By John Reichard, CQ HealthBeat Editor

June 7, 2013 -- Marking the opening round of what's likely to be steel-cage political combat over the impact of the health care law on insurance rates, President Barack Obama said last week in a speech in California that the overhaul is ushering in a new era of vigorous competition among plans in the state and elsewhere, resulting in reliable, affordable coverage.

Appearing in San Jose with local government, media, and philanthropic officials, Obama touted the state's new insurance exchange as a model.

"If you're one of nearly 6 million Californians or tens of millions of Americans who don't currently have health insurance, you'll soon be able to buy quality, affordable care just like everybody else," Obama said. Thanks to new online insurance marketplaces opening in the fall, health plans will actually have to compete, he said, "and that means new choices."

While in many states Americans now only have a choice of one or two plans, based on early reports about 9 in ten Americans expected to enroll in the new marketplaces live in states where they'll be able to choose between five or more different insurers, he said.

Contrary to "doom and gloom" forecasts, Obama said that in states that are properly implementing the overhaul, "competition and choice are pushing down costs in the individual market just like the law was designed to do." Premiums in California's exchange "were lower than anybody expected," he said. And about 2.6 million Californians, nearly half of whom are Latinos, "will qualify for tax credits that will in some cases lower their premiums a significant amount."

Republicans Starting to Push Back

Health law supporters say Obama's salesmanship is long overdue and sorely needed if the administration is to meet its goal next year of enrolling 7 million uninsured people in the new insurance exchanges. While Obama's appearance was good news for them, Republicans are gearing up to make counter claims. The right-leaning American Action Forum issued a statement last week saying coverage on the California exchange will limit enrollees' choice of providers. "What you will not hear from [Obama] is that if you live in California you could be losing 64 percent of your provider network," said Forum spokeswoman Emily Egan.

And in Ohio, Lieutenant Gov. Mary Taylor, a Republican, said the state insurance department's initial analysis shows "consumers will have fewer choices and pay much higher premiums" for plans to be offered by the federal exchange serving the state. Monthly premiums in the individual market now average $223, Taylor said, citing an estimate by the Society of Actuaries. But proposed rates show that average climbing 88 percent to $420, she added in a recent news release.

Late last week, five Senate Health, Education, Labor and Pensions Committee Republicans wrote to Health and Human Services Secretary Kathleen Sebelius asking her to follow up on a May 9 Associated Press story saying that a California law gave the state's exchange the power to keep secret certain spending details for the contractors that will perform most of the marketplace's functions.

The White House made clear in focusing on California that coverage of the uninsured Latino population is going to be a key part of making the health care law a success—not only in California, but nationally. Not only will that score the administration political points with a pivotal voting bloc in the 2012 elections, it could sharply reduce the number of Americans without coverage.

California has a big chunk of the nation's uninsured population, and nearly two-thirds of it are Latino, says the California Endowment, a health care philanthropy.

White House officials said in a background briefing that California provides a good model for the success of enrollment efforts going forward, Three powerful Spanish-language media companies have agreed to be part of the California outreach effort, officials noted, and will hit nearly 100 percent of the target Hispanic communities in the state, they added.

The three—Univision, Telemundo, and impreMedia—are beginning a three-phase campaign that could be copied in other states, officials said. The opening "awareness" phase will tell people what the health law (Pl 111-148, PL 111-152) does and that the enrollment period is fast approaching. The next is the "education" phase—which will start closer to the fall. That will let people know where to get more information and to find out what their coverage options are. The third phase is the actual enrollment period that will run from Oct. 1 through March.

Particularly critical to the success of the law is enrolling young and healthy people whose relatively low health costs would make it possible to keep premiums affordable for older, sicker Americans. Of the target population of 7 million covered in exchanges next year, administration officials say it's important that 2.6 million or 2.7 million are young and healthy. When you drill down and think about who these folks are, about one in three live in California, Florida and Texas, one official said.

Obama emphasized the importance of people stepping forward and signing up for coverage. But the key to that will be whether rates in exchanges across the country are affordable—or perhaps more importantly, are viewed as affordable.

