Healthcare: Many System Changes

Central to healthcare issues in the 2015 legislative session were several proposals that grew out of last year’s Hospital and Healthcare Roundtable, a bipartisan effort of Senators Martin Looney (D-New Haven) and Len Fasano (R-North Haven).
Ultimately, a 90-page amendment, filed in the final weeks, addresses many areas of Connecticut’s healthcare system.
Among other things, SB 811:

• Requires the state’s health insurance exchange to develop a website, but doesn’t identify how that is to be funded. The consumer website is to include cost and quality information
• Requires the Department of Insurance and the Department of Public Health to make publicly available, and report to the state’s exchange, information about the most frequently utilized procedures and services
• Requires health insurers to make available information about prescription drug coverage, provider network, and estimated cost for procedures
• Requires providers (doctors) to give notices in certain instances about the costs of procedures and services
• Establishes new rules surrounding facility fees, including requiring the billing facility to provide information about the fee and the right of the individual to request a reduction. It also requires hospitals to give additional notices in certain instances to the Department of Public Health, and recent patients
• Sets new rules for “surprise bills”—such as when an individual receives an unexpected bill for out-of-network services
• Uses the state’s Healthcare Cabinet, a group led by Lt. Governor Nancy Wyman , to study cost and quality in Connecticut and other states, and make recommendations to address relevant issues; the bill also calls on the Insurance Commissioner to convene a group to look at cost and quality issues
• Establishes a statewide Health Information Exchange with the goal of establishing a statewide electronic health information technology system; the Department of Social Services will have administrative control over this effort
• Establishes new requirements for mergers and acquisitions of hospitals and practices including additional reporting with the attorney general and the Department of Public Health; also requires all hospitals to file annual reports (previously pertained togroups with 30 or more doctors)
• Requires additional review by the Office of Healthcare Access (OHCA) during a Certificate of Need (CON) process for hospital transfer including a focus on community impact and a public hearing, and allows OHCA to place conditions on its approval

Mandates
As in previous years, lawmakers proposed a number of new health benefit mandates. These are medical procedures or services the state requires small employers to cover in the health plans they offer to their employees. Adding more covered services means higher premium payments for small businesses and their employees.
Specifically, mandates impact small employers who are fully insured; typically, larger employers self-insure. These larger employers are exempt from state mandates because they are regulated by federal law.
The state also self-insures through its health plan, yet routinely adopts the new mandates as a matter of course—which translates into higher premiums.  What’s more, under the Affordable Care Act, each state had to lock in their benefit packages two years ago, with that package not being able to be changed until next year (2016). So, whenever the state adopts a new mandate it has to pay the cost for certain individuals who use the state’s exchange.
SB 1085 addresses certain mental health coverage and was adopted after changes that substantially reduced its fiscal impact.
Telehealth
Many employers are using telehealth services for their employees to make healthcare more convenient and provide access to better care. Telehealth uses technology such as video and other formats to access doctors, nurses, and other providers remotely. SB 467 establishes some new requirements for telehealth providers including patient consent and medial record requirements. Overall, these new provisions should work with most of the existing practices of telehealth providers in Connecticut. This is an exciting field and it has the opportunity to increase quality and reduce cost of healthcare.
Insurance pooling
The legislature passed SB 913 that may jack up health insurance rates for municipalities.
SB 913 allows non-state public employees—such as municipal workers, and library employees—to pool their health insurance with the state employee pool. The catch is that it’s likely that healthier groups will be allowed into the pool, with less healthy groups (perhaps retirees) possibly excluded. This will lead to higher rates for certain groups.
SB 913 has already been signed by Governor Malloy and many of its provisions will take effect in October of this year. Some other provisions of concern regarding reporting were stripped from the bill prior to passage.
Insurance Fund raid
SB 955 which died earlier in the session, was revived in the final state budget package. This bill transfers about $8.8 million from the Department of Public Health’s budget and moves it into the Insurance Fund. Insurers pay for the Insurance Fund through an assessment, but in reality this is just passed through to smaller employers and consumers in the form of higher premiums.
This kind of hidden tax is becoming a pattern in the legislature. Recently, another $3.2 million was also added to the Insurance Fund to pay for the State Innovation Model and that has become a reoccurring assessment. Each time the fund is increased, employers and their employees pay higher premiums.
For more information, contact CBIA’s Jennifer Herz at 860.244.1921 | jennifer.herz@cbia.com | @CBIAjherz