States and Federal Health Care Reform

Skidmore College

Dr. Robert TurnerState and Local Politics

Presented by Courtney BurkeSeptember 23, 2010

Overview of States and Health Care

Examples of How Governments Influence Health Policy and Law

Advertising and marketing of health services & products

Expending funds on public programs, including public health insurance

Regulating anti-trust, health care contracting, privacy

Overseeing employment, workforce, patents, taxation, disparities, consumer protection, bioterrorism, etc.

Overseeing health insurance regulation, Rx regulation, human subjects research

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Government’s Balancing Act

Balance between public regulation for public health’s sake and the rights of private individuals

Examples – regulating companies’ advertising of cigarettes; gun manufacturers’ liability for injury; requiring the use of seatbelts; taxing unhealthy foods

What is federal vs. state jurisdiction?

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Law and Policy Powers of Government

Powers of public health agencies that directly protect and promote health

Power to police (states retain this right, too)

The right to tax and spend (this can coerce certain health behaviors)

Provide for the public’s welfare (public health insurance)

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Who Makes Policy? States

Governors and legislatures – pass laws; allocate money; provide oversight

State agencies – license and accredit; ensure public health; oversee health insurance

Courts – decide on scope of law; enforcement; balance between government and individual rights; punitive role

The scope and role is different in every state

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States and Medicaid

States’ Role in Medicaid

Setting eligibility, benefits

Overseeing payments, program integrity

Enrollment and coordination

Financing

Overall administration

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Interesting Things about States, the Federal Government, and Medicaid Federal government sets minimum rules, provides for

at least half of total costs

Medicaid (MA) is the largest grant-in-aid to states (much larger than education, transportation, or other funds)

To alleviate state budget gaps, the federal government has often used Medicaid as a vehicle for helping states balance their budgets

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Interesting Things about States and Medicaid

Very different across states

States have maximized flexibility

Medicaid is the largest funding source for long-term care (e.g., nursing home care, home care, hospice, durable medical equipment, services for persons with disabilities, etc.)

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Medicaid: NY and US Comparison Source: Kaiser Commission on Medicaid and the Uninsured

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States and Medicaid Waivers

Waivers are a statutory means for flexibility

Waivers have allowed cuts in services, but primarily focused on expansion and innovation

Research & demonstration or programmatic

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States and Health Care Reform

State Role in Health Reform: Financing

Three main sources of costs for states: Increased minimum levels for Medicaid eligibility –

state share

“Woodwork” effect for those currently eligible but not enrolled in public insurance

Administrative costs

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Financing (Example of New York) Woodwork – Enhanced state match may not apply to

those already eligible for public insurance but not currently enrolled (close to 1 million people in NY)

Administrative – Enrolling thousands more people, creating new administrative entities, etc.; NY Bridge Plan, exchange

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State Role in Health Reform: Administration

Create and oversee state insurance exchanges

Regulate products and rules within exchanges

Regulate small group & individual markets

Provide wraparound services or additional subsidies

Coordinate exchange with public insurance programs

Enforce individual or employer mandates

Potentially administer public option or develop co-ops

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Administration Examples in New York

Exchange – upstate/downstate, statewide, interstate?

Change rating rules or keep pure community rating?

Who is eligible for exchange?

Wrap services for those above federal eligibility levels or require them to use exchange with subsidies?

Provide additional subsidies to low-income because cost of insurance is higher?

Expand Family Health Plus buy-in or develop co-ops?

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State Role in Health Reform: Implementation

Update legislation, programs, and processes

Request waivers from federal rules if needed

Inform residents about options, provide outreach

Create technology to link old and new programs

Ensure services and programs mesh

Create new forms and eligibility processes

Assist citizens through the process

Expand capacity to deal with new enrollees

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Other Potential Roles for States What about illegal immigrants? Underinsured?

Interim operator of high-risk pools in some states

Creators/operators of co-op or public option

What exactly might the public option be? A Medicaid or Family Health Plus buy-in? A Medicare buy-in? FEHBP buy-in? A new plan? A stop-gap?

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State and Local Governments

All states (except VT) must have balanced budgets (some annual, some semi-annual)

About half of states have tax and expenditure limitations requiring supermajority or voter approval to increase taxes

Supplement federal programs; fill gaps; implement programs

Administer and help fund Medicaid and SCHIP

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Example of State Role in Health Reform

Implement and monitor compliance with new insurance regulations; oversee insurance products, rating rules

Provide outreach and assistance to residents about new laws and regulations

Set up and administer state-based insurance exchanges

Provide subsidies to businesses or individuals

Coordinate new programs with existing programs

Help finance costs of increased enrollment

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Class Role Play: States and Health Reform

Governor

Community health center

State Medicaid director

State Insurance commissioner

Small business

Medicaid enrollee

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Class Role Play: Health Reform

Explain your role in the policy process

What are your priorities/interests?

Where/how will you intervene in the process?

What will you say to your congressperson?

How will your point of view affect the process?

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Favorite State Health Policy Resources Kaiser State Health Facts online

www.statehealthfacts.kff.org

National Academy for State Health Policy www.nashp.org

Commonwealth Fund www.cmwf.org

Robert Wood Johnson Foundation www.rwjf.org

State Coverage Initiatives www.statecoverage.org

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Rockefeller Institute

The Public Policy Institute of theState University of New York

Courtney BurkeDirector, Health Policy Research Center411 State StreetAlbany, NY 12203-1003(518) 443-5522burkec@rockinst.orgwww.rockinst.org