Politics and Rates

States with Democratic governors are more likely to cast exchange rates in a favorable light and those run by Republican governors in a negative light. Kaiser Family Foundation Senior Vice President Larry Leavitt said in an interview that his review of the Ohio rates shows that they are actually about the same as those in California. In California, officials helped to create a favorable impression of the rates in the individual insurance market next year by noting they would be about the same or lower as the rates in 2013 for small employer plans. Individual rates would range from 2 percent above to 29 percent below the 2013 average premium for small employer plans, officials said.

Comparing premiums to those in the small group market is "a way of testing the reasonableness" of individual plan premiums, Leavitt said. That's because the benefits individual plans must provide next year will be comparable to those that exist in the small group market, he said. Had insurers come in with 2014 rates for the individual market that were sharply higher than those in the small group market, it would have been a sign of insurer price gouging under the health law, something he said supporters of the measure feared insurers would do after the law took effect.

In Ohio, officials instead chose to focus on year-to-year comparisons of individual plans. The 2013 rates they used to calculate the 88 percent increase were based on much skimpier coverage than the plans will have next year, analysts said. Kaiser analyst Karen Pollitz said that in some instances, plans now sold on Ohio's individual market barely qualify as health insurance and someone buying such policies risk bankruptcy if serious illness strikes. But individual coverage next year in Ohio will be more comprehensive and "heavily subsidized for 80 to 90 percent of newly insured Ohioans," she said.

The rates cited by Ohio officials are proposed and could be lower following rate review in the state.

California officials had only limited data comparing individual plan premiums in 2013 versus 2014. Blue Shield of California suggested enrollees in its individual plan would be paying 13 percent more next year.

By Rebecca Adams, CQ HealthBeat Associate Editor

June 3, 2013 -- Although federal health spending appears to be slowing, now is not the time to stop looking for ways to reduce national Medicare costs, two health policy analysts with different political ideologies said at a recent briefing.

"It's premature to celebrate the disappearance of the excess cost problem because we've been through this before," said former Congressional Budget Office director Doug Holtz-Eakin, now president of the conservative American Action Forum. He was speaking on a panel at the nonpartisan Alliance for Health Reform.

Holtz-Eakin cited several previous historical periods in which Medicare spending slowed but later picked back up, including 1975, 1978, 1984 and 1994-99, when managed care initially reduced costs before a backlash among the American public forced insurers to loosen restrictions.

Center for American Progress President Neera Tanden, a former Obama administration aide, agreed.

Recent news about lower Medicare spending does not "take any pressure off the effort to reduce national health expenditures," she said.
Beyond the consensus about the need to keep looking for ways to cut Medicare expenses, the two also agreed that systems that pay based on the quality of care could reduce long-term costs.

However, they did not agree on other ways to restructure the Medicare system.

Democrats have "fundamental questions about efforts to simply shift costs to beneficiaries," said Tanden, as Democrats say that some Republicans have proposed in their budget plans. "We should be wary of those efforts."

The Medicare trustees' report released May 31 showed that the trust fund that finances the inpatient hospital part of Medicare will be exhausted in 2026, two years later than had been projected last year.

Some of the slowdown could be due to changes in the delivery of health care, but a good deal of it may be due to the recession.
When the report was released, lawmakers also celebrated the positive news but said it may not last, particularly because of changing demographics as the nation ages.

"These numbers can allow us to be optimistic, but they are not a reason for inaction. We are facing a wave of retiring baby boomers. Close to 10,000 people a day qualify for benefits," Senate Finance Committee Chairman Max Baucus, D-Mont., said last week.

But adjustments to Medicare are politically explosive, particularly if they reduce benefits for seniors, and some lawmakers may feel that the improved fiscal news reduces the urgency of trying to push for change.

By John Reichard, CQ HealthBeat Editor

June 5, 2013 -- Will the health law trap a growing number of workers in part-time jobs as employers scramble to avoid higher health insurance costs under the overhaul? And to avoid a penalty, will those workers increasingly have to get federally subsidized coverage from insurance exchanges to comply with the law's insurance mandate that starts next year?

