ObamaCare 301: Essential Updates Before Open Enrollment

ITUP is a non-partisan, non-profit health policy “think tank” based in Santa Monica, CA.

We are funded by generous grants from The California Wellness Foundation, The California Endowment, Blue Shield of California Foundation, California Community Foundation, Kaiser Permanente, and The California HealthCare Foundation.

About ITUP

ACA RefresherMedi-Cal ExpansionCovered California

Insurance Market ReformsACA Impacts in the Rural North

Coverage Expansions

The ACA expands healthcare coverage through two major systems:

• MEDICAID (MEDI-CAL): public coverage program for low-income Californians

• COVERED CALIFORNIA: Virtual “shopping mall” where individuals, families, and employers can purchase affordable health insurance and get help with the costs of premiums, copays and deductibles

Medi-Cal

On January 1, 2014

Medi-Cal extended coverage to all citizens and legal permanent residents ages 19 - 64 with incomes up to 138% of the federal

poverty level ($16,243 for an individual and $33,465 for a family of four).

Increased income standard for parents from 100% to 138% FPL

Extended coverage to adults without dependent children to 138% FPL

Expanded Benefits

Mental health services and Substance Use Disorder treatments are now more accessible.

• Mental health services for the severely and chronically mentally ill are available through the county Mental Health Departments.

• Psychological services for those with less severe mental illness are provided through the Medi-Cal Managed Care plans and their provider networks.

• Expanded Substance Use Disorder treatment services are available to all Medi-Cal members.

Medi-Cal

Expanded Benefits

Dental services are now more accessible.

On May 1, 2015 dental benefits for adults were restored.

•Office visits•Cleanings•X-rays •Fillings •Crowns•Complete dentures •Root canals

Medi-Cal

EnrollmentThe ACA helps to streamline and modernize the enrollment process for Medi-Cal applicants.

• Central application and enrollment system for both Medi-Cal and Covered California – “CalHEERS”

• Electronically processed applications with income and residency information verified electronically

• Eliminated asset tests

• Except for seniors, Medi-Medis, and individuals in long-term care

• Improves renewal process with pre-populated forms

Medi-Cal

California’s Health Insurance Exchange is: Covered California

www.coveredca.com

One-stop shopping for quality, affordable health plans.

Individuals and households with incomes between 138% and 400% FPL qualify for premium subsidies.

• 138% FPL - $16,244/year (individual); $33,466/year (family of 4)

• 400% FPL - $47,080/year (individual); $97,000/year (family of 4)

In addition, Individuals and households with incomes between 100% and 250% FPL qualify for cost-sharing subsidies that reduce copays and deductibles, but only for those selecting “enhanced” silver plans.

Covered California

Covered CaliforniaAll plans must include the 10 essential health benefits

• Ambulatory patient services• Emergency services• Hospitalization• Maternity & newborn care• Mental health & substance use disorder services• Prescription drugs• Rehabilitative & habilitative services & devices• Laboratory services• Preventive & wellness services, chronic disease management • Pediatric services, including oral & vision care

Standardization of plans’ benefit packages makes them easy to compare

• Copays, deductibles, and out-of-pocket maximums vary with metal tiers

Covered California

Four tiers of health plans• Platinum (90% actuarial value)• Gold (80%)• Silver (70%)• Bronze (60%)• Minimum Coverage Plans (Catastrophic Coverage)

• Only available up to age 30 or to those who can prove they are experiencing financial hardship

Prices of plans vary within each tier. Plan choices apply for one year – you cannot change tiers

or plans until annual open enrollment or special enrollment.

People can only buy health insurance through Covered California during a specified time period called open enrollment.

Open enrollment for 2016 will reopen in the fall (Nov. 1 – Jan. 31).

But people with certain life events qualify for special enrollment.

Medi-Cal is open year-round.

Covered California

Insurance Market Reforms

Insurance plans:• Cannot cancel existing coverage, except for cases of fraud

• Cannot refuse to sell health insurance to individuals based on pre-existing conditions (e.g. asthma, diabetes, etc.)

• Cannot impose lifetime limits on coverage

• Must provide coverage for dependent children up to age 26

• Must provide recommended preventive services without cost-sharing or co-payments (wellness visits, mammograms, colonoscopies, vaccinations)

• Can vary premium costs only based on age, location, and family size

Individual Mandate (Shared Responsibility)

The ACA requires individuals to have health insurance.

