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 May 6, 2013

The road to full implementation has been bumpy for the Affordable Care Act (ACA) of late. Last week, the Kaiser Family Foundation released a new tracking poll that shows Americans remain confused about the law, with more than 40 percent unaware that the ACA is in effect. The ACA remains unpopular, with 35 percent having a favorable view of it while 40 percent have an unfavorable view. A majority of Americans, however, disapprove of trying to block the law by defunding it. The ACA has been the target of heavy political criticism of late – even Democratic Senator Max Baucus (MT) predicts an implementation “train wreck” ahead for ACA implementation. The Obama administration, however, moved to head off additional criticism when last week it released new applications for individuals and adults looking to get health insurance. Officials cut the forms down from 21 pages to seven pages for a family and three pages for an individual


House Energy and Commerce Committee Chairman Fred Upton (R-MI) and Senate Finance Committee Ranking Republican Member Orrin Hatch (R-UT) have released a report titled, “Making Medicaid Work.” The document outlines options for reforming Medicaid in two areas:  1) equipping states to implement patient-centered reforms to improve the quality of care provided to Medicaid enrollees; and 2) adopting per capita caps to achieve fiscal discipline in the program. To address Medicaid financing reform, the proposal would place federal per capita caps on the four major groups of Medicaid beneficiaries: aged, blind and disabled, children, and adults.  The overall federal per capita allotment would be based on the product of a state’s number of enrollees in each of these four categories and a per capita amount that would be established for each population category.  In addition, states that meet benchmarks with respect to costs, access, and quality would be awarded bonus funds.


ARIZONA: An end to the 2013 legislative session remains elusive as Medicaid expansion stakeholders remain at a stand-off. Governor Jan Brewer has vetoed a number of related bills, including some sponsored by Republican opponents of the expansion. Some have speculated that a message is being sent to legislator opponents to reconsider their position. Supporters of the expansion have ramped up their media campaign, with AARP running a full page ad in the Arizona Republic.

CALIFORNIA: The business community is rallying opposition to legislation that would impose a number of significant new penalties on private employers with 500 or more employees in the state. Opponents fear the legislation could lead to a dramatic increase in the amount of frivolous litigation employers face. The legislation proposes a penalty on employers if any of their employees, who work as little as eight hours per week, enroll in California's Medi-Cal program. The legislation is aimed at part-time and seasonal workers for whom large employers are not required to provide affordable health care coverage pursuant to the ACA.

CONNECTICUT: The non-partisan fiscal analysis arm of the General Assembly, Office of Fiscal Analysis and the Governor's Office of Policy Management issued its consensus revenue estimates for the biennium budget – the estimate is nearly $500 million less than what the governor used to propose his budget in February.  This has put additional pressures on the budget-making process during the final five weeks of the regular session.  However the current fiscal year ending on June 30th is now projected to conclude with a surplus of about $150 million.

FLORIDA: The legislature adjourned last week after passing a budget that does not include funding for a Medicaid expansion. Unless the Republican-controlled legislature comes back for a special session later this year, a move some Democrats are calling for, Florida will not expand Medicaid in 2014. Legislators could not reach agreement on Medicaid expansion despite Republican Governor Rick Scott’s endorsement of expansion in February. An estimated 1.3 million Floridians were expected to gain coverage through the Medicaid expansion.

MAINE: The Joint Committee on Insurance & Financial Services voted to send to the full legislature a bill that would require one geographical rating area for the state’s individual and small group products, and legislation that would reinstate prior approval and public hearings for rate filings in the individual market.  Full legislative votes are expected in the next several weeks. Separately, legislators are continuing to pursue legislation authorizing an Exchange Advisory Council, which would work with the Bureau of Insurance to evaluate implementation of the federally facilitated exchange.  The council would review and make recommendations on consumer outreach and enrollment, coordination between the state’s Medicaid program and the exchange, and whether health insurance coverage through the exchange is affordable.  Legislators are trying to craft language that ensures distinctions between navigators and insurance producers are not breached.  Final amendments to the legislation are expected to be advanced to the full committee this week.

MASSACHUSETTS: Attorney General Martha Coakley released a report on health care costs in the Bay state that raises a red flag concerning provider consolidation and alignments.  The annual report, titled “Examination of Health Care Cost Trends and Cost Drivers," provides six key findings, such as the fact that employers and consumers are increasingly enrolling in health insurance products that engage them in efforts to reduce their health care costs.  The report also found that "provider consolidation and alignments have significant market implications that should be carefully reviewed, particularly where proposed consolidations may reduce access to lower-cost options for consumers and undermine efforts to promote value-based decisions by purchasers."  The report offered five specific recommendations on how regulators can monitor the consequences of current health care market trends.

NEW YORK: With on-exchange product filings due on April 30, the exchange staff have been advancing consumer outreach and awareness sessions.  A series of regional advisory committee meetings have been scheduled around the state for the last two weeks in May. Exchange staff members are conducting outreach webinars through stakeholder groups, including local chapters of the health underwriters.  Off-exchange small group and individual product filings are due May 15.

WEST VIRGINIA: With Senator Jay Rockefeller, a major proponent of Medicaid expansion, standing nearby, Governor Earl Ray Tomblin last week announced his support for implementing Medicaid expansion. The governor said he anticipates expansion would allow the state to provide insurance coverage to approximately 91,500 working West Virginians, significantly reducing the number of uninsured. He warned, however, that state will proceed with a watchful eye on federal support for the program.  He said, “If the program becomes unsustainable, particularly after three years, or the federal government changes its promised funding allocations, we must be prepared to take action to protect our state.” It remains to be seen whether there will be popular support for Medicaid expansion in a state that in the last election went heavily in favor of President Obama’s Republican opponent.


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