HEALTH CARE REFORM AND WHAT IT MEANS FOR PEOPLE LIVING WITH HIV/AIDS Duke AIDS Policy Project

HEALTH CARE REFORMAND WHAT IT MEANS FOR PEOPLE LIVING WITH HIV/AIDS

Duke AIDS Policy Project

BARRIERS TO COVERAGE FOR PLWHA

1. Many can’t access employer based insurance

2. Pre-existing condition limitations

3. High cost

4. Can’t qualify for Medicaid because of income, assets, or inability to establish disability

5. Undocumented

Obamacare (the Affordable Care Act) solves everything but # 5

Americans want guaranteed coverage for pre-existing conditions

• Insurance market can’t add pre-existing conditions, getting most or all of the healthy people in the pool

• Getting most people in the pool means there has to be a requirement or very strong incentive

• If everyone has to be in the pool, there has to be financial aid to lower-income to pay premiums

• How the ACA does it:

• Elimination of medical discrimination• Mandated coverage• Premium Subsidies

COVERING THE SICK MEANS EVERYONE MUST BE IN THE POOL

THE LONG, TORTURED ROAD TO REFORM

1. ACA signed into law March 2010 – NO Republican voted for it

2. Immediate legal challenges – “individual mandate,” Medicaid

3. States and Federal Government engaged in frenzied implementation planning

4. March 2012 - Supreme Court upholds almost all of the law

5. Election 2012 & other threats to health care

OVERVIEW OF ACA CONSUMER PROTECTIONS

• Pre-existing conditions (effective 2014):

• Can’t be rejected• Health status can’t be considered in pricing

• Eliminates insurance caps

• Annual limits (effective 2014)• Lifetime limits (effective now)

• Can’t be dropped from insurance for getting sick

• Insurance can be terminated only for fraud

OVERVIEW OF INSURANCE EXPANSION

• Everyone who has adequate coverage already – employer, Medicaid, Medicare, etc -- stays the same

• People with inadequate or no coverage

• Over 133% of FPL State Insurance Exchange• State insurance exchanges with subsidies for

people 100 – 400% of poverty• Premiums, cost sharing, and maximum out of

pocket

• Under 133% of FPL Medicaid Expansion

• Temporary “Bridge” insurance: Federal Pre-existing Condition Insurance plan – available now through 2014

BENEFITS FOR NEWLY INSUREDBoth New Medicaid & Insurance Exchange require coverage of:

“Essential Health Benefits”• Specific benefits for

Medicaid and Insurance Exchange to be determined independently

• Specific benefits wont’ be the same between insurance plans or Medicaid

ESSENTIAL HEALTH BENEFIT CATEGORIES:

• Ambulatory Services• Hospitalization• Maternity & Newborn Care• Mental Health/Substance

Abuse• Prescription Drugs• Emergency Services• Rehabilitative/Habilitative • Lab Services• Preventative & Wellness

Services & Chronic Disease Management

• Pediatric services

SUPREME COURT DECISION• Upheld the

“individual mandate”

• ACA left standing, so consumer protections, etc remain in place, except….

• Limited the Medicaid Expansion• Feds can’t coerce

state to participate through withholding other Medicaid funds

• Left the public health fund intact.

IF MEDICAID IS NOT EXPANDEDOver 133% of FPL:

• Can buy insurance on Exchange

• Can get subsidies if under 400% of FPL

Under 133% of FPL

• No Medicaid Expansion unless State opts in

• Can buy insurance on exchange, BUT

• Subsidies not available to persons at or below 100% FPL

REFORM & HIV/AIDS: BREAKING IT DOWN

2014

Old Medicaid

New Medicaid

Employer Insurance

Insurance Exchange

with Subsidies

Uninsured

PCIP

VA, Tricare

Medicare

2014

Old Medicaid

New Medicaid

Employer Insurance

Insurance Exchange

with Subsidies

Uninsured

VA, Tricare

Medicare

PCIP

No change

2014

Old Medicaid New

Medicaid

Employer Insurance

Insurance Exchange

with Subsidies

Uninsured

VA, Tricare

Medicare

PCIPNew Program

“NEW MEDICAID”

2014

New Medicaid

• Income up to 138% FPL (133% + 5% income disregard)

• No assets test• No disability requirement• Different benefits - based

on “benchmark” insurance plan

• Must cover “Essential Health Benefits”

(About 5000 PLWHA gain coverage)

