Affordable Care Act Symposium

December 16, 2013

Working together for CNMI healthcare reform

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

What we hope to gain today?

Get the public and private sectors on the same page regarding the changes to the CNMI healthcare system

Provide status updates on implementation efforts by the Dept. of Commerce

Hear perspectives from healthcare stakeholders (provider and insurance carrier)

Collaborate on mitigating the impacts of the federal healthcare reform to strengthen our healthcare system, not destabilize it2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of

Health and Human Services

Healthcare Reform in the CNMI

Making the Affordable Care Act work for us

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

In this presentation

What is the Affordable Care Act?

How does it affect the CNMI?

What can we do to mitigate the impacts?

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Brief Background of the Affordable Care Act (ACA)

In March 2010, President Obama signed comprehensive health reform, the ACA into law.

This law was a bipartisan resolution to address the nationwide problems with health care.

The law does not create health insurance, but regulates it.

The ACA also includes provisions for improving quality and lowering the cost of health care.

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Why was the Affordable Care Act passed?

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

A Broken Health Care System

In 2009, the U.S. spent more on health care

Per capita ($8,608)Percentage of GDP (17.9%)

than any other nation (WHO)2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of

Health and Human Services

A Broken Health Care System

In 2006, the US ranked 39th in infant mortality, 43rd for adult female mortality (42nd for

male) and 36th for life expectancy (WHO)

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

A Broken Health Care System

2003 to 2009Premiums for businesses and employees

jumped 41% across the states

Per person deductibles jumped 77%(2010, The Commonwealth Fund)

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

A Broken Health Care System

Between 2001 and 2007, the percentage of bankruptcies due to medical problems increased 49.6% (Medical Bankruptcy in the United States, 2007: Results of a National Study. American Journal of Medicine).

An estimated 45,000 Americans die annually due to a lack of health insurance (2009, American Journal of Public Health)

In 2009, Families USA estimated that the extra cost of care for the uninsured added $1,000 to family insurance premiums.

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

A Broken Health Care System

Uninsured (2011) CENSUS Govt. Medical Expenditure (2007) WHO0

5

10

15

20

25

30

35

40

Uninsured Rates and Government Expenditures on Medical Care: CNMI and US

CNMI United States

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Market Reforms

Effective in 2010, insurance companies can’t: Deny coverage to young adults on their parent’s plan

until they are 26 Raise premiums without justification

-Grants awarded for CNMI rate review Deny coverage of children because of a pre-existing

condition Rescind coverage for no good reason Prohibit a consumer from filing an appeal on a coverage

denial2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Market Reforms

Effective in 2010, insurance companies can’t:

Charge any cost sharing or deductibles for certain in-network preventive care services

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

• Alcohol Misuse• Blood Pressure• Cholesterol• Colorectal Cancer• Depression • Breast Cancer• Obesity• Tobacco Use and

cessation interventions • Diabetes (Type 2)• “Well woman visits”  • Diet counseling 

• Immunization vaccines  • Contraception such as

birth control pills (Not abortions)

• Domestic and interpersonal violence screening and counseling for all women

• Autism screening for children at 18 and 24 months

(Non-grandfathered plans)

Preventive Care is crucial to public health and the economy

of the CNMI In the CNMI, over 11% of adults age 25+ have

diabetes (Diabetes in the Indigenous Population of the Commonwealth of the Northern Mariana Islands.

Pacific Health Dialog. 1999;6(1):39-44.)

Some estimates have put this number at over 25% (Tanapag Study, 2001. CNMI Tobacco, Diabetes, Obesity, HPTN 2008)

In 2010, a regional health emergency was declared in the US-affiliated Pacific Islands due to the epidemic of non-communicable diseases. (Pacific Island Health Officers Association)

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Market Reforms

Effective in 2011, insurance companies can’t:

Spend less than 80% of premiums collected on medical claims, otherwise they must reimburse the difference to their enrollees (Medical Loss Ratio)

- Keeps insurers accountable for how they spend your money

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

In 2011 and 2012, over $380,000 was rebated to CNMI residents because of

the MLR rule.

Health Insurance Reform

On October 1st, 2013 health insurance marketplaces, or “exchanges” opened in the US mainland.

These exchanges are used to compare coverage and enroll in health insurance.

Due to the tax credits and subsidies offered in these exchanges (up to 400% FPL), the CNMI could not afford this.

