Health Care Reform:The Impact on Practitioners, Patients, and

Politicians

Dave RennerDirector, State & Federal Legislation

Minnesota Medical Association

Pre-Quiz

PPACA?ACA?

ObamaCare?

All the same:Patient Protection & Affordable Care Act of 2010

Overview

• State vs. national context for reform• Reform elements

–Insurance Coverage & Reform–Quality Reporting & Improvement –Delivery & Payment Reform

• The politics of reform• Discussion/Q&A

The Landscape

2008 Health Reform Act• Bipartisan agreement• Public health investment• Quality reporting and

improvement• Payment and delivery reform

• Focus on cost containment

• Minimal focus on coverage/insurance reform

2010 Affordable Care Act (ACA)• Bipartisan disagreement• Public health investment• Quality reporting and

improvement• Payment and delivery reform

(Medicare/Medicaid)• Strong focus on

coverage/insurance reform• Minimal on cost

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Insurance Coverage & Reform

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Insurance Reform Context

• 9% uninsured• History of solid

regulatory structure• “Decent” environment

for health care stakeholders

• Strong non-profit tradition (state-based companies)

• 17% uninsured• Variable regulations across

states• Variable, but some very

contentious environments

• Variable, many for-profit, national plans

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ACA Insurance Coverage

• Estimated to provide coverage for 33 million of the 55 million uninsured

• 3 specific ways1. Individual Mandate

a) Employer Participation

2. Insurance Exchange w/ low-income subsidies3. Medicaid Expansion

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1. Individual Mandate• Effective January 1, 2014 • All US citizens and legal residents• Compliance means you have “qualifying coverage”

– A public program plan (e.g., Medicare or Medicaid)– Employer coverage– “Young invincible” plan

• catastrophic for those <30 without other insurance • available to those with premiums >8 percent of

income• Enforcement penalties• Exemptions• Upheld by SCOTUS: authority to tax

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2. Insurance Exchange & Subsidies

• One-stop shopping for coverage: “Expedia”• Individual and small employers• Subsidies to all between 133%-400% FPG• Sliding scale premiums: limits cost to 3%-9.5%

of income• Subsidies only for coverage bought through

Insurance Exchange

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2. Insurance Exchange (cont.)

• Exchange: An improved “marketplace” for purchase of insurance: individual and small employers (<100)– Administer tax credits– Determine “qualified” health plans that can sell products– Must be fully functional by January 2014– Can not sell to undocumented immigrants

• MN authorizing legislation not advancing– State moving forward with planning efforts– Over $70 million in federal grants to implement– Politically charged

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Why Do Exchanges Matter to Providers?

• Likely venue for insurance buying/eligibility decisions for up to 46% of Minnesotans

• Opportunity for increased transparency and improved comparability about health plans/products– Common standards and expectations

• Inclusion of quality/cost metrics may impact physicians and network definitions

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3. Medicaid Expansion• ACA allowed option for early expansion

– Gov. Dayton signed order Jan. 5, 2011 to expand for all Minnesotans <75% FPG

– DHS launched March 1, 2011• ACA: Medicaid eligibility for all < 133% FPG

(non-elderly) by 2014– SCOTUS ruled this optional for states

• Today: children, families, pregnant women, elderly– About ½ of newly insured done via expansion– Increased federal $ to states for new enrollees

• 90% federal $ first two year.12

Expansion Implications for MN

• Early Medicaid Expansion: eligibility for ~95,000– 32,000 GAMC– 51,000 MNCare enrollees– 12,000 Other (uninsured)

• Expanding to 133% replace MNCare with MA for single adults—save MN $

• Politically charged!

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4. Insurance ReformsKey component of federal reform and coverage expansion• 2010:

– Dependent coverage for adult children up to age 26 (MN law is up to 25)

– Temp. national high-risk pool (thru 2013)• MN opted out of managing pool (MCHA)

– No pre-ex for children– Phases in lifetime $ limits

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4. Insurance Reforms (cont.)

