Casper forum will analyze Affordable Care Act

Just the Facts Please

By Barb Rea,
ESPC Health Issues Volunteer

As a member of the Wyoming Health Care Commission and now as a Consumer Representative for the National Association of Insurance Commissioners, I’ve had the opportunity to hear high level presentations and discussions about healthcare reform from people who have devoted their careers to improving the healthcare system for the rest of us. These folks are mighty happy to that we finally have a law in place that addresses the healthcare system as a whole.

Nearly all agree it is not perfect, but gives us a place to start that did not exist before March 23, 2010, the date Congress passed the Affordable Care Act. We'll take an in-depth look at the ACA

While policy makers have known for decades that health reform was essential to the economic stability of the country it has been a long and difficult battle to get healthcare reform to the front burner. It’s hard to keep it there.

Admittedly, there is a lot of information for busy people and citizen legislators to learn, but it’s not impossible and there is a lot at stake. Sometimes I think Wyoming people and especially their policy-makers assume that we are so different from the rest of the country that what happens in Washington, D.C. won’t really change anything we do here. But in this case, we would be missing an opportunity to fix some Wyoming problems.

I have a friend who was told by the State Employees’ health insurance carrier, Great West, that the back surgery her doctor told her she needs is medically unnecessary. I also remember in the paper last year a couple was protesting in front of Blue Cross Blue Shield because the cancer drug that their doctor said the husband needed to keep him alive wasn’t in their formulary.

In both cases, there is no amount of consumer research that could have changed these stories. I’m sure they were never even given a chance to make a choice about what their insurance covered or didn’t cover. No one knows what kind of illness they may get and no one really knows the details of what their policy covers until they need it.

On the other hand, if providers are getting away with performing unnecessary surgeries or prescribing expensive new medicine that works no better than the previous version, we want to know that.

Our system should be more transparent, we should know that our providers are practicing evidence based medicine that works and that insurance will pay for the care we need. But in these cases, the patients and their families are suffering not only from their disease process but unnecessarily from a broken healthcare system.

Will health reform solve these problems and many others? Not without constant attention.

An educated public can:

• help move the discussion from one that polarizes and paralyses to one that solves real problems;
• help policy makers remain focused on the ultimate goal of health reform—security for our friends and neighbors in the form of guaranteed access to high quality affordable healthcare.
  

People shouldn’t have to worry that they will lose their healthcare if they get sick or change jobs. Insurance should work, there shouldn’t be any surprises. It should pay for the right care at the right time and it should protect us from bankruptcy.

September conference offers facts on ACA
Several agencies and organizations have come together as One Health Voice to provide a forum where people can hear directly from policy experts about why we need health reform and learn about what the Affordable Care Act can do to begin to transform our healthcare system.

Please join us on Tuesday, Sept. 13, 2011 in Casper for a one day symposium about healthcare reform and the Affordable Care Act, the new healthcare law.

T.R Reid, best- selling author of “The Healing of America, A Global Quest for Better, Cheaper and Fairer Health Care, will keynote the event.

Policy experts from the U.S. Health and Human Services Department, Consumers Union, the Colorado Center on Law and Policy and from Governor Mead’s office will provide overviews of the law, what role states will play in achieving the results they want and what consumers should expect in a reformed health care system.

The conference is open to everyone.

You can register on line at www.OneHealthVoice.com or contact LRosedahl@pubaffairsco.com.

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One Health Voice includes the Equality State Policy Center and these allies: AARP, American Cancer Society Cancer Action Network, Children’s Action Alliance, Consumer Advocates:Project Healthcare, Department of Family Services-Adult Protection Services, National Multiple Sclerosis Society, CO-WY Chapter, Wyoming Center for Nursing and Healthcare Partnerships, Wyoming Epilepsy Association, Wyoming Health Care Access Network/PhRMA, Wyoming Hospital Association, Wyoming Primary Care Association.

Wyo’s “Healthy Frontiers” pilot program will never replace Medicaid

By Sarah Gorin
ESPC health policy volunteer

Many Wyoming legislators derisively refer to the Patient Protection and Affordable Care Act (the federal health reforms) as “Obamacare.” This would be a humorous addition to the political debate if these same legislators had an alternative proposal, but at the moment the alternative appears to be “No Care.”

Much has been made of Wyoming’s pilot health care reform program, “Healthy Frontiers.” The program was initially funded by the 2010 Legislature, enrolled its first participants at the end of 2010, and received additional funding from the 2011 Legislature to expand to 200 participants.

Currently, Healthy Frontiers has enrolled just under 20 participants from the targeted pool – individuals participating in state job training programs, whose incomes are under 250% of the federal poverty level, and who live in Cheyenne or Casper (where selected medical providers have agreed to begin implementing the program).

Healthy Frontiers is a health care plan. It is important to understand that it is not health insurance. Healthy Frontiers emphasizes primary care and chronic disease management, with the goal of reducing medical costs over time by taking care of conditions before they develop into expensive crises. This logical approach is being implemented in many model programs across the country, and the ESPC has no quarrel with it.

But Healthy Frontiers also requires participants to pay into to a “personal health account” (not a health savings account for tax purposes), based on income. The ESPC has maintained from the beginning that the required contribution is unrealistically high, based on Wyoming’s Family Economic Self-Sufficiency Standard, which shows the incomes needed to support basic household expenses on a county-by-county basis.

The state also contributes to the personal health account as the client meets certain milestones in the program, such as establishing a relationship with a primary care provider and maintaining compliance with treatment regimens.

Further, the ESPC’s analysis shows that although program proponents hold out Healthy Frontiers as a cheaper alternative to Medicaid, it easily could cost the state more if fully implemented.

The rhetoric from some legislators and Governor Matt Mead about Healthy Frontiers is seriously overblown given the current status of the program. With only a handful of participants to date, and zero data on the workability of the financial requirements or on clinical outcomes, it is wildly premature to talk about this extraordinarily modest program as a substitute for anything.

