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COBRA Subsidy Extended

HR 3326 was signed into law this week. The bill (actually a DOD bill) provides the following benefits to those going onto COBRA (or currently in their first 9 months of COBRA):

1. Subsidy on federal COBRA will be extended from 9 months to 15 months at 65% paid by the employer (no information yet on Cal-COBRA)

2. Subsidy qualification has been extended to 2/28/2010 and notification is required to anyone who exhausted the 9 months subsidy already (and is still within the 15 month window)

3. Extends unemployment benefits an additional 6 months

CA Healthy Families In Jeopardy Again

There is renewed fear that the state may have to shutter the Healthy Families program and remove hundreds of thousands of California children from the health insurance plan (SCHIP).

Apparently, CMS has "determined" that a special tax extension plan adopted by the CA Legislature and signed into law by Gov. Scharzenegger (a 2.35% tax paid BY health insurers) fails to meet the CMS reading of the rules regarding such taxes.

If resolution is not found before the end of 2010, hundreds of thousands of children in California could be removed from the plan.

Public Option Waning, Now Annual Benefit Caps?

It appears that the public option portion of the health care reform legislation may be coming off of the table soon, if not already. There is talk of replacing it with a private insurance, non-profit version overseen by the government. Also, there is talk of at least a temporary reduction in the Medicare age to 55.

Apparently part of todays' compromise has to do with trying to keep premiums "reasonable". Since the bill would uncap lifetime maximums, the Senate has agreed (behind closed doors again) to allow and implement annual benefit caps on health plans.

California domiciled health plans currently do not impose an annual benefit maximum and PPO plans allow that number to be set at the lifetime maximum benefit of the plan. Only the MRMIP and compatible MRMIP "graduate plans" involve annual maximum benefits, and those are capped at $75,000 per year.

Senate Bill To Allow Benefit Caps

California Healthy Families Back In Business

In the summer I blogged about the closing of new enrollments in the Healthy Families program for children (SCHIP). Recently the program received additional funding and has re-opened to new enrollments. This is very good news for thousands of California families who need this low-cost health insurance coverage for their children. For current information on the California Healthy Families program, follow the link below.

California Healthy Families (SCHIP)

Closer on Healthcare Reform

It looks like we are getting very close to a final version of the Senate reform bill. Broad agreement has been reached on the Senate version, which is very close to the already-passed House version.

CNN Story Dec 8th

Politicians Are Out Of Touch

Business as usual I guess.

In the Boston Globe (8/4), columnist Derrick Z. Jackson notes House Speaker Nancy Pelosi's (D-CA) comments on the insurance industry last week, during which she called them "the villains in" the healthcare reform debate "with their 'exorbitant profits.' She charged, 'they have been immoral all along how they have treated the people that they insure."

Great sound bite and certainly it will get some people's blood boiling. But let's look at some truth here.

In Ms. Pelosi's home state of California, there are currently seven health insurance carriers selling individual & family plans to the public state-wide. They are:

Anthem Blue Cross (formerly Blue Cross of California)
Blue Shield of California
Health Net of California
Aetna
Kaiser Permanente
Assurant Health
PacifiCare (UHC)

Of those seven carriers, four are not California-based carriers (Aetna, Anthem BC, Assurant and PacifiCare/UHC (now owned by UHC))

That leaves 3…

Health Net Sells Northeast Operations

Health Net Inc. has announced that its northeast operations will become part of United Health (UHC) upon regulatory approval. Health Net has stated that they intend to focus exclusively on their western US operations.

Healthy Families Imposes Waiting List

The California SCHIP program, Healthy Families, has now officially added a waiting list for new enrollments going forward into the new fiscal year. Shortfall for the program is $90M in the general fund with a total underfunding of $270M for the childrens health insurance program.

http://www.mrmib.ca.gov/MRMIB/HFP_Wait_List_Effective_7-17-09.pdf

AB 98 Update

Looks like AB 98, the mandatory maternity bill, is being shelved for the remainder of the year. I will be curious to see if it is resurrected in the future.

AB 23 Signed Into Law

California Assembly Bill 23 was signed into law today by Governor Arnold Schwarzenegger.

AB 23 legalizes the continuation subsidy for Cal-COBRA beneficiaries, which is intended to mirror the federal COBRA subsidy.

According to my information, this subsidy is to be provided directly by the health insurance carriers and only the carriers are allowed to take the tax credit to offset the subsidy.

I will blog with more details in the next few days. AB 23 was created and signed into law because the state mini-COBRA law needed a correction to approve the subsidy.

California AB 98 & Individual/Family Health Plans

Happy Thursday! One more day to go then the weekend.

The California legislature is currently working on a new bill, AB 98, which, if passed and signed into law, will make a significant change to California individual health coverage.

The bill would require all individual & family health insurance plans in California, whether registered with the DMHC or the DOI, to contain mandatory maternity benefits. As I interpret the bill, any plan sold in 2010 would have to contain maternity benefits, and any plan sold prior to 2010 would be adjusted to include maternity at plan renewal.

Many Californians currently covered on individual & family plans have chosen plans without maternity benefits to save premium. Maternity benefits on a health plan are assumed at 100% utilization, meaning that all plans with maternity benefits are priced with the expectation that every subscriber will use the benefit. Those who do not need maternity coverage would lose the choice of purchasing a non-matern…

Mini-COBRA Expansion States

Hope everyone is having a great spring. Just wanted to update on the increase in mini-COBRA state continuation coverage programs going on currently.

Last month Viriginia added a state mini-COBRA program which went into effect in early April, 2009. I found out today that Pennsylvania is also finishing legislation to add a mini-COBRA program. Virginia's program runs 9 months to coincide with the subsidy. I expect Pennsylvania to go 9 or 18 months, again with the first 9 being subject to the subsidy.

For those who are not aware, a part of the ARRA legislation requires state mini-COBRA programs to provide the same 65% subsidy to qualified beneficiaries as the federal COBRA program.

In California, we have a program called "Cal-COBRA" which is the state mini-COBRA program with a special feature not found in other states.

Cal-COBRA applies to groups 2-19 employees which fall below the federal COBRA size. Additionally, Cal-COBRA contains an extension of coverage provision under AB 1…

COBRA Subsidy (and Cal-COBRA)

The new COBRA subsidy is getting an enormous amount of press. In brief, individuals & families who qualify for the subsidy (must be involuntarily terminated from employment between September 2008 and December 2009 and meet an income guideline) are eligible to receive 65% of the COBRA premium as a subsidy from the former employer for the first 9 months.

In addition, the same rules will apply to California state mini-COBRA (Cal-COBRA) program as well. The final answer to exactly who will provide this subsidy is still being worked out. It appears most likely that the subsidy will be paid by the health insurance carrier, itself, and not the employer.

In general, state mini-COBRA programs are intended to some degree to replicate federal COBRA for groups which do not fall under the federal COBRA size requirement (20+ full-time employees (part-time to count fractionally) for at least 1/2 of the previous calendar year). In California, Cal-COBRA is the state program of continuation for …