their parents' insurance plan until age 26; and 52 percent realize that people who don't have insurance will be subject to financial penalties. Additionally, half are aware that employers with more than 50 employees will have to offer their workers affordable insurance.
These are some of the major findings of today's HealthDay/Harris Poll, conducted between July 15 to 19, 2010 among 2,104 adults (aged 18 and over).
Among other findings: 82 percent think the bill will result in rationing of health care or that it might (it won't); 79 percent don't know or aren't sure if drug companies will pay an annual fee, (they will); 73 percent don't know the law establishes a new tax on the sale of medical devices; 66 percent don't know or aren't sure if the legislation will result in insurance exchanges where people can shop for insurance, (it will); and 63 percent either aren't sure or don't know if the new law will increase the number of people eligible for Medicaid, (it will).
"The problem for the (Obama) administration is healthcare reform is fiendishly complicated because the healthcare system is fiendishly complicated, and it is not politically feasible to tear up the system and build it again," said Humphrey Taylor, chairman of the Harris Poll, Harris Interactive's long-running public opinion poll. "Instead you have to build on the system that you have. When you try to build on a fiendishly complicated system, you have fiendishly complicated reforms."
Another cause of the confusion is due to the long and heated political debate that surrounded the bill before it was passed, Taylor said.
"The level of ignorance and misinformation is sort of astounding," he said. "It seems people are still reacting to the rhetoric, not the substance of what is in the bill, because they don't actually know what is or is not in the actual legislation."
For more information, click here to read the full report and methodology. HealthDay's news report is available here. Full data on the poll and its methodology are available at Harris Interactive.
Note: Percentages may not add up exactly to 100% due to rounding.
Methodology
This survey was conducted online within the United States July 15 to 19, 2010 among 2,104 adults (aged 18 and over). Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents' propensity to be online.
All sample surveys and polls, whether or not they use probability sampling, are subject to multiple sources of error which are most often not possible to quantify or estimate, including sampling error, coverage error, error associated with nonresponse, error associated with question wording and response options, and post-survey weighting and adjustments. Therefore, Harris Interactive avoids the words "margin of error" as they are misleading. All that can be calculated are different possible sampling errors with different probabilities for pure, unweighted, random samples with 100% response rates. These are only theoretical because no published polls come close to this ideal.
Respondents for this survey were selected from among those who have agreed to participate in Harris Interactive surveys. The data have been weighted to reflect the composition of the adult population. Because the sample is based on those who agreed to participate in the Harris Interactive panel, no estimates of theoretical sampling error can be calculated.
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Most (58 percent) know that the reform package will prohibit insurers from denying coverage to people because they are already sick; 55 percent know the law permits children to stay on their parents' insurance plan until age 26; and 52 percent realize that people who don't have insurance will be subject to financial penalties. Additionally, half are aware that employers with more than 50 employees will have to offer their workers affordable insurance.
These are some of the major findings of today's HealthDay/Harris Poll, conducted between July 15 to 19, 2010 among 2,104 adults (aged 18 and over).
Among other findings: 82 percent think the bill will result in rationing of health care or that it might (it won't); 79 percent don't know or aren't sure if drug companies will pay an annual fee, (they will); 73 percent don't know the law establishes a new tax on the sale of medical devices; 66 percent don't know or aren't sure if the legislation will result in insurance exchanges where people can shop for insurance, (it will); and 63 percent either aren't sure or don't know if the new law will increase the number of people eligible for Medicaid, (it will).
"The problem for the (Obama) administration is healthcare reform is fiendishly complicated because the healthcare system is fiendishly complicated, and it is not politically feasible to tear up the system and build it again," said Humphrey Taylor, chairman of the Harris Poll, Harris Interactive's long-running public opinion poll. "Instead you have to build on the system that you have. When you try to build on a fiendishly complicated system, you have fiendishly complicated reforms."
Another cause of the confusion is due to the long and heated political debate that surrounded the bill before it was passed, Taylor said.
"The level of ignorance and misinformation is sort of astounding," he said. "It seems people are still reacting to the rhetoric, not the substance of what is in the bill, because they don't actually know what is or is not in the actual legislation."
For more information, click here to read the full report and methodology. HealthDay's news report is available here. Full data on the poll and its methodology are available at Harris Interactive.
TABLE 1
KNOWLEDGE OF ITEMS THAT ARE INCLUDED IN REFORM BILL (PPACA)
"Please indicate if you believe each of the following is included (or
will result from) or is not included (or will not result from) the
health care reform bill that was signed by President Obama in March
of this year. If you don't know, please do not guess but
check "Not sure."
Base: All adults
Is Not
Is Included/ Included/
Will Result Will Not
From Result From Not
Sure
Not allowing insurers to deny
coverage to people % 58 9 34
because they are sick
Allowing children to stay on their
parents' insurance until % 55 9 35
they are 26 years old
Financial penalties for all
individuals who do not have or % 52 9 39
do not buy insurance
All employers with more than 50
employees must offer % 50 9 41
their employees affordable
insurance
Tax credits for small business to
provide insurance to % 43 14 43
their employees
Increasing the number of people who
are eligible for % 37 13 50
Medicaid
Insurance exchanges where people
can shop for % 35 14 52
insurance
A new tax on the sale of medical
devices % 27 13 60
An annual fee to be paid by drug
companies % 21 14 65
Note: Percentages may not add up exactly to 100% due to rounding.