And if such workers do have to rely on those subsidies, will taxpayers get stuck with the tab for higher subsidy payouts, casting further doubt on the Congressional Budget Office estimate that the health law won't add to the federal deficit over the next decade?

There's been no shortage of news reports and predictions by opponents of the law suggesting that those ill effects will be part of the fallout of a law CBO estimates will bring coverage to about 25 million uninsured Americans by the start of the next decade.

But predicting the extent to which such changes will occur and can be attributed to the health law (PL 111-148, PL 111-152) is no simple matter.

For example, employers who have warned that they will switch large numbers of workers to part time haven't necessarily made the final decision to do so. Also, there already is a labor force trend underway to more part time work, making it difficult to tease out whether, and how much, the law is adding to that.

And, Washington being Washington, opponents of the law may be exaggerating its ill effects in order to weaken public support for the overhaul and boost their prospects in the 2014 congressional elections.

Still, it's probably wishful thinking on the part of supporters of the law to brush off reports of a shift to part-time work as merely anecdotal. But some analysts still predict that to the extent it does occur, it may not happen on a large scale.

Under the law, starting in 2014, employers with 50 or more full-time workers will have to offer health coverage to those employees or pay a penalty. But the law does not require health coverage for part-time workers, defined as those who work fewer than 30 hours a week.

In recent weeks there have been reports of workers in a variety of occupations being limited to part-time work because of the law—from Head Start employees to adjunct professors to fast food workers to substitute teachers.

The overhaul is leading to part-time work for hundreds of thousands of Americans, Senate Republican leaders told reporters last month.
"We see across the country, municipalities, we see universities and businesses all cutting back on their workforce to get them below 30 hours, to the point that the University of California at Berkeley has said there are about 2.3 million individuals around the country who will be in this situation," Sen. John Barrasso, R-Wyo., said after the May 7 GOP policy lunch.

Senate Minority Leader Mitch McConnell recounted his meeting earlier that day with a Kentucky businessman. "He owns a number of retail operations. And what he's going to have to do is reduce the number of employees that he has as full-timers down to part-timers in order to deal with the impact of this law," McConnell, R-Ky., added. "I picked up a lot of anecdotes ... about that kind of reaction and other kinds of reactions, all of which add up to fewer jobs or more part-time jobs. In fact, I think there's something like 280,000 additional part-time jobs the last month as a result of this law."

Workers in some retail outlets suspect they are being limited to fewer hours because of the health law.

Duane Davis told NPR on April 29 that his employer, Juicy Couture, said he couldn't work more than 23 hours per week. Davis said he suspected his hours were being limited because of the health law, something the company denied. Chains such as Papa John's and Darden Restaurants, which owns Red Lobster and the Olive Garden, said they may reduce workers' hours, according to the same NPR report.

Colleges increasingly are slashing the hours of adjunct professors to avoid triggering the health coverage requirement for full-time workers, The Chronicle of Higher Education reported April 22.

And on June 1, the News & Observer in North Carolina reported that the Wake County school system is considering restricting its 3,300 plus substitute teachers to working fewer than 30 hours per week, starting July 1.

Effects Hard to Judge

But multiple factors go into the decision whether to employ workers part time or full time, analysts say. And fear and anxiety about the law and ignorance about what it actually does may be contributing to exaggerated predictions about its impact.

Neil Trautwein of the National Retail Federation says that the health law is just one of a number of factors employers take into account in deciding whether or not employees should work full or part time. "I think the ACA and 30-hour rule for full-time will lead to a more conscious view of who is full-time (and eligible) and who is not," Trautwein said in an email message. "It's still too early to see definitive directions on full versus part-time—the operative consideration isn't into effect, yet," he said.

Paul Fronstin of the Employee Benefits Research Institute notes in a recent report that the part-timer trend already was well underway.
"The recent recession has already resulted in an increased use of part-time workers," Fronstin said. The percentage of workers employed part-time has been rising since 2007, increasing from 16.7 percent in that year to 22.2 percent in 2011, he said.

