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 24, 2013

A Government Accounting Office (GAO) report has found what many already suspected – that the smooth launch of federally facilitated health insurance exchanges by October 1, 2013 is no sure thing. The report notes that much has been accomplished so far, but whether this progress and contingency planning are enough to assure smooth and timely implementation of exchanges cannot yet be determined.  

A couple of other reports released last week had more promising implications for the Affordable Care Act (ACA). A Robert Wood Johnson analysis found that the number of insurers offering individual coverage to consumers on exchanges this fall will be greater than “normal.”  Also, a Kaiser Family Foundation tracking poll found that the vast majority of Americans believe it is important to have health insurance – even young people (more than 70 percent) value health insurance. The findings could be significant since many critics question whether young people will purchase coverage because of anticipated high costs and light penalties for failure to comply. 


The Senate Finance Committee held a hearing last week on health care costs and price transparency that featured testimony from Steven Brill, the author of a widely circulated TIME magazine story on exploding health care costs titled, “The Bitter Pill: Why Medical Bills Are Killing Us.” Brill said he discovered that health care prices are not based on a “functioning marketplace” -- reflecting the cost of producing the product and the laws of supply and demand. He expressed particular concern about the impact of tax-exempt, non-profit hospitals that are the most profitable businesses in many communities across the nation. Brill added that the ACA “does nothing” to address high health care costs. Looking forward, Brill said that price transparency is an important first step to a solution but that other steps are needed.

The hearing also included testimony from three other witnesses, including Suzanne Delbanco, executive director of Catalyst for Payment Reform, who testified regarding barriers to transparency.  She suggested that the federal government should share charge, payment, and quality information for a much broader range of Medicare providers and services; 2) require price transparency from qualified health plans participating in federally facilitated exchanges; and 3) ensure that employers and consumers have access to their own claims data. Paul Ginsburg, president of the Center for Studying Health System Change, suggested that purchasers and health plans, rather than reporting prices to enrollees, should analyze data on costs and quality to develop benefit designs that provide incentives for enrollees to choose high-value providers. 


ARIZONA: While the legislative debate over the expansion of Medicaid coverage has come to end, the controversy continues. The conservative think tank the Goldwater Institute, several conservative legislators and other opponents are now poised to potentially derail implementation through a ballot initiative that would enable voters to decide the issue. If a sufficient number of valid signatures can be presented to the Secretary of State in support of the ballot question, implementation would be suspended. Republicans legislators who supported Governor Jan Brewer on Medicaid expansion are concerned they will be targeted for defeat during the 2014 election.

CONNECTICUT: When it meets on June 26, the Board of Access Health CT appears ready to adopt recommended carrier network requirements that, coupled with other exchange network requirements, exceed federal standards.  Two advisory committees of the exchange have recommended to the board that carriers must have 75 percent of the Essential Community Providers (ECPs) listed by the U.S. Department of Health and Human Services as participating by January 1, 2014, 35 percent of a more expanded ECP list that Access Health CT produced by January 1, 2014, and 75 percent by January 1, 2015.  Meanwhile Access Health CT has launched its marketing plan, which includes the airing of television commercials.

MAINEIn votes taken last week, the legislature failed to override Governor Paul LePage’s veto of Medicaid expansion legislation modeled on the ACA’s recommended approach. The Democratic majority pulled out all the stops to keep the bill alive but fell two votes short of the two-thirds majority needed to override a veto.   Several other bills are awaiting the Governor’s signature, including legislation that would require prior approval of individual insurance rates. Another bill on the governor’s desk would, effective 2015, move Maine to one geographic rating area for setting health plan rates.

MICHIGAN: The legislature recessed for the summer last week without Medicaid expansion coming to a vote in the Senate. The House earlier had approved a Medicaid expansion bill with limits on eligibility that would have required a federal waiver.  Governor Rick Snyder urged the Senate to vote for expansion, but Senate Republicans refused to call the bill for a vote. While Democrats were supportive of the bill, Republicans appeared to have procedural issues in the waning hours. The issue is expected to be on the Senate’s agenda for the fall. Governor Snyder indicated that a vote in the fall would likely delay implementation and enrollment by several months into 2014 at the earliest.

NEW HAMPSHIRE: The legislature will vote on a $10.7 billion, two-year state budget that would increase funding to higher education and services for the disabled and mentally ill but does not authorize expanding Medicaid. The Republican-led Senate negotiating team and Democratic-House team traded several proposals on Medicaid expansion before agreeing to establish a commission to study the possible impact of the proposed expansion on the state. The commission also will examine possible alternatives, such as using federal funding to buy private insurance for some residents. Legislative leaders could call a special session to vote on Medicaid expansion after the commission files its report. The Governor could also call lawmakers into special session if there is agreement, after the report is filed, to start coverage expansion by January 1, 2014. 

NEVADA: Medicaid expansion has been enacted in Nevada without fanfare. Republican Governor Brian Sandoval, an early adopter of expansion, recently approved funding for the measure as part of his budget, with appropriations spread across several bills. 


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