TABLE 2
BELIEF THAT ITEMS NOT IN REFORM BILL (PPACA) ARE INCLUDED
"Please indicate if you believe each of the following is included (or
will result from) or is not included (or will not result from) the
health care reform bill that was signed by President Obama in March
of this year. If you don't know, please do not guess but
check "Not sure."
Base: All adults
Is Not
Is Included/ Included/
Will Result Will Not
From Result From Not
Sure
An increase in the federal
government's budget deficit % 45 13 42
Higher income taxes for the middle
class % 37 22 41
All Americans will have health
insurance % 36 29 35
New ways to ration health care % 36 18 46
A new government run health plan
to compete with % 36 22 43
private insurance plans
A cut in Medicare benefits % 33 21 45
Higher tax deductions from
workers' pay % 33 16 50
Panels to decide what care very
sick, older people % 30 26 44
should receive
Illegal aliens will have health
insurance % 28 27 45
Note: Percentages may not add up exactly to 100% due to rounding.
Methodology
This survey was conducted online within the United States July 15 to 19, 2010 among 2,104 adults (aged 18 and over). Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents' propensity to be online.
All sample surveys and polls, whether or not they use probability sampling, are subject to multiple sources of error which are most often not possible to quantify or estimate, including sampling error, coverage error, error associated with nonresponse, error associated with question wording and response options, and post-survey weighting and adjustments. Therefore, Harris Interactive avoids the words "margin of error" as they are misleading. All that can be calculated are different possible sampling errors with different probabilities for pure, unweighted, random samples with 100% response rates. These are only theoretical because no published polls come close to this ideal.
Respondents for this survey were selected from among those who have agreed to participate in Harris Interactive surveys. The data have been weighted to reflect the composition of the adult population. Because the sample is based on those who agreed to participate in the Harris Interactive panel, no estimates of theoretical sampling error can be calculated.
-----
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Tuesday, June 15, 2010
U.S. Departments of Health and Human Services, Labor, and Treasury Issue Regulation on "Grandfathered" Health Plans under the Affordable Care Act
Allowing Americans to Keep Current Health Plans or Choose a New Plan While Extending Important New Benefits to All Consumers
The U.S. Departments of Health and Human Services, Labor and Treasury today issued a new regulation that makes good on President Obama's promise that Americans who like their health plan can keep it.
The new regulation protects the ability of individuals and businesses to keep their current plan while providing important consumer protections that give Americans - rather than insurance companies - control over their own health care. The new regulation also provides stability and flexibility to insurers and businesses that offer health insurance coverage as the nation transitions to a more competitive marketplace in 2014 when businesses and consumers will have more affordable choices through exchanges.
"The Affordable Care Act gives American families more control over their health care by providing greater benefits, cost savings and protections," said Secretary of Health and Human Services Kathleen Sebelius. "Today, with the announcement of the new 'grandfather' rule, we're providing the market stability and flexibility to ensure that families and businesses can make the choices that work best for them."
While the Affordable Care Act requires all health plans to provide important new benefits to consumers, under the law, plans that existed on March 23, 2010 are exempt from some new requirements. The "grandfather rule" issued today makes it clear that these plans can continue to innovate and contain costs by allowing insurers and employers to make routine changes without losing grandfather status. Plans will lose their "grandfather" status if they choose to significantly cut benefits or increase out-of-pocket spending for consumers - and consumers in plans that make such changes will gain new consumer protections.
"The rule we are announcing today will allow employers to make routine and modest adjustments to co-payments, deductibles and employer contributions to their employees' premiums without forfeiting grandfather status. This flexibility will encourage employers to continue offering health coverage to their employees and help to ensure coverage for all Americans," said Secretary of Labor Hilda Solis.
All health plans - whether or not they are grandfathered plans - must provide certain benefits to their customers for plan years starting on or after September 23, 2010 including:
* No lifetime limits on coverage for all plans;
* No rescissions of coverage when people get sick and have previously made an unintentional mistake on their application; and
* Extension of parents' coverage to young adults under 26 years old;
For the vast majority of Americans who get their health insurance through employers, additional benefits will be offered, irrespective of whether their plan is grandfathered, including:
* No coverage exclusions for children with pre-existing conditions; and
* No "restricted" annual limits (e.g., annual dollar-amount limits on coverage below standards to be set in future regulations).
"The Affordable Care Act positions consumers, instead of insurance companies, as decision makers when it comes to their health care," said Assistant Treasury Secretary for Tax Policy Michael Mundaca. "The rule we're announcing today preserves individuals' ability to keep their current plan and provides strong consumer protections that give Americans more control over their health insurance choices."
