1994 principles relevant today

August 30, 2010

Jan Hudson

Federal health care reform is starting a new chapter in Michigan. Beginning tomorrow, enrollment will open for the new high risk pool  for those with pre-existing conditions who have been uninsured six months. Coverage will be effective Oct.  1.

This component of the health care reform law got off to a rocky start when the Michigan Legislature failed to approve the expenditure of the federal funds for the high risk pool.  The federal government had to step in and make alternate arrangements. 

Health care reform implementation merits ongoing and careful thought and planning by policymakers, with input and monitoring by consumers, to ensure the best possible outcome for all of us.  

The Michigan League for Human Services developed a set of health reform principles in 1994 that are still relevant today and can serve as a good resource. 

They provide a good road map for navigating many upcoming implementation issues including:

  • The critical importance of a comprehensive package of benefits for those newly eligible for Medicaid (there is an option to provide a lesser package of benefits) as well as for those who purchase coverage through the Health Insurance Exchange (the “Expedia” of private insurance options).  A comprehensive package would include the full range of mental and physical health services, as well as dental and substance abuse services.
  • Adequate state regulatory and monitoring resources to ensure mandates are implemented timely and effectively, and that there are strong enforceable consumer protections.
  • Availability of access to quality care both geographically and culturally.  There are many opportunities in the law to expand or promote primary care.
  • Reasonable and adequate provider payment rates in public programs to ensure that current and newly eligible persons have access to care and not just a card.
  • An increase in the meaningful and cost-effective use of health information technology.
  • Promotion of quality, not quantity, of care through incentives or payments for outcomes, or other payment reforms for providers; and quality consumer education to help guide treatment decisions.
  • A priority for funding prevention and wellness options included, but not funded, in the law.
  • Development of effective cost containment strategies that maintain or improve quality care and are not simply code words for cuts in programs or services.

 Additional food for thought is provided by the State Consortium on Health Care Reform Implementation in a State Health Policy Briefing. This brief describes 10 aspects of federal health reform that states must get right if they are to be successful in implementation.

The group’s top priorities include:

1. Be strategic with insurance exchange

2. Regulate the commercial health insurance market effectively

3. Simplify and integrate eligibility systems

4. Expand provider and health system capacity

5. Attend to benefit design

6. Focus on the dually eligible

7. Use your data

8. Pursue population health goals

9. Engage the public in policy development and implementation

10. Demand quality and efficiency from the health care system.

(The State Consortium on Health Care Reform Implementation is a collaboration among the National Governors Association, the National Academy for State Health Policy, the National Association of Insurance Commissioners, and the National Association of State Medicaid Directors.)

There have been and will continue to be numerous opportunities for comment as federal regulations are developed and finalized.  The federal government has established a website where you can readily view the regulations for which comments are being accepted.  You are encouraged to take advantage of these opportunities and let your voice be heard in this historic process.

It will take ongoing vigilance to ensure the best implemenation for all.

 —  Jan Hudson

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How to achieve health equity

July 13, 2010

Karen Holcomb-Merrill

A Path Toward Health Equity, a recently released report from Community Catalyst, contains recommendations on how to strengthen community-based work to reduce health disparities.  The report focused on six states, one of which was Michigan. 

I had the opportunity to share my perspective on health equity work in Michigan, as the report was being developed.  Although it focuses primarily on specific recommendations about how to more effectively address health disparities, the report also contains some important information about the status of health disparities in our state.

The numbers serve as yet another reminder of the disparities that do exist.  Overall, 13 percent of those in Michigan are uninsured.  Among Hispanics, 24 percent are uninsured and among African Americans, 20 percent are without insurance.

Across the board, African Americans in Michigan die from preventable diseases at a much higher rate than whites.  African Americans and Hispanics have significantly higher infant mortality rates than whites in our state.  You can find more detail about these and other disparities in a League report on health disparities.

The Community Catalyst report proposes five strategies that could strengthen efforts at the local and state level to reduce health disparities.  They include:

  • Building and strengthening community-based organizations
  • Encouraging statewide health access groups to prioritize equity work
  • Building coalitions of community, state and national organizations
  • Connecting various stakeholders
  • Developing a disparities reduction/health equity policy agenda

We are already doing some of these things here in Michigan.  But the numbers tell us that we need to do better.  The League will continue to look for opportunities to play a role in reducing health disparities in our state.

— Karen Holcomb-Merrill


Can health care reform cure my headache?

May 19, 2010

Jan Hudson

Every time I participate in a discussion on the aspects of health care reform, my head hurts more.  I continue to be awed by the intricacy, complexity, and breadth of this new legislation. But at the same time, I am inspired by the great opportunity to make positive changes to public programs, insurance products, and the health care delivery system, to name just a few.

There was a dizzying array of information provided at the Public Policy Forum co-sponsored by the Michigan League for Human Services and the Michigan Health Insurance Access Advisory Council on April 23, followed by a forum sponsored by the Detroit Regional Chamber and the Federal Reserve Bank of Chicago – Detroit Branch on April 26 and 27.

Public Sector Consultants brought a diverse group together May 12 to hear presentations by Department of Community Health Director Janet Olszewski and Insurance Commissioner Ken Ross, and to provide feedback on what next steps make sense. State staff are working diligently to identify all the facets that must be addressed to develop a strong foundation for ongoing implementation efforts.

The complexity of the federal health reform legislation will make it an ongoing challenge to implement. Thank goodness every component is not scheduled to be implemented immediately, and hopefully there is enough time to get it right.

