Date: 09/11/2006
Final
Adult Access to Health Insurance
HEALTH CARE TASK FORCE
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10:16 AM - Adult Access to Health Care
Barbara Brett, Executive Director of CoverColorado, discussed recent legislation that permits CoverColorado's board of directors to reduce rates for the program. She stated that the primary reason why persons don't enroll in the program is because it is too expensive. She discussed the newly created premium discount program and the former insurance status of the new enrollees in the program. She explained that CoverColorado covers 5,200 persons in Colorado who have been denied health insurance in the private market and listed some conditions and reasons why persons are turned down for private insurance. She stated that 200 persons accounted for 71 percent of CoverColorado's costs in the last year and the program will begin a new intensive program to help manage those health care costs. She responded to questions from Representative Stafford regarding mental health parity legislation. Ms. Brett explained that currently, any person who has a diagnosis of mental illness or depression is likely to be turned down for coverage in the individual market. Ms. Brett further responded to questions from Representative Butcher regarding whether or not there is a cap on CoverColorado's premiums. Ms. Brett explained that previously, CoverColorado's rates were required to be set at 150 percent of the standard market premium and now the board of directors can vary the premium between 100 and 150 percent of the standard market premium.
10:27 AM
Janice Pramick, Director of Sales Development for Individual and Group Insurance - Anthem Blue Cross/Blue Shield, and Carl Miller, Director of Government Relations for Anthem Blue/Cross Blue Shield, began their discussion of the private health insurance market and distributed a handout to the committee (Attachment A). Ms. Pramick discussed reasons why persons are currently uninsured in Colorado and described Anthem's line of small business products. She described products that permit employers to contribute a set contribution, but still allow employees to access plans with increased coverage. She described the Anthem Benefits program and other products offered by Anthem.
10:36 AM
Allan Jensen, Colorado State Association of Health Underwriters, distributed a handout to the committee (Attachment B). He stated that increasingly, consumers are seeking control over their health insurance benefits and the cost of health insurance. He stated that health insurance costs are directly related to the costs of health care and that carriers have recently introduced a number of plans aimed at the small group market. He discussed market rating reform, and stated that such reforms have made the health insurance market more competitive. He listed a number of issues with the current health insurance market, including transparency. He stated that consumers increasingly are seeking information about price and quality in the health care market. Another issue in the health insurance market is participating and nonparticipating providers in health insurance plans. He described high deductible plans, which protect consumers from catastrophic medical losses and Health Savings Accounts (HSAs) which permit consumers to cover the costs prior to the attachment of the high-deductible plans. He gave a number of suggestions to improve the group and individual health insurance markets including increased tiering of family rates; allowing carriers a bit more rating flexibility and eliminating the 35 percent penalty on business groups of one; finding methods to allow for self-insurance of costly benefits, such as maternity; finding methods to reduce mandates for coverage and avoid new mandates; and some reinsurance methodologies. He listed some examples of products and the prices of the products available to persons in the small group and individual health insurance markets.
10:53 AM
Mr. Jensen responded to questions from Senator Keller regarding transparency and reinsurance legislation. He stated that the insurance carriers are seeing a big push to disclose their rate information on-line. With regard to reinsurance, Mr. Jensen explained that the New York model will not work in Colorado and that there needs to be a private funding aspect involved. Representative Stafford asked whether a person who has previously been denied for health insurance can reapply for coverage under new products. Mr. Jensen responded that persons will be denied for specific reasons and may sometimes be able to get private health insurance if the reasons they were initially denied change. Representative Stafford asked whether a person's denial of coverage is used to evaluate a person's eligibility for coverage in the future. Ms. Pramick stated that Anthem does not report information to the Medical Information Bureau. Mr. Miller responded to questions from Representative Lundberg, and discussed participating and nonparticipating providers. Representative Stafford asked if there is a list of conditions that is disclosed to a person applying for health insurance that may result in the person's denial for coverage, and Senator Keller asked how persons who are denied coverage in the private market can be kept in the private market rather than entering a public health insurance market. Mr. Jensen responded to questions from Representative Frangas regarding participating and nonparticipating providers. Mr. Miller responded to questions from Representative Butcher regarding competition in the health insurance market and Multiple Employer Welfare Associations.