Grandfathered health plans will be able to make routine changes to their policies and maintain their status. These routine changes include cost adjustments to keep pace with medical inflation, adding new benefits, making modest adjustments to existing benefits, voluntarily adopting new consumer protections under the new law, or making changes to comply with State or other Federal laws. Premium changes are not taken into account when determining whether or not a plan is grandfathered.
Plans will lose their grandfathered status if they choose to make significant changes that reduce benefits or increase costs to consumers. If a plan loses its grandfathered status, then consumers in these plans will gain additional new benefits including:
* Coverage of recommended prevention services with no cost sharing; and
* Patient protections such as access to OB-GYNs and pediatricians without a referral by a separate primary care provider.
Details about what routine changes insurers and employers can make without losing their grandfathered status, and the projected impact on large and small employer plans and the individual plan market can be found at http://www.healthreform.gov/newsroom/keeping_the_health_plan_you_have.html.
Most of the 133 million Americans with employer-sponsored health insurance through large employers will maintain the coverage they have today. Additionally, large employer-based plans already offer most of the comprehensive benefits and consumer protections that the Affordable Care Act will provide to all Americans this year - such as preventing rescission of coverage.
The roughly 42 million people insured through small businesses will likely transition from their current plan to one with the new Affordable Care Act protections over the next few years. Small plans tend to make substantial changes to cost sharing, employer contributions, and health insurance issuers more frequently than large plans. To help small businesses afford employee coverage, the Affordable Care Act includes a tax credit for up to 35% of their premium contributions.
The 17 million people who are covered in the individual health insurance market, where switching of plans and substantial changes in coverage are common, will receive the new protections of the Affordable Care Act sooner rather than later. Roughly 40 percent to two-thirds of people in individual market policies normally change plans within a year. In the short run, individuals whose plan changes and is no longer grandfathered will gain access to free preventive services, protections against restricted annual limits, and patient protections such as improved access to emergency rooms.
In 2014, small businesses and individuals who purchase insurance on their own will gain access to the competitive market Exchanges. These Exchanges will offer individuals and workers in small businesses with a much greater choice of plans at more affordable rates - the same choice as members of Congress. In fact, the Congressional Budget Office (CBO) has estimated that, on an apples-to-apples basis, premiums will be 14- 20 percent lower than they would be under current law in 2016 due to competition, lower insurance overhead, and increased pooling and purchasing power. Small businesses also will have more affordable options. CBO has estimated that a family policy for small businesses would be available in the Exchanges at a premium that is $4,000 lower than under current law in 2016.
These reduced premiums do not take into account the tax credits available to small businesses and middle class families to help make insurance affordable. These additional new choices and cost savings may further lower the likelihood that small businesses workers will remain in grandfathered health plans. Consumers insured through large employers are more likely to remain in grandfathered plans in 2014 and beyond.
-----
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The U.S. Departments of Health and Human Services, Labor and Treasury today issued a new regulation that makes good on President Obama's promise that Americans who like their health plan can keep it.
The new regulation protects the ability of individuals and businesses to keep their current plan while providing important consumer protections that give Americans - rather than insurance companies - control over their own health care. The new regulation also provides stability and flexibility to insurers and businesses that offer health insurance coverage as the nation transitions to a more competitive marketplace in 2014 when businesses and consumers will have more affordable choices through exchanges.
"The Affordable Care Act gives American families more control over their health care by providing greater benefits, cost savings and protections," said Secretary of Health and Human Services Kathleen Sebelius. "Today, with the announcement of the new 'grandfather' rule, we're providing the market stability and flexibility to ensure that families and businesses can make the choices that work best for them."
While the Affordable Care Act requires all health plans to provide important new benefits to consumers, under the law, plans that existed on March 23, 2010 are exempt from some new requirements. The "grandfather rule" issued today makes it clear that these plans can continue to innovate and contain costs by allowing insurers and employers to make routine changes without losing grandfather status. Plans will lose their "grandfather" status if they choose to significantly cut benefits or increase out-of-pocket spending for consumers - and consumers in plans that make such changes will gain new consumer protections.
"The rule we are announcing today will allow employers to make routine and modest adjustments to co-payments, deductibles and employer contributions to their employees' premiums without forfeiting grandfather status. This flexibility will encourage employers to continue offering health coverage to their employees and help to ensure coverage for all Americans," said Secretary of Labor Hilda Solis.
All health plans - whether or not they are grandfathered plans - must provide certain benefits to their customers for plan years starting on or after September 23, 2010 including:
* No lifetime limits on coverage for all plans;
* No rescissions of coverage when people get sick and have previously made an unintentional mistake on their application; and
* Extension of parents' coverage to young adults under 26 years old;
For the vast majority of Americans who get their health insurance through employers, additional benefits will be offered, irrespective of whether their plan is grandfathered, including:
* No coverage exclusions for children with pre-existing conditions; and
* No "restricted" annual limits (e.g., annual dollar-amount limits on coverage below standards to be set in future regulations).
"The Affordable Care Act positions consumers, instead of insurance companies, as decision makers when it comes to their health care," said Assistant Treasury Secretary for Tax Policy Michael Mundaca. "The rule we're announcing today preserves individuals' ability to keep their current plan and provides strong consumer protections that give Americans more control over their health insurance choices."
