Federal Health Care Reform Implementation Update

Elizabeth Hall, Vice President, Federal Affairs

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Public Policy Platform

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Federal Environment 2012 Timeline

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Note: This presentation is not intended to advise you on how to comply with PPACA or its related regulations. This presentation is not intended to offer legal advice. For specific questions, please consult with your counsel or benefits advisor.

Topics for Today

Implementation Updates▪ Supreme Court ▪ Exchanges▪ Essential Health Benefits

Political Environment

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Issue: Anti-Injunction Act

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Issue: Individual Mandate Constitutionality

Is the individual mandate constitutional:

• Commerce Clause – Can Congress force engagement in commerce/regulate “inactivity”?

• Necessary and Proper Clause

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Issue: Medicaid Expansion

Is the Medicaid Expansion Constitutional?• Is the Federal Government coercing states to expand

Medicaid benefits?

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Issue: Severability

Is the individual mandate severable?• The law includes no “severability clause”• If the law finds a portion of the legislation unconstitutional, what

portion of the law must stand or fall?

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Exchange Enabling Legislation

CT

VT

* Represents legislative activity as of 1/19/12, not compliance with ACA. No regular 2012 session: MT, NV, ND and TXSource: Blue Cross and Blue Shield Association, January 19, 2012

WV

MA

RI

WA

OR

NV

MT

CO

NE

SD

ND

KS

AZ NMOK

WI

IA

MO

IL

MI

OH

TN

MS

LA

AL GA

SC

NC

PA NJ

ME

UT

ID

KY

IN

AR

CA

FL

MD

MNNY

VA

WY

TX

Pending bill: 12

Failed 2012: 1

Enacted: 13

Executive Order: 7

DE

NH

Study Law: 3

DC

Failed 2012 + planning ongoing

No Bill + planning ongoing: 12

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Exchange Timeline - 2012

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Essential Health Benefits

Key Provisions in the Legislation

HHS to define essential health benefits (Institute of Medicine to provide guidance)

However, benefits shall include the following categories:1. Ambulatory patient services 6. Mental health and substance abuse disorder services2. Emergency services 7. Rehabilitative and habilitative services and devices3. Hospitalization 8. Laboratory services4. Maternity and newborn care 9. Preventive and wellness services & chronic disease mgt. 5. Prescription drugs 10. Pediatric services, including oral and vision care

Scope equal to “typical employer plan”

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Essential Health Benefits Bulletin

HHS Gives States Four Options:

1. The largest plan by enrollment in any of the three largest small group products in the state

2. One of top 3 state employee plans in the state

3. One of top 3 national Federal Employees Health Benefit Program plans in the state

4. The top HMO Commercial plan in the state

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Top Small Group Plans in Any of the 3 Largest Products

Anthem products are among the top 3 SG products in most states per HHS Web PortalState First* Second Third

CA Kaiser SG HMO Anthem PPO Anthem PPO

CO United Choice Plus Kaiser HMO Rocky Mountain PPO (Anthem)

CT Oxford PPO ConnectiCare HMO Blue Care HMO (Anthem)

GA BCBS Healthcare Plan of GA POS BCBS Healthcare of GA HMO Aetna HMO

IN Anthem PPO Anthem Lumenos United Choice Plus

KY Anthem PPO Anthem Lumenos Humana PPO

ME Anthem PPO Aetna PPO Anthem Lumenos

MO Blue Access Choice PPO (Anthem) United Choice Plus Mercy Health Plans PPO

NH HMO Blue New England (Anthem) Matthew Thorne Blue (Anthem) Access Blue New England (Anthem)

NV Rocky Mountain PPO (Anthem) Health Plan of NV POS Health Plan of NV HMO

NY Oxford Health EPO Prism EPO (Empire BCBS) Oxford HMO

OH Anthem PPO Med Mutual of OH Super Med. Anthem Lumenos

VA Anthem Health Plans of VA PPO Anthem Health Keepers HMO Optima Vantage HMO

WI United Choice Plus Compcare POS (Anthem) Medical Associates HMO

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Note: This presentation is not intended to advise you on how to comply with PPACA or its related regulations. This presentation is not intended to offer legal advice. For specific questions, please consult with your counsel or benefits advisor.

Topics for Today

Implementation Updates▪ Supreme Court ▪ Exchanges▪ Essential Health Benefits

Political Environment

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Political Environment

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2012 Elections, President Obama, Congress and Health Care Reform

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2012 Presidential Election: The Path to 270 Electoral Votes

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Source: Real Clear Politics

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Americans See Country Headed in the Wrong Direction

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Source: NBC News/Wall Street Journal Survey, Jan. 24 th, 2012 1,000 Am

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President Obama Approval Ratings

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Source: New York Times/CBS News Poll, Jan. 19th, 2012

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Republican Base Unimpressed with Party’s Candidates

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Source: Pew Research Center

• More Republican and Republican-leaning registered voters say the GOP field is only fair or poor (52%) than did so in early January (44%).

