MMGMA Health Care Update - September 18, 2007

Legislative Commission on Health Care Access Continues Deliberations: The Legislative Commission on Health Care Access and its eight work groups continued to debate various proposals for reforming the health care industry. Panel members have received multiple presentations from various entities detailing the current status of existing programs. The group is searching for places where the legislature can act.

Throughout the meetings, a desire to enact legislation authorizing universal health care remains a goal shared by many panel members but, the question remains what such a proposal would look like. Some cost containment work group members have conveyed a desire to pass a sustainable measure that elected officials on both sides of the aisle will look upon in future years as a legislative success.

The key to this, according to Rep. Erin Murphy (DFL-64A), is to ensure that future proposals don't rely exclusively on the public sector, and do not focus exclusively on providing coverage to Minnesotans without health insurance. Murphy stated that a sustainable solution will be one that looks at the entire population, and includes measures for containing the rising cost of health premiums that the insured population is currently wrestling with.

The work group is also looking at existing initiatives and trying to gauge their current or projected success. In a recent meeting held by the full Commission, Brian Osberg, Assistant Commissioner of the Department of Human Services, gave an overview of current efforts being implemented by the state to advance value-driven health care in Minnesota.

Osberg touched upon health information technology networks and explained the state's grant program that seeks to encourage and help fund interoperability between different systems. Commission co-chair Sen. Linda Berglin (DFL-61) noted that promoting expanded usage of electronic health records with increased compatibility between different networks are goals that the Senator and the Governor share. Osberg also discussed projects seeking to measure quality of care such as the Minnesota Community Measurement project.

The commission also received an overview on federal legislation that affects Minnesota. Not surprisingly, much of the overview focused on the Children's Health and Medicare Protection (CHAMP) Act. The U.S. House and Senate have each passed respective versions of the bill, which is due to be reviewed in conference committee. The House version halts a 9.9 percent cut in Medicare reimbursement rates. Multiple concerns have been raised about a number of the offsets used to fund this provision, including monies originally allocated toward the Medicare Advantage program. Staff from the Minnesota Department of Health also voiced concern about a number of rule changes proposed by Centers for Medicare and Medicaid Services (CMS) that could put some federal funds the state relies on to aid in running various public programs in jeopardy.

What is Affordability? The Health Care Access Commission's work group entitled "Cost Containment: Restructure the Health Care System through the Identified Savings" has been working actively to define "affordability" as it relates to health insurance. In doing so, the work group looked at how affordability is defined in Massachusetts and Vermont's comprehensive health reform proposals, and some of the flaws within those definitions.

In Massachusetts, anyone with a family income level at or above 300 percent of the Federal Poverty Guidelines (FPG) without health insurance will be penalized for not having coverage unless the Commonwealth Health Insurance Connector Authority determines that affordable coverage is not available.

According to a memo released by Julie Sonier, Director of the Health Economics Program with the Minnesota Department of Health, the Connector Authority has determined that an individual with income at 300 percent of FPG can afford coverage at $105 per month. The monthly cost of the lowest premium policy available to a 50 year old in Massachusetts varied from $232 to $356 per month. To put this in perspective, a family of four with an annual gross income of $61,950 and an individual who makes $30,630 are both considered 300 percent above the FPG.

According to Katie Cavanor, Senate Counsel and Research, the goal of the Massachusetts plan is to provide coverage to 95 percent of the population. Sen. Linda Berglin (DFL-61) speculated that the people in Massachusetts who will fall through the cracks will likely be people in their 40s and 50s with income levels slightly over 300 percent of the FPG.

Vermont offers a number of different health plans targeted to different cross sections of the uninsured community, and premium levels are determined largely by the beneficiaries' income levels. The Vermont Health Access Plan is an insurance plan for individuals over 18 at income levels below 150 percent of FPG, and parents below 185 percent are eligible.

The Catamount Health Plan is a privately run health plan available to uninsured Vermonters who had insurance, but lost coverage for a number of reasons, and who do not have access to employer sponsored insurance. The estimated premium for the Catamount Plan's least expensive plan will cost about $390 per month. Individuals with income levels below 300 percent of the FPG may also be eligible for state assistance. Similar to Massachusetts, the Vermont plan seemingly leaves few options for persons over 50 with income levels just above 300 percent of the FPG.

Senate Fiscal Analyst David Godfrey informed the work group that expanding eligibility for MinnesotaCare to all citizens whose income is at or below 300 percent above the FPG has the potential to increase the cost of premiums, particularly if the new population is less healthy than the current policyholders.