Grandfathered health plans will be able to make routine changes to their policies and maintain their status. These routine changes include cost adjustments to keep pace with medical inflation, adding new benefits, making modest adjustments to existing benefits, voluntarily adopting new consumer protections under the new law, or making changes to comply with State or other Federal laws. Premium changes are not taken into account when determining whether or not a plan is grandfathered.
Plans will lose their grandfathered status if they choose to make significant changes that reduce benefits or increase costs to consumers. If a plan loses its grandfathered status, then consumers in these plans will gain additional new benefits including:
* Coverage of recommended prevention services with no cost sharing; and
* Patient protections such as access to OB-GYNs and pediatricians without a referral by a separate primary care provider.
Details about what routine changes insurers and employers can make without losing their grandfathered status, and the projected impact on large and small employer plans and the individual plan market can be found at http://www.healthreform.gov/newsroom/keeping_the_health_plan_you_have.html.
Most of the 133 million Americans with employer-sponsored health insurance through large employers will maintain the coverage they have today. Additionally, large employer-based plans already offer most of the comprehensive benefits and consumer protections that the Affordable Care Act will provide to all Americans this year - such as preventing rescission of coverage.
The roughly 42 million people insured through small businesses will likely transition from their current plan to one with the new Affordable Care Act protections over the next few years. Small plans tend to make substantial changes to cost sharing, employer contributions, and health insurance issuers more frequently than large plans. To help small businesses afford employee coverage, the Affordable Care Act includes a tax credit for up to 35% of their premium contributions.
The 17 million people who are covered in the individual health insurance market, where switching of plans and substantial changes in coverage are common, will receive the new protections of the Affordable Care Act sooner rather than later. Roughly 40 percent to two-thirds of people in individual market policies normally change plans within a year. In the short run, individuals whose plan changes and is no longer grandfathered will gain access to free preventive services, protections against restricted annual limits, and patient protections such as improved access to emergency rooms.
In 2014, small businesses and individuals who purchase insurance on their own will gain access to the competitive market Exchanges. These Exchanges will offer individuals and workers in small businesses with a much greater choice of plans at more affordable rates - the same choice as members of Congress. In fact, the Congressional Budget Office (CBO) has estimated that, on an apples-to-apples basis, premiums will be 14- 20 percent lower than they would be under current law in 2016 due to competition, lower insurance overhead, and increased pooling and purchasing power. Small businesses also will have more affordable options. CBO has estimated that a family policy for small businesses would be available in the Exchanges at a premium that is $4,000 lower than under current law in 2016.
These reduced premiums do not take into account the tax credits available to small businesses and middle class families to help make insurance affordable. These additional new choices and cost savings may further lower the likelihood that small businesses workers will remain in grandfathered health plans. Consumers insured through large employers are more likely to remain in grandfathered plans in 2014 and beyond.
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Thursday, December 03, 2009
Sebelius Statement on Benefits of Health Insurance Reform for Businesses
HHS Secretary Kathleen Sebelius today highlighted the benefits of health insurance reform for businesses and released a new fact sheet regarding a recent analysis from the Congressional Budget Office.
"Businesses across the country are struggling under the weight of high health care costs," Secretary Sebelius said. "Health insurance reform will help lift this burden, help businesses prosper, and ensure workers have the affordable, quality health care they need."
A fact sheet regarding the analysis is included below.
Fact Sheet: New CBO Analysis Confirms Benefits of Health Insurance Reform for Businesses
American businesses know the health care status quo is unacceptable. Since 2000, premiums have more than doubled, a rate three times faster than the growth in wages. Between 2000 and 2009, the percentage of firms offering coverage fell from 69 to 60, with much of that drop occurring in the past year alone. Small businesses in particular struggle under the current health care system. For firms employing less than 10 workers, the erosion in coverage is striking -- from 57 percent offering coverage in 2000 to 46 percent offering coverage in 2009. If we do nothing, over the next ten years, health care costs for large businesses are projected to reach $28,530 per employee, a 116 percent increase from 2009.
A new analysis by the Congressional Budget Office (CBO) affirms that businesses' health insurance costs will be lower under health insurance reform -- even though the analysis does not take into account the full range of policies that will benefit businesses.
Health Insurance Premiums for Businesses According to CBO. In a November 30 letter to Senator Evan Bayh, CBO assesses the impact of the Patient Protection and Affordability Act on premiums for the individual, small-group, and large group markets. In 2016, CBO estimates that 159 million or 83 percent of privately insured people will be insured through employers.
Premiums for small business will go down. Small businesses are likely to see premiums drop by 1 to 4 percent under the proposal due to lower prices. These lower prices come from:
-- Lower administrative overhead. Right now, each small business
has to consult with a broker or hire someone to collate plan
information, assist employees with decisions, and handle issues as they
arise. Under reform, in the exchange, there will be people whose job it
is to provide plan information and facilitate enrollment. The exchange
centralizes what is otherwise a process that is extremely duplicative,
streamlining administrative costs and lowering premiums.