NEW MEDICAID:ESSENTIAL HEALTH BENEFITS

2014

New Medicaid

• Ambulatory Services• Hospitalization• Maternity & Newborn Care• Mental Health/Substance

Abuse• Prescription Drugs• Emergency Services• Rehabilitative/Habilitative • Lab Services• Preventative & Wellness

Services & Chronic Disease Management

• Pediatric services

NEW MEDICAID:ESSENTIAL HEALTH BENEFITS

2014

New Medicaid

Potentially Missing:• Case Management• Oral Health• Vision• Long Term Care• Private Duty Nursing• Hospice• Personal Care

NEW MEDICAID:PRESCRIPTION DRUGS

2014

New Medicaid

• The ACA doesn’t specify how expansive (or not) the drug formulary will be.

• One early statement from HHS – one drug per class

• Lots of advocacy on this nationally

2014

Old Medicaid New

Medicaid

Employer Insurance

Insurance Exchange

with Subsidies

Uninsured

PCIP

VA, Tricare

Medicare

Improvements

NOW

Medicare

• Free Preventative care

• Free annual wellness visit

• Medicare Part D:

• “Donut Hole” discounts to help pay for prescriptions.

• Donut Hole phased out by 2020

• ADAP counts as client’s out-of-pocket for Medicare Part D

2014

Old Medicaid New

Medicaid

Employer Insurance

Insurance Exchange

Uninsured

PCIP

VA, Tricare

Medicare

No Disc

rimin

atio

n

• Lifetime limits to insurance coverage eliminated.

• Insurance companies can’t cancel coverage just because you get sick.

• Children can’t be denied coverage due to a pre-existing condition.

• Free coverage for preventative care, like mammograms and colonoscopies.

EMPLOYER/PRIVATE INSURANCE

NOW

Employer/Private Insurance

2014

Old Medicaid New

Medicaid

Employer Insurance

Insurance Exchange with

Subsidies

Uninsured

PCIP

VA, Tricare

Medicare

New Insurance Marketplace

• Limited to those without adequate or affordable insurance

• State-based consumer-friendly insurance “marketplace”

• Subsidies on premiums and cost sharing to make health care more affordable only for those eligible to purchase on the exchange

• If state doesn’t take the lead, the federal government will operate the exchange & choose a default plan

• NC legislature has not adopted an exchange, but work has been done on plan evaluation, provider networks, etc.2014

Insurance Exchange

with Subsidies

INSURANCE EXCHANGE

About 1000 PLWHA

Same as for Medicaid – but specific covered services can be different• Ambulatory Services• Hospitalization• Maternity & Newborn Care• Mental Health/Substance Abuse• Prescription Drugs• Emergency Services• Rehabilitative/Habilitative • Lab Services• Preventative & Wellness Services &

Chronic Disease Management• Pediatric services

INSURANCE EXCHANGE – ESSENTIAL HEALTH BENEFITS

2014

Insurance Exchange

with Subsidies

• Like Medicaid – based on a “Benchmark Plan”

• Same issues around prescription drugs

• The likely NC benchmark plan has open formulary

INSURANCE EXCHANGE – ESSENTIAL HEALTH BENEFITS

2014

Insurance Exchange

with Subsidies

INSURANCE EXCHANGE PROVIDER NETWORKS• Network adequacy: State must assure enough providers

to permit adequate access

• Essential Community Providers:

• Plans offered in the Exchange must include “essential community providers” in networks

• ECPs = providers that serve predominantly low-income, medically underserved communities

• This includes FQHCs, Ryan White grantees, STD/TB clinics, family planning clinics disproportionate share hospitals, etc.

• Network Adequacy

• Insurance plans don’t need to contract with ALL ECPs

INSURANCE/MEDICAID ENROLLMENT

Diagram from NC Institute of Medicine, Examining the Impact of the Patient Protection and Affordable Care Act in North Carolina: Draft Final Report Pending US Supreme Court Decision, p. 64, May 2012

HEALTH CARE NAVIGATORS

Becoming a navigator:

• Entities that have expertise working with low-income, or other at-risk groups.

• Must have existing, or easily established, relationships with employers, employees, consumers (including the un- or under-insured)

• Must give fair, accurate and impartial information

2014

Old Medicaid New

Medicaid

Employer Insurance

Insurance Exchange

Uninsured

PCIP

VA, Tricare

Medicare

Gaps remain

• Immigrants• Undocumented, or• In US less than 5 years

• Some will be exempt from mandate because insurance still not affordable

• Some will choose not to sign up for insurance

SOME STILL UNINSURED

2014

Uninsured

• There will still be gaps to fill• Oral Health• Support services • Case management• Transportation• Cost sharing help• Uninsured

• Reauthorization in 2013 –What will Ryan White look like after health reform?

