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Topics of interest to both consumers and agents related to Covered California and the ACA biased in favor of the successful implementation of the Exchange and deliberately apolitical.

May 2011 Archives

Vermont Gov. Peter Shumlin signed a bill yesterday authorizing the state to adopt single payer health care - a move some liberals are cheering, saying the state could be a model for single payer on a much larger scale. In 2017 at the earliest, Vermonters will be guaranteed health care coverage. .In an interview with the International Business Times, Dr. Deborah Richter, M.D. of Vermont Health Care For All (VTHCA), a Vermont-based non-profit organization, responded to questions about this bill.

QUESTION: Will it cover everyone?

  • Richter: That is the intention, to cover every resident of Vermont.

QUESTION: How does it work?

  • Richter: Essentially, you no longer need health insurance because it will pay for everyone. Think of it like public schools.

QUESTION: How will it be financed?

  • Richter: Vermont residents will pay into the single-payer fund based on their income.

QUESTION: Can Vermont afford it?

  • Richter: Total costs are already going up 7 to 8 percent per year, so the [status quo] isn’t affordable. The single-payer health care system puts a budget around health care, so we’ll be spending less in total. There are also efficiencies. We will do health planning. For example, if it looks like we have too many hospital beds for our population, we’ll reduce that number. We will save on administrative costs of having only a single-payer [that health care providers deal with. We will have uniform rates, which mean all providers will be paid the same rate. This will further save administrative costs.

QUESTION: How do you think Vermont lawmakers arrived at the conclusion that it’s affordable?

  • Richter: We have an assessment from a Harvard economist who designed the system in Taiwan. The system has a track record of saving money. We have examples around the industrialized world that show us that we, too, can spend less and get better care.

QUESTION: How do you cut down on frivolous hospital visits and waste?

  • Richter: Studies have shown that [frivolous visits] happen mostly because people don’t have a primary care doctor. The bill will expand the primary care workforce, which will cut down frivolous visits. Also, people generally don’t enjoy [spending a lot of time in hospitals.

QUESTION: Any further comments?

  • Richter: It’s the most fiscally conservative way to cover everybody. I’m amazed people don’t want to embrace this. It’s going to cost less money and give everybody better care.

QUESTION: Can every state do it?

  • Richter: Absolutely

Third Exchange Board Meeting

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This entry borrows freely form a blog post authored by Micah Weinberg, published May 24, 2011 in The New Health Dialogue - A Blog from New America's Health Policy Program.

The California Health Benefit Exchange held its third meeting today. The meeting was an update on progress toward planning the development of the new health insurance exchange portal for the state, targeted for launch in the spring of 2013. The focus of this meeting was on integration with existing state programs and systems.

The "Level 1" grant will among other things provide more funding to hire a staff for the Exchange. The June 15th meeting will feature the participation of key federal government officials. Pending the approval of this grant, expected by the end of the summer, the Exchange has no budget and is staffed primarily by people from other parts of the government and by consultants supported by charitable groups. Pat Powers, the Interim Administrative Director of the Exchange, promised that, after the Level 1 grant is submitted, there will be time to do more strategic planning.

The substance of this meeting was on program integration, particularly as it relates to the eligibility and enrollment systems currently administered by the state for its existing rublic programs. Deborah Kelch, who is acting as one of the leading consultants gave an overview of program integration requirements.

Representatives of the Department of Insurance and the Department of Managed Healthcare, gave high-level overviews of the core functions of their agencies and their track records.

In the second part of the briefing, Bill Obernesser, a lead consultant on this work, laid out the federal requirements and mapped out the state's existing eligibility and enrollment systems. He was followed by representatives from the County Welfare Directors Association who spoke in greater detail about the county-based enrollment system for Medi-Cal and by a representative from the Managed Risk Medical Board who talked about the separate state-based system for enrollment in Healthy Families, California's CHIP program. There was also a briefing by Terri Shaw, the Project Director for Enrollment UX 2014, a national project designed to help develop a common user interface for state exchanges.

While federal court rulings against President Obama’s health care overhaul have gotten a lot of attention recently, not every state government is against the law. In fact, some are even moving ahead with efforts to support its implementation. The U.S. Department of Health and Human Services awarded seven cooperative agreements aimed at assisting a group of states designated as “Early Innovators” in creating the infrastructure to operate health insurance exchanges.

The states, which will divide up the $241 million are Kansas, Maryland, New York, Oklahoma, Oregon, Wisconsin and a multi-state entity led by the University of Massachusetts Medical School that consists of Connecticut, Maine, Massachusetts, Rhode Island, and Vermont.

Below, a closer look at five states that have been supportive of the overhaul.


California has been among the most active states in implementing reform. Assembly Bill 1602 and Senate Bill 900, both signed into law on Sept. 30, 2010, made California the first state to create independent health insurance exchanges for individuals and small businesses. The California Health Benefit Exchange, as the program is known, is to be overseen by a five-person panel. All in all, the California legislature has enacted six bills relating to health care reform into law, the highest number of any state.


Massachusetts was ahead of the game in 2006, then-Governor Mitt Romney signed into law a bill creating a health insurance exchange for the state. According to Massachusetts Health Connector, the independent state agency charged with operating the exchange, the law has enabled 98% of Massachusetts residents to obtain health insurance coverage. But Massachusetts did not stop at the creation of their exchange. SB 2585, signed by Governor Deval Patrick in August 2010, created a small group wellness incentive program that would allow such groups to receive federal health care tax credits.


