Posted by: reddiva | September 19, 2009

BAUCUS SCHMAUCUS!


The Baucus Health Care Plan

[I looked for about 3 hours trying to find the bill number for the Baucus Health Care Proposal.  I still haven’t found it, but I did finally find the entire text of the bill thanks to the Washington Post.

Their headline reads:

Baucus Measure Would Expand Care Without Adding to Deficit

Attempt at Compromise in Senate Draws No GOP Support”

I haven’t read the entire bill yet, but what I’ve read so far confirms this headline.  There would be no addition to our National deficit.  Why?  Because our taxes would go up to pay for it.  That tax hike would be substantial even though the figures I have seen in other places tries to hide that fact.  I haven’t seen the figures in this bill yet, but you can be sure I’ll let you know when I do!  For those of us who are frustrated by the GOP to say or do anything really beneficial to support those of us who voted for them, it is good to see that they are not supporting this bill.

Page one of this bill says, “Chairman’s Mark”.   I looked up the exact definition for that and found this:

“Chairman’s Mark/Staff Draft:
Recommendation by committee (or subcommittee) chair of the measure to be considered in a markup, usually drafted as a bill.”

I suppose, according to this definition, this bill may not yet even have a number which explains my difficulty in finding one.

All right, let’s attack this one (all 223 pages of it) as we did with H.R.3200:]

TITLE I—HEALTH CARE COVERAGE

SUBTITLE A—INSURANCE MARKET REFORMS

Rating Rules in the Individual Market

Current Law

The individual market is currently where individuals and dependents without employer-sponsored coverage or access to a public program purchase health insurance. Some states impose rating rules on insurance carriers in the individual market. Existing state rating rules restrict an insurer‘s ability to price insurance policies according to the risk of the person or group seeking coverage, and vary from state to state. Such restrictions may specify the case characteristics (or risk factors) that may or may not be considered when setting a premium, such as gender. The spectrum of existing state rating limitations ranges from pure community rating, to adjusted (or modified) community rating, to rate bands, to no restrictions. Pure community rating means that premiums cannot vary based on any characteristic, including health. Adjusted community rating means that premiums cannot vary based on health, but may vary based on other key risk factors, such as age.

Rate bands allow premium variation based on health, but such variation is limited according to a range specified by the state. Rate bands are typically expressed as a percentage above and below the index (i.e., the midpoint in the allowed rating band). For example, if a state establishes a rate band of +/- 25 percent, then insurance carriers can vary premiums, based on health factors, up to 25 percent above and 25 percent below the index. Both adjusted community rating and rate bands allow premium variation based on any other permitted case characteristic, such as gender. For each characteristic, the state typically specifies the amount of allowable variation, as a ratio. For example, a 5:1 ratio for age would allow insurers to charge an individual no more than five times the premium charged to any other individual, based on age differences. As of January 2009, one state has pure community rating, seven have adjusted community rating rules, and eleven have rating bands in the individual market. The remaining states have no limitations on rating set in law.

The Federal Health Insurance Portability and Accountability Act of 1996 (HIPAA, P.L. 104-191) established Federal rules regarding guaranteed availability, guaranteed renewability, and coverage for pre-existing health conditions in the individual market for certain persons eligible for HIPAA protections. HIPAA guarantees that each issuer in the individual market make at least two policies available to all “HIPAA eligible” individuals, and renewal of individual coverage is at the option of such individuals, with some exceptions. HIPAA also prohibits individual issuers from excluding coverage for pre-existing health conditions for HIPAA eligibles. In addition, a number of states have enacted guaranteed issue and pre-existing condition exclusion rules. Guaranteed issue refers to the requirement that an issuer must accept every applicant for coverage. Guaranteed issue does not affect (and is not affected by) rating or benefits. As of January 2009, 14 states require issuers to offer some or all of their individual insurance products on a guaranteed issue basis. Moreover, 42 states reduce the period of time when coverage for pre-existing health conditions may be excluded.

Chairman’s Mark

The Chairman‘s Mark would establish Federal rating, issue, renewability, and pre-existing condition rules for the individual market. Issuers in the individual market could vary premiums based only on the following characteristics: tobacco use, age, and family composition. Specifically, premiums could vary no more than the ratio specified for each characteristic:

  • Tobacco use – 1.5:1
  • Age – 5:1
  • Family composition:

o Single – 1:1

o Adult with child – 1.8:1

o Two adults – 2:1

o Family – 3:1

Premiums could also vary among, but not within, rating areas to reflect geographic differences. States would define geographic rating areas. Taking together all permissible risk factors, premiums within a family category could not vary by more than a 7.5:1 composite ratio.

