Affordable Care Act (ACA) Learning Sessions for Social Sector Leaders & Community Advocates

December 5, 2012

Coordinated by Access HealthColumbus Community Advisory Committee

Purpose Spread knowledge of federal health care reform in non-profit organizations to improve their ability to serve clients during the implementation of the Accountable Care Act (ACA). Today’s Objectives 1. Provide an update on Health Benefit Exchanges (HBE) 2. Improve knowledge on:

• Medicaid Ohio expansion possibilities • ACA cost and affordability for health benefits through the HBE

3. Obtain input on shaping future Learning Sessions

Affordable Care Act

Near Universal Insurance Coverage

Guaranteed Issue &

Insurance Mandate

Improvement Programs

(and grants)

Health Benefit

Exchanges

Expansion of Medicaid

Subsidized commercial

insurance for middle-income

families (market based)

11/16/12 – Ohio submitted intent for federal Health Benefit Exchange

Early 2013 – Ohio’s budget process will include the governor’s recommendation on Medicaid expansion for Ohio

June 2013 – State will finalize budget with Medicaid expansion decision

Fall 2013 – People begin to enroll through Health Benefit Exchanges

January 2014 -- • Permanent insurance reforms take effect • Low income subsidies start • Coverage through exchanges becomes

effective • Mandates take effect

o Individual Mandate o Employer Mandate

Health Insurance Exchanges

Exchanges were upheld by the Supreme

Court.

– Each state shall establish a qualified Exchange by

January 1, 2014.

– If a state chooses not to operate an exchange,

the federal government will do so.

– People will begin enrolling through exchanges in

the fall of 2013.

Health Benefit Exchange Options

1. An state built Health Benefit Exchange

2. A federally facilitated Health Benefit Exchange

3. A hybrid/partnership Health Benefit Exchange

- Some features of each

Ohio’s Health Benefit Exchange decision, November 16, 2012

Governor John Kasich sent a letter to the director of Centers for Medicare and Medicaid Services Center for Consumer Information and Insurance Oversight to indicate Ohio’s Health Benefit Exchange decision under the Affordable Care Act.

• “At this point, based on the information we have, states do not have any flexibility to build and manage exchanges in ways that respond to unique needs of their citizens or markets.”

• “Ohio will not operate a federally-mandated exchange but instead will exercise its right under the law to leave that to the federal government;”

• “Ohio will … retain the right to regulate the state’s insurance industry…”

• Ohio will retain the right to determine Medicaid and CHIP eligibility for its citizens

• Ohio reserves right to amend its intentions should HHS announce changes, etc.

Key Exchange Functions in a Federally–facilitated Exchange (FFE) - Objectives

Objectives of the FFE:

Positive consumer experience

Attractive and viable market for insurers

Working quickly and effectively with States

Reducing administrative and operational burdens on all

exchange participants

From: General Guidance on FFEs, issued by Health and Human Services, May

16, 2012

Key Exchange Functions in a Federally–facilitated Exchange (FFE) - Activities

Health and Human Services activities for FFE:

• Developing a unified FFE infrastructure

• Will look to States, consumers, issuers, health care providers, employers, and other local stakeholders to provide input in each state

• Early 2013- Qualified Health Plan Issuer applications will be released

• Summer 2013- Agreements with Qualified Health Plan Issuers will be completed

• October 1, 2013- Open enrollment on exchanges for the 2014 coverage year will begin

From: General Guidance on FFEs, issued by Health and Human Services, May 16, 2012

Medicaid Expansion, Ohio possibilities

On June 28, 2012, the United States Supreme Court issued an opinion upholding the constitutionality of the ACA, with the exception of one provision.

States now can decide not to expand their Medicaid programs without losing all federal Medicaid funding.

Source: Supreme Court Policy Brief, Health Policy Institute of Ohio, July 2012, http://bit.ly/SjDBca

Health Benefit Exchange Navigators – Pending House Bill 613

• Sponsored by Representative Barbara Sears (R-

Sylvania)

• introduced into the Revised Code the manner in which

the State of Ohio will regulate Navigators under the

Affordable Care Act (ACA)

• HB 613 establishes separate certification requirements

for Navigators and Insurance Agents with Ohio

Department of Insurance in charge of both

Health Benefit Exchange Navigators – Pending House Bill 613

• Under HB 613, a Navigator would not be permitted to sell,

solicit or negotiate health insurance.

• The bill would prevent Navigators from enrolling an

individual or employee in a health insurance plan.

