1. Healthy NY NYS Insurance Department Health Bureau

2. New York State Approximately 2.5 million uninsured 85% uninsured are adults As high as 1 in 4 uninsured in NYC (1.8 M) Most are employed Nearly 9 out of 10 uninsured workers do not have access to employer sponsored coverage 52% of uninsured workers are at employers of less than 25

3. New York State Community Rating & Open Enrollment Community Rating & Open Enrollment Small group market has mandated benefits (law sets a minimum standard) Small group market has mandated benefits (law sets a minimum standard) Standardized individual market Standardized individual market - no choice of benefit packages - very comprehensive - very expensive

4. Individual market experience Anti-selection Ever worsening experience Ever increasing premiums

5. Healthy NY Use of tobacco funds Use of tobacco funds Reinsurance to reduce premiums Reinsurance to reduce premiums Market-based initiative Market-based initiative Does not appear like a public program Does not appear like a public program Small businesses Sole proprietors Individuals Eligibility criteria Uninsured Most vulnerable / low income / low wage

6. Small businesses - Profile Small businesses - Profile 50 or fewer employees 50 or fewer employees At least 30% of employees earn $38,000* or less in annual wages At least 30% of employees earn $38,000* or less in annual wages Employer has not provided insurance in past 12 months Employer has not provided insurance in past 12 months has not contributed more than a de minimus amount per month per employee for coverage in past 12 months ($50/$75) has not contributed more than a de minimus amount per month per employee for coverage in past 12 months ($50/$75) * adjusted annually Eligibility

7. Individuals & Sole Proprietors Individuals & Sole Proprietors < 250% of FPL < 250% of FPL Employed in past year (or spouse has been) Employed in past year (or spouse has been) Not eligible for employer provided insurance Not eligible for employer provided insurance Ineligible for Medicare Ineligible for Medicare Uninsured for past 12 months Uninsured for past 12 months OR lost coverage due to certain reasons: divorce, separation, death, change/lose job, change residence, loss of eligibility, reached max age for dependent coverage, or other coverage was COBRA or other public programs Eligibility

8. Program Design Insurance at a reduced premium Insurance at a reduced premium Premium Reduction Premium Reduction Benefit Package Design Benefit Package Design Pooling Pooling Reinsurance (stop-loss) Reinsurance (stop-loss) Health plans are reimbursed a portion of claims paid on behalf of member Health plans are reimbursed a portion of claims paid on behalf of member Public – Private Partnership Public – Private Partnership

9. Standardized – all health plans offer the same benefit package. Standardized – all health plans offer the same benefit package. Started with small group benefits (mandated) and eliminated 3 of them: Started with small group benefits (mandated) and eliminated 3 of them: Home health care Home health care Chiropractic Chiropractic Outpatient alcohol and substance abuse treatment Outpatient alcohol and substance abuse treatment Newly enacted mandates not added Newly enacted mandates not added Benefit Package

10. Optional limited prescription drug benefit ($3,000 per person per year) Optional limited prescription drug benefit ($3,000 per person per year) Benefits modified slightly in 2007 Benefits modified slightly in 2007 Now include post-hospital / post surgical home health and PT Now include post-hospital / post surgical home health and PT Benefit Package

11. Pooling Experience is pooled together Individual premium rate is same as group rate Small employers Sole proprietors Individuals

12. $100,000 $30,000 Reimbursement up to 90% $0 for claims over $100,000 $0 for claims under $30,000 Claims Reinsurance (original level)

13. $100,000 $30,000 Reimbursement up to 90% $0 for claims over $75,000 $0 for claims under $5,000 Claims $5,000 $75,000 Current Reinsurance

14. 2001$ 115,900 2002$ 715,000 2003$ 13.3 M 2004$ 34.5 M 2005$ 61.7 M 2006$ 92 M 2007$123.3 M $ 37 $ 47 $ 54 $ 62 $ 70 Claims Stop-loss PMPM

15. Other Elements All HMOs are required to participate, other health plans may participate voluntarily. All HMOs are required to participate, other health plans may participate voluntarily. We have state-wide coverage We have state-wide coverage Employs managed care concepts Employs managed care concepts We did not have to contract w/ health plans We did not have to contract w/ health plans Creates a level playing field Creates a level playing field Applicants apply directly to the HMOs Applicants apply directly to the HMOs Marketing is done by the State Marketing is done by the State

17. Price is critical Price is critical Price sensitive businesses and individuals Price sensitive businesses and individuals Must be affordable in order to attract new lives Must be affordable in order to attract new lives Premium savings can be significant: Premium savings can be significant: 35-40% compared to other small group policies 60-80% compared to individual coverage What We’ve Learned

18. Healthier population than expected Healthier population than expected SL claims corridors: lowered SL claims corridors: lowered Flexibility here is critical Flexibility here is critical True costs are lower than you think True costs are lower than you think Savings for other, more expensive programs Savings for other, more expensive programs Generates premium tax revenue, covered lives assessment Generates premium tax revenue, covered lives assessment Operates on reimbursement basis Operates on reimbursement basis (pay the bills next year) What We’ve Learned

19. Recognize indirect benefits of program Recognize indirect benefits of program Rejuvenated private marketplace discussions Rejuvenated private marketplace discussions interest in new products for small groups interest in new products for small groups Cross-education of other programs Cross-education of other programs Family Health Plus, Child Health Plus, M/A Family Health Plus, Child Health Plus, M/A Programs can work together to educate broadly Programs can work together to educate broadly Don’t be overly rigid or complex Don’t be overly rigid or complex Don’t crowd-out your target Don’t crowd-out your target Keep it simple – too many eligibility rules will confuse Keep it simple – too many eligibility rules will confuse What We’ve Learned

20. www.healthyny.com More info on the program More info on the program Including premium rates, applications, guidance Including premium rates, applications, guidance Annual Reports on the HNY program are online Annual Reports on the HNY program are online 2003, 2004, 2005, 2006 and 2007 reports available 2003, 2004, 2005, 2006 and 2007 reports available program growth, enrollment trends, claims data, pricing impact, feedback from enrollees and health plans program growth, enrollment trends, claims data, pricing impact, feedback from enrollees and health plans