Thursday, December 30, 2010

Health Reform Benefits in 2011

It’s the new year, and that means new benefits from the Affordable Care Act (also known as the health reform law.) Seniors enrolled in Medicare’s prescription drug plan (Medicare Part D) will spend out of pocket. Currently, when a people with Part D have used $2,830 of their drug benefit, they are required to pay the entire cost until they reach a certain threshold. This is called the Part D coverage gap, or the “doughnut hole”. With the ACA, pharmaceutical companies are required to provide consumers with a 50% discount on all non-generic drugs while they’re in the coverage gap, and a 7% discount on generic prescription drugs. Although seniors will be paying less for their medications while in the coverage gap, the full price will be applied, getting them through the gap more quickly. By 2020 the coverage gap will go away entirely (see the AARP for further explanation).

Also effective January 1st is the implementation of the minimum medical loss ratio. We wrote about this previously; it requires that insurers spend at least 80% of the premiums they collect on medical care, instead of on advertising or paying their employees.

Doctors will soon find it easier to care for patients relying solely on Medicare. Although most physicians continue to accept Medicare, some primary care physicians find it quite hard to provide their patients with necessary services on the rates they are paid. Starting January 1st, Medicare payments for primary care and general surgeons in shortage areas will rise by 10%. Unfortunately, this increase will only last through 2015, at which point Congress will likely have to address the issue again.

Also effective January 1, seniors on Medicare will no longer have to pay copays for some preventive services. This will be limited to services that have been rated “A” or “B” by the United States Preventive Services Task Force. These are services that, based on available evidence, are likely to provide either moderate or substantial benefit, either by improving well-being or preventing death. This includes screening for elevated blood pressure, cervical cancer, cholesterol, colon cancer, vision testing in children, counseling for tobacco abuse, screening for osteoporosis, and many other services. Although there is disagreement among different experts regarding breast cancer screening, the ACA also covers mammograms for all women over 40, although the USPSTF no longer recommends routine mammograms for women under age 50.

Another small change you’ll notice is nutritional labeling for all food sold at chain restaurants and in vending machines. We already have nutritional labeling in New York City. There is no evidence that knowing how many calories are in the meals bought at chain restaurants changes behavior, or even that people understand what the numbers mean, but for some people knowing the information is valuable (starts in March).

We can also expect some smaller programs aimed at sparking innovative approaches to improve the way we deliver health care. The Center for Medicare and Medicaid Innovation will design and implement multiple small projects by consulting with stakeholders, including medical providers, insurers, and patients, to improve the quality of medical care by streamlining what is often a fragmented system. The goal is to find new models of health care delivery that will improve care and save money. For more information see the CMS innovations site. Another smaller project will give increased Federal support for 2 years to patient-centered medical homes (also known as health homes).

In Graduate Medical Education, Teaching Health Centers (where residents, or doctors-in-training who have finished medical school) will be funded as residency sites for 5 years. Residency slots will be redistributed to favor primary care training. These changes will occur in July.

Some other behind-the-scenes changes include grants to help Medicaid enrollees develop healthier lifestyles, as well as grants to small employers to develop similar wellness programs. States will receive grants to start planning their insurance “markets”, also known as the American Health Benefit Exchanges and the Small Business Health Options Program Exchanges. Enrollment in the Exchanges is planned for 2014.

Cost-saving measures include no longer paying hospitals for certain preventable infections acquired in hospitals; restructuring Medicare Advantage programs so that they are no longer subsidized at the expense of other Medicare beneficiaries (currently Medicare Advantage plan members receive extra benefits when compared with traditional Medicare beneficiaries, due to a 13% increased payment to the plans compared to those on traditional Medicare; the subsidy will decrease to 1% on average, but it will vary from state to state. See the Wall Street Journal for more information. Those with tax-free health savings accounts will only be able to over-the-counter drugs covered if prescribed by a physician. Individuals earning over $85,000 per year (couples earning more than $170,000) will continue to pay premiums for Part B coverage, but instead of having this threshold increase yearly it remains frozen. This will only affect about 5% of Americans. Similarly, about 3% of Part D enrollees will be subject to a new premium for this drug benefit program. These changes are in effect on January 1st.

Several other provisions include changes to long-term care, an optional disability insurance program, and several other items. For a full explanation see the Kaiser Family Foundation or

The vast majority of Americans will see many benefits from these changes. A small percentage will benefit, but also will have to pay more for some of their benefits; some may end up saving money despite this increased cost due to full coverage of preventive services.

Thursday, December 23, 2010

The grinch who stole health care reform?

Families USA does a great job reminding us of all the good the Affordable Care Act has already done with their holiday-themed post, "Five things the health care grinches don't want under your tree this year." The Republicans (and some Democrats) are looking forward to dismantling the law. We hope they don't want to roll back everything we've gotten so far: coverage for all kids regardless of health problems, no cost-sharing for most preventive services in new health plans, help for businesses to cover their employees, coverage for young adults, and new high risk pools for people with pre-existing conditions. Plus there's more to come in January of 2011, including lower drug costs for seniors on Medicare; free preventive services for seniors; requirements for insurance companies to spend premiums on care, not on advertising; and help coordinating safe discharges from hospital to home for vulnerable patients. Read more at Families USA's Stand Up for Health Care project and at

Happy holidays, and we look forward to working with all of you next year as week keep fighting for health for all.

