HEALTH IN COLORADO

GOVERNOR HICKENLOOPER’S VISION

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Coverage & affordability framework

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Insurance reforms

Insurance market reforms

2010 2014Dependent care coverage for adult children to age 26No pre-existing conditions exclusions for childrenNo lifetime limitsNo rescissionsMedical Loss Ratio to 80% ind. market and 85% large group market (2010 reporting, 2011 rebates)Free preventive care (new plans)Begin phase out of annual limits

No annual limitsGuaranteed issue Guaranteed renewabilityNo gender ratingNo health status ratingAge rating 3:1; Geographic variation/tobacco rating 1.5:1

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Individual mandate

• All citizens and legal residents required to have coverage starting 2014

• Exceptions: religious objection; Native Americans; financial hardship; lowest cost plan > 8% of income; undocumented immigrants; gaps of 3 months or less

• Penalties assessed through federal income tax for each uninsured family member to be phased in starting in 2014 at $95/individual or 1 percent of household income.

• In 2016 penalty = $695/adult, $375/child or 2.5% of income. Maximum of $2,085 per family or 2.5% of income, whichever is greater.

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Affordability Provisions

• Medicaid expansions: all non-disabled under age 65 eligible up to 133% of poverty

• Premium tax credits available up to 400% of poverty

• Cost sharing subsidies up to 250% of poverty (limits out of pocket spending)

• New marketplace for accessing coverage

Affordability

protections

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Coverage access points

Uninsured

health reform coverage access points

MedicaidMedicare

Employer based coverage

Health insurance exchanges and

nongroup

>$89,400 for a family of four;>400% of FPL

Job-based coverage, or Full-cost coverage in the exchange

$67,050-$89,400; 300-400% of FPL

Job-based coverage, or Subsidized exchange coverage: premiums capped at 9.5% of

income

$55,875-$67,050;250-300% of FPL

Job-based coverage, or Premium tax credit to cap premiums at 6.3 – 9.5% of income

$29,725-$55,875;133-250% of FPL

CHP+ (Children and pregnant women) Job-based coverage, or Premium tax credit to cap premiums at 3% - 6.3% of income, and out

of pocket subsidy

<$29,725 for a family of four; < 133% FPL

Medicaid Premium tax credit to cap premiums at 2% of income, and out of

pocket subsidy

Fam

ily In

com

eCoverage Options by Income (2014)

Family income based on 2011 federal poverty guidelines for a family of four; Source: Center for Public Policy Priorities, cppp.org

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Medicaid

• Medicaid will be expanded to 133% of federal poverty in 2014.

• Income eligibility based on modified adjusted gross income + 5% income disregard for nondisabled persons <65.

• Option for states to allow patients with chronic conditions to designate a health home (mental health included) and get increased federal match.

• The federal government will provide states 100% funding for expansion through 2016 with a gradual reduction to 90% in 2020.

• Medicaid primary care payment rates will increase to 100% of Medicare rates in 2013 and 2014.

• State must maintain coverage levels until 2014 for adults, 2019 for children and until 2019 for CHP+.

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Employer Coverage

• Small employers (<50) are not required to provide employee coverage. Have access to an Exchange.

• Tax credits available for small businesses (up to 25 employees with average wages under $50,000, if 50% of premium paid) to provide employer coverage starting 2010. – Up to 35% now, 50% 2014-2016

• Large employers (>50) pay a penalty per full-time employee if an employee receives subsidized coverage in the exchange.

• Employees who have an offer of employer coverage generally cannot purchase in the exchange, with a few exceptions.

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Medicare

• Eliminate the “donut hole” by 2020 starting with $250 rebate in 2010, 50% discount on name brand drugs in 2011.

• Expands number of covered preventive services and eliminates cost sharing starting 2011.

• 10% bonus payment for primary care physicians and general surgeons in health care shortage areas (2011-15).

• Improved care coordination and integration for dual Medicare/Medicaid eligible enrollees.

• Restructure Medicare Advantage payments• Require 85% medical loss ratio for Medicare

Advantage• Extend Medicare solvency by 12 years to 2029.

Implementation in Colorado

SB11-200: CO HEALTH BENEFIT EXCHANGE ACT OF 2011

Colorado Health Benefit Exchange Activities

COST CONTAINMENT

QUESTIONS & ANSWERS

George LyfordHealth Care AttorneyColorado Center on Law and Policy303 573-5669, ext. 310 GLyford@cclponline.org

Lorez MeinholdSenior Policy DirectorGovernor John Hickenlooper303-866-5856Lorez.meinhold@state.co.uscolorado.gov/healthreform