-- Greater competition. CBO attributes savings to "providing a
centralized marketplace in which consumers could compare the premiums of
relatively standardized insurance products." This includes competitive
pressure from a public health insurance option.
-- Administrative simplification. Physicians spend on average about
140 hours and $68,000 a year just dealing with health insurance
bureaucracy. By simplifying and standardizing paperwork and
computerizing medical records, doctors will be able to focus on caring
for their patients instead of dealing with bureaucracy. CBO estimates
nearly $20 billion in Federal savings over 10 years, with additional
savings accruing to businesses and families.
Up to 3 percent premium savings as the risk pool for employer-based coverage improves. Today, businesses have seen their premiums skyrocket every year, with many facing double digit percentage increases in their premiums. Health insurance reform will stop this trend.
With nearly 30 million additional Americans gaining health insurance, the purchasing pool for businesses will expand and, largely, improve. Big businesses will save from 0 to 3 percent on premiums due to the changing risk pool while small businesses could save 1 percent on
premiums.
Better options for small businesses. Small businesses would gain access to the health insurance exchanges and new benefit options and tax credits under reform.
-- 3.6 million small businesses could qualify for a tax credit to
help pay their premiums.[vii] An estimated 12 percent of people insured
through small businesses will qualify for tax credits that lower
premiums by 8 to 11 percent. This translates into $620 to $860 for
individuals and $1,540 to $2,120 for families assuming that the coverage
is comparable to what they get today.
-- Today, small businesses often have coverage that has high
deductibles and gap-ridden benefits. The legislation offers such
businesses better options that CBO assumes businesses will take. Such
better coverage has premiums that are 0 to 3 percent higher than the
average plans today, but will save money for employees by ensuring they
are not forced to pay high out-of-pocket costs for services not covered
by their current insurance.
-- In the current health insurance system, small businesses may see
premiums skyrocket if just one or two workers fall ill and accumulate
high medical costs. Health insurance reform will prevent insurance
discrimination based on health status, meaning that small businesses
will no longer be unfairly penalized if a worker falls ill.
9 to 12 percent premium savings for high-premium plans under current law. By assessing high-cost plans, the excise tax encourages businesses and individuals to streamline coverage, leading to lower premiums over time.
-- CBO estimates that the 19 percent of people in employer-coverage
in high-cost plans today will pay 9 to 12 percent less under reform.
This translates to premium savings of at least $835 for single and
$2,070 family policies.
-- This could yield increases in workers wages, by around $70
billion in 2019.
Nearly $10 billion in savings for small businesses.
-- Under current law, CBO estimates premiums to be $7,800 for
single policies and $19,300 for families in the small group market.
-- Small businesses that opt for comparable coverage under reform
could save up to $390 for single policies and $965 for family policies.
Assuming all 25 million people insured through small business save at
least $390 (more for families), this will yield nearly $10 billion in
savings in 2016 alone.
-- Additional savings will accrue to low-wage, small businesses
that newly offer coverage in the exchange. CBO estimates that roughly
12 percent of people in the small group market would get the credit
which would reduce premiums by about 10 percent in 2016. Multiplying
this by the population and average premiums in the report, this suggests
that about one and a half million people would save roughly $780 per
person on premiums in 2016.
-- Even those that CBO estimates will "buy-up" will save, paying
$100 less per family for coverage that is more protective.
At least $13.4 billion in savings for large businesses.
-- Under current law, CBO estimates premiums to be $7,400 for
single policies and $20,300 for families in the large group market.
-- CBO estimates that, under reform, large business premiums will
drop by $100 per single policy and $200 per family policy. With 134
million people enrolled in such coverage, this translates into at least
$13.4 billion in savings in 2016 alone.
Businesses can keep what they have.
-- CBO affirms that any proposed benefit mandates would not affect
the small or large group markets: "The requirement would have relatively
little effect on premiums in the small group market, however, because
most policies sold in that market already cover those services and would
continue to cover them under current law."
-- CBO also affirms the effectiveness of the grandfather policy:
"Further, small group policies that are maintained continuously would be
grandfathered under the proposal."
-- In the large group market, CBO affirms that "[Benefit]
requirements would have no significant effect on premiums in the large
group market."
No cost-shifting to the employer-based insurance market.
-- CBO states: "... CBO's assessment is that the legislation would
have minimal effects on private-sector premiums via cost shifting."
Additional Policies To Benefit Businesses. CBO does not include in its analysis several additional policies in the Patient Protection and Affordable Care Act that would benefit businesses.
Reinsurance for businesses that cover early retiree plans.
-- The proportion of employers that offer retiree coverage has been
declining precipitously over time, from 66 percent in 1988 to 29 percent
in 2009.
-- The proposal would provide a time-limited, Federal reinsurance
program to cover some of the cost of covering early retirees. This
translates to savings of up to $1,200 off the premium of every family
plan offered by that company.
Policies to slow health care cost growth.
-- Insurance oversight: In recent years, several states' insurance
commissioners have rejected unjustifiably high premium increases in the
small group and individual insurance markets. Health insurance reform
will allow insurance commissioners to continue to play this important
role and require transparency and oversight of premium increases.