RYAN WHITE & REFORM

THREE SCENARIOS

A LOOK AT WHAT HEALTH CARE REFORM WILL MEAN FOR LOW-INCOME CONSUMERS WHO DON’T QUALIFY FOR MEDICAID

• Jane Smith earns $16,433 a year. In 2012, she will be at 149% of the Federal Poverty Level.

• Currently, she is uninsured and gets her care through Ryan White & ADAP.

• In 2014, she will be required to purchase health insurance for herself.

• What does Health Reform mean for Jane?

JANE SMITH

JANE SMITH & INSURANCE SUBSIDIESJane will be eligible for cost-sharing subsidies, premium credits, and reduced out-of-pocket limit

  Without Subsidies With Subsidies

Premium $5700 $670/year (4% of income)$56/month

Cost sharing (deductible, copay, co-insurance)

Plan pay 70% of costs

Reduced so plan pays 96% of costs

Out of pocket $5950 $1984

• Mr. and Mrs. Diaz are undocumented immigrants. Their daughter, Maria, was born in the United States.

• Mr. Diaz has HIV, and currently gets care through Ryan White.

• Mr. and Mrs. Diaz pay taxes, and earn $25,390 a year, putting them at 133% of the Federal Poverty Limit.

• What happens to the Diaz family in 2014?

THE DIAZ FAMILY

THE DIAZ FAMILY & REFORM

• Because Mr. and Mrs. Diaz are undocumented, they will not qualify for Medicaid, or for any other protections under the ACA.

• The Diaz’ family can apply for Health Choice on behalf of Maria. (They will not have to provide any information on their immigration status).

• Mr. Diaz still needs Ryan White and ADAP to cover his care.

• Richard Doe is 30 years old and lives with his partner.

• Richard makes $46,021 a year, so he is at 400% of the estimated 2014 Federal Poverty Level.

• Richard’s employer – a small, local company, does not currently offer insurance. But, in 2014, they will begin providing insurance to their employees.

• Richard does not want his company to find out about his HIV status.

• What does reform mean for Richard?

RICHARD DOE

RICHARD, REFORM & CONFIDENTIALITY• Richard may not have to purchase his employer’s

insurance, if it costs more than 9.5% of his income ($4372/year or $364/month).

• Because insurers can no longer deny coverage based on pre-existing conditions, there is no reason for Richard’s employer to ask him about his health status.

• If the employer doesn’t offer insurance, Richard can buy on the Exchange. Richard will qualify a reduced premium: about $3440/year or $287/month

IS NC ON TRACK TO IMPLEMENTATION?• State leadership taking a “wait and see” approach (governor candidates,

legislative leaders)

• Looking to see what elections hold, chances of repeal• Federal government is moving forward at full speed – but that could

change with election outcome

• Health Benefit Exchange:

• State has not passed a bill to create its own Exchange & time is running short

• Feds may run exchange in 2014• Department of Insurance doing some planning• Because NC has not picked a benchmark plan, default plan will be the

largest insurance plan among the small-market plans, i.e. Blue Options.• Medicaid Expansion:

• Will require legislative action• Governor, candidates, and legislative leaders taking a “wait and see”

attitude• DMA (Medicaid) is planning, running numbers

THREATS TO REFORM ON NATIONAL LEVEL

• Depending on election outcome:

• “Obamacare waivers”?• Repeal

• Senate requires 3/5 majority if filibustered

• Repeal & Replace• Budget Reconciliation

• Takes time• Limited subject matter permitted

• Refusal of new administration to enforce ACA?• More litigation likely to compel

THREATS ON NATIONAL LEVEL BEYOND THE ACA

Sequestration

• Would cut 8.2% of non-exempt non-defense discretionary budget

• $659 million from domestic HIV/AIDS & viral hep

Medicare – Romney/Ryan plan for vouchers

• fixed dollar amount to buy coverage

Medicaid –

• Romney/Ryan: Block grant with growth limited to rate of inflation plus 1% annually (way less than current growth)

• 1.2 trillion drop in federal funding from 2014 to 2022• 14-27 million beneficiaries could lose coverage

• Per Capita funding – being discussed by both parties

GOP PLAN FOR MEDICAID

FOR MORE INFO

Allison Rice

Duke Legal Project

(919) 613-7135

rice@law.duke.edu