Almost all employers with 50 or more full-time workers offer health coverage, Fronstin noted. But there are other provisions of the health care law "that are expected to increase the cost of coverage," his report says. "As a result, there is concern that employers may respond by cutting back on health coverage for part-time workers or by increasing the proportion of part-time workers employed," it adds.

In 2011, 59.6 percent of full-time workers had coverage from their jobs, while 15.7 percent of part-time employees had health benefits. "Both have been trending downward since 2007," the report said. "However, in relative terms, part-time workers have experienced a much larger decline in coverage than full-time workers. Between 2007 and 2011, full-time workers experienced a 2.8 percent reduction in the likelihood of having coverage from their own jobs, while part-time workers experienced a 15.7 percent decline."

These trends form a baseline against which changes following the health law must be measured, Fronstin cautioned.

Some See Limited Impact

Urban Institute analyst Linda Blumberg says it's premature to assess what the impact of the health law on part-time employment. She adds that the law is a tempting scapegoat for decisions to switch to part-time work that would have been made anyway. Employers who are switching to more part-time work because of the law are likely to do so toward the end of the year, not now, she adds.

Blumberg does think the law will limit working hours in some cases. But the effect won't be large, she predicts. And she doubts the trend will add substantially to the federal subsidies. For one thing, a part-time worker wouldn't qualify for a subsidy if a spouse is offered coverage by his or her employer, she noted.

Small employers have expressed alarm about the health law, but Blumberg notes that they are not affected because employers with fewer than 50 workers don't have to provide coverage. And she suggested that the effect will be limited among larger employers already offering coverage who might want to switch more workers to part time because the law subjects them to higher costs.

Blumberg said the real impact is most likely to occur among employees who now work 30 to 35 hours per week and whose employers do not now offer health coverage. Those employers have a variety of tools to deal with the higher costs they face under the health law, she says. They can pay the penalty, something she calls "wasteful," or they can cut a worker's hours or they can "offer the coverage and trade off the growth in wages that that worker would have otherwise," she said.

"So do I think that some workers will end up with a small amount fewer hours per week in a typical week of work? Yes, I think that's going to happen in some cases," she said. "But I don't think it's going to be a huge phenomenon" because of the costs associated with doing that, such as the administrative and management hassles of having more part-time workers to manage and the greater turnover involved.

Blumberg also noted that some employers who say they are going to switch to part time may not do so because of the reaction from their employees and from the public. She noted, for example, that Darden backed off a plan to shift full time workers at Olive Garden and Red Lobster to part-time status following a negative public reaction to the move.

Berkeley Study

Barrasso's reference to 2.3 million workers comes from a February study by the University of California Berkeley Labor Center. It examined industries with a high percentage of employees working fewer than or slightly above 30 hours per week, placing them at risk for reduced hours by an employer wishing to avoid penalties.

It found that 2.3 million workers were most vulnerable to work hour reduction. That's because their employers do not now offer them health coverage and would have to do so under the health law, and because those employees make below 400 percent of the poverty line, which means that their employers would have to pay a penalty in many instances if they continued not to cover them.

"The industries with the highest concentration of such workers are restaurants, accommodation, building services, nursing homes and retail trade," the study said. "Retail and restaurants account for 47 percent of the most vulnerable group."

The study added that the 2.3 million workers identified as at greatest risk of having their hours reduced represents 1.8 percent of the U.S. workforce. That finding is consistent with research on the impact of Hawaii's health care law mandating employer coverage, the Berkeley researchers said. A 2011 study found a 1.4 percentage point increase in the share of workers working fewer than 20 hours a week because of the law, which mandates health coverage above 20 hours a week. The Berkeley study added that in Massachusetts, where the employer penalty is smaller than under the health law for not offering coverage, "there was no evidence of a disproportionate shift towards part-time work compared to the rest of the nation."

Blumberg said "2.3 million sounds like a big number, but it is a tiny fraction of the workforce." She also said the figure of those facing limited hours is likely below that. She said it should be adjusted downward to exclude the undocumented and those who will be Medicaid eligible under the health law, resulting in a number "considerably smaller than 2.3 million," she said. "And this doesn't take into account that some of these employers will likely decide to start offering coverage to these workers and shift some of their wage compensation to benefits in order to make the workers happy and fill the positions that they need filled with the right kind of people and avoid the firm costs of higher turnover and greater management," she added.