Monday, December 13, 2010

Reform law repeal? Unlikely; many benefits already in effect.

Since the Patient Protection and Affordable Care Act (PPACA, also known as the health reform law) was signed into law, its detractors have been bringing lawsuits everywhere they can find a willing prosecutor. More than 20 suits have been filed around the country, several of which have been dismissed (in Michigan and Virginia), and the majority of which are pending. On December 13th, the lawsuit in the Eastern District of Virginia was upheld when the judge ruled the mandate for individuals to buy insurance was unconstitutional, and that the Commerce Clause (regarding regulation of interstate finance) does not allow for a mandate to purchase health insurance (for a complete listing of lawsuits and their status, see The Washington Post). Other clauses are also an issue, but I'll leave that to the experts. Although the judge ruled that component of the law unconstitutional, the rest of the law is not affected.

Some constitutional scholars seem less than pleased with this ruling. Professor Stephen Schwinn, at the American Constitution Society Blog, notes that the decision goes far beyond a ruling on the individual mandate. He argues that the ruling is consistent with rolling back decades of judicial thought and returning the role of the courts to those of the first half of the 20th century. At that time, the Commerce Clause was defined quite narrowly, allowing the courts to obstruct congressional activity considerable. In the late 1930s, the courts moved to a more pliant interpretation of the Commerce Clause, taking into account the complexity of our modern economy. (Please read more about it here as I am not a lawyer). President Obama, himself a Constitutional scholar, clearly believes this law to be appropriate and within the mandates of the Constitution. There are, of course, some scholars who disagree and believe that requiring people to purchase health insurance is not allowed by the Commerce Clause. Most likely this will end up in the Supreme Court, according to policy watchers.

Most supporters of the PPACA believe that an individual mandate to buy insurance is required. Although the individual mandate was in part a bargaining chip to bring insurers on board to support health reform rather than bring their full advertising muscle against it, it also has value in making the system sustainable. If people are not required to buy health insurance but insurers are required to sell it to everyone regardless of their medical history, some people will simply wait until they’re ill to buy the insurance. If everyone does this, there won’t be enough money in the system to pay for expensive hospital stays or surgeries for those who are ill. As a result, everyone who does pay insurance will have to pay more to cover those who are sick, while others get a free ride. Worse, people may still not even buy insurance when they’re sick, then not pay their medical bills. Again, everyone else ends up having to pay more to make up for the people who don’t pay their part. (Here’s a helpful (if dry) video from the Kaiser Family Foundation that explains the concept of the individual mandate more thoroughly)

Nobody wants to have to pay for insurance, especially if they don’t think they need it. On the other hand, none of us want to see our friends, family, and neighbors suffer because they can’t afford to see a doctor. In addition, most people will qualify for coverage that is either free or significantly subsidized. Ironically, many of those calling for repeal are those who will have free health care in 2014 when the full effects of the law take place.

The health reform law is already benefiting many people, by requiring insurers to cover preventive services, eliminating pre-existing conditions for children, extending coverage to young adults, and creating special insurance plans for people with pre-existing conditions (see for details on all of these provisions). In 2014 it will benefit far more people, with improved eligibility for Medicaid, subsidized insurance options for the majority of Americans who are uninsured, elimination of denials for coverage for pre-existing conditions, and many other changes. (Find out how much you can expect to save with the Kaiser Foundation’s subsidy calculator)

The individual mandate is just one part of a large reform package meant to improve the way people get health care in the US. While its future remains uncertain, the remainder of the plan is intact, and many more benefits can be expected in the future.

Thursday, December 9, 2010

More good news for consumers as a result of the Affordable Care Act: No more “mini-med” plans

HHS recently released guidance regarding limited benefit insurance plans. These plans tend to be much less expensive than more comprehensive plans. The tradeoff, unfortunately, is that coverage falls short of what’s needed when the subscriber gets sick. Some plans only pay $100/day in the hospital (which the true cost can be well over $1,000/day), or have extremely low maximum benefits of only a few thousand dollars.

These plans are fine for those who are healthy, but any chronic condition or any acute event will rapidly exhaust the coverage, leaving the subscriber without any way to pay for needed care. This is the reason such plans will no longer be permitted starting in 2014.

In the meantime, those people who have no other choice but to continue to use such plans now have increased protection. The plans must make the limits of coverage clear to all subscribers, and must provide information on how to access more options through the website. New limited benefit plans are not allowed (with some exceptions), and existing limited plans will have to obtain waivers to continue operating, and will no longer be allowed at all in 2014.

Although this will make insurance prices go up for some in the future, at this time it ensures consumers know what they’re getting and know where to go to find out about more comprehensive plans. Although the limited benefit plans are better than nothing, people deserve the peace of mind that comes with not worrying if the next medical problem they face will lead to bankruptcy.