• The bill is scheduled for a possible vote in the House

Health and Aging Committee on December 5, 2012.

• Concerns include: prematurely establishing Navigator

rules, limiting Navigator assistance, lacks protections

around cultural and linguistic appropriateness and

disability accessibility

Individual mandate to purchase health insurance

Insurance market reforms: limit pre-existing conditions, guaranteed

issue, community rating

Health benefit exchange: provide individuals with income between

100% and 400% of poverty a sliding-scale federal subsidy to

purchase private insurance

Expand Medicaid to everyone below 138% of poverty

The Supreme Court upheld all provisions of the ACA but made the

Medicaid expansion optional for states

14

Federal Health Care Reform:

Patient Protection and Affordable Care Act (ACA)

0%

100%

200%

300%

400%

500%

Children 0-18 without coverage

Parents Childless Adults Disabled Workers Other Aged, Blind and Disabled

Fed

eral

Po

vert

y Le

vel (

FPL)

Medicaid

Private Insurance

Disabled Ohioans in this income range “spend down” their income to qualify for Medicaid

* The 2012 poverty threshold is $11,170 for an individual and $23,050 for a family of four.

Current Ohio Medicaid Coverage

Woodwork Effect

As a result of the federal mandate on individuals to purchase health

insurance, an estimated 320,000 Ohioans who are currently eligible

for Medicaid but not enrolled are expected to enroll in January 2014,

at an estimated two-year State cost of $700 million.

0%

100%

200%

300%

400%

500%

Children 0-18 without coverage

Parents Childless Adults Disabled Workers Other Aged, Blind and Disabled

Fed

eral

Po

vert

y Le

vel (

FPL)

Medicaid

Private Insurance $92,200*

(family of 4)

Disabled Ohioans in this income range “spend down” their income to qualify for Medicaid

$31,809* (family of 4)

Health Benefit Exchange

Optional ACA Medicaid Expansion to 138%

* The 2012 poverty threshold is $11,170 for an individual and $23,050 for a family of four.

Current Ohio Medicaid Eligibility Federal Exchange Eligibility Not Covered by Ohio Medicaid or Federal Exchange

2014 Federal Health Coverage Expansion

Impact of ACA

• Initial Draft Estimates for Eligible but Not Enrolled

17

Calendar

Year

People State $

(millions)

Federal $

(millions)

Total $

(millions)

2014 319,000 $369 $978 $1,347

2015 392,500 $571 $1,027 $1,598

2016 432,500 $613 $1,165 $1,778

2017 437,000 $644 $1,224 $1,868

2018 440,500 $676 $1,284 $1,959

Impact of ACA

• Initial Draft Estimates for New Enrollees

18

Calendar

Year

People State $

(millions)

Federal $

(millions)

Total $

(millions)

2014 597,500 $0 $3,027 $3,027

2015 663,000 $0 $3,523 $3,523

2016 699,500 $0 $3,863 $3,863

2017 706,500 $203 $3,854 $4,057

2018 714,000 $256 $4,008 $4,264

Behind the Numbers

• Based on the 2008 and 2010 Ohio Health Surveys

• Developed with both of Medicaid’s actuaries (Milliman, previous and Mercer,

current)

• Conservative estimates on take-up rates:

19

Newly Eligible

Subtotal ‐ Previously Insured……………………………………………. 38%

Subtotal ‐ Previously Uninsured………………………………………… 63%

Currently Eligible and Not Enrolled ‐ Nonelderly Non Medicare

Subtotal ‐ Other Insurance………………………………………………. 21%

Subtotal ‐ Uninsured……………………………………………………… 42%

Currently Eligible and Not Enrolled ‐ Elderly and Medicare………… 12%

20

Next Steps

• Determine how Medicaid will pay for woodwork effect

• Review long-term budget projections

• Decision will most likely be announced in the budget

21

Medicaid of the Future

22

Fragmentation vs. Coordination

Multiple separate providers

Provider-centered care

Reimbursement rewards volume

Lack of comparison data

Outdated information technology

No accountability

Institutional bias

Separate government systems

Complicated categorical eligibility

Rapid cost growth

Accountable medical home

Patient-centered care

Reimbursement rewards value

Price and quality transparency

Electronic information exchange

Performance measures

Continuum of care

Medicare/Medicaid/Exchanges

Streamlined income eligibility

Sustainable growth over time

SOURCE: Adapted from Melanie Bella, State Innovative Programs for Dual Eligibles, NASMD (November 2009)