Individuals must have health insurance through an employer, union, Exchange plan, individual plan, Veteran’s Administration, Indian Health

Services, Medicare, or Medi-Cal. Native Americans are exempt.

Individual tax penalty increases in 2016: The greater of flat dollar amount or income formula, whichever is more

•$95 per adult + $47.50 per child or 1% of income in 2014•$325/adult + $162.50/child or 2% of income in 2015•$695/adult + $347.60 /child or 2.5% of income in 2016 and thereafter

In 2015: Employers with 100 or more full-time equivalent employees must offer health insurance.

In 2016: Employers with 50 or more full-time equivalent employees must offer health insurance. Employers must pay 60% of the lowest cost bronze plan for their employees and dependent children.Or pay fees if a full-time employee uses tax credits in the Exchange

• Fee of $2,000 per employee, excluding the first 30 employees, for failing to offer insurance to full-time employees

• Fee of $3,000 per employee for failing to offer “affordable” coverage (employee contribution is more than 9.5% of income) for each employee who uses tax credits

Employer Mandate

Year 2: Results & Lessons Learned

1.3 million individuals enrolled in plans through Covered California

3.4 million individuals newly enrolled in

Medi-Cal since December 2013

Source: ITUP Health Care Financing Report 2015

Impacts of ACA In California

•Medi-Cal managed care enrollment increased by 58% between December 2013 and July 2015

•Covered California enrollment increased from zero to 1.3 million between December 2013 and July 2015

•90% are in subsidized coverage•92% of those in subsidized coverage are in silver or bronze; the percentages enrolling in bronze are increasing

•Covered California premiums increased by 4% in year 3; savvy shoppers could decrease their premiums by 4.5% by choosing the lowest cost plans in their coverage tier

Impacts of ACA for California Clinics

Composition of Community Clinic Visits changed dramatically

• Medi-Cal managed care visits increased by 55% •Privately insured (includes Covered California) visits increased by 19% •Uninsured visits declined by 28% •Bottom lines at Community Clinics increased from $0.21 to $3.50 per visit

The Affordable Care Act has dramatically changed the health insurance landscape in the state with the expansion of Medicaid, Covered California and new protections for all Californians.

Source: Data shown in above graph is from California Health Benefits Review Program, Center for Medicare and Medicaid Services, California HealthCare Foundation and Covered California (May 2015).

Notes: Medicare recipients and other publicly funded insured are not included in the graph.

1 http://www.commonwealthfund.org/publications/press-releases/2014/jul/after-first-aca-enrollment-period

The Affordable Care Act Has Changed Health Care in California

21

UNINSURED

EMPLOYER SPONSORED

MEDI-CAL

INDIVIDUAL MARKET

5.1

2.8

17.818.8

9.2

5

10

15

20

25

30

35

As of March 2015, Covered California has approximately 1.3 million members who have active health insurance. California has also enrolled nearly 3 million more into Medi-Cal, of whom over 2 million are newly eligible.

EMPLOYER

1.3

All Californians now benefit from insurance policy changes.

UNINSURED

From 2013 to 2015, the number of uninsured Californians has been reduced by almost half.1

1.5

subsidized, unsubsidized

and new Medi-Cal

COVERED CALIFORNIA

12.4

1.5 million ineligible for

Covered California due

to immigration status

Consumersin the individual market

(off-exchange) can get identical prices and benefits as Covered California enrollees

0.9

0

2013 2015

• One third of those eligible for premium assistance are not aware of their eligibility

• Extensive education on health insurance basics and details needed• Differences between HMO, PPO, EPO• Differences between premiums, tiers and cost-sharing

obligations• How to utilize coverage

• Education and outreach must be tailored to different communities, education levels, regions, and nationalities

• Mixed immigration status families fear legal repercussions of disclosing personal information

Lessons Learned

Several challenges presented during open enrollment.

