Final
STAFF SUMMARY OF MEETING
HEALTH INSURANCE
Date:
09/22/2005
ATTENDANCE
Time:
10:05 AM
to
04:18 PM
Green
X
Johnson
*
Place:
HCR 0107
Keller
*
McCluskey
X
This Meeting was called to order by
McElhany
X
Senator
Hagedorn
Penry
X
Riesberg
X
This Report was prepared by
Shaffer
*
Elizabeth Burger
Boyd
X
Hagedorn
X
X = Present, E = Excused, A = Absent, * = Present after roll call
Bills Addressed:
Action Taken:
September 22nd Meeting
-
10:06 AM
Carrie Curtis, Colorado Consumer Health Initiative, discussed Medicaid expansion options. She provided some opening remarks regarding the need for Medicaid for a very vulnerable population. A.W. Schnellbacher, AARP, continued the discussion of Medicaid expansions. His group supports incremental methods of arriving at universal health care coverage for Colorado citizens. He cautioned the committee about trying to fit plans from other states into the framework of Colorado. Deb DeBoutez, Colorado Coalition for the Homeless, stressed the need for more comprehensive and efficient health care services for the homeless, especially in terms of mental health care and addiction treatment services. Ms. DeBoutez handed out a white paper (Attachment A) that addressed medical care for the Aid to the Needy Disabled recipients. Representative Green expressed her concern about the time it takes to get a person declared disabled in terms of SSI. Chris Hapgood, Mental Health Association of Colorado, handed out a report (Attachment B) entitled Impact of State Budget Cuts on Mental Health and Substance Abuse Care in Colorado. He stressed the need for mental health services in Colorado because the fallout from lack of treatment is being pushed off onto emergency rooms and prisons. Senator Hagedorn wondered if there is an actual need for expansion of mental health services or if there is a scam being perpetrated by various mental health care professional organizations. Mr. Hapgood answered that mental health services are often not utilized because of the stigma of mental health problems. He believes that expanded funding is needed to increase awareness and stop cost shifting to emergency rooms and prisons. Betty Lehman, Autism Society of Colorado, provided some statistics (Attachment C) regarding early intervention for children with developmental disabilities.
10:36 AM
Lynn Dierker, Colorado Health Institute, gave a presentation (Attachments D, E, and F) on health information technology (HIT) in the delivery of medical care services. Ms. Dierker began with some background information and some basic definitions of what is included in the term "health information technology." She stressed that HIT saves money by reducing duplication and aiding physicians with correct diagnoses. Ms. Dierker talked about the need to build new infrastructure. She pointed out the trend and momentum toward a national health information network (NHIN). Representative McCluskey asked about the cost involved in the creation of a NHIN. Ms. Dierker said that the hope is that initial costs will be covered by various investment strategies and long-term costs will be outweighed by the savings.
11:00 AM
Ms. Dierker continued by discussing the various issues faced by states, including leveraging the influence of public payers (Medicaid, public employees, etc.), accommodating regional and statewide realities in the context of the national framework, and funding strategies to ensure full participation. She explained multiple regional health information organizations in various states and municipalities. The discussion then focused on Colorado and the Colorado Health Information Exchange Initiative (COHIE). The mission of the COHIE is to develop a technical prototype to connect diverse data users/systems across the states. Denver Health Medical Center, Children's Hospital, University Hospital, and Kaiser Permanente are the development partners for the COHIE. Representative Green expressed concern that most medical professionals aren't interested in using HIT. Representative McCluskey asked about standardization of HIT systems. Ms. Dierker responded that standardization is crucial and development partners recognize that and federal resources are being focused on that area. She summed up her presentation with a look at the potential development of a Colorado regional health information organization. She responded to questions from committee members regarding privacy issues.
11:25 AM
Sharon Caulfield, Colorado Coalition for the Medically Underserved (CCMU), testified (Attachment G) regarding issues of small business access to health insurance. She presented two strategies required to develop a successful small business market product. These are a standardized benefit package and the application of evidence-based medicine. Ms. Caulfield talked about the 2006 legislative session and the proactive initiatives developed by CCMU.
11:35 AM
Senator Hagedorn
recessed for lunch.
