California: Following defeat of comprehensive health care reform legislation in January, California legislators have introduced nearly two dozen reform bills in the second half of the regular legislative session. Some of the bills include portions of the health reform legislation that had been a compromise between Governor Arnold Schwarzenegger and Assembly Speaker Fabian Nùnez, including:
- AB 2967 and SBX1 12, which would create the California Health Care Cost and Quality Transparency Committee in the Health and Human Services Agency.
- SB 1440, which would require health care service plans to spend at least 85 percent of their income from premiums (or 75 percent for plans five years or younger) on medical benefits for plan members.
- SB 1522, which would require the Department of Managed Health Care (DMHC) and the Department of Insurance to develop regulations together to create five coverage choice categories of health plans that reflect a continuum of benefit levels.
Additionally, four measures would require health plans to provide coverage for the following services:
- AB 1887— Diagnosis and treatment of severe mental illnesses
- AB 54—Acupuncture in group plans
- AB 2234—Breast cancer screening and diagnostic tests under certain conditions
- SB 1198—Durable medical equipment
Some newly introduced bills respond to individual health insurers and plans canceling coverage of individuals who provide inaccurate information on their applications for coverage. These bills propose provisions that require notification of cancellation (AB 2549) or require prior approval (AB 1945) from state regulators before cancellation.
Other bills introduced are related to expanding regulatory oversight, such as SB 1300, which would prohibit provisions in contracts between health care providers and health care service plans that restrict providing health care pricing or quality information to subscribers or enrollees of the plan. AB 1554 would require regulators to approve rates in the individual market. SB 1525 would require DMHC to review plan procedures for determining medical necessity. SB 1669 would create a look back period of 10 years for determining medical conditions that would be excluded from coverage for those purchasing in the individual market.
Louisiana: On February 28, 2008, the Centers for Medicare and Medicaid Services (CMS) announced their approval for an increase in the eligibility level for children in the Louisiana State Children’s Health Insurance Program (SCHIP) from 200 to 250 percent of the federal poverty level (FPL). This reflects a reduction from the 300 percent FPL that had been enacted by the legislature due to the August 17, 2007 directive from CMS which limited eligibility in SCHIP to 250 percent FPL unless states are able to meet certain criteria. (See related article on Federal Challenges).
The state will depart from the delivery model used for the current SCHIP population to serve the newly-covered children. The new program will be administered by the same group that coordinates the state employees’ benefit plan. The benefits will be benchmarked to the state employees plan and will use its network of providers. Parents will pay $50 per month to enroll their children, and they will be required to pay similar copayments and deductibles as state employees.
Governor Bobby Jindal has indicated that he is still committed to raising the eligibility level to the originally proposed level of 300 percent FPL. State officials had hoped that the state would be allowed to increase their SCHIP eligibility above 250 percent FPL because a state-specific survey showed that they have achieved the benchmark of having 95 percent of poor children enrolled, due to aggressive outreach by the state. Nevertheless, after discussions with CMS staff, state officials elected to submit their request for 250 rather than 300 percent FPL.
New Jersey: On December 19, 2007, Governor Jon Corzine signed legislation to allow certain children to buy into the New Jersey FamilyCare program. Currently, New Jersey FamilyCare covers children up to 350 percent FPL. With the new legislation, children with family incomes above 350 percent FPL will be eligible to buy into the program as long as they have been uninsured for at least six months. Monthly premiums are $137 for a family with one child, $274 for a family with two children, and $411 for a family with three or more children. The state estimates that 15,000 children could benefit from the program.
On March 17, 2008, state Senator Joseph Vitale introduced the first phase of a health care reform bill that aims to provide coverage for all children in New Jersey. The bill also calls for expanding eligibility to parents under New Jersey FamilyCare, increasing it from 133 percent to 200 percent FPL. Other features of the legislation are designed to lower premiums in both the individual and small group markets. These provisions include raising the minimum loss ratio for insurers from 75 percent to 80 percent and widening the rating band to 3.5:1 in the individual market (from the current pure community rating system). The second phase of the bill will be introduced in late spring and will be proposed as part of the 2009 budget year.
Oregon: A new lottery process was implemented in early March to select 3,000 names from a list of nearly 91,000 uninsured individuals to be enrolled into the Oregon Health Plan (OHP) Standard program. The program provides basic health services to low-income adults who do not quality for traditional Medicaid. Currently, Oregon provides Medicaid benefits to low-income pregnant women, children, those with disabilities, the elderly, and some low-income adults. However, the state limited enrollment for the OHP Standard adults in 2004 due to budgetary shortfalls—decreasing enrollment from a high of over 100,000 to only affording coverage for 24,000. Over the years, enrollment in the program has dropped, due to attrition, to about 19,000, so the state reopened the plan in order to boost enrollment back to its maximum limit of approximately 24,000.
Utah: In March, lawmakers passed and Governor Huntsman signed H.B. 133, which creates a task force for developing a strategic health reform plan. The plan would require the Insurance Department to work with insurers to develop standards for health insurance applications and for compatible systems of electronic submission of applications. The plan also calls for health insurers to develop new health insurance products that meet certain criteria. In addition, the bill expands Utah's employer-sponsored premium subsidy program to also cover individual health plans.
In March, lawmakers also passed and Governor Huntsman signed H.B. 359, which slightly increases the state sales tax in order to offset a new five percent tax credit for health care costs paid by residents who do not have access to an employer-sponsored health plan. Self-employed residents and others that purchase individual health plans are eligible for the state's health care tax credit. The maximum amount for this nonrefundable credit is $300 for single taxpayers, $600 for married couples filing jointly, and $900 for taxpayers with dependants.
Washington: House Bill 2549, which establishes patient-centered primary care pilots, was sent to Governor Christine Gregoire after passing both houses March 8. Governor Gregoire has 20 days from March 13 to act on the bill and is expected to sign it into law. The goal of this legislation is to improve quality, reduce costs, and expand access to primary care through the use of medical homes. It will provide incentives to primary care providers who participate in a medical home program of the Washington State Collaborative to Improve Health.
On March 10, lawmakers passed SB 6333, which creates the Citizens' Work Group on Health Care Reform. This group will analyze different health care reform plans and engage the public in developing comprehensive reform for the state.
On March 12, SB 5261 passed both houses, which restores authority to the insurance commissioner to regulate the rate increases of health benefit plans in the individual market.