The problem with the program is a microcosm of the larger health care issue. Americans have made a commitment to providing care to everyone, to not let their neighbors die in the street. But we haven’t yet figured out how to pay for that commitment.

The Affordable Care Act is the first step in that direction, trying to get everyone covered with public or private health insurance so they can pay for their care.

Healthy Frontiers clients earn a painfully low income. Since Healthy Frontiers is not health insurance, if its clients need care above and beyond what is provided by the program, the cost of that care will fall – unpaid – on Wyoming’s hospitals and private providers.

By contrast, Medicaid actually is insurance and pays providers for clients’ care. If you were a health care provider in Wyoming, which program would you like to see behind the consumers coming through the door?

Wyoming’s lawmakers need to lay aside political agendas and focus on solutions that will help our residents access quality health care when they need it and keep our state’s hospitals and providers solvent.

State insurance commissioners meet in Texas

Brokers: the first casualty of the ACA?

Consumers reps fear NAIC will undercut health care reform

By Barb Rea
ESPC healthcare advocate

In 1993, American insurance companies were spending 93% of insurance premium revenue on health care claims. This percentage has been steadily eroding and now some companies spend only 50% of premium revenue on healthcare. The rest goes into administrative costs (which include paying fees to salesmen called brokers) and profits.

This calculation is called the Medical Loss Ratio. It is interesting for consumers to note that companies consider what they spend on health care to be a loss.

To encourage companies to work more efficiently, more transparently and to provide more value in their products, one of the new provisions in the Affordable Care Act requires insurance companies to spend 80% (85% in large group markets) of premium revenues on health care and less on profits. If they fail to meet these guidelines, insurers will have to pay a rebate to their customers.

The National Association of Insurance Commissioners (NAIC) was in charge of figuring out how to calculate and monitor the MLR and last October, after seven months of very transparent work, the commissioners passed the details of how this regulation would work.

At the October meeting of the NAIC, the insurance industry came in at the last minute with requests for changes that would have effectively meant insurance companies could operate at a 63% MLR. The commissioners, who are clearly proud of their rigorous methods, stuck to the intention of the law and dismissed those last minute amendments – to the great benefit of consumers.

The NAIC is meeting again this weekend in Austin, Texas. A few days before the meeting, consumer representatives learned that brokers, those agents who help sell and service insurance policies on a commission basis, were requesting a vote from the NAIC that would endorse HR 1206, the Access to Professional Health Insurance Advisors Act of 2011. The bill would remove brokers’ fees from the Medical Loss Ratio calculation entirely.

The brokers contend that insurance companies will start paying them less in order to meet the MLR rules. This may or may not be true. We don’t know because these fees have always been invisible to consumers and to many regulators, too. There is very little data to determine how much brokers are being paid or how much impact this will really have on the market.

One thing is certain though, brokers’ fees were clearly on the administrative side of the MLR equation when the benchmarks were established. The solution to just eliminate fees from the equation altogether would effectively undo the intention of the law.

According to Prof. Timothy Jost, one of the NAIC Consumer Representatives, "This bill would effectively end the MLR as a tool for reducing insurer costs, would increase premiums by whatever brokers chose to charge, and would transfer a billion or more in rebates from consumers to producers(brokers)."

All sides of the healthcare reform debate agree that one of the major goals of the ACA is to bend the cost curve ---that can only mean that at some point, some people who are making money from the current system will make less.

By 2014, buying insurance will be much easier as other provisions in the ACA standardize insurance language and benefit packages so people can make apples to apples comparison when they shop for a new policy.

We will never achieve the real goals of reform if every time some stakeholder is going to lose money, they can simply write a bill to eliminate that part of the ACA. Brokers may be the first casualty of the effort to cut health care costs.

The MLR went into effect January 1, 2011. Insurers are submitting additional forms to their commissioners which will make all these numbers transparent for the first time. We will have ample information to see which companies and which states are having trouble meeting the MLR and where brokers’ livelihoods are indeed threatened. In the meantime, there is already a waiver process available to states that can demonstrate market instability. We don’t need a sweeping solution at this time.

Consumer representatives are asking that commissioners slow down, analyze the data and address these concerns on a state-by-state basis instead of hacking away at important consumer protections that can help reduce costs in the long run.

Equality in the Equality State

House may not bring up anti-equality amendment
Medicaid studies backed by House Labor, Health committee

By Sarah Gorin
ESPC researcher and lobbyist

The House leadership reportedly is considering the option of not bringing up SJ5 - Defense of marriage – constitutional amendment, for debate. SJ 5 proposes amending the Wyoming Constitution to say that only a marriage between a man and a woman is valid or recognized in Wyoming.

A proposed constitutional amendment requires a two-thirds vote, and apparently proponents do not have close to the 40 votes required to get the measure through the 60-member House. A debate will take hours, hours that will kill other bills waiting to be heard, and could well be futile if the votes are not there.

There are reports that the House leadership also does not want to add to the state’s fame on national television:

YouTube - Rachel Maddow- Wyoming anti-abortion bill advances

The House already has approved HB 74 – Validity of marriage, which recognizes marriage as a contract only between a male person and a female person, and not involving more than two parties. The bill also prohibits recognition of marriages or civil unions contracted in another state, if the relationship does not meet the above criteria.

HB 74 is awaiting debate in the Senate. We encourage readers to contact their Senators. Send a gentle, polite email message outlining your reasons for opposing the bill. The legislature’s Hotline enables you to leave a message asking your senator to vote no on HB 74. Be sure to leave your name and a telephone number for the senator to call you back should he or she be so inclined.

Health care still chronically ill …

ON Friday, the House Labor, Health and Social Services Committee heard and approved two bills relating to the Medicaid expansion contemplated by the federal Affordable Care Act (ACA).