02:01 PM -- Discussion of Draft Legislation
The committee reconvened. Senator Hagedorn announced that the next meeting of the Health Insurance Interim Committee would be held on Thursday, October 6, in House Committee Room 112. He explained that the afternoon portion of today's committee meeting would be devoted to reviewing draft legislation requested by the committee at the September 7 meeting. Drafts of the proposed legislation, LLS # 140, 141, 143, 144, 145, 146, 147, 148 (Attachments H through O), were distributed to the committee. Senator Hagedorn stated that the committee will not be voting on any draft legislation today, nor will he accept any amendments on the bills until the October 6 meeting.
02:05 PM
Kristen Forrestal, Office of Legislative Legal Services, came to the table to explain LLS #140 - Healthy Business, Healthy People Program (Attachment H). She explained that the bill is a redraft of a bill from the previous session, Senate Bill 05-237. Under the Healthy Business, Healthy People program, insurers of small employers can receive reimbursement for certain amounts of claims paid for eligible insureds. Eligible insureds include persons who have not had insurance for 12 months, whose employers do not provide insurance or have not provided insurance for the past 12 months, and who have a household income of not more than 350 percent of the Federal Poverty Level (FPL). Ms. Forrestal responded to questions from the committee regarding the choice of plans under the Healthy Business, Healthy People Program and changes from Senate Bill 05-237 that were incorporated into the current draft. Representative Penry discussed concerns with how insurers would price the insurance product offered under the Healthy Business, Healthy People Program.
02:16 PM
Christy Chase, Office of Legislative Legal Services, came to the table to discuss LLS #141 - Health Assurance Districts (Attachment I). Senator Hagedorn discussed health assurance districts, stating that there is growing interest in health assurance districts statewide and that the bill is designed to make the health assurance districts work together with health services districts. Ms. Chase stated that health assurance districts are currently limited to rural areas of the state, and that the bill would expand health assurance districts to all areas of the state. Health assurance districts would be permitted to organize, operate, control, direct, manage, contract for, and furnish or provide, directly or indirectly, health care services to the residents of the district. She explained that the bill permits health assurance districts to collect property tax, or alternately, sales tax, to fund their operations. Ms. Chase responded to questions from Representative Boyd regarding whether counties and special districts would be permitted to levy both a property and sales tax, stating that the districts would have to choose whether to levy a property or sales tax, but could not levy both. Ms. Chase responded to questions from the committee regarding the board of directors of special districts. Senator Hagedorn and Representative Penry discussed the need for the creation of a special district to fund health care when counties currently have the authority to levy taxes.
02:29 PM
Michele Hanigsberg, Office of Legislative Legal Services, came to the table to discuss LLS #143 - Primary Care Services (Attachment J). Ms. Hanigsberg explained that the bill creates a program under which low-income individuals who meet certain eligibly criteria may receive primary health care services. In order to be eligible for the program, the person must be at least 19 but below 64 years of age and have an income at or below one hundred percent of the FPL. The bill requires the Department of Health Care Policy and Financing to report to the Joint House and Senate Health and Human Services Committee the options for incorporating the new primary care program into the state's Medicaid program. Ms. Hanigsberg responded to questions from the committee regarding the possible fiscal impact of the bill and whether the primary care program would cover hospital services, stating that it would not.
02:41 PM
Jerry Payne, Office of Legislative Legal Services, came to the table to discuss LLS #144 - Pueblo Health Insurance Study (Attachment K). Mr. Payne explained that the bill instructs the Division of Insurance (DOI) to conduct a study of the factors that drive health insurance in Pueblo. Among the items the study is required to address are: the factors that drive health insurance costs in Pueblo County; the statistical interaction, relationships, and dependencies of the factors; the cost components of health insurance premiums for individuals and groups in Pueblo County; the role of modified community rating for Pueblo County; and whether health coverage for individuals and groups in Pueblo County is reasonably available. Mr. Payne responded to questions from the committee regarding who would complete the study if the DOI does not contract for the study, stating that DOI would be required to conduct the study.
02:46 PM
Christy Chase, Office of Legislative Legal Services, came to the table to discuss LLS #145 - Basic Health Plan Managed Care Option (Attachment L). Ms. Chase explained that the bill repeals the requirement that health insurers offer a standard plan to small groups and substitutes a requirement that the basic plan option include a design with the same or similar benefits as are currently available to Medicaid recipients enrolled in a managed care organization.
