Health Reform 2.0: Insurance
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This document summarizes a presentation by the Blue Cross Blue Shield Association (BCBSA) on the state of the US healthcare system and BCBSA's strategic goals and priorities. The key points are: 1) BCBSA's 2017 strategic goals are to ensure a viable private insurance market, viable government programs, a level playing field, and effective political positioning. 2) The US healthcare spending reached $3.2 trillion in 2015, with private insurance covering about half of the population and government programs like Medicare and Medicaid covering another third. 3) The individual market under the ACA grew to 20 million but now faces high premiums, deductibles, and lack of competition in many states.
Health Reform 2.0: Insurance
- 1. Blue Cross Blue Shield Association is an association of independent Blue Cross and Blue Shield companies. AAFP State Legislative Conference - Healthcare 2.0 Kim Holland, VP, State Affairs Office of Policy and Representation November 3 , 2017
- 2. 2 Agenda • Looking through our rose-colored glasses • The good, bad and ugly of healthcare coverage and cost • A summer of discontent • What’s next • Ending up where I started
- 3. 3 Ensure viable private insurance market Ensure viability of government programs Ensure level playing field Ensure effective political positioning 1 2 3 4 BCBSA 2017 Strategic Goals
- 4. 4 11% 33% 20% 17% 3% 12% 4% Source U.S. health care spending grew 5.8 percent in 2015, reaching $3.2 trillion or $9,990 per person. As a share of the nation's Gross Domestic Product, health spending accounted for 17.5 percent.(cms.gov) US Health Expenditures Report 4
- 5. 5 U.S. Health Care Coverage* Group Individual Market: = 6% Medicare Medicaid Uninsured *Note: Numbers are estimates and do not account for variation in reporting dates, dually eligible Medicare/Medicaid enrollees or other sources of health insurance coverage
- 6. 6 ACA Impact on the Individual Market 20 million individuals covered under the ACA 9% uninsured rate (lowest in history) But… individual market is in real trouble in most states CHOICEPREMIUMS DEDUCTIBLES
- 7. 7 • Issuer participation: 132 from 167 • Average number of issuers 3 from 4 • Only one issuer in state 8 from 5 • Average premium 2nd lowest cost silver 37% • Average APTC 45% *http://aspe.hhs.gov 10.30.2017 2018 Exchange Participation Trends*
- 8. 8 First Attempt: ACA Repeal/Replace HOUSE Narrowly passed American Health Care Act (May 4) VOTE: 217-213 SENATE Narrowly defeated Health Care Freedom Act (July 27) VOTE: 49-51
- 9. 9 Key provisions: • Funds CSRs through 2019 • Short term stability fund (reinsurance) – $15B/year for 2018 & 2019; $10B/year for 2020 and 2021 • Long term stability fund (multi-use) – $62B phased out over 8 years • Age, income and geography adjusted tax credits for 2020+ Key hurdles: • Congressional Budget Office estimated 20+million more uninsured • Unreachable consensus on Medicaid, – States, moderate Republicans: more $$ – Conservatives: faster cuts and work requirements • Similar challenges with tax credit proposal – Moderate Republicans: need adjustments for low income, older people – Conservatives: oppose as “Obamacare-lite” Second Attempt: Better Care Reconciliation Act Senate failed, shy 3 votes
- 10. 10 • Retroactively repealed individual and employer mandates • Provided short term stabilization fund (reinsurance) • Gave states mega block grants (Medicaid, tax credits, cost sharing reductions) but significantly less money • Repealed medical device tax but not others (health insurance tax, others) Third Attempt: Graham Cassidy Senate could not muster needed votes, possible Spring comeback?
- 11. 11 • Executive order – Instructs DOL to propose regulations to expand access to Association Health Plans – Instructs tri-agencies (HHS, Labor, Treasury) to consider proposing regulation to expand availability of short-term limited duration policies – Instructs tri-agencies to increase usability of HRAs • Discontinuation of CSR funding for 2017 – State AGs intervene; take case to DC Circuit to lift abeyance • Notice of Benefit and Payment Parameter – Returns flexibility/authority to states in establishing benchmarks for essential health benefits, QHP review responsibilities Administrative Actions
- 12. 12 Alexander-Murray bipartisan bill • Restores CSRs through 2019 (with consumer benefit) • Funds enrollment outreach • Streamlines 1332 Waiver process to expedite applications and approvals at both state and federal levels • Expands catastrophic plan eligibility • Prompts issuance of interstate compact regulations Hatch-Brady bill • Same on CSRs but eliminates individual and employer mandates Current Efforts to Stabilize Individual Market Action unlikely until end of FY17
- 13. 13 KEY YEAR-END PRIORITIES Congress • Tax reform • DACA • Border Wall • FY2018 Budget Reform (i.e., overall discretionary spending) BCBSA • CSR Funding • Individual mandate • Short-term limited duration policies • Association Health Plans (AHPs) • Health Insurance Tax (HIT)
- 14. 14 OPIOIDS: A NATIONAL CRISIS… Source: 2016 National Survey of Drug Use & Health; 2015: CDC Report IMPACTED BY OPIOID USE 470,000 ADDICTED TO HEROIN 2.1MILLION ADDICTED TO OPIOID PAIN RELIEVERS 4x +2.5MILLION PAIN PATIENTS 1999-2013 OVERDOSE DEATHS OPIOID IN 1 3FAMILIES A presentation of the Blue Cross and Blue Shield Association. All rights reserved. Proprietary and Confidential.
- 15. 15 Health insurance should be available to everyone, regardless of pre-existing conditions with broad based funding for the highest cost individuals. Healthcare must be more affordable for patients, families and taxpayers, and key protections – such as equal rates for women and men, no lifetime caps on benefits and allowing young people to stay on their parents’ plans until age 26 – should remain in place. States should be empowered to meet the needs of their communities, because they know their local healthcare systems and their citizens’ needs best. BCBSA Principles for the Future of U.S. Healthcare
Editor's Notes
- #4: Moving on to BCBSA strategic priorities for the year - 4 overarching goals individual, small, large Medicare Medicaid FEP Fair competition…. Well positioned politically….
- #5: In 2015 –US health expenditures reached $3.2 T or nearly $10,000 per person 17.5% of GDP Part of why health reform is so hard . . . Lots our industries/jobs at risk
- #6: This slide is a compilation from multiple sources The lions share of the insured market is still in the employer market There are only 18 million in the individual market and only about 11M of those are buying through the exchanges Lesser reimbursements or non-payments means higher costs to employer market