Medicaid currently provides health care coverage for people in four categories, all low-income: the aged, blind and disabled; children; pregnant women; and caretaker adults. Under the ACA, Medicaid will be expanded to include everyone with incomes under 133% of the federal poverty level.

Those who already have insurance will be able to keep it. Everyone else with incomes above 133% of poverty will have the opportunity to purchase private health care coverage under state health insurance exchanges, which are supposed to provide transparency for the consumer. The federal government will provide subsidies to help pay premiums to those with incomes up to 400% of the federal poverty level.

The two bills considered and approved by the committee today look at two different aspects of the Medicaid expansion. SF 50 - Medicaid options study, will examine alternatives to Medicaid – e.g., can it be provided more cheaply in a different format?

SF 102 - Medicaid cost study, will look at the costs of the Medicaid expansion in its current form.

The committee discussion revealed a great deal of misinformation about the ACA, along with a fair amount of hostility. This seems to be spawned, at least in part, by frustration with the current Medicaid program, where costs continue to rise just like other health care costs.

The dense interconnectedness of health care costs will require some sustained attention from legislators. For example, Medicaid is undeniably a substantial source of funding to our state’s health institutions, nursing homes, county hospitals, pharmacies, and private medical providers.

While this is not justification for simply throwing money at all these entities, any significant reduction in Medicaid spending will adversely affect them and consequently the availability of medical care to Wyoming residents.

The Equality State Policy Center is a member of Consumer Advocates: Project Healthcare (CAPH), which is working to educate the public and decision-makers about the ACA and other health care proposals from the consumers’ point of view.

On February 22, CAPH will host an informational meeting for any and all interested parties about the new federal insurance pool for people with pre-existing conditions who have not been able to obtain coverage. Premiums for the Pre-existing Conditions Insurance Pool (PCIP) are significantly less than those for the state’s high-risk pool.

The meeting will be held from 1:30 p.m. to 3:30 p.m. at the Laramie County Public Library in Cheyenne.

Participate
Citizens can register their opinions on specific legislation by using the “Online Hotline” or the telephone Hotline – 1-866-966-8683 or, in Cheyenne, 777-8683.

Discriminating against gays and lesbians

Gay marriage amendment squeaks through Senate

“The people of Wyoming want to vote on this,” Sen. Curt Meier asserted Thursday as he called for the Senate to endorse his bill putting a proposed constitutional amendment voiding the marriage contracts of same-sex couples living in or traveling through Wyoming.

The amendment, proposed to Article 1, Section 38 of the Wyoming Constitution would state:

“Only a marriage between a man and a woman is valid or recognized in Wyoming. The legislature may define the benefits and obligations of marriage which may be different than the benefits and obligations afforded to all other civil relationships.”

Approval of the resolution, SF5 -Defense of marriage - constitutional amendment, required a two-thirds vote from the Senate, and it got just that, passing on the slimmest margin of 20-10.

Sen. Cale Case (R-SD25, Lander) termed the decision to amend Article 1 of the state constitution the “greatest irony of all” because it is the document’s “Declaration of Rights.” Section 2 of Article 1 states, “Equality of all. In their inherent right to the pursuit of life, liberty and happiness, all members of the human race are equal.” (Bold face type in original)

“You’re going to take this beautiful list and you’re going to deny rights in this same section” of the constitution, Case said.

Sen. Drew Perkins (R-SD29, Casper) countered that voting for the proposed amendment merely gives the citizens of Wyoming the right to vote on the idea. “This isn’t the law,” he said, and noted that opponents did not trust the same neighbors they rely on to sit on juries to address the idea of further limiting the rights of gay and lesbian couples.

“It either passes or it fails,” he said. “It’s not our decision.”

But Sen. Chris Rothfuss (D-SD9, Laramie) said those defending their votes as merely giving the public a chance to vote were denying the Senate’s essential role as defined by the people who wrote the state constitution. The founders put in a requirement of a two-thirds vote to place amendments before the voters as a first check to prevent “the opportunity for the majority to overwhelm” the rights of the minority.

He said senators could easily think of many policies that the majority of voters would favor at the expense of various minorities and pass them. A church could be singled out for discrimination. But he noted doing so “… won’t be right and it won’t be equitable.”
He said senators should vote yes or no because they favor the intent of the amendment, not to somehow empower the public at large. “You’re on the hot seat.”

Sen. Meier closed the debate saying, “This is a vote on public policy.”

Here’s how the vote is reported on the bill digest:
Ayes: Senator(s) Anderson, Barnard, Bebout, Coe, Cooper, Dockstader, Driskill, Emerich, Geis, Hicks, Hines, Jennings, Johnson, Landen, Meier, Nutting, Perkins, Peterson, Ross and Scott.

Nays: Senator(s) Burns, Case, Christensen, Esquibel, F., Hastert, Martin, Nicholas P, Rothfuss, Schiffer and Von Flatern.

Ayes 20 Nays 10

The proposed amendment now goes to the House where opponents believe they have a chance of preventing it receiving the 40 votes needed for final passage.


Health litigation fund whacked

The House Appropriations Committee Thursday morning cut the appropriation for a special fund to finance state litigation that proponents say will enable the state to “push back” against the Affordable Care Act, the major health care reform bill passed by Congress last year.

The Joint Interim Labor, Health and Social Services Committee approved the HB 39 - Health litigation fund with a $2 million appropriation. That’s down from the $10 million - $20 million interim Chairmen Sen. Charles Scott (R-SD30, Casper) and now-retired Rep. Jack Landon of Sheridan originally considered necessary, House Labor Chairman Elaine Harvey (R-HD26, Lovell) told the committee.

“We need the ability to fight it. We need the ability to fight back,” Harvey said of the implementation of the new federal law.

Chris Boswell, the new head of the Department of Administration and Information, told the committee the fund would be used to develop the expertise necessary to implement the ACA. “This has to do with where Wyoming wants to take this,” Boswell said of the ACA.