-- Delivery system reform. Health insurance reform will invest in
care innovations such as accountable care organizations, make healthcare
providers more accountable and efficient through value-based purchasing,
and improve quality and patient safety, including reducing preventable
readmissions. A recent report by the Business Roundtable found that if
many of the delivery system reforms were adopted by the private sector,
large businesses could save $3,000 per employee by 2019.
-- Lowers expensive drug costs. Biologic drugs are some of the most
expensive drugs on the market, and yet there is no streamlined avenue to
get generics on the market to provide lower-cost alternatives. Reform
will create an expedited process to make generic biologic drugs
available, significantly lowering drug costs.
Immediate benefits. While the CBO report provides savings estimates for 2016, several of the policies discussed above would take effect immediately, including early retiree reinsurance, administrative simplification, small business tax credits, and increased oversight of the insurance industry.
Benefits to Businesses Beyond Lower Costs. CBO focused exclusively on health insurance premiums which are critical to businesses. There would be other benefits of health reform for businesses as well.
Improved workplace productivity.
-- The Institute of Medicine found that lost productivity due to
untreated illness among uninsured workers cost businesses between $75
billion and $150 billion per year. Expanding coverage to the uninsured
will create a more productive workforce.
-- Current job-lock (inability to leave current employment if it
will result in loss of health insurance) has been demonstrated to hurt
the economy through reduced productivity, and prevents an employee from
taking a job with potentially higher wages. By ending limitations on
coverage based on pre-existing conditions and expanding portable
coverage options through the health insurance exchange, reform will
increase the flexibility and productivity of the workforce.
New jobs.
-- Bringing down the cost of healthcare will enable investments in
business and job creation. The President's Council of Economic Advisers
(CEA) estimated that if the annual growth rate of health spending slows
by 1.5 percentage point, new jobs could rise by 500,000.
-- The health insurance exchange will expand options for coverage,
making small businesses a more attractive place for people to work, and
encouraging people to start up businesses of their own.
-- Health insurance reform could save 80,000 jobs in the small
business sector by 2019 and increase take-home pay by almost $30
billion.
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"Businesses across the country are struggling under the weight of high health care costs," Secretary Sebelius said. "Health insurance reform will help lift this burden, help businesses prosper, and ensure workers have the affordable, quality health care they need."
A fact sheet regarding the analysis is included below.
Fact Sheet: New CBO Analysis Confirms Benefits of Health Insurance Reform for Businesses
American businesses know the health care status quo is unacceptable. Since 2000, premiums have more than doubled, a rate three times faster than the growth in wages. Between 2000 and 2009, the percentage of firms offering coverage fell from 69 to 60, with much of that drop occurring in the past year alone. Small businesses in particular struggle under the current health care system. For firms employing less than 10 workers, the erosion in coverage is striking -- from 57 percent offering coverage in 2000 to 46 percent offering coverage in 2009. If we do nothing, over the next ten years, health care costs for large businesses are projected to reach $28,530 per employee, a 116 percent increase from 2009.
A new analysis by the Congressional Budget Office (CBO) affirms that businesses' health insurance costs will be lower under health insurance reform -- even though the analysis does not take into account the full range of policies that will benefit businesses.
Health Insurance Premiums for Businesses According to CBO. In a November 30 letter to Senator Evan Bayh, CBO assesses the impact of the Patient Protection and Affordability Act on premiums for the individual, small-group, and large group markets. In 2016, CBO estimates that 159 million or 83 percent of privately insured people will be insured through employers.
Premiums for small business will go down. Small businesses are likely to see premiums drop by 1 to 4 percent under the proposal due to lower prices. These lower prices come from:
-- Lower administrative overhead. Right now, each small business
has to consult with a broker or hire someone to collate plan
information, assist employees with decisions, and handle issues as they
arise. Under reform, in the exchange, there will be people whose job it
is to provide plan information and facilitate enrollment. The exchange
centralizes what is otherwise a process that is extremely duplicative,
streamlining administrative costs and lowering premiums.
-- Greater competition. CBO attributes savings to "providing a
centralized marketplace in which consumers could compare the premiums of
relatively standardized insurance products." This includes competitive
pressure from a public health insurance option.
-- Administrative simplification. Physicians spend on average about
140 hours and $68,000 a year just dealing with health insurance
bureaucracy. By simplifying and standardizing paperwork and
computerizing medical records, doctors will be able to focus on caring
for their patients instead of dealing with bureaucracy. CBO estimates
nearly $20 billion in Federal savings over 10 years, with additional
savings accruing to businesses and families.
Up to 3 percent premium savings as the risk pool for employer-based coverage improves. Today, businesses have seen their premiums skyrocket every year, with many facing double digit percentage increases in their premiums. Health insurance reform will stop this trend.
With nearly 30 million additional Americans gaining health insurance, the purchasing pool for businesses will expand and, largely, improve. Big businesses will save from 0 to 3 percent on premiums due to the changing risk pool while small businesses could save 1 percent on
premiums.
Better options for small businesses. Small businesses would gain access to the health insurance exchanges and new benefit options and tax credits under reform.