Blumberg also predicts other health law effects that employers and workers would find favorable, such as an enhanced ability of small employers to compete with large firms for workers because workers in small businesses will have an easier time finding reliable coverage in the individual market and in a number of instances will have subsidies to help them buy it. And in a separate study she conducted with researchers from Georgetown University, she found that the health law would boost entrepreneurship and self employment. "Overall, we estimate that the number of self-employed people in the United States will be about 1.5 million higher following the universal availability of non-group coverage, the financial assistance available for it, and other related market reforms," the study found.

• Berkeley Study (pdf)
• Self Employment Study

By Emily Ethridge, CQ Roll Call

June 5, 2013 -- House Republicans said they are continuing to move ahead with legislation to replace Medicare's physician payment system but will wait to negotiate some of the more contentious issues.

Rep. Joe Pitts, chairman of the House Energy and Commerce Health Subcommittee, said the panel remains "on track" and continues to work with Democrats and members of the Ways and Means Committee on a replacement measure.

"We'll have something out there by the end of July for everybody to work on over August," Pitts, R-Pa., told reporters after a subcommittee hearing last week.

Energy and Commerce Republicans recently released an updated version of their plan to replace the current payment formula, known as the sustainable growth rate. The draft legislation was left incomplete, lawmakers said, so they could get more feedback from provider groups and other stakeholders.

For example, the draft measure lacks a means of covering the cost of repealing the SGR, which the Congressional Budget Office estimated would cost $139.1 billion over 10 years.

"We intend to avoid the error made in years past of discussing how to pay for reform before the policy is developed," said full committee Chairman Fred Upton, R-Mich. "But make no mistake: SGR reform will be offset with a real and responsible pay-for when it comes to the floor of the House for a vote."

The Republicans' draft would replace the SGR with an enhanced fee-for-service system while also allowing providers to opt out and participate in alternative payment models. The first phase would repeal the SGR and provide a period of stable payments, and the second phase would tie fee-for-service payments to meeting quality measures.

Witnesses recommended that the first phase last three years in order to give providers and the administration time to collaborate on identifying quality goals and methods of measurement.

Cheryl Damberg, a senior policy researcher and professor at the Pardee RAND Graduate School, noted that while primary care services already have a number of quality measures that are ready to use, clinical subspecialties need more time to develop those.

William Kramer, the executive director for national health policy at the Pacific Business Group on Health, said the system should try to give providers feedback on their performance as quickly as possible so they can make productive changes.

Del. Donna M.C. Christensen, D-V.I., asked about how to ensure that providers who see the most medically challenging patients can still participate in the new care models and receive incentives. Damberg suggested giving providers rewards for reaching each increment of improvement and aligning those incentives across a group of providers.

Subcommittee Democrats said they supported the goals of replacing the payment system and generally agreed with the Republicans' approach, although some said the discussion draft did not go far enough.

"It doesn't provide us with any real direction on payment reform," said Florida Democrat Kathy Castor. "It will keep us wedded to the SGR and that poor public policy of temporary patches."

She said she preferred a bill (HR 574) from Pennsylvania Democrat Allyson Y. Schwartz and Nevada Republican Joe Heck that would put more emphasis on moving physicians to new payment and delivery models. Schwartz also told reporters this week that the Republicans' draft outline was "disappointing."

GOP committee leaders emphasized that they would continue working with Democrats and members of the Ways and Means Committee to develop a formal legislative proposal. The most recent draft reflected discussions with committee Democrats, even though it did not have their names on it, Upton said.

California Democrat Henry A. Waxman, the ranking member of the full committee, said in a written statement that the draft legislation follows shared policy goals on which they have broad agreement.

Republicans on the Energy and Commerce Committee and the Ways and Means Committee first released a framework to repeal the SGR in February, and they outlined additional details in April. Both committees have held hearings on the issue.

The Senate Finance Committee has held hearings on replacing the payment formula, but lawmakers there have not yet released legislation that would do so.