23

Integrated Care Delivery

for Individuals Enrolled in both

Medicare and Medicaid

24

25

The Vision for Better Care Coordination

• The vision is to create a person-centered care management

approach – not a provider, program, or payer approach

• Services are integrated for all physical, behavioral, long-term

care, and social needs

• Services are provided in the setting of choice

• Easy to navigate for consumers and providers

• Transition seamlessly among settings as needs change

• Link payment to person-centered performance outcomes

26

Stark

Wood

Wayne

Butler

Lorain

Clark

Union

Trumbull

Franklin

Fulton

Portage

Clinton

Lucas

Medina

Warren

Greene

Summit

Madison

Pickaway

Geauga

Clermont

Delaware

Lake

Hamilton

Cuyahoga

Columbiana

Mahoning

Montgomery

Ottawa

Ohio ICDS Regions

Central

Molina

Aetna

NW

Aetna

Buckeye

WC

MolinaBuckeye

SW

Molina

Aetna

NE

United

CareSource

Buckeye

EC

United

CareSource

NEC

UnitedCareSource

ICDS Regions and Demo Counties

Central

EC - East Central

NE - Northeast

NEC- Northeast Central

NW - Northwest

SW - Southwest

WC - West Central

27

Transitioning Children with Special

Needs from Fee-For-Service to

Managed Care

28

Who Will Transition

• All children with special needs that are currently in the

Medicaid fee-for-service program

• The exceptions are children with certain conditions

• Cystic Fibrosis

• Hemophilia

• Cancer

29

Health Homes

30

Medicaid Health Homes

• Goal is to ensure that people are getting the physical

health services they need

• Where is a person most likely to receive physical health

services?

• Medicaid Health Homes for people with Serious and

Persistent Mental Illness were launched in October

Q&A

Health Benefits Exchanges &

Medicaid Expansion possibilities

ACA Costs & Affordability for Individuals and Families

2014 Coverage Reform Overview

• In 2014, the following insurance market

reforms take effect:

– Guaranteed issuance of coverage

– Coverage must include essential benefits

– No pre-existing condition exclusions

– Plans can have deductibles, copayments and cost

sharing requirements subject to limits.

– Premium vary only by age and smoking (3 to 1)

– Low income subsidies

Low Income Subsidies

Premium Subsidies

– Premium is the amount you pay to buy

insurance coverage

Cost sharing subsidies

– Cost sharing is the out-of-pocket expenses you

pay to health care providers as your share of the

cost when you have insurance, because of

deductibles, copays and co-insurance

Low Income Premium Subsidies

Beginning in 2014, low income premium

subsidies are:

– available up to 400% FPL to reduce the cost of

buying coverage;

– only available for coverage on an exchange;

– determined on a sliding scale, based on income.

– based on premium for a benchmark plan, allowing

individuals to buy more expensive coverage and

pay the difference.

Low Income Premium Subsidies

Income Premium No More Than % of

Income

Up to 133% FPL 2% of income

133 – 150% FPL 3 – 4% of income

150 – 200% FPL 4 – 6.3% of income

200 – 250% FPL 6.3 – 8.05% of income

250 – 300% FPL 8.05 – 9.5% of income

350 – 400% FPL 9.5% of income

Enrollee’s Share of Premium After Low Income Subsidies

Low Income Annual Premium (after subsidies)

Income as % of FPL

Annual Income

Premium as % of Income

Annual Premium

Monthly

Premium

100% $11,170 2% $223 $19

138% $15,415 3% $462 $39

150% $16,755 4% $670 $56

200% $22,340 6.30% $1,407 $117

250% $27,925 8.05% $2,248 $187

300% $33,510 9.5% $3,183 $265

350% $39,095 9.5% $3,714 $310

400% $44,680 9.5% $4,245 $354

Enrollees’ Share of the Premium

Single Person – CY 2012 FPL

Low Income Annual Premium (after subsidies)

Single Person Example – CY 2012 FPL

FPL 100% 200%

Monthly Income

$ 931 $ 1,862

Monthly Premium *

$ 19 $ 117

* Does not include Cost Sharing

portion of medical expenses

Low Income Annual Premium (after subsidies)

Income as % of FPL

Annual Income

Premium as % of Income

Annual Premium

Monthly

Premium

100% $23,050 2% $461 $38 138% $31,809 3% $954 $80 150% $34,575 4% $1,283 $107 200% $46,100 6.30% $2,904 $242 250% $57,625 8.05% $4,898 $408 300% $69,150 9.5% $6,569 $547 350% $80,675 9.5% $7,664 $639 400% $92,200 9.5% $8,759 $730

Enrollees’ Share of the Premium

Four-Person Family – CY 2012 FPL

Low Income Annual Premium (after subsidies)

Four-Person Family Example – CY 2012 FPL

FPL 100% 200%

Monthly Income

$ 1,921 $ 3,842

Monthly Premium *

$ 38 $ 242

* Does not include Cost Sharing portion of medical

expenses

Low Income Cost Sharing Subsidies

Cost sharing is the out-of-pocket expenses you pay

to health care providers when you have insurance,

because of deductibles, copays and co-insurance.

