Wednesday, July 15, 2009

Capitol Hills News and More

The Senate Health Education Labor and Pensions (HELP) Committee approved along party lines its own version of the Affordable Health Choices Act of 2009 today. Key provisions include a "strong" public plan option, a health insurance exchange, an employer mandate, and long-term-care insurance coverage. Business Insurance explains that

The coverage mandate would apply to employers with more than 25 employees.
Employers would have to pay 60% of the premium, plans could not have annual or
lifetime dollar limits, and coverage would have to be extended to employees’
adult children to age 26.

Employers not meeting these standards would have to pay an annual assessment of $750 for each full-time employee not covered and$375 for every part-time employee not covered.

However, in a slight modification of an earlier proposal, the assessment would start with the 26th employee not covered. If an employer had 26 employees and did not provide acceptable coverage, its assessment would be $750, not $19,500.

In addition, individuals not enrolled in a health care plan would be liable for an annual penalty of $750.

The HELP Committee's press release claims that "The non-partisan Congressional Budget Office estimates the bill to cost less than $615 billion over 10 years." But this bill relies on a major expansion of the federal and state government financed Medicaid program to cover the uninsured. A USA Today article published today explains that

Under the proposals being discussed, anyone with annual income that puts him or
her at the federal poverty level or slightly above it would be eligible to sign
up for Medicaid. Now, states set rules about who is eligible to sign up, but
none allows all poor adults to enroll.

At the House threshold of 133% of poverty, CBO estimates an additional 11 million people would sign up for Medicaid. Raising the limit to 150% of poverty, as the Senate [HELP] panel envisions, means an additional 15 million to 20 million people would enroll.

The estimated 10-year cost: $500 billion.

Some governors are raising alarms that the measure will increase the burden on their hard-pressed states, which pay part of Medicaid's costs.

The House bill calls for the federal government pick up all the new Medicaid expenses, and it promises to enact big savings in the program. The Senate Finance Committee has suggested the federal government would help states with their extra costs only for the first five years.

"This would be a haymaker thrown right at our taxpayers,"
says Indiana Gov. Mitch Daniels, a Republican and former budget director in the George W. Bush administration. He says expansion of Medicaid to 150% of poverty
could increase the state's costs by $750 million a year — 5% of the state budget
— and wipe out an innovative Indiana health care program. Although Indiana is
now solvent, unlike California and some other states, "that would be a monster
of a mandate," Daniels says.

I read a recent BNA article explaining that State government lobbyists are carefully tracking this legislation in an effort to avoid unexpected mandates.

Modern Healthcare reports that "In a statement, Senate Finance Committee Chairman Max Baucus (D-Mont.) reaffirmed his commitment to work with the HELP panel to bring legislation to the Senate floor 'that ensures quality, affordable healthcare for every Americanand lowers costs over the long-term.' The Finance Committee is expected to officially release its reform bill before the end of this week. * * * [Senator Chris] Dodd [who is managing the health care reform bill in Sen. Kennedy's absence] wouldn't speculate on the outcome of merging the two bills, but said he hoped 'nearly all' of HELP's language would make it into the final Senate package."

On the federal employee health care front, OPM announced today that in accordance with a Presidential executive order it has begun to collect information from federal agencies on existing employee health and wellness programs.

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