Issuers in the individual market would be required to offer coverage on a guaranteed issue basis. Under guaranteed issue, if a plan has a capacity limit and the Secretary determines that the number of individuals who elect that plan would exceed the limit, the issuer would be allowed to limit the number of enrollees according to specified rules. Also, issuers would be required to offer coverage on a guaranteed renewability basis, and rate those policies on the same factors used when initially issuing such policies. Issuers would be prohibited from excluding coverage for pre-existing health conditions and from rescinding health coverage.

[You can read the HIPAA Public Law here ( http://aspe.hhs.gov/admnsimp/pL104191.htm ) if you are interested in delving into this a little deeper.

I have to admit that it seems everyone has it in for old people.  A person who uses tobacco would pay 1 ½ times more than a non-user, but an elderly person would pay fives times as much as a younger person.  For my own purposes, I’m going to consider this a “death panel” until I find something different.  Our simplified example will fit here as it has in the past.  If the lowest charge is $100 a month, some individual is going to end up paying $500 a month.  A family could pay $750.  I am sorry but I just don’t see any savings here.

I found an interesting tidbit on page 15.  The heading is “Grandfathered Plans.  I have highlighted and italicized what I consider to be the two most important phrases in this section.]

Grandfathered Plans

Current Law

No provision.

Chairman’s Mark

Individuals and groups who wish to renew coverage in an existing policy would be permitted to do so. Plans could continue to offer coverage in a grandfathered policy, but only to those who were currently enrolled, dependents, or in the case of an employer, to new employees and their dependents. No tax credits would be offered for grandfathered plans.

Beginning January 1, 2013, Federal rating rules would be phased in for grandfathered policies in the small group market, over a period of up to five years, as determined by the state with approval from the Secretary. These plans could continue to exist after the transition period, but would be subject to the new rating rules.

[In other words, our employers couldn’t provide our existing policies after this five-year period of “phasing to the new rating rules”.   Why didn’t he just say that they would be phased out?  The same is true of this bill as is true of H.R. 3200 – private insurance will be phased out.  Here they are again with Socialized medicine being the only viable option for the public. These people are making me really angry!  Why do they keep saying that they aren’t trying to do these things when that is the goal of every plan I have seen out there so far?]

National Plans

Current Law.

No provision.

Chairman’s Mark

The Chairman‘s Mark would allow national plans, with uniform benefit packages that are offered across state lines. These national plans must be licensed in every state that they choose to operate and would be regulated by the states in terms of solvency and other key consumer protections and would offer coverage through the state exchanges.

[Did we really expect this wouldn’t be here?  This is just a buttered-up way to say “Government Plans.”  It isn’t enough that they want the Federal Government to be too big for their own breeches, they want to dictate to the States that they must grow bigger as well.   Page 14…]

Chairman’s Mark

Plan Participation. All private insurers in the individual and small group markets that operate nationally, regionally, statewide, or locally must be available in a newly established state exchanges, if the insurers are licensed by a state (that is, a state has determined that the plans meet all the market-reform requirements).

Establishment of State Exchanges. States would be required to establish an exchange for the individual market and a Small Business Health Options Program (SHOP) exchange for the small group market, with technical assistance from the Secretary, in 2010. This requirement may encompass a single exchange with separate resources for individual and small-group customers. The Secretary would be required to establish and maintain a database of plan offerings for use by state exchanges. The database would enable the review of state-specific information. The Secretary could contract out to a private entity for the operation of the plan database.

[Slipped into this section is a clause that I find troubling.. top of page 15.. ]

Legal U.S. residents will be able to obtain insurance through the state exchanges. Parents who are in the country illegally will not be able to buy personal insurance coverage through the state exchange but will be able to buy insurance for their U.S. citizen or lawfully present children.

[We’re back to paying for health care for those who are in this country illegally.  There go my taxes.]

[…]

SUBTITLE C—MAKING COVERAGE AFFORDABLE

Chairman’s Mark

Definition of Four Benefit Categories. Four benefit categories would be available: bronze, silver, gold and platinum. No policies could be issued in the individual or small group market (other than grandfathered plans) that did not meet the actuarial standards described below. All health insurance plans in the individual and small group market would be required, at a minimum, to offer coverage in the silver and gold categories.

All plans must provide preventive and primary care, emergency services, hospitalization, physician services, outpatient services, day surgery and related anesthesia, diagnostic imaging and screenings (including x-rays), maternity and newborn care, pediatric services (including dental and vision), medical/surgical care, prescription drugs, radiation and chemotherapy, and mental health and substance abuse services that at least meet minimum standards set by Federal and state laws. In addition, plans could charge no cost-sharing (e.g., deductibles, copayments) for preventive care services, except in cases where value-based insurance design is used. Plans could also not include lifetime limits on coverage or annual limits on any benefits. Any insurer that rates on tobacco use must also provide coverage for comprehensive tobacco cessation programs including counseling and pharmacotherapy (prescription and non-prescription). The provisions in this paragraph would all be within the actuarial value of the appropriate benefit level.