By Rebecca Adams, CQ HealthBeat Associate Editor

June 7, 2013 -- Using telemedicine or physician assistants and primary care providers to deliver specialty care instead of specialists seems to give patients broader access to the services without compromising quality, according to an evaluation of initiatives in six states that are still in the early stages.

The 24-page study by the Center for Studying Health System Change for the Commonwealth Fund evaluated efforts to increase access to specialty care among patients, including those enrolled in Medicaid, in Connecticut, Illinois, Minnesota, New Mexico, Oregon and Tennessee. Each model, the study said, showed the potential to be used in other states.

"Some respondents found quality of care and patient outcomes to be the same, if not better" than when patients were treated by specialty providers. The programs have not been fully analyzed to determine cost savings but the study said that comprehensive evaluations by other groups are planned for the projects in New Mexico, Connecticut, and Minnesota. Each initiative had different ways of expanding access to specialty services.

Some of the early results included, for example, an increase in the Connecticut project in the percentage of diabetic patients that got retinopathy screening. The percentage grew from 10 percent to 40 percent. In that project, the program created a telehealth program in 2009 to look for early signs of blindness in people with diabetes. Medical assistants were taught to use retinal cameras to take images of patients. The images were then sent to ophthalmologists for diagnosis. Using telehealth for diabetic retinopathy saved about $28 a patient, or about 35 percent of the cost per patient when compared to an exam by a specialist, according to the report. The project is run by Community Health Centers Inc., the Yale Medical Group and the University of Connecticut. The community health centers care for about 130,000 patients.

In New Mexico, waits for rheumatology appointments at the University of New Mexico fell from six months to one month after a videoconference-based project was created. In that program—known as Project ECHO (an acronym for Extension for Community Healthcare Outcomes)—primary care providers were trained to act as quasi-specialists. Primary care doctors and other primary care providers ask specialists for advice on how to treat patients with specific conditions, and, over time, the primary care providers learn enough to treat many common concerns without having to refer the patients to specialists. One primary care provider in the project sent all patients with rheumatology needs to specialists before the training, but after the project was implemented, that rate of referral fell to about 10 percent of cases.

The quality of care seemed "to be the same, if not better," said the study. The authors noted that patients treated for hepatitis C through Project ECHO had about the same outcomes as patients treated by specialists.

The report also said that in Oregon, the use of physician assistants helped orthopedic patients who didn't need surgery to get therapy in a quicker way than waiting for specialty care. The physician assistants also were able to replace temporary splints for patients with routine broken bones with less of a wait than the patients would have had to endure to see an orthopedist. The use of casts early on helps to heal the bones.

Some advocates of the projects hope to expand them. But the study concluded that this could be tough to do, particularly without changes to current Medicaid payment policies.

The study said potential changes might include: paying providers to consult with specialists or treat patients remotely, allowing federally qualified health centers to provide more specialty care, funding the training of primary care providers in specialty care and changing, for example, the way coordinating patient care is paid for in managed care contracts.

• Medicaid study (pdf)

By John Reichard, CQ HealthBeat Editor

June 6, 2013 -- Maryland officials convened a summit this week to fire up outreach groups charged with enrolling the uninsured in health coverage this fall, and the daunting size and complexity of the job quickly became apparent.

It was clear from the long meeting of several hundred community, church, social services, and local health officials last week that even in a well-organized, committed state like Maryland, expanding health coverage this fall and winter under the health law is going to be a heavy, heavy lift. The event was held the University of Maryland, Baltimore County campus

Joshua Sharfstein, the state's top health official, got things rolling by declaring to the still somewhat sleepy audience that "this day is an incredibly important day, because we are really here launching the outreach efforts to get more people enrolled and to make health care work better in Maryland."

Sharfstein tried to rouse the crowd by pointing incredulously to a news report that opponents of the health law have spent $400 million on advertising to repeal it. "Four hundred million dollars on paid media to tell people we shouldn't be expanding health care in the United States," he said. "Four hundred million dollars! I want you to stand up if you're on the other side of that ledger. Get up," he said. "This is an incredibly important mission. We are here in Maryland to help people connect to services and opportunities that could literally mean the difference between life and death.

