National Heath Care Reform The Affordable Care Act Angela Marese Boyle, NODD Specialist, Region 3 & Kathy Rallings, NODD Health Benefits Specialist

About The Law  Signed into law March,  Puts in place health insurance reforms to Hold insurance companies more accountable Lower health care costs Guarantee more choices Enhance quality of health care

New Consumer Protections 2010  Must provide coverage for children with pre- existing conditions  No lifetime limits on essential benefits *  Annual limits will be restricted*  External appeals process  State consumer assistance  No rescissions for minor errors

Improving Quality and Lowering Costs  Small business tax credits  Relief for seniors prescriptions  No cost sharing for preventive care*  Wellness and disease management  Reducing health care fraud  Early retirees*  Partnership for Patients*

Increasing Access  Uninsured with pre-existing conditions  Young adults*  Primary care workforce  States to allow more on Medicaid  Better payments for rural providers  Community health centers  Insurance companies unreasonable rate hikes

Grandfathered Plans Collectively Bargained by Enactment To Qualify Cannot:  Changes in annual benefit limits  Elimination of benefits for certain conditions  5% increase to employee share of premium  Increases of 15% plus medical inflation to deductibles  More then a $5 or 15% adjusted for medical inflation on co-pays 6

Grandfather Plans Exceptions 7  Cost sharing for preventive care  No patient protections  No limit on deductibles in 2014 Only 35% will retain this status by 2013

First Renewal on or After September 23, 2010  Coverage for dependents under age 26 AB 36 (tax conformity)  Elimination of lifetime limits  Elimination of annual limits $750, $1.25 Million $2 Million Completely banned Jan

Early Retiree Reinsurance Program  Chronic or high cost claims between $15,000-$90,000  55-Medi Care eligible  Approved Plan Sponsors  2014 or 5 Billion  Reductions in:  Premiums  Deductibles  Co-pays  Other out-of-pocket costs

Accountable Care Organizations  2012 for Medicare  Voluntary participation  Patient centered  Restructure payments  Shared savings  Measurements to improve quality  Improved coordination & communication

Partnership for Patients: Better Care, Lower Costs GOALS BY 2013  40% decrease in preventable hospital-acquired conditions  60,000 lives saved  Reduce hospital readmissions by 20%  1.8 million patients would not suffer complications Potential Savings of $35 Billion

California Health Benefit Exchange  First in the nation  In place by 2014  Governing Board Kimberly Belshé Diana S. Dooley, Chair Paul Fearer Susan Kennedy VACANT (Senator Steinberg to appoint)  Pending bills to make Exchange Work

California Health Benefit Exchange  Est. 2.4 million Californians eligible  Subsidy based on family income Under 400% FPL Unaffordable employer based 9.5% of income 60% actuarial value Not eligible for Medi-Cal May opt out of employer-based coverage if cost is between 8% and 9.8% of income.

Actuarial Examples

Individual Mandate 2014  Tax penalty Hardship waiver Sets minimum standards  Establishes floor for negotiations  Limit on waiting periods to 90 days

Employer Penalties Firms with 50 or more FTEs No coverage offering $2,000 per full-time employee At least one employee receives subsidy 1 st 30 except Unaffordable offering $3,000 per employee receiving a subsidy

Maximum Out of Pocket

Employee Only

Family Coverage

Taxes  Report value of benefits on W-2 Includes employer contributions to HSA, MSA or FSA excludes dental and vision.  % tax on INSURERS $10,200 single $27,500 family Adjusted for age, CPI, and gender  Employers must report annually to the IRS

California Statutes and Proposals  SB1088 (Price) Conformed California state law regarding 26 year olds  AB52 (Feuer) Rate Regulation  Pending Exchange bills AB1296 AB714 AB792

 Heath and Human Services  The Commonwealth Fund  Kaiser Family Foundation  California HealthCare Foundation  The California Endowment  Physicians for a National Health Program  UC Berkley Labor Center  For additional information and links to various health care websites: How You Can Stay Informed Good sources of information: 22