Planning for the Affordable Care Act: Impact on Oncology

Gerald F. Kominski, Ph.D.Professor, UCLA Fielding School of Public Health, and

Director, UCLA Center for Health Policy Research

April 15, 2014

President Obama Signing the ACA into LawMarch 23, 2010

The Uninsured—As a Share of the Nonelderly Population, by Poverty Levels and Family Type, 2011

SOURCE: KCMU/Urban Institute analysis of 2012 ASEC Supplement to the CPS.

Em-ployer-Spon-

sored In-surance,

56%

Uninsured,18%

Medicaid*

21%

Individual Non-Group,

6%

51%

39%

10%

≤ 138%(Medicaid)

Income

266.4 M Nonelderly

Family Type

59%

25%

16%

47.9 M Uninsured

400% +

139-399% FPL(Subsidies)

Children

Parents

Adults without DependentChildren

Basic Principles of the Affordable Care Act (ACA)Too many Americans fall through the cracks of the current health insurance “system.” Therefore, the ACA seeks to: Expand access to private insurance and Medicaid, rather than

redesign the entire insurance “system” Incremental, not fundamental, financing reform

Provide federal funding to expand access, while allowing state variation in implementation of the law New federalism

Expand private health insurance markets, subject to extensive federal regulations In exchange for steering millions of Americans into private insurance markets

Major Elements of the ACA Effective as of 2014

Most Americans are now subject to the “individual mandate” and will need to

demonstrate that they have qualified insurance, or pay a tax, next year

Tax is being phased in over the next 3 years, and will be the higher of $695 per adult,

$2,085 per family, or 2.5% of household income, by 2016

To assist individuals and families to comply with the mandate, provides

subsidies for those with incomes from 100% and 400% FPL

Requires out-of-pocket spending for premiums, ranging from 2.0% to 9.5% of income

Creates state Marketplaces, as known as Exchanges, with standard, qualified health plans,

where subsidies can be used

Expands Medicaid coverage for anyone with income <139% FPL

Medicaid expansion is fully funded by the Federal government from 2014-16, then Federal

funding drops from 100% to 90% by 2020Note: In 2014, FPL = $11,670 for a family of 1, $23,850 for a family of 4

What kinds of insurance policies can be sold in the state Marketplaces?

All policies must include: Essential Health Benefits Limits on annual out-of-pocket spending No-cost coverage for “approved” preventive services No annual or lifetime dollar caps on benefits Premiums based only on age, geographic area, and

family size Cannot charge more for pre-existing conditions

One of 4 approved “metal tiers” of coverage

What are Essential Health Benefits?

1. Ambulatory patient care2. Emergency services3. Hospitalization4. Lab services5. Prescription drugs6. Maternity and newborn care7. Mental health and substance abuse disorder treatment8. Rehabilitation and habilitation services and devices9. Preventive and wellness services and chronic disease support10. Pediatric services, including dental and vision care

78

Monthly Premiums for All Metal Tiers, 2014Before Subsidy, Region 16 (Los Angeles County), Couple (Ages 62 and 58)

Plan Bronze Silver Gold PlatinumAnthem EPO $957 $1,280 $1,538 $1,784Anthem HSA EPO $963 - - -Anthem HMO - $1,110 $1,389 $1,588Blue Shield HSA PPO $1,001 - - -Blue Shield PPO $1,017 $1,232 $1,450 $1,662HealthNet HMO - $1,036 $1,171 $1,321HealthNet PPO $1,041 - - -Kaiser HSA HMO $1,023 - - -Kaiser HMO $1,038 $1,391 $1,691 $1,819 LA Care HMO $834 $1,137 $1,277 $1,410Molina HMO $866 $1,111 $1,210 $1,452

ESI HealthNet HMO = $1,280 ($342 out-of-pocket premium)

NOTES: Data are as of January 28, 2014. *AR and IA have approved waivers for Medicaid expansion; MI has an approved waiver for expansion and plans to implement in Apr. 2014; IN and PA have pending waivers for alternative Medicaid expansions; WI amended its Medicaid state plan and existing waiver to cover adults up to 100% FPL, but did not adopt the expansion.