The ESPC has opposed the litigation fund, arguing the money could be put to better use helping to fund the education of the doctors, dentists, and other health care providers the state needs. The bill calls for state involvement in lawsuits against the ACA brought by private citizens under certain circumstances. The ESPC believes state involvement in private lawsuits is poor public policy.

But the discussion that the fund could be used to develop state expertise that might aid in implementation of the act (or in litigating against it) was a new tack by proponents.

The committee decided to cut the appropriation by 75 percent to $500,000. That size of fund is similar to other state funds set up to represent state issues in water disputes and natural resources litigation.

The bill now goes to the House floor.

Participate
Citizens can register their opinions on specific legislation by using the “Online Hotline” or the telephone Hotline – 1-866-966-8683 or, in Cheyenne, 777-8683.

A day at the legislative races

Arizona copy cat bill fails

Minerals committee refuses to move ALEC-motivated measure


In a session dominated by discriminatory legislation, justice advocates registered a significant victory Monday when the House Minerals Committee refused to put a troubling immigration bill up for discussion.

Members of the House Minerals, Business and Economic Development Committee killed a bill modeled after Arizona’s controversial SB1070 by simply refusing even to offer a motion for passage. There was significant Establishment opposition to the bill, House Bill 94 – Illegal Immigration, including from the Wyoming Lodging and Restaurant Lodging Association.

The ESPC and its allies believed the bill would lead to racial profiling, split up families that include documented and undocumented people living in the state, would hamper police, who would have to devote resources to enforcing federal immigration law, and could spawn national protests that would adversely affect Wyoming’s tourism industry.

The bill was modeled closely on Arizona's SB1070. Reports by National Public Radio last fall tied the bill to the American Legislative Exchange Congress (ALEC) and the private prison industry in the U.S.

Chesie Lee, the lobbyist for ESPC-member group the Wyoming Association of Churches celebrated the victory with this message:

“Good News! ... After a lengthy hearing before the House Minerals Committee with many raising significant problems with HB 94 for Wyoming from diverse points of view, no one on the House Minerals Committee was willing to move the bill, so it died in committee being indefinitely postponed following some discussion.
“I believe the voice of the Wyoming Association of Churches on this issue was good and made a difference. … The room was packed with many having to stand in the hallway. Only a couple other than sponsors spoke in favor of the bill, but no one representing any organization spoke for it.”

Lee notes that some students plan a rally for 11:30 am on Thursday at the State Capitol to celebrate.
This is a great victory, especially considering the socially conservative tenor of this legislature. We all winced Monday when House Bill 74 – Validity of Marriage passed the House. The measure makes gay and lesbian marriage illegal in Wyoming, including existing marriages made legally in other states.

Advocates managed to narrow the number of representatives who favored the measure in earlier votes, but in the end fell still needed to swing three more legislators when the House voted 32-27 to pass the bill. (House Minority Leader Patrick Goggles was excused from the vote. Goggles is working his way through some significant family matters.)

Meanwhile, the House Judiciary Committee killed one of three bills aimed at refining Wyoming’s Open Meetings and Public Records laws. The committee amended but approved a bill, House Bill 120 – Public meetings, requiring public entities to inform interested media outlets and others 24 hours in advance of special meetings. Those entities, such as city councils, boards, commissions, and conservation districts, still could schedule emergency meetings without the 24-hour notice when circumstances demand immediate action.

A provision that would have required audio recordings of all executive sessions held by public boards and entities was stripped from the bill via an amendment proposed by Rep. Bob Nicholas (R-HD 8, Cheyenne). Supporters, including the Wyoming Coalition for Open Government, the Wyoming Press Association, the League of Women Voters, and the ESPC hope to see that provision restored.

Reps. Sam Krone (R-HD24, Cody) joined Rep. Nicholas in voting against the measure.

The Judiciary Committee also approved HB 121, which seeks to impose a deadline, initially within three days, to ensure fulfillment of a request for public documents. Opposition from the Wyoming Association of Municipalities and the Wyoming County Commissioners Association led the committee to adopt an amendment aimed at giving a public board or agency more time to respond to complicated requests or requests for voluminous amounts of material.

The proponents had hoped to limit severely the ability of public agencies to charge exorbitant amounts for producing and providing copies of public documents, noting that taxpayers already pay for the initial creation of the documents.

Again, agencies opposing the measure convinced the committee they need the ability to recover costs of obeying state public records law intended to assure public access to government records. The committee stripped out a clause prohibiting charging labor costs associated with producing a public document. They also successfully amended the bill to allow agencies to charge for the costs of redacting information from documents that could jeopardize a police investigation or expose other information that is entitled to protection.

Proponents said such charges represent a “hidden tax” on members of the public.

Meanwhile, the committee killed HB119 – Public records and meetings – court proceedings. Committee member objected to provisions that made challenges of denial of access to meetings and public records the top priority in Wyoming courts. Supporters said the priority designation was essential to ensuring timely access to information essential to the public as it considers public policy decision-making by its elected and appointed leaders.

Quicker hits

Marriage law: The House Labor, Health and Social Service Committee narrowly defeated HB65 - Marital counseling and approved HB39 – Health Litigation Fund. The first bill would have required couples seeking to get married or divorced to get three hours of counseling before a marriage license or a divorce could be obtained.

Suing the feds: The ESPC opposed HB 39, which appropriates $2 million to support litigation to challenge the new federal health care reform law, suggested the funds could be better spent to train doctors, dentists, physicians assistants and/or other providers who deliver care in Wyoming communities that lack practitioners.

Chairman Elaine Harvey (HD26, Lovell) said the funding will support state efforts to challenge what many see as the federal government acting unconstitutionally and usurping states rights. The litigation fund will demonstrate to the federal government that “we’re … prepared to do what we need to do to push back on this legislation.”