Friday, December 3, 2010

Town Hall in Brooklyn December 2nd, 2010

NPA New York Local Action Network cosponsored an event on December 2nd with multiple organizations** entitled “Health Reform: The Battles Ahead in Albany and Washington.” Those who attended were fortunate to hear from New York experts Dr. John McDonough (Distinguished Fellow in Public Health at Hunter College); Mark Hannay (Director of Metro New York Health Care for All); Kinda Serafi (Senior Health Policy Associate at the Children’s Defense Fund); NPA’s Dr. Bill Jordan (NPA board member and co-chair of health policy for the Public Health Association of New York), Jenny Rejeske (Director of Health Advocacy for the New York Immigration Coalition), and Lois Uttley (Director of the Mergerwatch Project, co-founder of Raising Women’s Voices for the Health Care We Need, and Board Member of PHANYC).

Dr McDonough began the talk with an overview of the provision of the Health Reform Act, also known as the PPACA. The goal of the act is to improve access to health care through nine different measures:

1) Affordable and available coverage through creation of an insurance exchange and subsidies

2) Reforms of Medicaid and CHIP (Child Health Insurance Program) to increase the number of people eligible by changing income requirements and covering single adults

3) Delivery system reforms to lower the rate of spending increase throughout the system

4) Prevention and wellness initiatives to improve access to preventive care by eliminating cost-sharing for most preventive services and creating a national program to promote wellness & prevention

5) Workforce initiatives to improve access to primary care

6) Eliminating fraud and abuse

7) Improving access to generic versions of certain expensive medicines

8) New affordable private voluntary disability insurance

9) Attain revenues by increasing taxes on the most wealthy (with an income over $200,000 for individuals, $250,000 for families) and on unearned income, as well as taxes on indoor tanning salons

He also explained how the reforms enacted would not only pay for themselves, but would end up saving billions of dollars by decreasing costs of health delivery, decreasing costs of taking care of the uninsured nationwide, and reforming the way Medicare and Medicaid work to make them more efficient.

Following Dr McDonough, Mark Hannay explained where we are in New York with this law, and where we have to go to truly make sure all New Yorkers have affordable access to health care. Because most of the implementation of this law falls to the states, we have a tremendous opportunity to turn New York’s program into a model for other states. New York has about 2.7 million uninsured right now, of whom about 2 million will be insured once the law takes effect.

Kinda Serafi discussed the advantages of this law for many people who currently are uninsured. One of the challenges will be to make application for these programs accessible for all. Currently, Medicaid applications can be so long and daunting, or stigmatizing, that many New Yorkers who qualify do not apply. On implementation, the best case scenario would be to create a system accessible to everyone, by phone, mail, internet, or in person, that could help individuals and families determine what plans they’re eligible for, how much they will cost, and other details. Although this would require an extensive overhaul of the Medicaid eligibility system, which is currently quite antiquated, but would be well worth the investment.

Dr. Bill Jordan spoke about the challenges posed to the health care workforce by this law. As it is, there aren’t enough primary care doctors to meet demand. When millions more people flow into the system with their new health coverage, we need to make sure there are enough doctors to care for them. To help with this, the PPACA increases loan repayment for primary care providers, redistributes residency training slots to favor primary care sites and rural, underserved areas, and also redirects training funds to increase the supply of general surgeons.

Jenny Rejeske discussed the impact of the law on immigrants. As a group, many immigrants have much to gain from this law. Some immigrants, those who are undocumented, are left behind. The majority of immigrants will benefit as the most are here with legal status, either as residents or as naturalized citizens. The key will be to ensure that those eligible for Medicaid and other subsidies are aware that these programs are available to them. In addition, we need to ensure that undocumented immigrants are connected to the health care services available to them, including patient financial assistance at all hospitals that accept federal funds, as well as community health centers and HHC clinics and hospitals for those living in New York City.

Lois Uttley finished up by talking about women’s health. In terms of women’s health, there are great gains for most women, in that maternity care will be a mandated service starting in 2014, and preventive services must be provided without a deductible for new insurance plans starting this year (meaning mammograms, pap smears, and STI testing are now free to all women regardless of which insurance plan they use). The negative for women will be the restrictions on abortion coverage for all new insurances bought through the exchange, as well as a likely similar effect even on those who have insurance now. The law states that each state has the right to limit, prohibit, or restrict coverage abortion in all insurances sold on the exchange (14 states have already taken advantage of this). Even where abortion coverage is allowed, participants in those plans have to write 2 separate checks to the company, one to cover abortion and one for everything else.

Attendance at the event was impressive at 115. Audience members asked important questions to clarify the impact of the law on immigrants and children, as well as the future structure of the health care system.

Thanks to all the co-sponsors, panel members, and attendees!

**Co-sponsors of this event were: Long Island University School of Health Professions, AARP-NY, PHANYC, Children's Defense Fund-NY, Community Service Society, Committee for Interns and Residents - SEIU, Health Care for All New York, Health Care Leaders of New York, New York Immigration Coalition, National Organization for Women - New York State,
 and Raising Women's Voices for the Health Care We Need