All US territories chose to use the one-time lump funding to expand Medicaid, rather than establish an exchange.

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

For Plans or Policies Starting Jan. 1, 2014 or later

Health insurance issuers must include coverage which

Incorporates defined essential benefits

Limits cost-sharing on these “EHBs”

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Essential Health Benefits (EHB) categories are:Ambulatory Patient Services

Emergency ServicesHospitalization

Laboratory ServicesMaternity and Newborn Care

Mental Health and Substance Abuse Disorder ServicesPediatric services, including Oral and Vision

Prescription DrugsPreventive and Wellness Services and Chronic Disease Management

Rehabilitative Services

These must be provided to the covered person according to the EHB benchmark plan, Blue Cross Blue Shield Standard Option and Pediatric Vision

services of FEDVIP

For Plans or Policies Starting Jan. 1, 2014 or later

Insurance carriers offering coverage in the individual and small group market may not charge discriminatory premium rates. Rates can only vary according to:

- Family Size

- Geographical Area

- Age

- Tobacco Use Insurance must be guaranteed available (during certain

open enrollment and special enrollment periods) Insurance must be guaranteed renewable

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

For Plans or Policies Starting Jan. 1, 2014 or later

No waiting period can exceed 90 days

Annual limits on essential health benefits are prohibited

Health insurance carriers may not impose a preexisting condition exclusion or discriminate based on health status.

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Does the new healthcare reform include the CNMI?

The federal law is expanded to the territories, but only in pieces.

The goal of the ACA is for every American to have affordable, comprehensive health insurance

To do this, three major components of the law become a metaphorical “three-legged stool”

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

The “three-legged stool”

Market Reform

s

Employer Mandate

Individual

Mandate

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Market reforms• These are new, strict rules that insurance

carriers must follow regarding coverage, premium rates and cost-sharing limits

Individual Mandate• Requirement for everyone to have “minimum

essential coverage” or pay a tax penalty. Insurance exchanges help make enrolling and paying for coverage easier.

Employer Mandate• Requires employers to offer sponsored health

insurance coverage or pay a penalty. Tax credits are available for small businesses.

In the Territories..

Market Reform

s

Employer Mandate

Individual

Mandate

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Market reforms• Only the market reforms are

mandated by federal law.• This means that if an insurer wants to

sell an insurance policy in 2014, the insurer must sell coverage to anyone applying in that market.

• Insurance companies run the risk of only insuring the sick which increases claim experience and raises premiums.

Concerns of the impacts of the ACA in the CNMI

Risk “Mitigators” are not extended to the territories

Insurance carriers risk insuring only the very sick. This raises premiums and makes coverage unaffordable, so even fewer are covered.

The benchmark plan is costly and too rich in benefits for the CNMI

Possible collapse of the insurance market2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of

Health and Human Services

Benefits the ACA brings to the CNMI Prior to the ACA, the CNMI Insurance Division had

virtually no regulatory power over the rates and forms of health insurance.

Now we have a benchmark for insurance regulatory framework

Additional Medicaid funding Pricing transparency and consumer advocacy Market reforms Keeps insurers accountable for premium dollars Opportunity to reduce the number of uninsured

and decrease CHC receivables2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of

Health and Human Services

What can we do to mitigate the impacts?

Local action: Pass laws to reduce abuse of guaranteed availability

Allow carriers to only guarantee issue coverage during limited enrollment periods

Tailor essential health benefits to suit the needs of the CNMI

Improve access to public assistance: Presumptive eligibility for Medicaid, Create public assistance enrollment for multiple programs

Increase prevention awareness/Work to reduce NCDs

Pass laws for Employer/Individual responsibility to have coverage

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Where does the Consumer Assistance Program fit in all

this? Assist with the filing of complaints and appeals Collect, track and quantify problems Answer health care questions, explain health care coverage

options Educate the public on health care issues and consumer rights Vigorously advocate on behalf of the consumer and to influence

policy decisions and local legislation

2013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of Health and Human Services

Health care consumers need to know how to protect themselves from unfair and

illegal business practices. The CAP helps educate consumers to

advocate for themselves.Contact the CAP office to get help

understanding your rights as a health care consumer

Website: cnmicap.wordpress.comEmail: advocacyoffice@commerce.gov.mp

Phone: 670-664-30052013 CNMI Consumer Assistance Program Presentation made possible by a grant from the U.S. Dept. of

Health and Human Services