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Immediate Improvements in the Insurance Market for Americans over 50

The Early Retiree Reinsurance Program and the Pre-existing Condition Insurance Plan by Richard Popper, Director of Office of Insurance Programs, Affordable Care Act. Includes access, coverage, and affordability enhancements for Americans aged 50+.

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Immediate Improvements in the Insurance Market for Americans over 50

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  1. Immediate Improvements in the Insurance Market for Americans over 50 The Early Retiree Reinsurance Program and the Pre-existing Condition Insurance Plan January 24, 2011 Richard Popper Director, Office of Insurance Programs

  2. Affordable Care Act Includes Many Advantages for Americans Ages 50+ • Improves access, coverage, and affordability for Americans ages 50+ • Closure of the Part D coverage gap • Coverage of preventive services in Medicare • Prohibition on annual and lifetime limits and pre-existing condition exclusions (by 2014) • Two programs provide immediate support to individuals, employers, and unions • Early Retiree Reinsurance Program • Pre-existing Condition Insurance Plan

  3. ERRP The Early Retiree Reinsurance Program (ERRP) • Provides reimbursement to participating employment-based plans for a portion of the costs of health benefits for early retirees and early retirees’ spouses, surviving spouses, and dependents • Available until 2014, when more comprehensive health insurance reforms take effect • Affordable Care Act allocated $5 billion in program funding

  4. ERRP Eligible Plan Sponsors and Early Retirees

  5. ERRP Approved Sponsors Eligible for 80% Reimbursement of Allowable Costs • Program reimburses 80% of claims costs for each early retiree (or early retiree's spouse, surviving spouse or dependent), for claims incurred for that individual between $15,000 and $90,000 during a plan year, and paid • Sponsors can receive credit/reimbursement toward the cost threshold for claims payments made by the insurer or health plan, as applicable, and by the early retiree and early retiree’s spouse, surviving spouse, or dependent

  6. ERRP Sponsors Must Use Reimbursements to Reduce Plan or Enrollee Costs An ERRP sponsor may use program reimbursements only to: √ reduce the sponsor’s health benefit premiums or health benefit costs; √ reduce health benefit premium contributions, copayments, deductibles, coinsurance, or other out-of-pocket costs for plan participants; or √ reduce any combination of these costs. Sponsors may not  use program reimbursements as general revenue

  7. ERRP Variety of Employers Are Participating in ERRP • Over 6,500 sponsors have submitted applications to ERRP; of these, more than 5,000 have been approved • Plan sponsors include Fortune 500 companies, state and local governments, non-profit organizations, educational institutions, unions, and religious organizations • More information is available at http://www.errp.gov

  8. PCIP Overview of the Pre-Existing Condition Insurance Plan (PCIP) • Provides immediate, comprehensive coverage for individuals with pre-existing conditions until the Health Insurance Exchanges are available in 2014 • Law required establishment within 90 days of enactment • In order to qualify for PCIP, an individual must: • Be a U.S. citizen or residing in the U.S. legally; • Have been uninsured for a minimum of 6 months before applying to PCIP; and • Have a pre-existing condition or have been denied coverage because of a health condition 8

  9. PCIP Offers Comprehensive Benefits… Care in medical offices for treatment of illness or injury Emergency services Inpatient and outpatient hospital services Inpatient and outpatient mental health and substance abuse services Prescription drugs Home health care and hospice services Outpatient laboratory and diagnostic services PCIP

  10. PCIP …and Important Features for Consumers • First-dollar coverage for preventive care • No lifetime maximum on the amount the plan pays for enrollee’s care • Benefits are available immediately when coverage begins, even for pre-existing conditions • The ability to receive benefits at any qualified provider

  11. PCIP 2011 Plan Options and Out-of-Pocket Costs As in commercial coverage, PCIP enrollees pay monthly premiums and deductibles for coverage 11 NOTE: All deductible and copayment amounts are for in-network benefits.

  12. PCIP Where Consumers Can Find More Information • Consumers interested in applying to PCIP may visit http://www.pcip.gov • Under “Select Your State,” consumers should click their state of residence on the interactive map • Each page includes state-specific information • Consumers may also request information by calling 1-866-717-5826 (TTY: 1-866-561-1604) • The Call Center is open from Monday – Friday from 8 am – 11 pm EST 12

  13. Questions and Answers 13

  14. For more information on the Pre-existing Condition Insurance Plan, please visit http://www.pcip.gov Richard Popper richard.popper@hhs.gov Cara Demmerle catherine.demmerle@hhs.gov 14

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