The Senate Health, Education, Labor and Pensions (HELP) committee recently released its health reform proposal and plans to begin debating the bill in committee tomorrow, June 17. This marks the first major step in the legislative process to reform our failing health care system.
The Committee’s bill, titled the “Affordable Health Choices Act”, has five major elements: providing choice of coverage options, cost reduction, prevention, health system modernization, and long term care and services.  It addresses these issues through a variety of proposals and initiatives, one of them being the establishment of ‘Health Benefit Gateways’ in every state. Such entities would provide eligible individuals and businesses greater access to affordable, quality health insurance by providing a marketplace in which they could shop for qualified health plans. The Gateways would make it easier for consumers to compare premiums, out-of-pocket costs, and other features of the health plans, as well as to enroll in plans electronically. Low- and moderate-income people (people earning up to 500 percent of the federal poverty line) participating in the Gateway would receive subsidies on a sliding scale to help offset the cost of coverage. In addition to offering private health insurance options, Gateways will also be able to enroll qualifying individuals into federal health programs like CHIP and Medicaid, as well as other public programs, such as TANF.

A new board called the Medical Advisory Group would set the benefit levels and define affordability in the Gateway. According to the bill the benefit packages should cover a wide array of services, including those in categories like mental health and substance abuse, ambulatory patient services, maternity and newborn care, prescription drugs, rehabilitation and habilitation services, and others. One category of services that was not mentioned, but which advocates for people with disabilities believe is critically needed, is a full complement of durable medical equipment (such as wheelchairs), prosthetics, orthotics (DMEPOS) and other assistive devices.

Participation in the Gateway would be voluntary. Individuals who are content with their existing coverage would be able to keep it. However, the bill does require that all individuals be enrolled in a health plan. Individuals who do not have qualifying coverage for any month during a taxable year will have to pay a fine. Exemptions would be given to people who do not have access to affordable insurance or for whom payment of the fine would represent an exceptional hardship.

The Affordable Health Choices Act also proposes the creation of a new public health plan that would be available in the Gateway. However, very few details on the structure of this public plan were included in the bill that was released. These details will be worked out in Committee.

The bill sets forth a package of reforms to the individual and group insurance market which would help ensure greater access to coverage and put an end to some discriminatory practices.  For one, there is a requirement that all insurers provide coverage to all individuals and employers that apply and that they guarantee renewal of policies. Also, plans would no longer be able to impose preexisting condition exclusions, nor set annual or lifetime limits on benefits. There would also be limits on out-of-pocket expenses like co-pays and deductibles for preventative care. The bill would prohibit insurers from using health status, gender, genetic information, disability, type of work, or claims history to determine premium rates. Premiums could vary by age but the rate set for older individuals could not be more than twice the amount charged the youngest person.  Another positive reform included is the proposal that family coverage plans cover dependents through age 26.

A significant proposal included in the Affordable Health Choices Act is the creation of a new national voluntary insurance program to help cover long term services for adults with disabilities. According to the Consortium for Citizens with Disabilities, there are currently over 200 million adults in the U.S. who lack any insurance protection against the cost of long term services and supports.  For many individuals who are born with or develop functional impairments, the only access they have for coverage of long term services and supports is through federal and state Medicaid programs. However, many cannot qualify for Medicaid because of the program’s income eligibility limits. The HELP bill would establish the Community Living Assistance Supports and Services (CLASS) program which would give cash benefits to individuals who are unable to perform two or more activities of daily living. Individuals 18 years and older, who contribute into the program through payroll deductions for a minimum of five years could qualify for the program. Unless they opt out, people would be automatically enrolled in the program through their employer and would pay a fixed premium throughout their life. This program would give people with disabilities added choice and access to long term services and supports.

One area in which the bill does fall short is in its treatment of immigrant children and families. The focus on individual versus existing group approaches to enrollment and coverage could create barriers for low-income families and their dependents, including mixed status families that include both citizens and immigrants. The bill also states that no federal funds should be used to issue payments to undocumented immigrants. This is listed in the section that discusses the Gateway subsidies but could be interpreted to apply broadly to the whole Act, which could potentially prohibit federal funding for public health services that are currently available to all community members.

The Congressional Budget Office’s initial estimate puts the price tag of the Affordable Health Choices Act at about $1.0 trillion over 10 years. It also projects that while 39 million individuals could obtain coverage from the new Gateway program, potentially 23 million people could lose coverage from other sources, bringing the net decrease in the number of uninsured people down to only about 16 million. This does not seem to go far enough in solving the huge uninsurance problem we currently have in this country. However, CBO makes it a point to clarify that theirs is a preliminary assessment, which does not factor in some changes which are under consideration that could expand coverage including:  a potential expansion of Medicaid to cover individuals up to 150 percent of the poverty line, the new public health program, and mandating employer participation.

Issues pertaining to financing health reform and changes to Medicaid and Medicare are not really addressed in the HELP bill, since the committee does not have jurisdiction over these matters. These issues will be taken up by the Senate Finance Committee. Senator Max Baucus (D-MT), the Chairman of the Senate Finance Committee, could release preliminary legislative language as early as tomorrow. The Committee is scheduled to begin debate on the bill on June 23.

Language may soon be released in the House, as well. The Committees with jurisdiction on health reform plan to hold hearings next week on their joint bill and hope to have the bill on the House floor in July.

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