-- 3.6 million small businesses could qualify for a tax credit to
help pay their premiums.[vii] An estimated 12 percent of people insured
through small businesses will qualify for tax credits that lower
premiums by 8 to 11 percent. This translates into $620 to $860 for
individuals and $1,540 to $2,120 for families assuming that the coverage
is comparable to what they get today.
-- Today, small businesses often have coverage that has high
deductibles and gap-ridden benefits. The legislation offers such
businesses better options that CBO assumes businesses will take. Such
better coverage has premiums that are 0 to 3 percent higher than the
average plans today, but will save money for employees by ensuring they
are not forced to pay high out-of-pocket costs for services not covered
by their current insurance.
-- In the current health insurance system, small businesses may see
premiums skyrocket if just one or two workers fall ill and accumulate
high medical costs. Health insurance reform will prevent insurance
discrimination based on health status, meaning that small businesses
will no longer be unfairly penalized if a worker falls ill.
9 to 12 percent premium savings for high-premium plans under current law. By assessing high-cost plans, the excise tax encourages businesses and individuals to streamline coverage, leading to lower premiums over time.
-- CBO estimates that the 19 percent of people in employer-coverage
in high-cost plans today will pay 9 to 12 percent less under reform.
This translates to premium savings of at least $835 for single and
$2,070 family policies.
-- This could yield increases in workers wages, by around $70
billion in 2019.
Nearly $10 billion in savings for small businesses.
-- Under current law, CBO estimates premiums to be $7,800 for
single policies and $19,300 for families in the small group market.
-- Small businesses that opt for comparable coverage under reform
could save up to $390 for single policies and $965 for family policies.
Assuming all 25 million people insured through small business save at
least $390 (more for families), this will yield nearly $10 billion in
savings in 2016 alone.
-- Additional savings will accrue to low-wage, small businesses
that newly offer coverage in the exchange. CBO estimates that roughly
12 percent of people in the small group market would get the credit
which would reduce premiums by about 10 percent in 2016. Multiplying
this by the population and average premiums in the report, this suggests
that about one and a half million people would save roughly $780 per
person on premiums in 2016.
-- Even those that CBO estimates will "buy-up" will save, paying
$100 less per family for coverage that is more protective.
At least $13.4 billion in savings for large businesses.
-- Under current law, CBO estimates premiums to be $7,400 for
single policies and $20,300 for families in the large group market.
-- CBO estimates that, under reform, large business premiums will
drop by $100 per single policy and $200 per family policy. With 134
million people enrolled in such coverage, this translates into at least
$13.4 billion in savings in 2016 alone.
Businesses can keep what they have.
-- CBO affirms that any proposed benefit mandates would not affect
the small or large group markets: "The requirement would have relatively
little effect on premiums in the small group market, however, because
most policies sold in that market already cover those services and would
continue to cover them under current law."
-- CBO also affirms the effectiveness of the grandfather policy:
"Further, small group policies that are maintained continuously would be
grandfathered under the proposal."
-- In the large group market, CBO affirms that "[Benefit]
requirements would have no significant effect on premiums in the large
group market."
No cost-shifting to the employer-based insurance market.
-- CBO states: "... CBO's assessment is that the legislation would
have minimal effects on private-sector premiums via cost shifting."
Additional Policies To Benefit Businesses. CBO does not include in its analysis several additional policies in the Patient Protection and Affordable Care Act that would benefit businesses.
Reinsurance for businesses that cover early retiree plans.
-- The proportion of employers that offer retiree coverage has been
declining precipitously over time, from 66 percent in 1988 to 29 percent
in 2009.
-- The proposal would provide a time-limited, Federal reinsurance
program to cover some of the cost of covering early retirees. This
translates to savings of up to $1,200 off the premium of every family
plan offered by that company.
Policies to slow health care cost growth.
-- Insurance oversight: In recent years, several states' insurance
commissioners have rejected unjustifiably high premium increases in the
small group and individual insurance markets. Health insurance reform
will allow insurance commissioners to continue to play this important
role and require transparency and oversight of premium increases.
-- Delivery system reform. Health insurance reform will invest in
care innovations such as accountable care organizations, make healthcare
providers more accountable and efficient through value-based purchasing,
and improve quality and patient safety, including reducing preventable
readmissions. A recent report by the Business Roundtable found that if
many of the delivery system reforms were adopted by the private sector,
large businesses could save $3,000 per employee by 2019.
-- Lowers expensive drug costs. Biologic drugs are some of the most
expensive drugs on the market, and yet there is no streamlined avenue to
get generics on the market to provide lower-cost alternatives. Reform
will create an expedited process to make generic biologic drugs
available, significantly lowering drug costs.
Immediate benefits. While the CBO report provides savings estimates for 2016, several of the policies discussed above would take effect immediately, including early retiree reinsurance, administrative simplification, small business tax credits, and increased oversight of the insurance industry.
Benefits to Businesses Beyond Lower Costs. CBO focused exclusively on health insurance premiums which are critical to businesses. There would be other benefits of health reform for businesses as well.
Improved workplace productivity.