Each plan design for products in the state exchanges would be required to apply parity for cost-sharing for treatment of conditions within each of the following categories of benefits: (1) inpatient hospital; (2) outpatient hospital; (3) physician services; and (4) other items and services, except in cases where value-based insurance design is used. Each plan design would also be required to meet the class and category of drug coverage requirements specified in Medicare Part D. (Generally, Part D plans must offer two drugs in each class or category.) States may permit some flexibility in plan design to encourage widely agreed upon cost and quality effective services. These requirements would not add to or change the actuarial value of the benefit designs.

Insurers participating in the state exchanges would be required to charge the same price for the same products in the entire service area as defined by the state regardless of how an individual purchases the policy (i.e., whether the policy is purchased inside or outside the state exchange from the carrier or an agent).

Definition of Levels. The bronze benefit package, which would represent minimum creditable coverage (MCC), would be equal to the actuarial value of 65 percent with an out-of-pocket limit up to the Health Savings Account (HSA) current law limit ($5,950 for individuals and $11,900 for families in 2010) indexed to the per capita growth in premiums for the insured market as determined by the Secretary of HHS. The silver benefit package would have an actuarial value of 70 percent with the out-of-pocket limits for MCC. The gold benefit package would have an actuarial value of 80 percent with the out-of-pocket limits for MCC. The platinum benefit package would have an actuarial value of 90 percent with the out-of-pocket limits for MCC. A separate “young invincible” policy would be available for those 25 years or younger. This plan would be a catastrophic only policy in which the catastrophic coverage level would be set at the HSA current law limit, but prevention benefits would be exempt from the deductible.

For those between 100-200 percent of FPL, the benefit will include an out-of-pocket limit equal to one-third of the HSA current law limit. For those between 200-300 percent of FPL, the benefit will include an out-of-pocket limit equal to one-half of the HSA current law limit.

[This sounds more like an airline frequent flyer program than an affordable health insurance program.  There is no reason for this to be so confusing.  Who do our elected officials think they will impress using language that confuses the normal citizen?]

Application of State and Federal Laws Regarding Abortion

Current Law

The performance of and payment for abortions is regulated by both state and Federal laws. State law, for example, sometimes prescribes parental notification, waiting periods and other procedural requirements before an abortion may be performed. Under Federal law, certain kinds of Federal funds may not be used to pay for abortions and certain recipients of Federal funds may not discriminate against specified health care entities that perform or refuse to perform, pay for, provide referrals for, or provide training for abortions.

Chairman’s Mark

This provision would ensure that state laws regarding the prohibition or requirement of coverage or funding for abortions, and state laws involving abortion-related procedural requirements are not preempted. The provision similarly provides that Federal conscience protections and abortion-related antidiscrimination laws would not be affected by the bill. The rights and obligations of employees and employers under Title VII of the Civil Rights Act of 1964 would also not be affected by the bill. In addition, this bill does not affect state or Federal laws, including section 1867 of the Social Security Act (EMTALA), requiring health care providers to provide emergency services.

Abortion Coverage Prohibited as Part of Minimum Benefits Package

Current Law

Currently, Federal funds may be used to pay for abortions only if a pregnancy is the result of an act of rape or incest, or where a woman suffers from a physical disorder, physical injury, or physical illness that would place the woman in danger of death unless an abortion is performed. However, many private insurance plans include coverage for abortion beyond these limited categories.

Chairman’s Mark

This provision provides that abortion cannot be a mandated benefit as part of a minimum benefits package except in those cases for which Federal funds appropriated for the Department of Health and Human Services are permitted. A qualified health plan would not be prohibited, however, from providing coverage for abortions beyond those for which Federal funds appropriated for the Department of Health and Human Services are permitted. Federal funds continue to be prohibited from being used to pay for abortions unless the pregnancy is due to rape, incest, or if the life of the mother is in danger.

Required Segregation of Public Funds

Current Law

No provision.

Chairman’s Mark

No tax credit or cost-sharing credits may be used to pay for abortions beyond those permitted by the most recent appropriation for the Department of Health and Human Services. In addition, insurers participating in any state-based exchange that offer coverage for abortion beyond those permitted by the most recent appropriation for the Department of Health and Human Services must segregate from any premium and cost-sharing credits an amount of each enrollee‘s private premium dollars that is determined to be sufficient to cover the provision of those services.