The health care reform legislation will touch all of us. A few of the benefits follow:

  • 32 million people are expected to gain health care coverage by 2019.
  • Medicaid will be expanded (2014) to all families or individuals with incomes below 133 percent of the federal poverty level (about $14,400 for an individual).  A federally designated category or group will no longer be required to be eligible; the federal government will cover the cost of the new enrollees for the first three years.
  • Young adults can remain on their parents’ health care plans up to age 26, without being an IRS-defined dependent or being in school.
  • When the Insurance Exchange is implemented in 2014, subsidies will be available to assist families with incomes up to 400 percent of the poverty level (about $88,000 for family of four) be able to afford coverage. In addition, cost-sharing caps, on a sliding income scale, will also be implemented.
  • Insurers will be prohibited from denying coverage for pre-existing conditions or cancelling coverage when an insured person gets sick. Insurers will also have to use a high percentage (80 percent to 85 percent) of  premiums for patient care, and will no longer be able to establish annual or lifetime limits on benefits.
  • Small businesses will receive subsidies (up to 35 percent) to help them afford coverage for their employees.
  • The Medicare Part D “donut hole” (the period when costs have reached a high level, but no assistance with drug costs is available) will gradually be reduced.
  • Programs to promote wellness and prevent chronic disease will become a major focus.

These are only a small sampling of the extensive provisions included in this historic legislation. Many organizations are putting information on their websites. The key thing to remember in reviewing these documents is that they are works in progress, and may be updated frequently as more clarification or regulations are issued by the various federal offices involved in implementation. 

Families USA, the Kaiser Family Foundation, The Commonwealth Fund, and the Robert Wood Johnson Foundation include extensive materials on the health care reform legislation and its implementation.

I think Atul Gawande in The New Yorker in December articulately summed up where we are and what we need to do to make this work:

 “At this point, we can’t afford any illusions: the system won’t fix itself, and there’s no piece of legislation that will have all the answers, either… But if we’re willing to accept an arduous, messy, and continuous process we can come to grips with a problem even of this immensity. We’ve done it before.”

— Jan Hudson


Health care reform — one step closer

March 22, 2010

Jan Hudson

In June 1994, the Michigan League for Human Services’ Board of Directors adopted a set of health care reform principles.

Last night’s historic House vote brought us one step closer to realizing the implementation of many of the policies and principles included in that document, which by health care reform standards, (see a brief history of health reform) is relatively new.

The Senate bill passed by the House is Senate Bill H.R. 3590 and the ensuing reconciliation bill is Reconciliation Act H.R. 4872.  Several components of the League’s health reform principles are included below with a brief explanation of how they are addressed in health reform legislation:

  • Coverage for nearly all Americans. By 2019, it is projected that 95 percent of non-elderly legal residents would have insurance. The legislation expands Medicaid to all adults and children under 133 percent of the federal poverty level (FPL) and provides subsidies to families with incomes up to 400 percent FPL to purchase insurance.  In addition, caps, based on a sliding income scale, will protect low-income persons from excessive out-of-pocket costs.
  • Mandated enrollment in health care coverage to spread the costs as broadly as possible.  The legislation requires most people to obtain coverage or pay a penalty, which is necessary to provide an incentive for people to secure coverage before they become ill. With nearly everyone enrolled in coverage, over time, premiums should become more affordable as they will no longer include the “extra cost” of providing care for those who are uninsured.
  • Focus on disease prevention and chronic disease management.  There are numerous prevention and wellness initiatives included in the legislation.  For example, all co-payments, co-insurance and deductibles for preventive services will be eliminated for Medicare beneficiaries.
  • Coverage of the full range of mental and physical health needs.  The new state-based exchanges would have to provide minimum standards for coverage and cost-sharing protections for enrollees, making sure coverage is comprehensive and affordable. Four levels of coverage will be required. Medicaid would continue to provide comprehensive coverage to all who qualify with enhanced federal subsidies for the newly eligible.
  • Implement effective cost containment. The legislation takes a number of steps, particularly within Medicare, to institute efficiencies to lower cost and improve quality of care, through changes in the delivery system, and through the establishment of an independent Payment Advisory Board charged with developing proposals to slow the growth of both Medicare and private insurance spending and improving quality of care.
  • Comprehensive quality management and health care outcomes.  The legislation creates a research institute to conduct comparative effectiveness research, create a value-based system for hospitals and physicians, and encourages the development of new patient-care models, to name a few.

Of key importance are the provisions in the legislation that will reform the health insurance marketplace by prohibiting lifetime limits on benefits and terminations of coverage when people become ill.  In addition, the reforms will prohibit insurers from denying coverage or charging higher premiums to persons with pre-existing conditions, or higher premiums based on gender.

The reform package gradually eliminates the Medicare Part D “doughnut hole,” the coverage gap in which beneficiaries continue to pay Part D premiums, but have no pharmacy coverage, and must fully pay for their medications.  An immediate 50 percent reduction in the cost of brand-name drugs will be available to those who reach the “doughnut hole.”

The reform package passed by the House last night will also provide subsidies to small businesses to enable them to provide coverage at a reasonable cost to their employees. They will also be able to purchase comprehensive, affordable coverage through the state-based exchanges.  Many small businesses have been unable to provide, or have been forced to drop insurance coverage due to the escalating cost of premiums.  The exchanges will provide opportunities for small business to purchase coverage with more affordable and predictable premiums.

The above information is only a small sample of the benefits included in the health care reform legislation passed by the House.  The reconciliation bill, which must now be taken up by the Senate, can be passed with a simple majority (51 votes).  Action by the Senate is expected this week.

The League and the Michigan Health Insurance Access Advisory Council are sponsoring a forum on April 23, Federal Health Care Reform: Challenges for the States.  For more information and to register, click here.

— Jan Hudson