Rep. Frank Peasley (HD3, Douglas) reiterated the states rights argument. “Our pushback has more to do with general states rights. If they can do this to us,” he said of the Affordable Care Act, “they can do anything to us.” Peasley conceded Rep. Keith Gingery’s point that potential travel costs laid out in the bill are exorbitant if the state simply intends to file friend-of-the-court briefs as it joins lawsuits conducted by other states against the new law.

Reps. Gerald Gay (HD36, Casper), Matt Greene (R-HD45, Laramie), Hans Hunt (HD2, Newcastle), David Miller (HD55, Riverton) joined Peasley and Harvey in supporting the bill.

Reps. Craft, Barbuto and Gingery opposed the measure, which passed on a 6-3 vote.

Campaign finance: The Senate on Monday defeated on a 15-15 tie vote an effort to strip disclosure amendments made to Senate File 3 – Campaign Finance – organizations. This is the bill that will change state law to comply with the U.S. Supreme Court decision in Citizens United v. FEC, which allows corporations to funnel unlimited amounts of money into independent expenditure campaigns to support or oppose candidates for election. The measure ultimately won final passage by the Senate on a 28-2 vote.

The Insurance Industry and the Affordable Care Act:

What consumers need to know

By Barb Rea
ESPC health issues volunteer

The insurance industry poured $80 million into lobbying what is now known as the Affordable Care Act (ACA), the nation’s new health care law. The industry succeeded in reaching its main objectives, killing the public option and ensuring the inclusion of an insurance mandate—a requirement that people buy health care—that will bring them millions of new customers.

Many healthcare policy analysts believe that efforts to repeal the ACA will not be successful because the powerful insurance industry wants the provision that will tax people who fail to buy insurance to remain intact.

In exchange for the mandate that will bring the industry tens of millions of new customers, the industry agreed to comply with new rules and regulations. The new rules and regs will profoundly affect the way the companies compete, and will at the same time provide new security for millions of Americans. The industry is now spending millions of our premium dollars to influence the people in charge of writing the new rules and regulations.

Instead of fighting for repeal of the law, our representatives both in Congress and the Wyoming Legislature should be working to ensure Wyoming has a way to enforce compliance with these new consumer protections.

This is especially important in Wyoming, where representatives of the insurance industry are the default experts on all insurance questions. We have very little experience with or expertise in insurance regulation—the state has, for example, no authority to review rates unless it declares a particular insurance market is not competitive.

And the state declined to apply for $1 million in federal grant money that the ACA made available to all states to help them beef up their insurance oversight. Wyoming Blue Cross/Blue Shield currently operates with an excessive surplus, one of the highest in the nation, and continues to file for rate hikes, which our Insurance Commissioner has no authority to deny.

Wendell Potter, a former public relations executive for Cigna, one of the largest insurance companies in the U.S., reveals in his new book, Deadly Spin, how the industry works systematically to increase profits at the expense of consumers and pours millions of dollars into PR campaigns created to spread disinformation.

Mr. Potter resigned after he began to see that his industry was contributing daily to the growing numbers of un- and underinsured. The industry was part of the problem—and its promise to support health reform efforts under President Obama was disingenuous.

He explains the relationship between health care and how the industry works to maintain its profit margin. Currently, insurance companies compete on risk selection-- companies (for-profit and non-profit alike[1]) try, in a variety of ways, to select healthy customers and dump sick ones to avoid having to pay claims.

These are some of the tactics:

• denying people coverage or charging them more because of some pre-existing health condition;
• excluding or limiting coverage of certain conditions;
• “rescinding”— canceling—a policy when a person gets sick;
  
• more subtle tricks like discontinuing coverage of certain medications or changing the amount the customer must pay for them; and
• changing the network of providers available to the customer to exclude certain types of specialists —or maybe your specialist.

From the consumer’s perspective these tactics are genuine “gotchas,”and we have come to assume that this is just the way the business works. Few of us anywhere in the nation file complaints. The process is very intimidating, and those who do file are rarely able to overturn the insurance company’s decision.[2]

The new federal healthcare law addresses these problems and establishes new rules to eliminate “gotchas.” The ACA is designed to move the industry from one that competes on risk selection to one that competes on risk management.

Many of these rules have already gone into effect. Insurers, for example, can no longer cancel a policy if a person gets sick, or deny coverage to children with preexisting conditions. [3]

Starting this year, thanks to the ACA, we will be able to see what proportion of our premiums is used to pay for medical care and what proportion goes into marketing, other overhead—and profit. If companies don’t spend 80 to 85% of our premiums on our claims, they will have to pay us a rebate.

If the new law drives insurers who are taking a larger bite out of our premiums out of business, they shouldn’t be missed. That will be a good thing for consumers. These companies now are collecting premiums without paying claims. And insurance customers, under the new law, are guaranteed the right to an external appeal if companies fail to pay as promised.

The law also allows for the establishment of a set of “essential benefits” so all insurance companies have to cover the same set of benefits, making policies easier to compare and spreading the risk of the total cost of health care in our state across as many people as possible.

This is important in Wyoming, because the federal guidelines for establishing these benefits are broadly defined and states will have the authority to make consumer protections stronger if they want to. We could make Wyoming citizens much safer by making these standards as broad as possible. We could guarantee that patients in Wyoming will never be put in a situation where the doctor tells them they need something but their insurance doesn’t cover it.

With the establishment of insurance exchanges in 2014, insurers will have to begin to compete by adding value to their products, like providing great customer service, or patient education, or by offering coverage for popular elective procedures over and above the essential benefit package.

The mandate to buy insurance is the key to spreading the risk. Without a mandate the likelihood is greater that people would only buy insurance when they got sick.