• 2014:– With mandate: guaranteed issue and renewability– Limits on premium variations

• Age: 3 to 1 ratio• Geography, family size, tobacco use: 1.5 to 1 ratio

• Essential Benefits– 4 benefit packages available (bronze, silver, gold,

platinum)• Variable levels of plan-covered costs (60%-90% of costs)

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Quality Reporting & Improvement

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Minnesota’s Efforts

• Expand MN Community Measurement (voluntary) work statewide

• First statewide quality report issued November 2010 (MDH)

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MN Quality Measures

• 2010 Measures (2009 dates of service)– Vascular, Diabetes Care, HIT Use

• 2011 Measures– Depression remission, colorectal cancer screening,

optimal asthma care• 2012 Measures

– Patient satisfaction, C-section rates, early inductions, total knees (2012 services, reported 2014)

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MN Provider Peer Grouping• Public reporting of cost and quality performance

of physician clinics and hospitals– Primary care and multispecialty clinics – “total care”– Endocrinology, cardiology, pulmonology, allergy, orthopedic

clinics – “condition-specific care”• MMA: Reliability & validity standards established• Slowed because of methodology challenges• Hosp. release-Dec. 2012?• Clinic release-Feb. 2013? Later?

– Original release summer, fall 2011

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ACA Quality

• Medicare PQRS– 2011: Voluntary, 1% incentive for reporting– 2012-2014: 0.5%

• An additional 0.5% incentive payment for participating in qualified MOC Program (quality practice-based learning programs through specialty boards)

– 2015: 1.5% penalty – 2016+: 2% penalty

• 2011: “Physician Compare” Website– Find-A-Doctor feature on Medicare.gov– General information

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Delivery & Payment Reform

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Current Payment Models

ERVisits

Lab Work/Imaging

HospitalStay

Health Insurance Plan

PhysicianPractice

$ $

Avoidable

Avoidable

Avoidable

OfficeVisits

NurseCare Mgr

PhoneCalls

$

No payment for services that can prevent utilization...

...No penalty or reward for

high utilizationelsewhere

Source: Miller HD. Network for Regional Healthcare Improvement, Center for Healthcare Quality and Payment Reform, 2010 (used with permission).

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Health Care Home:Pay for Care Coordination Services

ERVisits

Lab Work/Imaging

HospitalStay

Health Insurance Plan

PhysicianPractice

$ $ $

Avoidable

Avoidable

Avoidable

$Payment for care coordination...

Care Coordinator

PhoneCalls

MonthlyCare MgtPayment

OfficeVisits

Source: Miller HD. Network for Regional Healthcare Improvement, Center for Healthcare Quality and Payment Reform, 2010 (used with permission).

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Proposed Medicare Model:Shared Savings/Risk

ERVisits

Lab Work/Imaging

HospitalStay

Health Insurance Plan

PhysicianPractice

$ $

Avoidable Avoidable

Avoidable$

Portion of savings from reducedspending in other areas...

...Returnedto physician

practice aftersavings

determined...

...but no upfront $for better care

OfficeVisits

NurseCare Mgr

PhoneCalls

$

Source: Miller HD. Network for Regional Healthcare Improvement, Center for Healthcare Quality and Payment Reform, 2010 (used with permission).

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Politics of Reform

• ACA: First major health reform passed by Congress since Medicare in 1965

• Passed where others had failed– Nixon, Clinton

• Success???– Now the real battles begin

Politics of Reform

• Very polarizing issue• Candidates running on “Repeal Obamacare”• MN HIE tied up in anti-ACA rhetoric

• HIE started as a Republican idea• Market-based health reform• Now can’t be touched by Republican legislators

• Nov. elections—referendum on health reform?

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In What Direction is HCR Headed?

• New Congress and President (new?) may repeal?? Modify ACA

• Regardless, HCR will move forward– Costs are unaffordable– Purchasers are demanding payment changes– Patients are demanding delivery changes– Everyone wants better/more consistent quality

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Questions/Discussion

Dave Renner612-362-3750

drenner@mnmed.org

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CONFLICT OF INTERESTI hereby certify that, to the best of my knowledge, no aspect of my current personal or professional situation might reasonably be expected to affect significantly my views on the subject on which I am presenting.