• Interfaces between County social services and CalHEERS

• Understanding and awareness of premium assistance

• Provider directory inaccuracies and adequacy of provider networks

• Linkages between plan enrollment and provider enrollment

• Understanding the differences between bronze and enhanced silver

• Understanding insurance concepts like copays, deductibles and premium payments

Challenges

Essential Updates

People with certain life events qualify for special enrollment.•Events that cause people to lose health insurance

• Job loss or reduction in hours• Divorce or death of policy-holder family member• Turning 26 and aging out of parent’s insurance• Becoming ineligible for Medi-Cal• Expiration of COBRA

•Marriage•Native Americans •Becoming a citizen or legally present individual•Moving to an area with different plans•Birth or adoption•Exceptional circumstances – loss of eligibility for hardship, natural disasters, etc.•Error by Covered California or enrollment counselor MUST enroll within 60 days of the “life event”

Covered California

Covered CaliforniaFiling Taxes and Reconciling Subsidies

The federal government will determine if an individual or household received the proper amount of premium subsidies when taxes are filed. Actual earned income for the year and the subsidies received vs. entitled to will be examined.

Some individuals may be given refunds OR may have to repay a portion of the subsidies they received, depending on their income or other changes during the year.

It is extremely important for households to update their income information as frequently as needed during the year.

It is extremely important for households to file their income taxes each year or they will lose their eligibility for subsidies.

Married couples must file jointly to receive premium subsidies.

Late Premium Payments

Have 90 days after first late payment to become current

Coverage is active for first 30 days

After 30 days, coverage is suspended for a 60 day period

Coverage can be reactivated at any time by day 90 by paying full premium balance

If full premium balance has not been paid after 90 days, coverage is terminated

After termination, must wait until next open enrollment period to re-enroll

Covered California

An “embedded” medical and dental plan will be offered in 2015 to children and families.

No dental deductible; dental services are not subject to the medical deductible.Preventative dental care (cleanings, x-rays, sealants/fluoride) are covered with no cost sharing.Cost-sharing subsidies cannot be applied to lower the cost of services like fillings, extractions, and braces.

Covered California

Covered California

Open Enrollment for Plan Year 2016:

November 1, 2015 – January 31, 2016

Covered California’s 2016 Standard Benefit DesignsIn California, standard benefits allow apples-to-apples plan comparisons and seek to encourage utilization of the right care at the right time with many services that are not subject to a deductible.

Benefits in blue are not subject to any deductible.

Section 1115 Medicaid Waiver Renewal: Whole person pilots

Top 1% of most costly users •Full scale local partnerships •Fully integrated services and shared savings •Reinvest savings •Care manager and other enhanced services •$1.5 billion over 5 years

Medi-Cal Waiver Renewal: Denti-Cal Outcomes

Better fee for service outcomes •Denti-Cal

• Better fees, better access to and use of preventive dental services

• $750 million over 5 years

Medi-Cal Waiver Renewal: Public Hospital Transformation

DSRIP (now PRIME) and DSH global value payments •Public hospitals and district hospitals •Build ambulatory care capacity and re-orient towards value based care•$3.2 billion for public hospital systems •$467 million for district hospitals •Independent study of “uncompensated care” linked to future funding

New Substance Use Disorder Waiver

Full complement of services •Early intervention•Outpatient and intensive outpatient •Partial hospitalization •Low intensity and high intensity residential•Medically monitored and medically managed inpatient•Opioid treatment

New SUD Waiver

Better controls •MOUs between county Drug Medi-Cal and local MCOs •Flexible local rate setting with state approval•ASAM criteria must be met for waiver services •100% FFP for new eligibles

Medi-Cal Assets TestMedi-Cal enrollees only age 65 or older, disabled, OR individuals in long-term care are subject to assets tests.

Cannot have property worth more than: $2,000 for an individual $3,000 for a couple Home you live in, one car, personal effects are exempt

If you cannot pass the assets test, you must “spend down” to qualify for Medi-Cal.

Pay medical bills Pay debts, mortgage, car loan Buy clothes, home furnishings, home repairs Liquidate non-liquid assets

Medi-Cal Estate RecoveryMedi-Cal enrollees only age 55 or older OR members utilizing long-term care services are subject to estate recovery after the death of the beneficiary.

The State can make a claim against the estate of a Medi-Cal member equal to the cost of care or what was paid to the managed care plan

Exemptions to estate recovery:A spouse is alive (recovery can be made after the death of the spouse)Member had a minor, blind, or disabled childThere is nothing left in the estate

A lien can be placed on the home of a Medi-Cal enrollee in long-term care Only if s/he does not intend to return homeExempt if a spouse, child under 21 or blind/disabled, or sibling lives in the home

Medi-Cal for Former Foster YouthYoung people who were in the foster care system on their 18th birthday qualify for Medi-Cal up to age 26.