The ACA puts us on the path to near total coverage in several different ways:

1. Most people in Wyoming will continue to get their health insurance through their employer.
2. Forty thousand will find coverage through the new insurance exchange where people and small business can shop for insurance. This coverage will be made more affordable with the application of federal subsidies for anyone making less than 400% of Federal Poverty Level (approx. $80,000 for a family of 4).
3. Thirty thousand will become eligible for Medicaid, a public insurance program, with the federal government picking up most of the tab and at a cost savings to the state, according to a report prepared for the Wyoming Department of Health.

Most of us agree that the system is broken but many do not understand how the federal law can help us create a Wyoming solution. Insurance should pay for what is medically necessary and people should easily be able to predict how much they will have to pay out of pocket for premiums, deductibles and co-pays.

But if we are unwilling to regulate this industry at the state level we should let the federal government do it for us.

Wyoming has made many attempts at state-wide health care reform over the last 25 years but has never had the political will to do all that is necessary. We need the federal framework provided by the ACA to achieve real reform, and we need to be wary of allowing industry representatives to do the job for us.

A Wyoming solution has to be a real solution to the failure of our health care system to meet the health care needs of all our citizens, not perpetuate the practices that got us here.

[1]“…Blue Cross Blue Shield of Wyoming had only one hundred thousand members in 2007, but CEO Timothy Crilly collected a salary of $471,000, or $4.71 per member, the highest per capita rate in the nation.” Potter, Deadly Spin.
[2] Assessing State External Review Programs and the Effect on Pending Federal Patient s Rights Legislation. Pollitz, Lucia, Bangit. Kaiser Family Foundation, May 2002.
[3] This rule hasn’t stopped the industry from gaming the system for children as many plans stopped offering child only policies. “How States Are Making Sure Coverage is Available to Children. Families USA, 2010.

Barb Rea, pictured above, serves as a consumer representative to the National Association of Insurance Commissioners.

Speaking of the Affordable Care Act ...

House Labor rehabilitates HB 35

The House Labor, Health and Social Services Committee worked hard – and late – on a nullification act that challenges the Affordable Care Act. It is sponsored by Rep. Bob Brechtel R-HD38, Casper) and a dozen other legislators, at least a few of them itching to prove their anti-federalism credentials.

House Bill 35 – Health care choice and protection act proclaims the ACA unconstitutional and thus null and void in Wyoming. As drafted, the bill imposed a $5,000 fine and a felony conviction on any state employee, official, or public servant found to be enforcing the ACA.

But the sponsors ran into a storm of criticism from a wide variety of interest groups. Wyoming Public Employees Association lobbyist Bob Kuchera expressed worries that the bill puts state employees at risk of committing a felony if they simply went about their work of implementing the new federal law.

Sheila Bush of the Wyoming Medical Society said her members are divided in their opinion of the ACA. Nevertheless, she noted that some doctors in the state are making significant investments in health information technology with the assistance of incentives in the ACA.

“What does it say to our providers … if we say they are breaking the law by doing so?” Bush asked.

Lobbyist Tom Jones of the Wyoming Health Care Association said he believed the bill as proposed could make it legal for a Wyoming resident to refuse to pay taxes that fund Medicaid. And he said the legislative assertion in the bill that the ACA is unconstitutional is meaningless. He noted the Supreme Court reserved the right to rule on the constitutionality of all laws in the early 19th century.

The legislature’s opinion of the ACA “ … doesn’t matter in the end,” Jones said.

Lobbyists for the American Heart Association and the American Cancer Society noted the ACA brings many health benefits to people. Jason Mincer of the ACS asked, “What is (HB35)’s intent toward cancer survivors?”

Proponents said the act mirrored the Firearms Freedom Act approved last year. Rep. Keith Gingery, (R-HD 23, Jackson) pushed the committee to amend the bill to more closely mirror that bill. He offered successful amendments to change the felony crime to a misdemeanor carrying a $2,000 fine and made a number of other significant changes.

Rep. Frank Peasley (R-HD 3, Douglas) called the objections to the bill, especially fears of prosecution, “a lot of hooey.”

“We need to make a stand or we don’t make a stand,” he said. When it became clear there was no consensus on the committee over the meaning of some of its sections, Peasley later commented, “I guess we have to pass this bill before we know what’s in it.”

That remark sparked a few guffaws in the committee room and a retort from Chairman Elaine Harvey, who said Congress passes bills it does not understand, not the Wyoming legislature.

“I read this bill as the state is not going to go out and participate,” co-sponsor Rep. Lorraine Quarberg, (R-HD28, Thermopolis) said, and would refuse to allow state employees to enforce the bill. She argued that it does not say doctors cannot take grant money available because of the ACA without committing a crime.

That comment prompted Harvey (R-HD26, Lovell) to note that the state also cannot stop the IRS from impounding property to enforce the IRS code. Quarberg replied that the state needs to stand up to the federal government.

“This is a gutsy move,” replied Quarberg. “You dig down deep.”

Gingery pushed his amendments through, including one that pared down the list of those specifically in position to be accused of a felony. He trimmed wording that said “Any official, agent, employee or public servant of the state of Wyoming” would be found guilty of a felony if they attempted to enforce compliance with “this article.”

As the bill left the committee it said simply “Any public servant” who tried to enforce compliance with the ACA as defined in HB35 would be guilty of a misdemeanor.

Though he took some heat, Peasley may be right that at least some of the committee members did not understand the effect of what they did until they review the amendment on the House floor.

The bill was narrowly approved on a 5-4 vote. Rep Gerald Gay (R-HD36, Casper), Rep. Matt Green (R-HD45, Laramie) and Rep. Hans Hunt (R-HD2, Newcastle) joined Peasley and Gingery in supporting the bill.

Rep. Joe Barbuto (D-HD48, Green River), Rep. Bernadine Craft (D-HD17, Rock Springs), and Rep. David Miller (R-HD55, Riverton), joined Harvey in opposing the bill.

