HEALTH REFORM COMPONENTS AND IMPLEMTATION TIMELINE
LANDMARK HEALTH REFORM LEGISLATION IS NOW LAW - CHAPTER 58

On April 12, 2006 Gov. Romney signed into law first-in-the- nation health care reform that holds both employers and individuals responsible.

The comprehensive law is full of innovation and compromise. It most benefits low to moderate income individuals and families by providing access to affordable health insurance. 70% of the Commonwealth's uninsured work - now they will have access to quality and affordable health care.

Key Provisions

Besides expanding Medicaid to capture low-income uninsured residents, the health reform act also creates a new mechanism known as the “Connector” to hook up uninsured residents who cannot afford regular health plans with low-cost, subsidized plans.

The connector plans will allow uninsured residents to purchase plans with pre-tax dollars, reducing the price by 25 percent or more.

• Monthly premiums are expected to range from $200-$300.
• Individuals can keep a policy even when changing jobs.
• Individuals earning up to 300 percent of the Federal Poverty Level (about $48,000 per year for a family of four) qualify for the subsidized connector plans.

Penalty for non-compliance with Individual mandate- fines. Those who failed to sign up for an insurance plan during the first year will lose their personal tax exemption on their tax return. In subsequent years, the uninsured will be charged a monthly sum equal to 50 percent of a monthly premium of one of the state subsidized low-cost plans. Individuals with annual incomes of 100% of Federal Poverty Level (FPL- about $10,000) or less would be signed up with plans that require no premium.

The Employer mandate requires most employers to either provide coverage or pay an annual $295 per-employee assessment. Currently, employers who provide coverage help pay the cost of free care through an insurance surcharge. Employers who do not provide coverage don’t pay a surcharge. The employee assessment is triggered if a businesses’ employees access free care five times per year in the aggregate or one employee accesses free care more than three times.

SCHIP

Expands MassHealth via SCHIP to children with income from 200% FPL to 300% FPL (July 1, 2006)

• CMS approval necessary
• FY 2007 enrollment estimate is around 16,000 (9,300 “CMSP converters” and 7,000 previously uninsured)
• Premiums
• 200.1 – 250% FPL = $20 per child; $60 family maximum
• 250.1 – 300% FPL = $28 per child; $84 family maximum
• Crowd-out provision- must be uninsured for minimum of six months prior to application, or subject to a six month waiting period.
  Exceptions:
  • Special or serious health care needs of child
  • Prior coverage involuntarily terminated
  • Parent died in previous six months
  • Prior coverage lost due to domestic violence
  • Prior coverage lost due to becoming self-employed
  • Existing coverage’s lifetime benefits reduced substantially within previous six months

Restoration Of Optional Benefits
Restores optional services cut in 2002 - Dental, eyeglasses, chiropractor, orthotics, prosthetics, Level IIIB detox, and inpatient administrative necessary days for non-behavioral health stays.

• Adds dental benefit to Essential (July 1, 2006)
• Includes two-year smoking cessation pilot program (July 1, 2006);
• Introduces plan for creates Wellness Program tied to reduced cost-sharing if wellness goals met (will not be ready by July 1, 2006).
• Member notices will be mailed to about 650,000 members late June to mid-July

Enrollment Cap Increases
Increases enrollment caps for adults in MassHealth Family Assistance/HIV; CommonHealth; and Essential programs (March 9 and July 1, 2006).

• Family Assistance/HIV Adults (770 to 1,300) effective March 9, 2006.
• CommonHealth Adults (13,000 to 15,600) effective March 9, 2006
• Essential (44,000 to 60,000) effective July 1, 2006.

Commonwealth Care Health Insurance Program
Administered by the Commonwealth health Insurance Connector Authority “in consultation with” MassHealth; not a MassHealth program

• Private insurance-based premium assistance program for uninsured individuals at or below 300% of FPL and not eligible for MassHealth or Medicare
• Specialized program for individuals below 100% FPL (required benefits and limited cost-sharing)
• Crowd-out provisions (e.g., employer must not have provided coverage for which employee is eligible in previous 6 months AND for which employer paid more than 20% of premium for family coverage or 33% of premium for individual coverage)
• Enrollment can be capped if funds in CWC Trust Fund are insufficient
• Issues and policy around families with members in both MassHealth and CWC to be determined

State officials still need approval from the Feds for the new structure to provide health coverage to the uninsured; federal funding is vital to the success of the law. MassHealth expansions and restorations will begin in coming months, while key elements of the "Insurance Connector" remain undecided. And still to be determined is setting the parameters of "affordable plans" and sliding-scale subsidies to purchase insurance.

Timeline for Implementation and Key Milestones

May-October 2006
Operationalize the Commonwealth Health Insurance Connector Authority

June 2006
Reach agreement with CMS on CMS-64 reporting and back-up requirements for Safety Net Care Pool expenditures (Commonwealth Care, Uncompensated Care Pool, and CNOM programs)

• Implement SCHIP expansion
• Process applicants from the Essential waiting list
• Propose outreach grants to support Commonwealth Care awareness, public education and enrollment
• Implementation of smoking-cessation pilot program (See accompanying story)

October 2006
The Connector will begin offering and enrolling lower- income residents into Commonwealth Care products via Medicaid managed care organizations and begin subsidy payments

January 2007

• The Connector will begin to offer private products to unsubsidized persons and employers.
• March-May 2007
• Statewide open enrollment period in anticipation of individual insurance requirement beginning on July 1, 2007

July 2007

• Establish the requirement that all individuals over age 18 must obtain and maintain health insurance
• Eliminate Insurance Partnership employer subsidies for self-employed persons
• Implement quality-based Medicaid provider pay-for- performance
• Creation of Health Safety Net Office and Health Safety Net Trust Fund

- Adapted from Health Care for All e-newsletters, 5/06; Health on the Hill, A Publication of the House Committee on Public Health, Vol. IV, No. 5 , April 21, 2006; and MassHealth PowerPoint presentation Health Care Reform and DRA 2005 Implementation Update, May 24, 2006, Stephanie Anthony, Deputy Medicaid Director, thanks to Kim Simonian for forwarding.

06/05