Regardless of incomeRegardless of state residency while in foster careSimplified one-page applicationNo recertification until age 26Exempt from managed careApply via county social services officesFoster Care Ombudsman available for assistance –

fosteryouthhelp@dss.ca.gov or 1-877-846-1602

ImmigrationU.S. Citizens and Lawful Permanent Residents (LPRs) have full access to coverage and financial assistance based on income.There is no waiting period or 5-year ban for legal immigrants newly in the U.S.

Undocumented Immigrantso Not eligible for full scope Medi-Cal or Covered Californiao Eligible for Emergency Medi-Cal (limited scope)o Children will be eligible for full scope effective May 2016

Deferred Action for Childhood Arrivals (DACA)o Not eligible for Covered Californiao Eligible for Medi-Cal

Maternity Benefits

• Pregnant women with incomes up to 138% are now eligible for full scope Medi-Cal

• AIM (now MCAP, the Medi-Cal Access Program) covers pregnancies for women with incomes over 138% of FPL up to 300% of FPL as does Covered California. • The MCAP premiums are less than Covered

California; there are no copays or deductibles for those women eligible, and the provider networks are different.

• Women may choose which program they prefer for their pregnancy.

Insurance 101

Health Insurance Terms

• Premium – monthly amount paid for insurance coverage

• Example: Michael, age 40, lives in Redding and makes $18,000/year. He pays $55 a month in premiums, after premium assistance is applied, for the lowest cost Silver plan, and the federal government pays $308. If he earned $48,000 a year, the federal government would pay nothing.

• Copay – fixed amount paid at the point of service for a covered health care service

• Example: if Michael earns $18,000, he pays $15 for a primary care visit and $25 for a specialist in the enhanced silver plan. If he earns $48,000, Michael pays a $45 copay when he sees his primary care provider, $75 for a specialist.

Health Insurance Terms

• Deductible – amount you owe for health care services before your health insurance begins to pay

• Example: If Michael earns $18,000 a year, Michael has a $550 medical deductible and a $50 brand name drug deductible in the enhanced silver plan. If Michael earns $48,000 a year, Michael has a $2,250 medical deductible and a $250 brand name drug deductible, but most outpatient services are exempt from the deductible in the silver plan. If he is hospitalized, he will have to pay $2,250 before his plan starts paying.

Health Insurance Terms

• Coinsurance – your share of the costs of a covered health care service• Example: After Michael hits his deductible, he pays 20% of the

negotiated rate of hospitalization services.

• Out-of-Pocket Maximum – the maximum total costs of health care services you are responsible for in a year • Example: Once Michael has paid $6,500 in medical expenses (not

including premiums), he hits his out-of-pocket max, and the plan pays any remaining expenses, at no cost to Michael.

Deductibles

• Bronze, Silver, and Catastrophic plans have deductibles

• In Bronze and Catastrophic, 3 non-preventative primary/urgent/mental health care visits are not subject to the deductible

• Most outpatient services, generic drugs, and durable medical equipment are exempt from the deductible in Silver plans

• Prenatal care, immunizations, other preventative care, and children’s eye exams and glasses are never subject to deductibles or cost sharing

Out-of-Pocket Maximums$6,250 $6,250 $6,250

$5,200

$4,000

$2,250 $2,250

Bronze SilverEnhanced

Silver 73

Enhanced

Silver 88

Enhanced

Silver 94

GoldPlatinum

(200-250% FPL)

(150-200% FPL)

(100-150% FPL)

Medical Deductible

Brand-name Drug Deductible

Out-of-Pocket Max

Provider Networks

Each health plan has its own network of doctors, hospitals, and other providers that contract with the plan to care for enrolled members.

Out-of-network means that a provider is not contracted with the health plan to serve its members, and the services may not be paid for by the plan.

To minimize costs, patients should seek care from providers in network.

To find out which providers are in network, check the health plan’s website, call the health plan, and ask the provider.

Covered CaliforniaHealth plans are participating in Covered California.

Covered California

• Premium cost• Outpatient providers in network• Hospitals in network• Drug formulary• HMO vs. PPO vs. EPO• Premium and cost-sharing trade off

• How much care do you anticipate using?

• Do you qualify for cost-sharing subsidies?