02:49 PM
Kristen Forrestal, Office of Legislative Legal Services, came to the table to discuss LLS #146 - Reimbursement for Health Care Services (Attachment M). She explained that the bill requires a hospital to inform a consumer at the time of admission that the consumer may be responsible for charges rendered in the facility by a health care provider who has not contracted with the consumer's health insurance company. Further, for managed care plans with out-of-network benefits, if a consumer receives a services at a network facility that is not an emergency service and the person, due to circumstances beyond his or her control, is treated by a non-network provider, the covered services is required to be reimbursed by the carrier to the provider. The consumer is responsible for any difference between the provider's billed charges and the amount reimbursed by the carrier.
02:52 PM
Christy Chase, Office of Legislative Legal Services, came to the table to discuss LLS #147 - Colorado Reinsurance Program (Attachment N). Ms. Chase explained that the bill establishes the Colorado Reinsurance Program to provide reinsurance reimbursement payments to health insurance carriers who offer qualifying health benefit plans to qualifying individuals. A qualifying individual is defined as a person who has a net household income of no higher that 200 percent of the FPL, and a qualifying health benefit plan is defined as a health benefit plan that is a high deductible plan that would qualify for a health savings account.
02:55 PM
Christy Chase, Office of Legislative Legal Services, began her discussion of LLS #148 - Premium Subsidy Program (Attachment O). Ms. Chase explained that the bill establishes the Colorado Premium Subsidy Program to provide premium subsidy payments to individuals enrolled in qualifying health benefit plans. Qualifying individuals are persons who have been uninsured for the past 12 months, who have a net household income of no higher than 200 percent of the FPL, whose employer has not provided group health insurance during the prior 12 months, or who are unable to pay the employee portion of a health insurance premium. Qualifying plans include high deductible plans that would qualify for a health savings account or a managed care plan with the same or similar benefit design as is currently available to a Medicaid recipient. Senator Hagedorn explained that the program would be a five-year pilot. Senator Hagedorn responded to questions from the committee regarding whether the premium subsidy program could coexist with a reinsurance program. Representative Penry asked why the bill was structured as a payment instead of a tax credit and Senator Hagedorn replied that the idea of the bill is to ensure direct monthly support to individuals purchasing health insurance rather than providing the credit on a quarterly or annual basis.
03:02 PM -- Testimony by Working Groups
Jerry McElroy, Kaiser Permanente, came to the table to discuss the draft legislation as the representative of the Health Insurer Working Group. He stated that LLS #140 (Attachment H) attempts to insure uninsured persons, but that the bill could be burdensome to implement and administer. Mr. McElroy stated that LLS#141 (Attachment I) is innovative. LLS#143 (Attachment J) is innovative and necessary, but he and the Health Insurer Working Group question how the program will be funded. LLS#144 (Attachment K) will provide important data and the inclusion of DOI in the legislation is important, but there are questions as to why the bill is only limited to Pueblo. He discussed LLS#145 (Attachment L), stating that the bill is interesting, but the ramifications of the bill are unclear. Mr. McElroy stated that LLS #146 (Attachment M) is interesting, and the Health Insurer Working Group would like to explore the idea further. He testified that he prefers the design of LLS#147 (Attachment N) to LLS #140 because it creates a board to administer the program rather than requiring the CoverColorado Board of Directors to administer the program. The Health Insurer Working Group also believes that it is good to create a general fund funding mechanism for the program, however, limiting the qualifying plan to a high deductible plan with a health savings account may be problematic. LLS #148 (Attachment O) is a good, simple concept that doesn't require a lot of administration, however, the bill needs to guarantee that the subsidy will be spent on health insurance. Senator Hagedorn explained that the subsidy payment will not go directly to the individual.
03:20 PM
Travis Berry, Business Council on Health Care Competition and the representative of the Employer Working Group, distributed a handout to the committee (Attachment P). Mr. Berry stated that the Employer Working Group is not able to offer specific suggestions on the drafts due to time, and suggested that the committee identify is goal before proposing legislation. He stated that controlling the health care cost shift is important and that covering more people, getting individuals care in the most appropriate setting, increasing Medicaid reimbursement, and ensuring that individuals get access to cost and quality information will help eliminate cost shifting in health care. He suggested that the state leverage funds with federal, employee, and private sources when possible and that the committee should consider proposals that build on existing programs such as Medicaid.