-- The Institute of Medicine found that lost productivity due to
untreated illness among uninsured workers cost businesses between $75
billion and $150 billion per year. Expanding coverage to the uninsured
will create a more productive workforce.
-- Current job-lock (inability to leave current employment if it
will result in loss of health insurance) has been demonstrated to hurt
the economy through reduced productivity, and prevents an employee from
taking a job with potentially higher wages. By ending limitations on
coverage based on pre-existing conditions and expanding portable
coverage options through the health insurance exchange, reform will
increase the flexibility and productivity of the workforce.
New jobs.
-- Bringing down the cost of healthcare will enable investments in
business and job creation. The President's Council of Economic Advisers
(CEA) estimated that if the annual growth rate of health spending slows
by 1.5 percentage point, new jobs could rise by 500,000.
-- The health insurance exchange will expand options for coverage,
making small businesses a more attractive place for people to work, and
encouraging people to start up businesses of their own.
-- Health insurance reform could save 80,000 jobs in the small
business sector by 2019 and increase take-home pay by almost $30
billion.
-----
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Wednesday, June 17, 2009
PIA Opposes Kennedy Proposal to Create Health Insurance "Navigators"
/PRNewswire/ -- A proposal to award grants to public and private entities to conduct public education, distribute information and assist with health insurance enrollment is ill-advised, according to the National Association of Professional Insurance Agents (PIA).
The proposal is part of the Affordable Health Choices Act introduced by Sen. Edward M. Kennedy (D-Mass.), chairman of the Senate Committee on Health, Education, Labor & Pensions.
Section 3105 of the Kennedy bill says American Health Benefit Gateways would be created in every state, serving as a health insurance exchange. A "Navigators" program would award grants to public and private entities to "conduct public education; distribute fair and impartial information regarding health plans; [and] assist with enrollment and provide information that is culturally and linguistically appropriate for the population." The bill stipulates that both health insurance issuers and current independent insurance agents would be prohibited from participating in the Navigators program.
"This proposal would give federal grants to groups with no background or expertise in health insurance the responsibility to advise businesses and individuals regarding their health insurance decisions," said PIA National President Kenneth R. Auerbach, Esq. "In addition, it would specifically exclude licensed health insurance agents or brokers from participating, which makes no sense at all."
"Consumers already turn to their local professional insurance agents to help them navigate the current maze of health insurance choices," Auerbach said. "There's no need to recreate that system. The Kennedy proposal would use taxpayers' dollars to set up what are, in essence, federal insurance agencies for health insurance in every state, with the proviso that those with health insurance experience would be barred from being involved."
Auerbach expressed concern that entities receiving grants to act as health insurance "Navigators" could be community groups, labor unions, or other organizations with no experience in health insurance and that might be biased in favor of a government-option in health insurance, with the potential to inappropriately steer people away from opting for private health insurance plans.
PIA believes that Congress should build on the private health care delivery system, not seek to dismantle it. PIA vehemently opposes the creation of government-funded insurance agencies or brokerages for health care insurance that would displace professional insurance agents.
"It is our hope that this flawed section of Sen. Kennedy's bill that creates federally-backed insurance brokerages with no expertise in health insurance will be removed as the legislative process continues," said PIA Director of Federal Affairs Mike Becker.
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The proposal is part of the Affordable Health Choices Act introduced by Sen. Edward M. Kennedy (D-Mass.), chairman of the Senate Committee on Health, Education, Labor & Pensions.
Section 3105 of the Kennedy bill says American Health Benefit Gateways would be created in every state, serving as a health insurance exchange. A "Navigators" program would award grants to public and private entities to "conduct public education; distribute fair and impartial information regarding health plans; [and] assist with enrollment and provide information that is culturally and linguistically appropriate for the population." The bill stipulates that both health insurance issuers and current independent insurance agents would be prohibited from participating in the Navigators program.
"This proposal would give federal grants to groups with no background or expertise in health insurance the responsibility to advise businesses and individuals regarding their health insurance decisions," said PIA National President Kenneth R. Auerbach, Esq. "In addition, it would specifically exclude licensed health insurance agents or brokers from participating, which makes no sense at all."
"Consumers already turn to their local professional insurance agents to help them navigate the current maze of health insurance choices," Auerbach said. "There's no need to recreate that system. The Kennedy proposal would use taxpayers' dollars to set up what are, in essence, federal insurance agencies for health insurance in every state, with the proviso that those with health insurance experience would be barred from being involved."
Auerbach expressed concern that entities receiving grants to act as health insurance "Navigators" could be community groups, labor unions, or other organizations with no experience in health insurance and that might be biased in favor of a government-option in health insurance, with the potential to inappropriately steer people away from opting for private health insurance plans.
PIA believes that Congress should build on the private health care delivery system, not seek to dismantle it. PIA vehemently opposes the creation of government-funded insurance agencies or brokerages for health care insurance that would displace professional insurance agents.
"It is our hope that this flawed section of Sen. Kennedy's bill that creates federally-backed insurance brokerages with no expertise in health insurance will be removed as the legislative process continues," said PIA Director of Federal Affairs Mike Becker.
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