Planning for the Affordable Care Act: Impact on Oncology

1. Planning for the Affordable Care Act: Impact on Oncology Gerald F. Kominski, Ph.D. Professor, UCLA Fielding School of Public Health, and Director, UCLA Center for Health Policy Research April 15, 2014

2. March 23, 2010 President Obama Signing the ACA into Law

3. SOURCE: KCMU/Urban Institute analysis of 2012 ASEC Supplement to the CPS. The Uninsured—As a Share of the Nonelderly Population, by Poverty Levels and Family Type, 2011 Income Family Type 400% + Children Parents 139-399% FPL (Subsidies) Uninsured, 18% Adults without Dependent Children Medicaid* 21% 47.9 M Uninsured Individual Non-Group, 6% 266.4 M Nonelderly

4. Basic Principles of the Affordable Care Act (ACA) Too many Americans fall through the cracks of the current health insurance “system.” Therefore, the ACA seeks to: • Expand access to private insurance and Medicaid, rather than redesign the entire insurance “system” • Incremental, not fundamental, financing reform • Provide federal funding to expand access, while allowing state variation in implementation of the law • New federalism • Expand private health insurance markets, subject to extensive federal regulations • In exchange for steering millions of Americans into private insurance markets

5. Most Americans are now subject to the “individual mandate” and will need to demonstrate that they have qualified insurance, or pay a tax, next year Tax is being phased in over the next 3 years, and will be the higher of $695 per adult, $2,085 per family, or 2.5% of household income, by 2016 To assist individuals and families to comply with the mandate, provides subsidies for those with incomes from 100% and 400% FPL Requires out-of-pocket spending for premiums, ranging from 2.0% to 9.5% of income Creates state Marketplaces, as known as Exchanges, with standard, qualified health plans, where subsidies can be used Expands Medicaid coverage for anyone with income <139% FPL Medicaid expansion is fully funded by the Federal government from 2014-16, then Federal funding drops from 100% to 90% by 2020 Major Elements of the ACA Effectiveas of 2014 Note: In 2014, FPL = $11,670 for a family of 1, $23,850 for a family of 4

7. What kinds of insurance policies can be sold in the state Marketplaces? • All policies must include: • Essential Health Benefits • Limits on annual out-of-pocket spending • No-cost coverage for “approved” preventive services • No annual or lifetime dollar caps on benefits • Premiums based only on age, geographic area, and family size • Cannot charge more for pre-existing conditions • One of 4 approved “metal tiers” of coverage

8. What are Essential Health Benefits? • Ambulatory patient care • Emergency services • Hospitalization • Lab services • Prescription drugs • Maternity and newborn care • Mental health and substance abuse disorder treatment • Rehabilitation and habilitation services and devices • Preventive and wellness services and chronic disease support • Pediatric services, including dental and vision care

9. 78

10. Monthly Premiums for All Metal Tiers, 2014Before Subsidy, Region 16 (Los Angeles County), Couple (Ages 62 and 58) ESI HealthNet HMO = $1,280 ($342 out-of-pocket premium)

12. Current Status of State Medicaid Expansion Decisions, 2014 ME VT WA NH MT ND MN OR MA NY WI* SD ID MI* RI CT WY PA* NJ IA* NE OH DE IN* IL NV MD CO UT WV VA CA DC KS MO KY NC TN AZ SC OK AR* NM GA AL MS AK LA TX FL HI Implementing Expansion in 2014 (26 States including DC) Open Debate (6 States) Not Moving Forward at this Time (19 States) NOTES: Data are as of January 28, 2014. *AR and IA have approved waivers for Medicaid expansion; MI has an approved waiver for expansion and plans to implement in Apr. 2014; IN and PA have pending waivers for alternative Medicaid expansions; WI amended its Medicaid state plan and existing waiver to cover adults up to 100% FPL, but did not adopt the expansion.

13. Estimated Health Insurance Coverage in 2017 Uninsured Uninsured Medicaid/CHIP Medicaid/CHIP Exchange Private Non-Group/Other Private Non-Group / Other Employer-sponsored Insurance Employer-sponsored Insurance NOTE: This assumes that all states choose to expand Medicaid eligibility up to 138% FPL January 2014. SOURCE: Congressional Budget Office, February 2013. Total may not equal 100% due to rounding

14. ACA’s Major Advantages for Oncology • For patients: • No pre-existing condition exclusions or higher premiums based on health history • Can never be denied coverage now or in the future • No annual or lifetime dollar limits on covered benefits • Comprehensive essential health benefits • Reasonable limits on annual OOP liability • Maximum $6,350/$12,700 • For centers: • Patients cannot be denied coverage • ~12million newly insured according to CBO

15. Concerns for Oncology under the ACA • Medicaid expansion • Medicaid payments are low in many states • In states not expanding Medicaid, 4.8 million low-income adults will remain uninsured • Narrow networks • These have been used by insurers for decades (HMOs and PPOs), but because of increased awareness of the use of narrow networks in state Marketplaces, many consumers seem to think they were created by the ACA • Is your Center contracting with plans being offered in your Exchange region?

16. Major Concerns for Oncology under the ACA • Inclusion of preferred cancer treatments, including specific specialty drugs • Because every state is required to provide essential health benefits (EHBs), and every state had to identify an actual health policy offered in the state to serve as the benchmark for (EHBs), this may not be a major issue • However, whatever restrictions exist in your state are related to limits imposed by insurers, not by the ACA • Have you experienced problems with coverage before 2014? Are there more problems in 2014?

17. Biased reporting on the ACA: “Nation’s elite cancer centers off-limits under Obamacare” From The NY Post, March 19, 2014: “The AP asked the centers how many insurance companies in their state’s exchange included them as a network provider. Of the 19 that responded, 4 reported access through all insurers: the Kimmel Comprehensive Cancer Center at Johns Hopkins in Baltimore; Fox Chase Cancer Center in Philadelphia; Duke Cancer Institute in Durham, NC; and Vanderbilt-Ingram Cancer Center in Nashville, Tenn.” Fact Check: Did the AP determine if all insurers provided coverage for these 19 Cancer Centers prior to the ACA? NO! So, the AP is implying that the ACA has reduced access, without reporting a shred of evidence from before the ACA. As a professor, I would give the AP reporter an F, for failure to understand the basics of pre-post study designs.

18. June 30, 2012

19. Mr. President, let’s meet in the middle, but you go first…

20. More Want Opponents To Work To Improve Law Rather Than Continue Efforts To Repeal Do you think opponents of the health care law should continue their efforts to repeal the law or should they accept that it’s the law and work to improve it? NOTE: “Opponents should leave the law as is (VOL.)” and “Neither of these/opponents should do something else (VOL.)” responses not shown SOURCE: Kaiser Family Foundation Health Tracking Poll (conducted January 14-21, 2014)

21. Medicare Part D Started Out With Little Support, but is Now Highly Popular Among Seniors AMONG THOSE AGES 65+: As you may know, Medicare provides a prescription drug benefit, known as Medicare Part D. Given what you know about it, in general, do you have a favorable or unfavorable impression of the Medicare prescription drug benefit? NOTES: Question wording varied slightly in 2004-2006 surveys. Neither/neutral (VOL.) and Don’t know/Refused answers not shown. SOURCE: Kaiser Family Foundation surveys

22. Thank you!