03:26 PM
Pam Nicholson, Centura Health, and Charlie Hebeler, representatives of the Provider Working Group, testified that it was difficult to review the proposed bills in the time allotted. Senator Hagedorn stated that the testimony on the bills at the next meeting would not be limited to the working groups, but that all interested parties could comment on the drafts at that time. Ms. Hebeler and Ms. Nicholson raised a number of points regarding the proposed legislation. Regarding LLS#146 (Attachment M), Ms. Nicholson stated that most hospitals already inform consumers about the possibility of being charged non-network rates when the individual is admitted to the facility. Ms. Hebeler stated that it is difficult to know whether the problem of health insurers being required to reimburse full-billed charges when consumers are treated by a non-network provider is large enough to warrant a change in the law. She discussed statistics regarding the problem that were distributed to the committee by the Division of Insurance (Attachment Q). Regarding LLS #143 (Attachment J), the program is a good idea, but requiring program participants to have an income of 100 percent FPL may mean that not all needy people will qualify to participate in the program. Ms. Hebeler stated a number of concerns with LLS #145 (Attachment L), including possible repercussions if one of the basic plan designs is tied to a Medicaid plan and Medicaid is cut back or Medicaid's plan offerings are changed. She questioned whether the basic plan should be the only option available for groups in the small group market, stating that there is no compelling reason not to continue to offer a choice of basic and standard plans to small businesses. The Provider Working Group is very enthusiastic about the possibilities of LLS #141 - Health Assurance Districts (Attachment I). Senator Hagedorn requested that the Colorado Health and Hospital Association discuss methods to reduce health care costs and present its conclusions to the committee at the next meeting.
03:47 PM
Lorez Meinhold, Colorado Consumer Health Initiative, Carrie Curtiss, Colorado Consumer Health Initiative, Elizabeth Arenales, Colorado Center on Law and Policy, and Kelli Fritz, AARP, the representatives of the Consumer Working Group, came to the table. Ms. Fritz discussed LLS #148 (Attachment O), stating that before the state implements premium subsidies, it should first expand Medicaid to all eligible populations and community-rate all insurance products in the small group market. Ms. Curtiss discussed LLS #140 (Attachment H), stating that although the Healthy Business, Healthy People Program concept is innovative, other states that have implemented reinsurance programs have done so after creating a strong public base of support for health care programs. Ms. Meinhold discussed LLS #141 (Attachment I), stating that the concept of health assurance districts is good and that health assurance districts will give communities an interesting alternative to state funding. Ms. Arenales discussed LLS #143 (Attachment J), stating that consumers want to support a bill that expands coverage to the most needy, but that limiting the program to only federally qualified health centers may limit access for program participants. She further stated that the bill may create a mechanism to allow the Department of Health Care Policy and Financing to pursue Medicaid waivers without legislative authorization. Ms. Curtiss suggested that, as an alternative to the Primary Care Program, the state consider implementing a Medicaid Medically Needy Program. Ms. Meinhold discussed LLS #145 (Attachment L) stating that having a standard plan outlined in statute allows consumers to compare health insurance products. She further stated that it is important to understand how many people are currently enrolled in basic and standard plans, and that eliminating the standard plan limits the options business have when purchasing health insurance. She reminded the committee that insurers are not required to offer all of the basic plan designs described in state law, but that all insurers must offer the same standard plan. Ms. Curtiss discussed LLS #146 (Attachment M), stating that consumers oppose any bill that attempts to balance bill consumers. She stated that consumers are already paying a lot for health insurance, and that allowing consumers to be balance billed will increase those costs. Further, she stated that it is the responsibility of the health plans to ensure an adequate network and that the issue is predicated on a contracting dispute between providers and insurers which consumers should be left out of. Ms. Arenales discussed LLS #147 (Attachment N), Colorado Reinsurance Program, stating that the bill does attempt to address the costs of insurance for low-income individuals, but that there are questions as to whether individuals with incomes under 200% of the FPL could afford the deductible of a high-deductible health insurance plan. Ms. Meinhold raised similar concerns with LLS #148 (Attachment O), stating that persons with incomes under 200% of FPL may not be able to afford health insurance even with a premium subsidy. The group concluded by reiterating Mr. Berry's comments that the committee must identify its goal: should the committee's legislation be directed at lowering health care costs or obtaining health insurance for uninsured individuals?
04:17 PM
Senator Hagedorn discussed a survey regarding health care costs recently published in USA Today.
04:18 PM
The committee adjourned.