The Divisive Politics of the ACA

1. . Implementing the Affordable Care Act in Maryland –What’s at Stake for People Living with Serious Mental illness and Their Families Andrew Sperling Director of Legislative Advocacy NAMI National andrew@nami.org October 18, 2013

2. The Divisive Politics of the ACA • Despite the resolution of the 2012 election, the future of the ACA still dominates the national political debate • Sharp divisions between, and within, the major political parties • The end of the government shutdown is unlikely to resolve this debate • Registration and plan enrollment challenges on the state run and federally facilitated Exchanges are likely to continue • Plan enrollment is not effective until January 2014 and initial enrollment will run through 2014

3. Federal Structure of the ACA • Individual mandate with penalties, the greater of: • $95 in 2014, $325 in 2015, $695 in 2016, OR • % of household income (1% in 2014, 2% in 2015 and 2.5% in 2016 and beyond) • Exempts individuals below the tax filing threshold and those otherwise eligible for Medicaid expansion • Employer mandate – Penalizes employers with 50 or more workers that do not offer affordable coverage • Companies that fail to offer coverage and have employees receiving subsidies in the exchange must pay $2,000 per employee • Companies that offer coverage but have employees in the exchange must pay $3,000 per employee • Enforcement of penalties delayed until 2015

4. Insurance Market Reforms • Since September 2010: • Bar on pre-existing condition exclusions for children under 19 • Prohibition on coverage rescissions months • Family coverage for dependents up to age 26 • No lifetime limits on coverage • Starting in 2014: • Prohibition on pre-existing condition exclusions • Restrictions to severely limit the use of health status, gender and age in determining premium rates • Requirements for guaranteed issue and guaranteed renewal of coverage in the individual and small group markets • New restrictions on annual and lifetime limits in insurance plans, with greater accountability for “grandfathered” plans (prohibiting caps after 2014 and a requirement for covering preventive services with no cost sharing after 2018) • New restrictions on medical loss ratio (requiring plans to dedicate a fixed % of premium dollars to care) • Greater transparency, accountability and notice requirements for health plans seeking to increase premiums on enrollees

5. Subsidies for Coverage Expansion • Below 138% of FPL (about $14,500 for a single individual in 2013) eligible for Medicaid expansion IF your state elects the option – expansion was made optional by the Supreme Court in 2012 • 17 million Americans meet this criteria, 5.2 million are in states not currently electing to expand Medicaid • Between 138% and 400% of FPL premium tax credits are available (as limit on premium as a % of income) • Cost sharing subsidies available up to 250% of FPL (reduced maximum annual cost sharing limitation)

6. Qualified Health Plans • Qualified Health Plans (QHPs) will be available to individuals and small employers in the Exchange • The Exchange will: • Set standards for QHPs • Certify participating plans, and • Rank plans from bronze to platinum to indicate what level of coverage the plan offers • QHPs must: • Provide “Essential Health Benefits” (EHBs) • Ensure sufficient choice of providers • Be accountable for performance on clinical quality measures and patient satisfaction • Implement a quality improvement strategy • Provide accurate and standardized consumer information • 4 “metal” levels • Bronze – covers 60% of actuarial value of benefits • Silver – covers 70% of actuarial value of benefits • Gold – covers 80% of actuarial value of benefits • Platinum – covers 90% of actuarial value of benefits • Catastrophic – high-deductible plan for individuals up to age 30 or individuals exempted from the mandate to purchase coverage

7. Essential Health Benefits • 10 required benefit categories: ambulatory, emergency, hospitalization, maternity/newborn, mental health and substance use disorder services, prescription drugs, rehabilitative/habilitative, laboratory, preventive/wellness/chronic disease management, pediatric services (including oral and vision) • Separate regulations have been issued for EHB requirements in the Exchanges and Medicaid expansion • States were allowed to select a state “benchmark” standard for EHB from within their current market (Maryland chose CareFirst HMO HSA Open Access) • Major concerns remain with the limited requirements for prescription drug coverage – coverage can be limited to as few as a single drug in each therapeutic class

8. Mental Health Specific Provisions • Parity requirement in state-based exchanges (Section 1311) – all plans offered through exchanges must comply with the Domenici-Wellstone Mental Health Parity and Addiction Equity Act of 2008 • Medicaid 1915(i) plan option – Allows targeting of different benefit packages for targeted populations (e.g., serious mental illness) and specific services (e.g., supported employment, ACT teams, supportive services in housing, transportation, etc.), with no cost neutrality requirement • Medicaid emergency psychiatric demonstration project (Section 2707) – Lifts IMD restrictions for emergency acute care – 13 states selected, including Maryland • Medicaid “medical home” option (Section 2703) – Available through a plan amendment with 90% FMAP (no waiver required) to target care coordination for individuals with: • at least two chronic conditions, or • one chronic condition and risk of another, or • at least one serious mental health condition • currently underway in 15 states

9. Implementation in Maryland • In April 2011, Governor O’Malley signed SB 182/HB 166 establishing the Maryland Health Benefit Exchange (MHBE) – 9 member board announced • In May 2012, SB 372/HB 433 was signed into law, addressing exchange implementation • In August 2012, the Maryland Health Connection was announced – numerous advisory boards have been formed to work on Navigator programs, IT, risk adjustment, etc. • In 2014 & 2015, the Connection will act as a clearinghouse for all Qualified Health Plans (QHPs) • All QHPs must offer at least one Silver and Gold plan

10. Implementation in Maryland • Consumer Assistance and Outreach • Online portal for the Connection • www.marylandhealthconnection.gov • Registration and enrollment through a single web-based portal • MAGI screen (Modified Adjusted Gross Income) • Clearance through the federal “HUB” • Why the first two weeks have been challenging • This week’s budget agreement will tighten rules on income verification

11. Implementation in Maryland • Navigator program for the small group and individual markets • SHOP Exchange for small businesses • Common IT system for the Maryland Health Connection, Medicaid, CHIP

12. Medicaid Expansion in Maryland • Eligibility up to 138% of FPL – about $15,856 for a single adult – no asset test!! • MAGI screen process much simpler than current application and income/asset verification process – continuous eligibility throughout the year • “Medically frail” are to be screened to an enhanced benefit program similar to existing Medicaid • Primary Adult Care (PAC) program ends on December 31, 2013 • 100% FMAP through 2017 and then 90% thereafter • Pre-existing mandatory eligibility categories stay in the “old” Medicaid program • Concerns about a future two-tiered Medicaid program

13. More information • www.healthcare.gov • www.marylandhealthconnection.gov • http://www.nami.org/Template.cfm?Section=Health_Care_Reform