Factors to Consider in Selecting a Plan

Steps after enrollment• Pay premium!!• Receive ID card• Find out what providers are in network and pick

your preferred primary care doctor• Primary care & specialty• Local hospitals• Urgent care centers

• Hours• Schedule initial primary care appointment• Transfer prescriptions• Compile medical records

Covered California

The Remaining Uninsured

2013:7 million

uninsured (under age 65)

2019:2.7 million

remaining uninsured

Medicaid Expansion

Covered California

Not eligible: Immigration

status

Eligible, but not enrolled:

Medi-Cal

Eligible, but not enrolled:

Exchange

State Programs

Restricted Scope Medi-Cal Emergency coverage only, plus prenatal care and delivery for pregnant

women For individuals who do not qualify for Medi-Cal For adults with incomes up to 138% FPL, pregnant women 213% FPL, &

children 266% FPL Budget for FY 2015-16 funds full-scope Medi-Cal for children under 266% FPL

(SB 4) Pregnant women with incomes less thand 138% of FPL can be eligible for full

scope Medi-Cal. Over 133% and up to 300% of FPL can be eligble for MCAP

State Programs

Access for Infants and Mothers (AIM) MCAP now Comprehensive care for pregnant mothers, including post-partum care Women up to 300% FPL Must be uninsured and ineligible for Medi-Cal Modest premiums As of July 1, AIM operates under the Department of Health Care Services,

renamed “Medi-Cal Access Program”

Family PACT Family planning, reproductive, & sexual health services for uninsured men and

women For individuals with incomes up to 200% FPL Must not be eligible for Medi-Cal, or must have no coverage for family

planning

California Children’s Services (CCS) Children (under 21) with specific diseases or disabilities like cystic fibrosis Covers only services relating to the qualifying conditions Family must have income ≤ $40,000, or out-of-pocket medical expenses must

be more than 20% of family income, or child must be enrolled in Medi-Cal May become more fully integrated with Medi-Cal

Genetically Handicapped Persons Program (GHPP) For adults (over 21) with specific qualifying genetic conditions like hemophilia Not limited to services for the qualifying conditions No income limit, but must apply for and be found ineligible for Medi-Cal and

Covered California

State Programs

Every Woman Counts (EWC) Free clinical breast exams & mammograms for uninsured low-income women

40 or older Free pelvic exams & pap smears for uninsured low-income women 21 or older Treatment for women diagnosed with breast or cervical cancer, with incomes

up to 200% FPL Must apply for and be ineligible for Medi-Cal and/or Covered California

Improving Access, Counseling & Treatment for Californians with Prostate Cancer (IMPACT)

Provides 12 months of free treatment for low-income men diagnosed with prostate cancer

Must be uninsured or underinsured, with incomes up to 200% FPL Must apply for and be ineligible for Medi-Cal and/or Covered California

State Programs

Local Programs

County Indigent Services• CMSP counties provide limited primary care services to the remaining uninsured• Public health entities typically provide care regardless of patient’s immigration

status • Counties, such as Sacramento and Fresno, are beginning to restore limited

coverage to some patients regardless of immigration status

All programs vary significantly by county.

FAQs & Resources

Covered CaliforniaSHOP Exchange

For small employers that would like to offer health coverage to employees

•Open to employers with ≤ 50 employees in 2014, will expand to employers with 100+ employees in 2016

•Up to 50% refundable tax credit for small, low-wage employers (< 25 employees with average wages < $50,000) with a two year limit

Employers will choose the level of coverage (share of employees’ medical costs covered) and the “reference” plan.

Employees will choose the plan—giving employees a choice of insurance carriers. Employees pay the difference in cost above the reference plan.

For questions about coverage, call your insurance company.

If you have a complaint, file a grievance or appeal with the insurance plan.

For Medi-Cal eligibility issues, contact your county DPSS office. For benefits issues, contact the managed care plan.

Persistence is key.

Troubleshooting

Roles in Enrollment

Navigator ProgramIntegrated education, outreach, and enrollment program pays

application counselors through grants

Brokers: sell insurance to individuals and employersCentralized call centers: work with county enrollment systems to answer questions, submit applications, and enroll consumers.

Enrollment Systems

To apply or get help applying:

Call 800-300-1506

Go to CoveredCA.com

Get in-person assistance at local health clinics, county social services offices, brokers’ offices, & nonprofit

organizations

Covered California

Resources

1. Think beyond premiums. Recognize various cost sharing obligations.

2. Get informed. Know the details of your plan.

3. Have problems? Be persistent.

4. Pick your doctor; use your coverage!

5. Need help? Ask! Call your plan and additional resources.

Final Thoughts