Quick notes on Wednesday action on bills of interest –

Senate File 3 – Campaign finance – organizations was approved in the Senate’s Committee of the Whole with a disclosure amendment that will require corporations and other organizations engaging in independent expenditure campaigns to name their top three donors in the advertisements they buy. The Senate seemed a little uneasy about how it will work, so we’re watching for amendments that might ease disclosure needed to keep elections honest.

Senate File 14 – Counties – election districts likewise made it through first reading. We still have fears that the “flexibility” in the bill allows counties to establish a combination of at-large and single-member districts is subject to mischief. At worst, in counties with a substantial minority population, it could lead to a “political quarantine” of the minority group. Sen. Wayne Johnson, R-SD 6, Cheyenne, mentioned similar concerns in comments on the floor.

Health Care Freedom resolutions – The legislature is determined to send a message to Washington, D.C. and the rest of the country that it intends to resist the Affordable Care Act passed by Congress last year. The Senate Judiciary Committee approved a heavily amended version of SJ 2 which would place a constitutional amendment on the 2012 ballot that asserts the federal government has never been granted the power to make decisions regarding lawful healthcare services. That power is reserved to the state of Wyoming and its people, the amended version says. It says the attorney general may assist any state resident in litigation to protect the right to make those decisions. The committee included several sections lifted from SJ 3, a similar but less strident proposal. Those sections denote the Legislature’s intention to continue its own authority to mandate care under Workers’ Compensation, at the state’s prisons, and at other institutions.

Contract validity?

The Senate Judiciary Committee heard more than an hour of testimony on SJF 5 – Defense of Marriage – constitutional amendment. Proponents argued the amendment is necessary to somehow protect the institution of marriage from gays, lesbians, and transgendered people. Opponents said they’re merely seeking the same legal protections that society extends to heterosexual couples.

Jason Marsden of the Matthew Shepard Foundation said the proposal will void valid existing contracts, something the Legislature simply would not allow to happen to existing business contracts.

House Education panel passes DOMA bill

Back of the bus for Equality State gays

The House Education Committee Monday night approved a bill that would clear the way for Wyoming to deny the validity of same-sex marriages legally made in other states or countries.

The committee voted 7-2 to send the bill to the House floor with a do-pass recommendation after opponents of the measure noted the irony of approving legislation limiting the legal rights of the state's gay residents on Martin Luther King Wyoming Equality Day.

Earlier in the day Gov. Matt Mead had addressed celebrants who honored Dr. King's memory by marching to the Capitol at noon.

“In his acceptance speech for the Nobel Peace Prize, King spoke of his audacious belief that peoples everywhere could have three meals a day for their bodies, education and culture for their minds," the new governor said, "And dignity, equality and freedom for their spirits.”

“Food for the body, mind and soul are not things to be taken for granted. Not everyone has enough of it and we must continue to strive to provide it for all of our citizens. The work is not done,” the governor said.

But the Education Committee did not get the message. Advocates for the bill stayed on message, asserting that the legislation, House Bill 74 - Validity of marriage will protect the integrity of marriage. The law declares that marriages "other than of a male and a female person are void."

How gay relationships threaten heterosexual marriage was not made clear.

Lead sponsor Rep. Owen Petersen, R-HD19, Mountain View, (pictured above) said legislators must protect traditional heterosexual marriage as one of the key building blocks of society. The federal Defense of Marriage Act (DOMA) allows states to void legal marriage contracts made in other jurisdictions even though the Commerce Clause of the U.S. Constitution generally requires states to recognize legal contracts made in others.

Jason Marsden, formerly a lobbyist for Wyoming Conservation Voters and now executive director of the Matthew Shepard Foundation in Denver, attended the hearing to remind legislators that they really do not know the people the legislation will affect both legally and economically. He said later that most legislators certainly would go out of their way to understand how a change in water policy would affect a few irrigators or a small community.

They don't bring that same concern to members of the gay and lesbian community, he noted.

Rep. Cathy Connolly, D-HD13, Laramie, laid out a long list of arguments against the bill. She warned that adopting the bill threatens economic development by making the state less attractive to skilled professional couples who happen to be gay. But she also noted the personal affront to her as a lesbian who raised a son in a deeply committed relationship.

Connolly and Rep. John Freeman, D-HD60, Green River, cast the two no votes against HB 74.

Reps. Bob Brechtel, R-HD38, Casper, Donald Burkhart, R-HD15, Rawlins, Rep. Kendell Kroeker, R-HD35, Casper, Sam Krone, R-HD24. Cody, Carl "Bunky" Loucks, R-HD59, Casper, and Michael Madden, R-HD40, Buffalo, and Chairman Matt Teeters, R-HD5, Lingle, voted to pass the bill.

Short takes

• The Senate Judiciary Committee heard testimony for two hours on SJ2 - Health Care Freedom and SJ3 - Health Care Freedom (2). Both challenge the Affordable Care Act. SJ2 is a nullification bill likely in violation of the Supremacy Clause of the U.S.Constitution. That has not stopped its advocates who include lead sponsor Sen. Leslie Nutting, R-SD 7, Cheyenne, and the Wyoming Liberty Group. Testimony resumes Wednesday at 7 a.m.
  
• The Senate Corporations Committee Tuesday morning will consider SF3 - Campaign finance - organizations. The proposed bill brings state campaign finance law into compliance with the U.S. Supreme Court's 2010 decision that corporations can spend directly and freely through independent expenditure campaigns attacking or supporting specific candidates. The ESPC is advocating comprehensive disclosure laws so Wyoming voters can identify the sources of funding for those independent expenditures.
• Senate File 14 - Counties - election districts also will be heard by Senate Corporations. The bill allows a county to set up commission voting district that would allow some commissioners to be elected at-large in part of a county and by district in others. The ESPC fears the state is simply erecting another racist structure in the wake of federal court's dismantling of an existing one. Last spring, U.S. Distrct Court Judge Alan Johnson ordered Fremont County to end its system of at-large commission elections because they diluted the Native American vote. That dilution made it virtually impossible for a member of that large minority group to win a commission election.
  