Berglin added that such an expansion might also prompt Minnesota Comprehensive Health Association (MCHA) beneficiaries and MCHA candidates to enroll into MinnesotaCare. This trend would drastically increase premiums and overhead, unless there was language inserted into statute specifically prohibiting MCHA enrollees from moving to MinnesotaCare.

With respect to affordability, Berglin observed that the number of uninsured Minnesotans eligible for Medicaid is much higher than the number of uninsured persons eligible for MinnesotaCare, and the primary reason cited for not enrolling is cost. Holly Rodin with the Service Employees International Union SEIU) said the commission should look at ways to identify people who are currently paying for health insurance they can't afford. Peter Benner with AFSCME, however, expressed concern about political pressure to increase the amount of money that is identified as the benchmark for defining affordability.

Mary Edwards with Fairview Health Services said another crucial piece of the puzzle consists of asking whether consumers know what their health care premium dollars are paying for. As an example, some consumers may opt for high deductible plans because of the lower premiums, but this decision has to beg the question whether or not these consumers can realistically afford the high deductibles.

There is no shortage of challenges for the Commission and work groups, but panelists remain undeterred as they move toward defining comprehensive
coverage and looking for ways to make such a package affordable to all Minnesotans.

Upcoming Meetings:

Governor's Health Care Transformation Task Force
Monday, September 17th , 2007 - 9:30 a.m. to 4:00 p.m.
Location: Revenue Building - Skjegstad Room, 600 Robert St. N., St. Paul

HCAC Working Group: Single Payer Approach to Health Care
Tuesday, September 18, 2007 - 11:00 a.m.
Room: 200 State Office Building
Chair: Rep. Ken Tschumper
Agenda: Possible financing mechanisms for a single payer system

HCAC Working Group: Development of New Cost Containment Strategies
Tuesday, September 25, 2007 - 1:00 p.m.
200 State Office Building
Chair: Rep. Jim Abeler and Sen. Ann Lynch
Agenda: TBA

HCAC Working Group: Identifying Health Care Costs/Savings
Tuesday, September 18, 2007 - 2:00 p.m.
200 State Office Building
Chairs: Rep. Erin Murphy, Sen. Tony Lourey
Agenda: Discussion on regulatory and licensing law changes Increasing the variety of providers providing care to rural and underserved populations. Continue previous discussion on recommendations. Written testimony can be submitted to Jenn Holcomb (jenn.holcomb@house.mn) before noon Sept. 14.

HCAC Working Group: Insurance Market Reform
Wednesday, September 19, 2007 - 10:00 a.m.
200 State Office Building
Chairs: Rep. Diane Loeffler, Sen. Mary Olson
Agenda: Discussion of risk adjustment Written testimony can be submitted to Jenn Holcomb jenn.holcomb@house.mn) by noon Sept. 13.

HCAC Working Group: Public Health
Monday, September 24, 2007 - 10:00 a.m.
200 State Office Building
Chairs: Rep. Steve Gottwalt, Sen. Patricia Torres Ray
Agenda: Discussion on non-financial barriers to receiving health care

HCAC Working Group: Bridging the Health Care Continuum
Tuesday, September 25, 2007 - 10:00 a.m.
G-15 State Capitol
Chairs: Sen. Kathy Sheran
Agenda: TBA

HCAC Working Group: Identifying Health Care Costs/Savings
Tuesday, September 25, 2007 - 2:00 p.m.
200 State Office Building
Chairs: Rep. Erin Murphy, Sen. Tony Lourey
Agenda: Continue discussion on recommendations

HCAC Working Group: Insurance Market Reform
Wednesday, September 26, 2007 - 10:00 a.m.
200 State Office Building
Chairs: Rep. Diane Loeffler, Sen. Mary Olson
Agenda: TBA

Governor's Health Care Transformation Task Force
Monday, October 22, 2007 - 9:30 a.m. to 4:00 p.m.
Location: Revenue Building - Skjegstad Room, 600 Robert St. N., St. Paul, MN 55164-0975

Governor's Health Care Transformation Task Force
Monday, November 19, 2007 - 9:30 a.m. to 4:00 p.m.
Location: To Be Determined

Governor's Health Care Transformation Task Force
Monday, December 3, 2007 - 9:30 a.m. to 4:00 p.m.
Location: To Be Determined

Governor's Health Care Transformation Task Force
Monday, December 10, 2007 - 9:30 a.m. to 4:00 p.m.
Location: To Be Determined

Governor's Health Care Transformation Task Force
Monday, January 7, 2007 - 9:30 a.m. to 4:00 p.m.
Location: Snelling Office Park - Mississippi Room, 1645 Energy Park Drive, St. Paul