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HEALTH CARE REFORM HEALTH CARE REFORM – Insurance Changes – Insurance Changes and Implications for and Implications for

ProvidersProviders

Kenneth W. Kizer, MD, MPHAlaska State Hospital and Nursing Home Association

Fairbanks, AKSeptember 8, 2010

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TO REVIEW…TO REVIEW…

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HEALTH CARE IS ENTERING A PERIOD OF “CLASS 5 CHANGE”

WHAT’S CAUSING THE ‘RAPIDS’?WHAT’S CAUSING THE ‘RAPIDS’? 1.1. The need to control the The need to control the

growth of health care costsgrowth of health care costs

2.2. The need to improve quality The need to improve quality and safety and safety

3.3. Not enough caregivers Not enough caregivers

4.4. The need for new facilitiesThe need for new facilities

5.5. Changing patient needs and Changing patient needs and expectationsexpectations

6.6. Biomedical science advancesBiomedical science advances

7.7. New technologiesNew technologies

8.8. The struggling economy The struggling economy

9.9. The health IT revolutionThe health IT revolution

10.10. The health care reform law The health care reform law

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THE FORCES DRIVING HEALTH CARE THE FORCES DRIVING HEALTH CARE CHANGE ARE NOT CAUSED BY THE CHANGE ARE NOT CAUSED BY THE

HEALTH CARE REFORM LEGISLATION.HEALTH CARE REFORM LEGISLATION.

THE LEGISLATION IS MERELY THE WAY THE LEGISLATION IS MERELY THE WAY THAT ELECTED POLICY MAKERS HAVE THAT ELECTED POLICY MAKERS HAVE CHOSEN TO ADDRESS THE PROBLEMS CHOSEN TO ADDRESS THE PROBLEMS

WITH HEALTH CARE WITHIN THE WITH HEALTH CARE WITHIN THE CONTEXT OF AMERICAN CULTURE.CONTEXT OF AMERICAN CULTURE.

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What is the Health Care Reform Law?What is the Health Care Reform Law? The most far-reaching health care legislation since

Medicare was enacted in 1965 Refers to 2 specific legislative acts

The Patient Protection and Affordable Care Act of 2010 (PPACA) - PL 111-148, enacted March 23, 2010

The Health Care and Education Affordability Reconciliation Act of 2010 (HCERA) - PL 111-152, enacted March 30, 2010

The legislation seeks to: Expand access to health care by increasing insurance coverage

and pay for the expansion Reform health insurance practices Improve the quality of care Control the rate of increase of health care expenditures

Changes are incrementally implemented, beginning in 2010 and extending well beyond 2014

Legislation that affects everyone involved with health care

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Selected Statistics About the Health Selected Statistics About the Health Care Reform LawCare Reform Law

Expands health insurance coverage to 34 million persons

Guarantees that 94% of Americans will have health insurance of some type

Is projected to cost $938 B over the next 10 years Is projected to extend solvency of the Medicare

Trust Fund by 12 years (to 2029) Is projected to cut the federal deficit by $143 B

over the next decade Medicaid will become larger than Medicare

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Patient Protection and Affordable Patient Protection and Affordable Care Act of 2010Care Act of 2010

I. Quality, Affordable Health Care For All AmericansII. Role of Public ProgramsIII. Improving the Quality and Efficiency of Health CareIV. Prevention of Chronic Disease and Improving

Public HealthV. Health Care WorkforceVI. Transparency and Program IntegrityVII. Improving Access to Innovative Medical TherapiesVIII. Community Assistance Services and SupportsIX. Revenue ProvisionsX. Strengthening Quality, Affordable Health Care For

All Americans

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IT’S A JOURNEYIT’S A JOURNEY

1. PPACA is a major milestone in the transformation of American medicine, but the journey started long before this legislation was enacted

2. Hundreds of sets of implementing regulations have yet to be promulgated

3. There will be unplanned occurrences and unintended consequences of the legislation

4. Course corrections will need to be made 5. There will be more health care reform legislation

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THE WAY WE THINK ABOUT HEALTH THE WAY WE THINK ABOUT HEALTH CARE HAS TO CHANGE CARE HAS TO CHANGE

6. It’s about the quality, not quantity, of services provided

7. Payment will be increasingly based on value – and constrained

8. Historical levels of waste and inefficiency can no longer be tolerated

9. Performance improvement is an essential business strategy

““ALL HEALTH CARE IS ALL HEALTH CARE IS LOCAL”LOCAL”

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Session ObjectiveSession Objective

1. To review how PPACA affects health insurance

2. To consider some of the insurance reform-related implications for health care providers.

3. To explore the implications for Alaska.

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PPACA Affects Health Insurers By PPACA Affects Health Insurers By

1.1. Prohibiting or restricting certain practicesProhibiting or restricting certain practices

2.2. Specifying and/or standardizing covered benefits Specifying and/or standardizing covered benefits or populationsor populations

3.3. Limiting amount of premiums spent on non-Limiting amount of premiums spent on non-medical costsmedical costs

4.4. Being more prescriptive about setting premiumsBeing more prescriptive about setting premiums

5.5. Limiting variation in premiumsLimiting variation in premiums

6.6. Authorizing federal review of premium increasesAuthorizing federal review of premium increases

7.7. Allowing multi-state insurance compactsAllowing multi-state insurance compacts

8.8. Requiring individuals to have health insuranceRequiring individuals to have health insurance

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PPACA Affects Health Insurers By PPACA Affects Health Insurers By

9.9. Creating more insurer options (exchanges)Creating more insurer options (exchanges)

10.10. Providing incentives (tax credits) for employers to Providing incentives (tax credits) for employers to provide health insurance (and wellness programs) provide health insurance (and wellness programs) and disincentives (penalties) for not providing and disincentives (penalties) for not providing employee coverageemployee coverage

11.11. Increasing public reporting requirementsIncreasing public reporting requirements

12.12. Designing-in quality of care improvement Designing-in quality of care improvement strategiesstrategies

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Panel….Panel….