What's next for Wyoming?

GOP landslide brings questions about future course

The GOP landslide on election day leaves observers wondering how major issues facing the state will be addressed. Wyoming Republicans pushed Democrats to the lowest point in years in the state legislature and swept all five statewide offices, including, as expected, the governorship.

Governor-elect Matt Mead, the former U.S. attorney for Wyoming under President George W. Bush, won the open seat with 72% of the vote.

Mead has promised to join the states suing to overturn the Affordable Care Act. On the campaign trail, he referred to a state pilot program as Wyoming’s answer to questions about covering the uninsured and holding down costs – even though the pilot (which is a health care plan, not health insurance) has yet to be implemented, much less evaluated. Wyoming residents will be looking for Mead’s ideas on keeping community hospitals and nursing homes solvent, meeting the state’s need for primary care providers and addressing rising premiums for Wyomingites fortunate enough to have insurance.

Mead has said he will resist increases in the state’s minimum wage, which stands now at just $5.15 per hour for workers not covered by the federal minimum wage. He has expressed support for sealing the border to stop illegal immigration, while also stating that legal immigration makes our country better. At the state budget level, it is unclear how Mead’s administration will address funding for infrastructure needs in communities around the state, or deal with fluctuations in state revenues.

Republicans captured 50 of 60 seats in the Wyoming House, taking nine seats that had been held by Democrats the past two years. In the Wyoming Senate, the GOP won 13 of 15 seats, reducing the number of Democrats to four out of 30 members. Senate Minority Leader Katherine Sessions was defeated by Leslie Nutting, an opponent of health care reform and reproductive rights. Nutting will be the only woman in the Senate. The small number of Democrats raises questions about committee assignments.

Although Wyoming legislators perennially campaign against over-regulation, past efforts to overhaul or “streamline” regulations have resulted in only minor tweaks as lawmakers and citizens come to realize how regulations protect the state’s communities and natural resource base as the mineral industries boom and bust. With new developments such as the near-disappearance of the mule deer herd on the Pinedale Anticline and possible contamination of groundwater near Pavillion by fracking, Wyoming residents probably will be cautious about giving energy extractors a freer hand.

Historically, Wyomingites also have been reticent to intrude into each other’s private lives, as evidenced by the defeat of a ballot initiative banning abortions and, more recently, the defeat of efforts to amend the Wyoming Constitution to prohibit gay marriage or civil unions. Bills on these topics may be offered in the 2011 session, even though they seem at odds with conservative views on keeping government out of private decisions.

The election results point toward opportunities to test reality against rhetoric. Just as support for the Affordable Care Act has gone up as people begin to experience its benefits, it may well be that support for budget cuts or intrusive legislation will go down as people see such proposals play out.

Insurance companies battle health care reform regs

By Barb Rea

Editor's note: Barb Rea is Wyoming's consumer advocate to the National Association of Insurance Commissioners (NAIC). She is attending the NAIC quarterly meeting in Orlando, Fla. She also is volunteering on behalf of Consumer Advocates: Project Healthcare, a group of Wyoming advocates raising the consumer's voice in health care reform. The NAIC is crafting rules that will guide implementation of the the Affordable Care Act.


Health reform is not going to happen magically. The Affordable Care Act (ACA) established the framework for changing the system and now people are working hard to write the rules and regulations that will make it happen.

When you look at the details and the intent of the law, each piece is designed to move the insurance industry to change the way it does business. In exchange the industry will get more customers.

We are trying to move the insurance industry from making its money off risk selection (providing coverage only to healthy people) to one that competes on providing better value to its customers.

But it won’t be easy. For instance, one of the early reforms scheduled to begin Jan. 1, 2011, requires that insurance companies to spend more of your premium dollar on health care (80% in the individual market and 85% in the group market) and less on profit. This calculation is known as the Medical Loss Ratio.

And the companies have to prove they’re meeting the Medical Loss Ratio requirement. If they don’t reach this ratio, they have to give the money back to consumers in the form of a rebate. The law is requiring public transparency and accountability—new concepts in the insurance world.

The goal of this reform is not so much to get money back from the insurance company but rather to force the companies to price their products correctly.

Over the last 5 months the National Association of Insurance Commissioners (NAIC) has brought together consumer representatives, insurance commissioners and insurance company representatives to craft rules and regulations on the Medical Loss Ratio, as assigned to them through the new federal healthcare law. They have been conferencing sometimes daily to decide what numbers have to be reported and create a way to collect and report this information.

This week at NAIC’s quarterly meeting in Orlando, the final decisions on this topic will be made. As you can expect there has been considerable wrangling, with the industry trying to include as many items as possible in the medical expense side of the equation and as few as possible on the overhead side. The consumers won a good number of those battles but not all.

Now just days before this final vote, the industry is pushing for several last minute changes in the calculation of the Medical Loss Ratio. The changes essentially mean many companies would never have to pay a rebate (or change their pricing).

Here are the changes they seek:

• They want brokers’ commissions excluded from the equation;

• They want companies who sell in several states to be allowed to aggregate their numbers nationally, which would enable them to disguise high profits in one state by combining loss ratios from those states with loss ratios from other states where they may charge lower prices or pay higher health care costs;

• The industry also wants to change the actuarial formula previously adopted by the drafting group for evaluating compliance with the Medical Loss Ratio standard. Known as the “credibility adjustment,” the industry wants a change that favors insurance companies over consumers.

The implications are stunning. The industry can appear to be helping to transform the system but continues to try to get away with as much as possible to maintain “business as usual.” This is how they have made their fortunes and there is no reason to believe they won’t continue to behave that way.

Transparency and oversight are provided for in the ACA. To get this to work, we must be vigilant in monitoring the transformation of the health care system. If we don’t have citizens willing to take this job we are not going to move this to the finish line.