• At about this point four years ago, 68% of Republican and GOP-leaning voters rated the field as excellent or good.

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Obama vs. Romney Presidential Matchup

• A USA TODAY/Gallup Swing States Poll from Jan. 28th found that registered voters in 12 key swing states are evenly split between Barack Obama and Mitt Romney in their 2012 presidential election preferences.

▪ Obama and Romney have also been statistically tied in each of five polls conducted among swing state registered voters dating back to August

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Source: Gallup USA/Today Poll

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Battle for the House of Representatives

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Map Source: Real Clear Politics

Current House: 242 Republicans & 193 Democrats

Democrats Need to Win 25 New Seats to Flip House

50 Seats are Considered Slight Lean/Toss-Ups

Republican Held Seats Democrat Held Seats

GOP Currently Holds 28 of those Seats

Democrats Holds 22 of those Seats

Magic Number: 218 Seats are needed for House Majority

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Congressional Approval Ratings

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Source:: Real Clear Politics

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Battle for the Senate

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Map Source: Real Clear Politics

Current Senate: 53 Democrats & 47 Republicans

GOP Need to Win 4 New Seat to Re-Gain Control of Senate

8 Senate Races this Election Cycle are Considered Toss-Ups

6 of those Toss-Up Senate Races are Currently Controlled by Democrats

Majority

Magic Number: 51Seats are needed for Senate

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Key Battleground Senate Races Up-Close

Four Most Competitive Senate Races

• Massachusetts

• Florida

• Nevada

• Virginia

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Massachusetts Senate Race

Senator Scott Brown (R-Incumbent)

Elizabeth Warren (D)

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• Scott Brown won this seat in a special election against a weak opponent

• Moderate voting record and bipartisan appeal

• President Obama won Massachusetts with 62 percent of the vote in 2008

• 54 percent of the state’s voters are registered independents

• Latest poll had both candidates in statistical tie

• Viewed as liberal star who plays well to the deep blue party base in state

• Harvard law professor, oversaw TARP and established the Consumer Financial Protection Bureau.

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Florida Senate Race

Senator Bill Nelson (D-Incumbent)

Congressman Connie Mack (R) *Likely Republican Nominee*

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• Has been Senator since 2000

• Only Democrat to hold state-wide office in a increasingly conservative state

• Nelson currently has a huge fundraising advantage

• Latest poll had candidates in statistical tie

• Fits the conservative trending of the electorate

• Father was two term Florida Senator

• Still needs to survive a bruising primary race

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Nevada Senate Race

Senator Dean Heller

(R-Incumbent)

Congresswoman Shelley Berkley (D)

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• Appointed to the Senate last year

• Former Congressman and Secretary of State

• Large Hispanic population and large influx of new voters

• Polls have both candidates in statistical dead heat

• Largely unknown outside her Vegas area district

• Has represented Clark County (Las Vegas) since 1998

• Nevada economy has been devastated by the recession and the drag of President Obama could hurt Berkley’s chances

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Virginia Senate Race

Former Senator George Allen (R)

Former Gov. Tim Caine (D)

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• Former Governor and Senator

• Strong possibility that the current Gov. Bob McDonnell could be picked as Romney’s running mate

• Polls have both candidates in statistical tie

• Chosen to run with President Obama’s message

• Former Governor and DNC Chair

• Once a solidly republican state, the voter demographics have shifted to become more favorable to democrats

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40%

44%

41%

35%

45%

40%

44%

40% 41%

50%48%

46%

41%44%

46%43% 44% 43%

51%

44% 43% 44%

14% 14%10%

14%12% 11%

15%18% 18%

9% 8%

13%

18%

14%12%

15%17% 16% 15%

19%17%

19%

46%

41%

48%50%

43%

49%

42%

42% 42%

41%43% 42% 41% 42% 42% 42%

39%41%

34%37%

41%

37%

0%

20%

40%

60%

80%

Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan

Public Remains Largely Split On ACA

Favorable Unfavorable

Don’t know/Refused

ACA signed into law on

March 23, 2010

Source: Kaiser Family Foundation Health Tracking Polls

2010 2011 2012

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Republican Opposition to ACA Far More Intense Than Democratic Support

16%

17%

14%

57%

34%

9%

30%

6%

19%

27%

19%

6%

11%

35%

18%

10%

Very favorable Somewhat favorable Somewhat unfavorable Very unfavorable

Total

Democrats

Independents

Republicans

Source: Kaiser Family Foundation Health Tracking Poll , conducted January 12-17, 2012

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Next Steps

• What happens next?

• What does it mean to you?

Questions?