PA House Insurance Committee Holds Hearing on Federal Health Care Reform
The PA House Insurance Committee listened to advocates, policy experts and health officials in order to better understand what federal health reform will mean for Pennsylvania families and small businesses. Legislators sought advice on how to get ahead of the curve in laying a foundation for expanded access to care for patients, addressing workforce capacity issues to ensure care for the newly insured and look at delivery system and payment reforms aimed at improving the quality of patient care.
Before getting into the nuts and bolts of the health reform bill, the panel heard testimony from Georgeanne Koehler, who fought tirelessly for health care reform after losing her brother Billy last year. Georgeanne stressed that if we’d had the important reforms brought by the Patient Protection and Affordable Care Act, Billy would’ve had access to the care he so desperately needed. She urged the House Insurance Committee to keep stories like Billy’s in mind as they look toward implementing reform on the state level so that they do right by the thousands of people like Billy across Pennsylvania.
Dr. Valerie Arkoosh, an anesthesiologist at the University of Pennsylvania Medical Center and President of the National Physicians Alliance provided an excellent overview of the changes the federal reform bill will bring to Pennsylvania (a copy of her testimony is attached):
Options and Access for the Uninsured
Nearly 90% of the 1.2 million uninsured Pennsylvanians will have access to quality, affordable health insurance thanks to the new law. This will happen through several key avenues: the state exchange, expanded Medicaid eligibility and new plans for those with pre-existing conditions (high-risk pools). By 2014, Pennsylvania will need to create a health insurance exchange where individuals (including those with pre-existing conditions), employees without employer-provided insurance and small businesses (those with less than 100 employees) can shop for affordable, quality health insurance plans. In order for an insurance company to participate in the exchange, their plans must meet certain minimum benefit standards and offer quality care at a reasonable price. The PPACA also requires that all members of Congress (and their staffs) purchase insurance through their state’s exchange beginning in 2014. Sliding scale subsidies will be provided to those with incomes up to 400% of the federal poverty level (currently $88,200 for a family of four).
Pre-Existing Condition Insurance Plan
Pennsylvanians with pre-existing conditions will finally have access to stable, quality health care they can count on. While the state insurance exchange won’t be up and running until 2014, Pennsylvania (in just a few weeks) will begin to set up a state-level insurance plan to offer a coverage option to adults with pre-existing conditions who have been denied coverage in the private market and aren’t eligible for other government programs. Pennsylvania will receive $160 million to run this insurance pool, which is estimated to help about 5,500 Pennsylvanians and serve as an important bridge to the state exchange in 2014. If you have a pre-existing condition and would like to apply for insurance through this plan, we can point you in the right direction.
Expanded Medicaid Eligibility
To help the lowest income Americans, the new reform law also expands Medicaid eligibility to households earning 133% of the federal poverty level ($29,326 for a family of 4) and to childless adults, a population often left out of the Medicaid program. The Medicaid expansion will be largely covered by federal funding—100% for the first three years, tapering down to 90% in 2020 and beyond.
Relief for Seniors
Seniors are another group that will greatly benefit from the new law—this year, seniors caught in the “donut hole” gap in prescription drug coverage will begin receiving $250 rebate checks and will receive a 50% reduction in the cost of brand name drugs next year. The “donut hole” will be closed entirely by 2020.
Renewed Focus on Quality Care & Healthy Outcomes
Some of the best features of the new law are those that begin to shift incentives away from our current fee-for-service system toward one that rewards coordinated care, healthy patient outcomes and cost reduction. Jean Haynes, President and CEO of Geisinger Health Plan (one of the insurance arms of Geisinger Health System) shared some very exciting strides they’ve been able to make in these areas:
Through “bundling”—a way of utilizing a series of evidence-based best practices to improve the processes of care and patient outcomes—Geisinger was able to identify 40 steps critical in achieving the best outcomes. Using these key components and practices, Geisinger’s cardiac care unit was able to:
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reduce the length of a patient’s stay by 8% which reduced hospital charges by 5%
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reduce the 30-day readmission rate by 44%
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reduce the number of patients with any complications by 13%
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reduce the in-hospital mortality rate by 80%
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cut per-patient cost by $2,000
By aligning the focuses of the system’s physicians, hospital and insurance arms on healthy patient outcomes and aligning reimbursements with results, Geisinger was able to achieve the highest quality, most efficient care while reducing cost.
While there was a lot of good news and hopeful information about the important reforms set to take shape in Pennsylvania over the next several years, some red flags emerged that called attention to the need for transparency, accountability and a commitment by all stakeholders to holding true to the spirit and letter of the new law.
Advocates urged that:
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legislators take a leadership role in bringing all key stakeholders—consumers, policy experts, advocates, insurance companies and providers to the table with a shared commitment to properly implementing reform;
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the Pennsylvania Insurance Department to have the regulatory authority to protect consumers from rate hikes and discrimination;
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that the state continue to invest in modernizing information systems to reduce cost and provide consumers with easily understandable information to compare insurance plans;
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there needs to be a clear path between current state programs like adultBasic, Medicaid and the new exchanges that will be up in 2014 so folks don’t fall through the cracks ; and
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the state exchange to be set up as a public entity, with an independent board and oversight.
More information on when specific reforms take effect and Families USA’s advice to legislators on how to properly implement reform on a state level can be found here.
Stay tuned for more updates on the work of the Governor’s Health Care Reform Implementation Advisory Committee and the PA House Insurance Committee.
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