Health Reform Weekly
A weekly compilation from Aetna of health care-related developments in Washington, D.C. and state legislatures across the country.
Week of June 17, 2013
Enrollment in Medicare Advantage plans has jumped 10 percent since last year, according to a new report from the Kaiser Family Foundation. A record 14.4 million seniors are now enrolled in private Medicare plans despite fears that payment rate changes required under the Affordable Care Act (ACA) would hurt enrollments. Additionally, the continued growth in enrollments came despite a decline in the number of plans available. The popularity of Medicare Advantage speaks to the value seniors find in the private coverage option. But the authors of the research warn that the full impact of the ACA cuts has not been felt yet and that the changes could still disrupt the market.
Federal
The House Energy and Commerce Subcommittee on Health held a hearing last week on “The Need for Medicaid Reform: A State Perspective.” The hearing included testimony from state officials in Arkansas and South Carolina, and a former state official from Indiana. Subcommittee Chairman Joe Pitts (R-PA) raised concerns about the financial challenges states face, as Medicaid costs account for an increasingly larger share of overall state budgets. He expressed support for providing states greater flexibility to implement innovative reforms that improve the quality of care for beneficiaries and modernize their Medicaid programs. States can adopt reforms under demonstration waivers, but Pitts expressed concern that CMS takes a long time to approve such waivers. Ranking Democratic Member Frank Pallone (D-NJ) discussed his support for the ACA’s Medicaid eligibility expansion, and stated that the existing waiver process already provides flexibility for states to adopt innovations. He also expressed concern that Republican proposals to reform Medicaid would place greater financial burdens on Medicaid beneficiaries.
States
ARIZONA: The legislature adjourned on June 14 after finally passing Medicaid expansion as part of a Senate budget bill. Adjournment came nearly two months after the normal close of session thanks in part to the contentious issue of Medicaid expansion. The final week was filled with high drama as the House Appropriations Committee voted down the Senate budget bill. Speaker Tobin adjourned the House for several days, but Governor Jan Brewer then called a special session to convene immediately. A coalition of Democrats and Republicans approved the measure, which was supported by the governor.
CALIFORNIA: Insurance Commissioner Dave Jones is calling on the Covered California exchange to exclude the state’s largest for-profit health insurer, Anthem, from the small business or SHOP exchange. The Commissioner is taking the long-shot step of asking the Board of Covered California to exclude Anthem, as he explained it, to “hold health insurers accountable when they are raising rates unreasonably.” The media and consumer groups also are beginning to react to the rates filed by some insurers for the state’s insurance exchange next year.
FLORIDA: Governor Rick Scott has announced that final approval has been given by the Centers for Medicare and Medicaid Services (CMS) to extend Medicaid managed care to all counties in the state. In addition, the waiver amendment allows the state to improve on the managed care model originally developed for the five-county reform demonstration that began in 2006. The Managed Medical Assistance program is tentatively scheduled to begin enrolling individuals in April 2014 and is anticipated to have approximately 2.9 million recipients when fully implemented.
MAINE: Prior to passing a final budget package late last week, the House passed a compromise measure previously passed by the Senate that would allow the state to expand Medicaid under the ACA with a three-year sunset date on the expansion. The bill managed to attract slightly more support than the Medicaid expansion bill considered in the last go-around in the House, but it still fell short of the two-thirds threshold needed to override a near-certain veto from Governor Paul LePage. Legislators in both houses continue to evaluate their options as the governor threatens to veto the bipartisan budget agreement, which also passed short of the two-thirds threshold. Further complicating the scenario is the looming end of the legislative session.
MASSACHUSETTS: The legislature is considering several changes in health-care related assessments. Both houses are proposing to shift $9 million in administrative costs for running the Health Safety Net onto payers and hospitals and begin a surcharge on payers outside of the current $160 million annual assessment. In addition, the proposed budget in the House for the newly created Center for Health Information and Analysis (CHIA) is $22.5 million, while the Senate version is $26.7 million. Similar to the Health Safety Net, hospitals and payers finance CHIA through an annual assessment process based on the budget for the agency. Finally, the Senate proposed budget would increase funding for the vaccine trust fund by 7 percent in 2015 and 2016. Both houses set the current level at $54.4 million.
NEW HAMPSHIRE: Senate Republicans rejected a bill that included language allowing the state to accept a $5.3 million federal grant to provide consumer education related to the implementation of the ACA. The Democrat-led House attached the language to an unrelated bill last week and sent it to the Senate. But the Senate’s Republican majority decided to kill the bill rather than pass it or send it to a committee of conference for further discussion. Gov. Maggie Hassan’s office has indicated it will continue to push for acceptance of the grant as the budget process moves forward.
OHIO: Companion bills have been introduced in the House and Senate to establish the framework for Medicaid reform. One goal of the bills is to reduce the number of individuals enrolled in the Medicaid program who have the greatest potential to obtain health care coverage through an employer or the health insurance marketplace. The bills set broad requirements for the Medicaid director but do not specify what reforms are needed to accomplish the requirements. While the bills do not include Medicaid expansion, discussions continue about including expansion language as an amendment once further discussions take place. Hearings on the bills will begin in the near future and could pass before the General Assembly recesses July 1.
Resources
Health Reform Connection
America's Health Insurance Plans
Aetna 2011 Annual Report
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