Health Care Reform and Chambers

1. Health Care Reform and Chambers

2. Agenda • PPACA overview: How did we get here? • PPACA impact on Chambers • Key considerations for the evaluation of your program • Opportunities to be a resource to your members • Resources

3. Health Insurance History - Marketplace Premium Prices Soar Average Premium per Year Employer Health Benefits 2011 Summary of Findings, The Kaiser Family Foundation

4. Health Insurance History - Marketplace Percentage of Firms Offering Health Benefits by Firm Size Employer Health Benefits 2011 Summary of Findings, The Kaiser Family Foundation

5. Market Structure Changes • Medical Loss Ratio • Guaranteed issue/renewability • Essential benefits • New fees and taxes • System volume—provider taxes • Cost shift for low wage employees • Getting federal “share” • Premium tax credits • Individual penalty • Max deductibles and out of pockets • Small Business tax credits • Pay or play for 50+ • Grandfathering • Delayed until 2015 • Public federal and state exchanges • SHOP Exchanges

6. What does this mean for your Chamber and the support you provide to your members?

7. Where can you make a difference in small group? • Distribution costs (brokers, marketing) • Premium tax – 1.4% • Profit control • Administrative costs (communication, retention, churn) • Benefit Design • Cost of claims • Wellness

8. Health care reform challenges the viability of today’s chamber programs • Reform requirement to move from experience rating and unique program pool factors to community rating • Requirement that all small businesses within a carrier’s book of business are rated on same factors • Compression of distribution costs to meet new Medical Loss Ratio requirements pressuring margin and marketing expense • Creation of new distribution infrastructure including Health Insurance Exchanges, Navigators and Co-ops • Under 10 life market – potentially large part of chamber member pools – movement to public exchanges and individual market due to subsidies • Long term nature of broker driven business and need for unique delivery of value added support

9. What should you be considering as you think about your Chamber’s role in health insurance?

10. Chambers need to consider the role they want to play among the continuum of options. Continuum of Roles No Role/ Exit Value added Service Provider Navigator Group Purchaser/ Captive Agent Multi Line Brokerage PHIX COOP

11. Market Structure Changes Small Employers (2-100) Individuals Self-Employed Health Insurance Exchange Medical Mutual Anthem Kaiser New Health Care Co-op “National” Plan

12. Being a key part of the distribution channel is also a possibility • Advertising and sponsorship revenue streams on a non-exclusive basis • Endorsement of a particular carrier • Endorsement by or inclusion of the chamber in a private health insurance exchange environment • Beyond health insurance, positioning the chamber to endorse or participate in related distribution opportunities • Insurance as the starting point or potential “loss leader” • Other options pitched as a part of the connection to the employer exploiting the relationship and moving related product to employees • Broker and alliance roles

13. Feeding the strategy machine… What are you providing that is unique and valuable? How does that work relate to your mission? In its best possible, achievable outcome, what will work in this area do to advance the mission? How does the potential business model support or conspire against the needs of your members? How does the work you do stack up against your members expectations? How critical is the impact you can make for your members relative to other alternatives? What resources are required to achieve success and staying power? What alternatives exist for use of resources (staff, money, brand, relationship, goodwill) to advance results for your members? What political implications exist for the role you are considering in your environment? Does advocating for your business model put you in conflict with the goals of your members or your mission? How will your actions impact relationships with key employers, providers, industry players and stakeholders in your community?

14. Ideas for action… Things You Should Definitely do… Things you might consider… Higher risk opportunities for mission or sustainability • Honor and acknowledge the relationship, trust and brand you have with business community decision makers • Education of members • Advocacy / information for legislative process and rulemaking • Research/info gathering on attitudes, behaviors, impact, expectations • Provide advertising opportunities and venues for players looking at market share • Consultative support at the next level for members (calculators, tool sets, technical sessions) • Exchange outreach/ navigator role • Endorsement of insurance provider or ancillary benefit strategies (carrier, exchange, tpa) • Brokering help among members • Exchange operator • COOP or self insurance pools • Deeper involvement in case client health outcomes management • Aggressive support of new market entrants or tests • Government contracts funded by PPACA

15. Three key areas of potential discussion with your leadership • Understand the urgency of your situation – can you afford to “wait and see?” • Understand the practicality of your options – relationships, stakeholders, short term opportunities and long term risks • Look “outside” for ideas but decide based on the unique issues you face “inside” your situation

16. Your Chamber’s “End Game” • Best in the WorldWhat can your chamber be the best in the world at doing in support of your members? • Passionate • What is your organization passionate about? • Resource Engine • What drives the economic engine of your organization? For your chamber, what drives the goodwill of your members? Best in the World Passionate  Resource Engine Framework from Jim Collins, Good to Great and the Social Sectors So, how does health insurance fit for you?

17. How can you be a help your members as they prepare for the implementation of PPACA?

18. Provide information and education • Market reform overview and timeline; COSE GamePlans • Informational web sites; collaboration point • Webinars on aspects of market change • Broker/legal/financial adviser panel presentation • Review sessions/help line staffed by brokers • Calculators and estimators; tax credits, FTE, pay or play

19. Advocate for business • Clarity of rules • Transparency • Access / availability of information • Flexibility for the market to work • Maintain / create incentive for employer action and involvement • Minimize penalty for reaction to business realities • Focus the conversation away from financing mechanisms (insurance) and towards cost and quality among providers and health and wellness

20. Resources • www.cose.org/healthcarereform • COSE Health Care Gameplan • Kaiser Family Foundation (www.kff.org)

21. Questions? • Steve Millard, COSE • 216-592-2436 or smillard@cose.org • Kenn Penn, ChamberSolutions • 757-664-2502 or kpenn@chambersolutions.com