While Maryland has yet to create a statewide health insurance exchange that does not mean that legislators in the Old Line State have failed to take any action. SB 57, signed by Governor Martin O’Malley in April 2010, implemented a number of parts of the federal health care reform law, including a provision barring insurance companies from denying coverage to children with pre-existing conditions as well as ensuring that people under the age of 26 may remain of their parents’ plan if they elect to. O’Malley created, via executive order, the Maryland Health Care Reform Coordinating Council and is on record as stating this his goal is to provide an additional 350,000 Maryland residents with health insurance through reform efforts.

Rhode Island

The commission created by Rhode Island to study health care reform implantation was given a broad range of responsibilities. SB 3021, adopted in June 2010, created a 17-member Senate commission charged with studying cost containment, efficiency and transparency hospitals treatment of patients, and rate reimbursements. The commission, which is also responsible for studying the creation of the state’s insurance exchange, has been stipulated to have regular meetings and is set to deliver a report on its findings to the Clerk on the Senate by May 31, 2011.

New Mexico

Early last year, Gov. Bill Richardson issued Executive Order 2010-012 that simultaneously created the New Mexico Health Care Reform leadership team and required the drafting of a plan for implementing health reform. The plan covers details ranging from the broad (the expansion of publicly funded benefits) to the very specific (Native American health). The state’s Human Services Department has been designated as the primary agency responsible for supporting the leadership team’s implementation blueprint.

In all, according to Saenz, 31 states have created some sort of implementation entity, meaning that even a few states that are party to one of the suits filed against the law have nonetheless begun compliance efforts

The Board of the California Health Benefit Exchange met for the second time, today. The first order of business was a report from the Interim Administrative Officer Pat Powers, who laid out the near and long term tasks to be completed by staff. She cited the recruitment and hiring of an Executive Director and General Counsel, and the submission of the Exchange Planning Grant as the first priorities.

Ms. Powers mentioned opportunities for stakeholder participation such as public comment in meetings, plans to make the Board more accessible such as webcasting and using webinars. Several attendees addressed the importance of including stakeholder input early so that their expertise could be incorporated into staff recommendations prior to being presented to the board for action.

The Board then heard reports from the subcommittees that were created at the last meeting. The Search/Recruitment Committee adopted an amendment that the Executive Director have expertise not only in private market programs but also in public programs.

The Exchange Establishment Grant Subcommittee reported on attending an Exchange establishment meeting in Denver and are planning to change the level of grant the state applies for. The thinking is that rather than submit a long term Level II grant in September, the Board may submit a Level I grant in June, and take a little more time with the larger Level II grant that requires a four-year budget.

The remainder of the agenda consisted of 4 expert presentations on policy issues that will impact the exchange:

  1. An overview of the Individual and Small Group Markets, Marian Mulkey, Director of the Health Reform and Public Programs Initiative, California Health Care Foundation (CHCF) presented a review of the individual and small group health insurance markets in California. California’s Individual and Small Group Markets on the Eve of Reform
  2. Projections of Potential Exchange Enrollment, Jerry Kominski, Associate Director, UCLA Center for Health Policy Research, presented the UCLA/UCB microsimulation model.
  3. The Small Business Health Options Program (SHOP). Rick Curtis, President, Institute for Health Policy Solutions, presented an overview of the SHOP, discussing how market constructs are important to SHOP viability, the different and similar roles of the individual and SHOP Exchanges, and some key design and development issues regarding the SHOP.
  4. The Basic Health Program Option. Katie Marcellus, Assistant Secretary, California Health and Human Services Agency, presented an overview of the Basic Health Program (BHP), explaining the structure, options, and policy issues relevant to the BHP.

Ms. Belshé closed by acknowledging that California is still the only state with a constituted Board. She challenged those in the media spinning the story that California is slowing down implementation,

States are currently in the process of establishing health insurance exchanges for individuals and employer groups under 50 lives that are mandated to take effect in 2014 by the Patient Protection and Affordable Care Act. And although each state is free to develop its own method of implementation, they don’t have to develop their own automation platforms. Proven technology exists to enable state governments to offer highly innovative and sustainable exchanges, and several private exchanges are bidding for the exchange business.

CHOICE Administrators

In California, an existing small-group exchange, CaliforniaChoice, serves more than 10,000 employers and 150,000 members. CHOICE Administrators is part of The Word & Brown Companies, a general agent and third party administrator. CHOICE Administrators is aligning itself to bid for the administration of state exchanges in 2014.

MAXIMUS and Connecture

MAXIMUS, a leading provider of government services worldwide, and Connecture, a leader in Web-based marketplaces and administration solutions for health insurance distribution, have announced recently that the two companies have entered into a strategic alliance. This alliance will deliver a comprehensive government Health Insurance Exchange solution blending the expertise in eligibility and enrollment for state Medicaid and CHIP programs provided by MAXIMUS with Connecture’s established Web-based health insurance shopping, enrollment and administration solution.

Aon Hewitt

Aon Hewitt announced recently that it is launching the an exchange for employer groups of 1,000 or more full-time employees beginning as early as January 2012. The Aon Hewitt exchange structure intentionally mirrors the ACA model. The firm will offer five standardized designs: bronze, bronze plus, silver, gold and platinum. It’s designed for an employer that wants to continue to provide coverage but wants to do it in an exchange environment which offers less administrative burden for the employer and more choice to the employee,

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