11:25 AM
Lisa Esgar, Director of Operations and Finance for the Colorado Department of Health Care Policy and Financing, distributed a handout to the committee (Attachment C). She discussed the Colorado Indigent Care Program (CICP), explaining that the program distributes funds to providers for caring for indigent and uninsured persons who are not eligible for Medicaid or CHP+. Persons with incomes up to 250 percent of the Federal Poverty Level are eligible for the program. She explained that the program is primarily funded through Disproportionate Share Hospital (DSH) payments and the Medicare Upper Payment Limit (UPL). There is a cap on the funding the state can draw from the DSH program - $87 million currently. Clinics, such as federal qualified health centers, are typically not eligible for DSH or UPL payments, but there is a budget line that permits Children's Hospital to administer CICP payments to CICP clinics. The program currently serves 179,129 persons and each provider participating in the program can decide what types of services to provide as long as clients are notified. Ms. Esgar discussed the Colorado Health Care Services Fund, which was established by Senate Bill 06-044 and allocates money to Denver Health, community health clinics, and primary care clinics operated by licensed or certified health care facilities. In addition, Senate Bill 06-044 increased the income eligibility limit for the CICP program from 200 percent to 250 percent of the federal poverty level.
11:35 AM
Ms. Esgar continued her discussion of the Old Age Pension (OAP) State Medical Program. The OAP Medical Program provides limited medical care for individuals receiving Old Age Pension grants. Persons eligible for the program are over age 60, but may not meet the eligibility guidelines for SSI and therefore are not eligible for Medicaid. The program is funded with 100 percent state funds and served 4,965 clients in FY 2005-06. Ms. Esgar responded to questions from the committee regarding provider participation in the OAP program and the funding for the CICP expansion. Ms. Esgar further responded to questions from Representative Stafford regarding private hospital participation in the CICP.
11:43 AM
Carrie Curtiss, Colorado Consumer Health Initiative, testified regarding uninsured persons in Colorado. She discussed the cost of insurance and stated that some high-deductible plans may not adequately protect persons from the costs associated with a catastrophic illness. She stated that there is no guaranteed issue requirements in the individual market. She discussed the importance of transparency in the health care system, stating that HSAs will only work if consumers have access to pricing information. She further discussed participating and non-participating provider legislation.
11:48 AM
Deb Deboutez, Colorado Coalition for the Homeless, testified that the CICP is the safety net health care program in Colorado, but is inadequate for the needs of the homeless and uninsured in Colorado. She stated that the CICP currently reimburses the Stout Street Clinic at 19 cents on the dollar. She discussed the need for health insurance for homeless and indigent persons.
11:50 AM
Jennifer Miles, Colorado Community Health Network, testified regarding Senate Bill 06-044. She stated that appropriations for CICP were flat for 6 to 7 years, and therefore, as enrollment increased, the payments to providers were effectively cut over that period. She discussed changes that may be necessary to the provisions of SB 06-044 stating that the SB 06-044 funding is currently a separate line item in the budget. The CICP program is also subject to House Bill 06S-1023, which requires applicants to provide proof of legal status at the time of applying for public benefits. She discussed Medicaid expansions funded by Amendment 35, which increased the tax on tobacco products and targeted the new revenue to fund health care. She discussed the importance of dental care and suggested that the CHP+ add a dental benefit for adults. She further discussed the need for a health care program for disabled persons who are going through the SSI eligibility process.
11:57 AM
Ms. Miles responded to questions from Representative Frangas regarding whether or not a waiver is required to add a dental benefit to the CHP+ for adults. Ms. Deboutez responded to questions from Representative Butcher regarding the homeless population in Colorado.
12:05 PM
Elisabeth Arenales, Colorado Center on Law and Policy, distributed three handouts to the committee (Attachments D through F). She discussed the funding challenges for the Old Age Pension Medical Care Program. Funding for the program is capped at $10 million per year, but there is a supplemental fund for the program that provides limited additional funding. The funding for the program is inadequate and has lead to benefit reductions and inconsistencies. She further discussed the CICP program and the cost-sharing requirements under the program. She stated that co-payments for the program have increased and discussed research which indicates that increasing co-payments also increases the likelihood that persons will not receive appropriate care. She explained that providers in the CICP program are responsible for administering the functions of House Bill 06S-1023. Ms. Arenales responded to questions from the committee regarding medical-related bankruptcies and the Old Age Pension Medical Program.