Current Status of State Medicaid Expansion Decisions, 2014

WY

WI*

WV

WA

VA

VT

UT

TX

TN

SD

SC

RI PA*

OR

OK

OH

ND

NC

NY

NM

NJ

NH

NV NE

MT

MO

MS

MN

MI*MA

MD

ME

LA

KY KS

IA*

IN* IL

ID

HI

GA

FL

DC

DE

CT

CO CA

AR*AZ

AK

AL

Implementing Expansion in 2014 (26 States including DC)Open Debate (6 States)Not Moving Forward at this Time (19 States)

NOTE: This assumes that all states choose to expand Medicaid eligibility up to 138% FPL January 2014.SOURCE: Congressional Budget Office, February 2013. Total may not equal 100% due to rounding

Estimated Health Insurance Coverage in 2017

Without Health Reform(56 Million Uninsured)

With Health Reform(29 Million Uninsured)

58% 56%

10% 8%

13%16%

19%10%

9%

Total Nonelderly Population = 279 million

Uninsured

Medicaid/CHIP

Private Non-Group/

OtherEmployer-sponsored Insurance

Uninsured

Medicaid/CHIP

Private Non-Group / Other

Employer-sponsored Insurance

Exchange

ACA’s Major Advantages for Oncology For patients:

No pre-existing condition exclusions or higher premiums based on health history Can never be denied coverage now or in the future

No annual or lifetime dollar limits on covered benefits Comprehensive essential health benefits Reasonable limits on annual OOP liability

Maximum $6,350/$12,700

For centers: Patients cannot be denied coverage ~12 million newly insured according to CBO

Concerns for Oncology under the ACA Medicaid expansion

Medicaid payments are low in many states In states not expanding Medicaid, 4.8 million low-income

adults will remain uninsured

Narrow networks These have been used by insurers for decades (HMOs and

PPOs), but because of increased awareness of the use of narrow networks in state Marketplaces, many consumers seem to think they were created by the ACA

Is your Center contracting with plans being offered in your Exchange region?

Major Concerns for Oncology under the ACA Inclusion of preferred cancer treatments,

including specific specialty drugs Because every state is required to provide essential health

benefits (EHBs), and every state had to identify an actual health policy offered in the state to serve as the benchmark for (EHBs), this may not be a major issue

However, whatever restrictions exist in your state are related to limits imposed by insurers, not by the ACA

Have you experienced problems with coverage before 2014? Are there more problems in 2014?

Biased reporting on the ACA: “Nation’s elite cancer centers off-limits under Obamacare”From The NY Post, March 19, 2014: “The AP asked the centers how many insurance companies in their state’s exchange included them as a network provider. Of the 19 that responded, 4 reported access through all insurers: the Kimmel Comprehensive Cancer Center at Johns Hopkins in Baltimore; Fox Chase Cancer Center in Philadelphia; Duke Cancer Institute in Durham, NC; and Vanderbilt-Ingram Cancer Center in Nashville, Tenn.”

Fact Check: Did the AP determine if all insurers provided coverage for these 19 Cancer Centers prior to the ACA? NO!

So, the AP is implying that the ACA has reduced access, without reporting a shred of evidence from before the ACA.

As a professor, I would give the AP reporter an F, for failure to understand the basics of pre-post study designs.

June 30, 2012

Mr. President, let’s meet in the middle,

but you go first…

NOTE: “Opponents should leave the law as is (VOL.)” and “Neither of these/opponents should do something else (VOL.)” responses not shownSOURCE: Kaiser Family Foundation Health Tracking Poll (conducted January 14-21, 2014)

More Want Opponents To Work To Improve Law Rather Than Continue Efforts To Repeal

0.55

0.88

0.31

0.59

0.38

0.08

0.66

0.16

0.06

0.02

0.02

0.23

Accept that it is the law and work to improve it Continue efforts to repealDon't Know/Refused

Total public

Among those with a FA-VORABLE opinion

Among those with an UN-FAVORABLE opinion

Don’t know/ Refused to provide an opinion

By overall opinion of the health care law:

Do you think opponents of the health care law should continue their efforts to repeal the law or should they accept that it’s the law and work to improve it?

NOTES: Question wording varied slightly in 2004-2006 surveys. Neither/neutral (VOL.) and Don’t know/Refused answers not shown.SOURCE: Kaiser Family Foundation surveys

Medicare Part D Started Out With Little Support, but is Now Highly Popular Among Seniors

Feb

Apr

Jun

Oct

Dec

Apr

Aug

Oct

Dec

Feb

Apr

Jun

Nov

Nov

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

0%

20%

40%

60%

80%

17

24 2427 25

21

32 3128

23

30

32

42

63%

55

47 45 44 42

34 3237

5045 46

30

34

14%

Favorable Unfavorable

AMONG THOSE AGES 65+: As you may know, Medicare provides a prescription drug benefit, known as Medicare Part D. Given what you know about it, in general, do you have a favorable or unfavorable impression of the Medicare prescription drug benefit?

Thank you!