National Association of Health UnderwritersNational Association of Health Underwriters

Health Reform UpdateHealth Reform UpdateJanuary 8, 2010January 8, 2010

Russ Childers, PresidentRuss Childers, PresidentJanet Trautwein, CEOJanet Trautwein, CEO

Jesse Patton, Legislative Council ChairJesse Patton, Legislative Council ChairSusan Rash, Legislative Council Vice-ChairSusan Rash, Legislative Council Vice-Chair

Jessica Waltman, Sr. Vice President of Government AffairsJessica Waltman, Sr. Vice President of Government Affairs

Current Status of Reform EffortsCurrent Status of Reform Efforts

• Bills have passed in House and SenateBills have passed in House and Senate• Congress will not use formal conference Congress will not use formal conference

committee to work out differencescommittee to work out differences• Previous bills of this magnitude have held Previous bills of this magnitude have held

open formal conference committeesopen formal conference committees• Negotiations going on behind closed doorsNegotiations going on behind closed doors• Process being used called “ping-pong” Process being used called “ping-pong” • Amends bills in each house to make identicalAmends bills in each house to make identical

Current Status of Reform EffortsCurrent Status of Reform Efforts

• Democratic leadership will still need 60 votes Democratic leadership will still need 60 votes in the Senatein the Senate

• Although a vote on the final bill will only Although a vote on the final bill will only require 51 votes, the motion to proceed to a require 51 votes, the motion to proceed to a vote on the final bill will require 60vote on the final bill will require 60

• Goal is passage by State of the Union Address Goal is passage by State of the Union Address (February 2(February 2ndnd))

• This goal will be very difficult to achieveThis goal will be very difficult to achieve

What Needs to be Changed What Needs to be Changed Clarifying the Role of the StatesClarifying the Role of the States

• Minimum Loss Ratio RequirementsMinimum Loss Ratio Requirements• Structure of the ExchangesStructure of the Exchanges• Agent-Broker Language needs to be Agent-Broker Language needs to be

clarifiedclarified• Regulatory authority overallRegulatory authority overall

Additional Key IssuesAdditional Key Issues

• Taxes need to be eliminated or delayed Taxes need to be eliminated or delayed until major reforms beginuntil major reforms begin

• Effective dates need to be at least 12 Effective dates need to be at least 12 months after enactmentmonths after enactment

• High risk pool funding needs to focus on High risk pool funding needs to focus on existing high risk pool and alternative existing high risk pool and alternative mechanism structures rather than creating mechanism structures rather than creating new federal entities.new federal entities.

Additional Key IssuesAdditional Key Issues

• Personal responsibility Personal responsibility requirements/individual mandate requirements/individual mandate

• Age ratingAge rating• Insurance pooling requirementsInsurance pooling requirements• Public Option still in House languagePublic Option still in House language

Issues of Concern for You and Your ClientsIssues of Concern for You and Your Clients

• Employer Mandates and Waiting PeriodsEmployer Mandates and Waiting Periods• Senate language likely to prevailSenate language likely to prevail• Employers over 50 must provide coverage or pay Employers over 50 must provide coverage or pay

$750 penalty per FTE if even one employee is $750 penalty per FTE if even one employee is eligible for subsidieseligible for subsidies

• Part-time and seasonal employees excludedPart-time and seasonal employees excluded• Full time means 30 or more hours per week averaged on Full time means 30 or more hours per week averaged on

a monthly basisa monthly basis

Issues of Concern for You and Your ClientsIssues of Concern for You and Your Clients

• Employer Mandates and Waiting Periods Employer Mandates and Waiting Periods • Allows maximum 90 day waiting periodAllows maximum 90 day waiting period• Penalties for waiting periods longer than 60 days Penalties for waiting periods longer than 60 days

of $600 per employeeof $600 per employee• Employees who are not eligible for subsidies can Employees who are not eligible for subsidies can

opt out of employer coverage with voucher for full opt out of employer coverage with voucher for full employer contribution if employee share of employer contribution if employee share of premiums exceeds 9.8% of household income.premiums exceeds 9.8% of household income.

• House language much more onerous.House language much more onerous.

Issues of Concern for You and Your ClientsIssues of Concern for You and Your Clients

• ERISAERISA• Unclear whether Senate language will prevailUnclear whether Senate language will prevail• Senate bill retains exclusive federal regulation of Senate bill retains exclusive federal regulation of

self-funded plansself-funded plans• Many new requirements on ALL plans, including Many new requirements on ALL plans, including

new automatic enrollment procedures for new automatic enrollment procedures for employers with more than 200 employees, new employers with more than 200 employees, new notice requirements, and new reporting notice requirements, and new reporting requirementsrequirements

Implementation IssuesImplementation IssuesWhat is effective at Enactment?What is effective at Enactment?

• Coverage for reconstructive surgery for children with Coverage for reconstructive surgery for children with congenital or developmental deformities (House)congenital or developmental deformities (House)• All plans in all market segmentsAll plans in all market segments

• Group pre-existing conditions waiting period changes Group pre-existing conditions waiting period changes from 6/12 to 1/3. (House)from 6/12 to 1/3. (House)• All plans in all market segmentsAll plans in all market segments

• Pre-existing conditions limitations due to domestic Pre-existing conditions limitations due to domestic violence are prohibited (House)violence are prohibited (House)• All plans in all market segmentsAll plans in all market segments

Implementation IssuesImplementation IssuesWhat is effective in six months?What is effective in six months?

• No lifetime limits (at enactment in House)No lifetime limits (at enactment in House)• All new plans (Senate); All plans in HouseAll new plans (Senate); All plans in House

• Restrictions on annual limitsRestrictions on annual limits• All plans in all market segmentsAll plans in all market segments

• Coverage for specific preventive services with no Coverage for specific preventive services with no cost-sharingcost-sharing• All plans in all market segmentsAll plans in all market segments

• Elimination of pre-existing exclusions for children Elimination of pre-existing exclusions for children under 19under 19• All new plans in all market segmentsAll new plans in all market segments

Implementation IssuesImplementation IssuesWhat is effective in six months?What is effective in six months?

• Extension of dependent coverage to 26 (at enactment Extension of dependent coverage to 26 (at enactment in House)in House)• All new plans in Senate; All plans in HouseAll new plans in Senate; All plans in House

• Restrictions on rescission of policiesRestrictions on rescission of policies• All new plans in Senate; All plans in HouseAll new plans in Senate; All plans in House

• New appeals processNew appeals process• All new plans in all market segmentsAll new plans in all market segments

• No discrimination in coverage or premium based on No discrimination in coverage or premium based on salarysalary• All group plansAll group plans

Make Your Voice Heard!Make Your Voice Heard!• GRIP Program• HUPAC Distributions • Phone calls, letters, emails

and Faxes• Consumer/Employer

Outreach• Social Media• Op-Eds and Letters to the

Editor• Media Outreach