The Washington Extension

November 18, 2011

Medicare News

CMS has calculated that seniors saved more than $1.2 billion on their prescription drugs due to changes in the Affordable Care Act. This is an average of $550 per person. More than 22.6 million Medicare beneficiaries have used a least one Medicare preventive benefit, newly free-of-charge in the ACA.

ACA Updates

Oregon’s Insurance Administrator is joining the HHS office charged with implementing the ACA as an advisor to states establishing exchanges. Teresa Miller has been recognized for her creation of a detailed and transparent rate review process for health insurance in Oregon.

The Supreme Court scheduled 5.5 hours of oral argument on the ACA for March—a modern-day record for length of time devoted to a case. The time will be divided between the individual mandate (2 hours), Medicaid expansion (1 hour), whether the Anti-Injunction Act bars the court from considering the constitutionality of the individual mandate until 2014 (1 hour), and severability, or whether the entire law is unconstitutional if just one section is determined so (1.5 hours).

North Dakota legislation to create a health insurance exchange was defeated by state House Republicans. The legislature doesn’t meet again until January 2013, essentially ruling out any chance for the state to establish its own exchange before the initial federal deadlines. North Dakota estimated its exchange would cost $39.6 million to implement, and an additional $10.2 million every two years to operate. The operating costs would have been paid for by assessing taxes on insurance companies.

The Illinois legislature is hung up on whether the exchange should adopt an active purchaser model with power to negotiate rates with insurers. The governor’s office is concerned that the state could lose more than $90 million in federal grant funding if legislation is not enacted soon. Illinois already passed legislation authorizing an exchange, but needs to fill in details such as the structure of the governing board, funding mechanism and other powers.

Minnesota’s exchange task force began work to shape that state’s health care marketplace, where 300,000 Minnesotans could gain coverage. Former Republican Governor Tim Pawlenty proposed implementing a state exchange well ahead of the ACA, though Republican lawmakers now oppose exchanges and are so far absent from the task force. Business, insurance and consumer groups all broadly support exchange implementation in Minnesota.

South Carolina’s Department of Health and Human Services (HHS) chief recommended the state pass on establishing a health insurance exchange. The study—presented to an exchange study committee established by the governor—finds that “ill-defined and unfinished” federal regulations would hamper the state’s progress, South Carolina’s HHS department is already at full capacity implementing Medicaid, and encourages development of private exchanges in the state. The committee must issue recommendations to the governor by the end of November.

On the Hill

A deficit reduction compromise is appearing unlikely, as the deadline looms less than a week away. Interest groups and legislators are warming to the idea of sequestration—automatic cuts in 2013 that take effect if no compromise is reached. Kaiser Health News is documenting the long wish list from the health care sector as the Super Committee continues negotiations.

Reports/Other News

Walmart released a request for information seeking partners to help it build a “national, integrated, low-cost primary care healthcare platform that will provide preventative and chronic care services” for millions of Americans. The company subsequently retracted part of the RFI, stating that it is not building such a platform and the statement of intent was incorrect.  The RFI seeks vendors to provide chronic care, diagnostic, and preventative services; health and wellness products; and select acute care services. Other vendor responses may address proposed ownership/operating models for delivering low-cost care, financial models, information systems and data sharing models, integrated delivery systems, and care delivery and support models.

HHS released a health plan “finder” tool for small businesses. The new website allows small employers to search for available insurance by ZIP code and sort by out-of-pocket limits and average cost. Users can view descriptions of the plan options and filter products by various measures, including doctor choice, maternity coverage, mental health or prescription coverage, and company.

A Gallup/Healthways poll found that adults receiving health insurance from their employers continues to decline, falling to 44.5% in the third quarter of 2011. Employer-based health insurance has declined steadily since 49.8% when this poll was initiated in 2008.

Visit Extend Health — the nation’s largest private Medicare exchange.

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