Most policies currently have out-of-pocket spending

limits, which require the insurance company to pay

100% once you reach the spending limit.

In most policies, the current out-of-pocket limits are

$6,050 for individuals and $12,200 for families.

Low Income Cost Sharing Subsidies

Beginning in 2014, low income cost sharing

subsidies are:

– available up to 400% FPL to reduce out-of pocket

spending by reducing out-of-pocket limits;

– only available for coverage bought through an

exchange; and

– determined on a sliding scale, based on income.

Cost Sharing (out-of-pocket expenses to health care providers)

Income Out-of-Pocket Limits (based on 2012 limits)

100 – 200% FPL $1,997/individual; $3,993/family

200 – 300% FPL $3,025/individual; $6,050/family

300 – 400% FPL $3,993/individual; $7,986/family

Above 400% FPL $6,050/individual; $12,100/family

Out-of-Pocket Spending Limits After Subsidies

Premium plus Cost Sharing (out-of-pocket expenses to health care providers)

Income as % of FPL

Annual Income Annual

Premium

Annual Cost Sharing

Expenses Limit

Maximum Annual

Premium Plus Cost Sharing

Maximum Monthly Premium Plus Cost Sharing

100% $11,170 $223 $1,997 $2,220 $185

138% $15,415 $462 $1,997 $2,459 $205

150% $16,755 $670 $1,997 $2,667 $222

200% $22,340 $1,407 $3,025 $4,432 $369

250% $27,925 $2,248 $3,025 $5,273 $439

300% $33,510 $3,183 $3,993 $7,176 $598

350% $39,095 $3,714 $3,993 $7,707 $642

400% $44,680 $4,245 $3,993 $8,238 $687

Enrollees’ Share of the Premium and

Cost Sharing After Subsidies

Single Person – CY 2012 FPL

FPL 100% 200%

Monthly Income

$ 931 $ 1,862

Monthly Premium +

Cost Sharing $ 185 $ 369

Premium plus Cost Sharing (out-of-pocket

expenses to health care providers)

Single Person Example – CY 2012 FPL

Premium plus Cost Sharing (out-of-pocket expenses to health care providers)

Income as % of FPL

Annual Income Annual

Premium

Annual Cost Sharing

Expenses Limit

Maximum Annual

Premium Plus Cost Sharing

Maximum Monthly Premium Plus Cost Sharing

100% $23,050 $461 $3,993 $4,454 $371

138% $31,809 $954 $3,993 $4,947 $412

150% $34,575 $1,283 $3,993 $5,276 $440

200% $46,100 $2,904 $6,050 $8,954 $746

250% $57,625 $4,898 $6,050 $10,948 $912

300% $69,150 $6,569 $7,986 $12,619 $1,052

350% $80,675 $7,664 $7,986 $15,650 $1,304

400% $92,200 $8,759 $7,986 $16,745 $1,395

Enrollees’ Share of Premium and Out of Pocket Expenses After Subsidies

Four-Person Family – CY 2012 FPL

FPL 100% 200%

Monthly Income

$ 1,921 $ 3,842

Monthly Premium +

Cost Sharing $ 371 $ 746

Premium plus Cost Sharing (out-of-pocket expenses to health care providers)

Four Person Family Example – CY 2012 FPL

Q&A

ACA Costs & Affordability

Feedback

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Want to learn more about the Affordable Care Act?

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http://healthreform.kff.org/timeline.aspx?source=QL http://healthreform.kff.org/the-basics/Requirement-to-buy-coverage-

flowchart.aspx http://healthreform.kff.org/the-basics/employer-penalty-flowchart.aspx http://www.governor.ohio.gov/Portals/0/pdf/11.16.12%20Letter%20to%20HHS.pd

f http://cciio.cms.gov/resources/files/FFE_Guidance_FINAL_VERSION_051612.pdf http://healthreform.kff.org/subsidycalculator.aspx http://uhcanohio.org/content/health-care-reform-0