The Secretary shall also establish a process using an estimated actuarial value by which insurers that provide coverage for abortions beyond those permitted by the most recent appropriation for the Department of Health and Human Services must demonstrate that no federal premium and cost-sharing credits are used for the purpose of paying for such abortions.

[Can you say hypocritical?]

Rules Regarding Coverage of and Tax Credits for Specified Services

Current Law

No provision.

Chairman’s Mark

The Secretary would ensure that in each state exchange, at least one plan provides coverage of abortions beyond those for which Federal funds appropriated for the Department of Health and Human Services are permitted. The Secretary would also ensure that in each state exchange, at least one plan does not provide coverage of abortions beyond those for which Federal funds appropriated for the Department of Health and Human Services are permitted.

[ I wonder what makes him think I live in Massachusetts?  He keeps bringing that up – as though it matters to me or anyone other than the people who live in Massachusetts.  I keep hearing from them that the Massachusetts health care socialized medicine is garbage.  I have yet to read one positive thing written by a citizen – not the Governor or anyone who was responsible for passing the law.  I will highlight in bold and italicize the important parts in the section below.]

SUBTITLE D—SHARED RESPONSIBILITY

Personal Responsibility Requirement

Current Law

Federal law does not require individuals to have health insurance. Only Massachusetts, through its statewide program requires that individuals have health insurance (although this policy has been considered in other states, such as California, Maryland, Maine, and Washington). All adult residents of Massachusetts are required to have health insurance that meets “minimum creditable coverage standards” if it is deemed “affordable” at their income level under a schedule set by the board of the Massachusetts Connector. Individuals report their insurance status on state income tax forms. Individuals can file hardship exemptions from the mandate; persons for whom there are no affordable insurance options available are not subject to the requirement for insurance coverage.

Under Massachusetts law, for taxable year 2007, an individual without insurance and who was not exempt from the requirement did not qualify for a State income tax personal exemption. For taxable years beginning on or after January 1, 2008, a penalty is levied for each month an individual is without insurance. The penalty consists of an amount up to 50 percent of the lowest premium available to the individual through the Connector. The penalty is reported and paid by the individual with the individual‘s Massachusetts State income tax return at the same time and in the same manner as State income taxes. Failure to pay the penalty results in the same interest and penalties as apply to unpaid income tax.

Chairman’s Mark

Personal Responsibility Requirement. Beginning in 2013, all U.S. citizens and legal residents would be required to purchase coverage through (1) the individual market, a public program such as Medicare, Medicaid, the Children‘s Health Insurance Program, Veteran‘s Health Care Program, or TRICARE or through an employer (or as a dependent of a covered employee) in the small group market, meeting at least the requirements of a bronze plan, or (2) in the large group market, in a plan with first dollar coverage for prevention-related services as recommended by the U.S. Preventive Services Task Force – except in cases where value-based insurance design is used and cannot have a maximum out-of-pocket limit greater than that provided by the standards established for HSA current law limit. Exemptions from the requirement to have health coverage would be allowed for religious objections that are consistent with those allowed under Medicare, and for undocumented aliens. An individual enrolled in a grandfathered plan would be deemed to have met the responsibility requirement.

In order to ensure compliance, individuals would be required to report on their Federal income tax return the months for which they maintain the required minimum health coverage for themselves and all dependents under age 18. In addition to this self-attestation by individuals of qualified coverage, insurers (including employers who self-insure and therefore act as insurers), must report information on health insurance coverage information to both the covered individual and to the Internal Revenue Service. This information includes months of coverage in the tax year and individuals covered on the policy and may include other relevant information. A similar reporting requirement would apply to employers with respect to individuals enrolled in group health plans if the reporting is not provided by the insurer (for example in the case of self-insured plans) and for those enrolled in public health insurance plans.

Excise Tax. The consequence for not maintaining insurance would be an excise tax. If a taxpayer‘s MAGI [modified adjusted gross income] is between 100-300 percent of FPL [Federal Poverty Level],  the excise tax for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or an individual claimed as a dependent) is $750 per year. However, the maximum penalty for the taxpayer unit is $1,500. If a taxpayer‘s MAGI is above 300 percent of FPL the penalty for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or as an individual claimed as a dependent) is $950 year. However, the maximum penalty amount a family above 300 percent of FPL would pay is $3,800.

[That’s enough to digest for now.  I’ll start on page 32 next time…. The cooperatives are here as well.  Looks like no matter how much we protest against government sponsored socialized medicine, we’re going to get it one way or the other!]

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  1. […] – the penalty goes into a “general fund.”  No doubt, that is to help us pay for those non-citizen mothers we were discussing when we stopped last […]

  2. […] Chairman’s Mark […]


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