"So I'm going to ask one more time. Please stand up right now," he said. "And I want you to give someone a high five!" Sharfstein finally got most people on their feet, laughing and clapping.

But the moment of levity didn't last long.

The presentations that followed walked audience members through the various provisions of the law (PL 111-148, PL 11-152) and noted the challenges they face in trying to expand coverage to about 700,000 uninsured residents, many of whom have a high school diploma or less.

In many cases they either don't speak English or know insurance terminology such as premiums, deductibles and co-payments, speakers said. And they're less likely to know the ins and outs of "advance refundable premium tax credits," or whether it would be better to take the federal subsidies up front or file for them the following year with their income tax returns.

The lower education levels of many of the uninsured must be accounted for in materials describing the coverage program, said Danielle Davis, who directs Maryland's outreach effort. She added that in many instances, people who are not covered find talking about insurance "intimidating and stressful."

Among the challenges for outreach officials and those they are trying to help is that people without coverage face financial consequences whether or not they take the time to understand the complexities of insurance and how to get it under the health law.

Consumers cannot merely tune out the topic without taking some kind of financial hit, since starting next year they will face a tax penalty if they don't have insurance. If they do sign up they will have out-of-pocket premium costs they do not now pay. That puts pressure on both the uninsured and the people giving them that piece of bad news.

Lynn Quincy, an analyst with Consumers Union, noted another challenge. Middle income people are likely to think that subsidies to buy coverage are not for them, but are just for poor people. Or, they fear they'll get crummy coverage with the subsidies. Neither of those things are true, she said.

Help is On the Way

But the good news in Maryland is that the state has a relatively large amount of money with which to pay people to help consumers sign up for benefits. And navigators in the state will go through far more rigorous training to help people with the law than in other states—120 hours.

Also, the outreach effort blankets Maryland, with the state awarding contracts to six "connector entities" to help people get coverage through the state's marketplace, which is called Maryland Health Connection.

Those six organizations are partnering with many other local groups in their regions, officials said. They are planning a variety of ways to connect with people—linking with hospitals, health centers, churches and schools as well as by sending information home to parents with schoolchildren.

For example, the Howard County connector entity plans to outfit an RV to travel around and provide information about the law, and it has linkages with 125 churches and 15 supermarkets.

There also will be demonstrations on computers in local libraries about how to get educated and enrolled, and visits in Montgomery and Prince George's County to community events and picnics.

Quincy offered encouragement by telling audience members about brochures Consumers Union has carefully designed to educate people about the law. The materials will be customized for each state.

The brochure was tested both in states where people favor the law and in those where they oppose it. She said consumers of differing education and income levels understood the message on the pros and cons of taking tax credits up front as a way of paying less each month for coverage. The pamphlet explains by doing that, consumers risk having to pay more in taxes later if it turns out they got too much in subsidies because their incomes were higher than they anticipated.

Moreover, the consumers they questioned in focus groups said they thought such corrections were fair, she added.

Despite the complexities, consumers viewed the coverage provisions of the law as valuable and a way to protect themselves financially, Quincy said. "Even those with a negative impression of health reform said they would act on tax credit information because it would help their families," she said.

If attendees were discouraged by the challenges speakers described, they didn't express it. And they got encouragement too from Bishop Douglas Miles of Baltimore, who has served as president of the city's Interdenominational Ministerial Alliance.

Miles recalled a Martin Luther King quote in which the civil rights leader said: "Of all the forms of inequality, injustice in health care is the most shocking and inhumane."

Miles suggested that attendees had a chance to combat that inequality, and predicted that because of the overhaul, "nearly 300,000 Marylanders will gain access to quality, affordable health insurance coverage in the coming months, reducing the number of uninsured Marylanders by 50 percent."

What is perhaps most likely to make or break the exchange is whether or not it offers attractive rates. That won't be known until July. The insurer CareFirst caused some consternation by proposing an increase of 25 percent for 2014 in the individual market in Maryland, although Kaiser Permanente proposed only a 4 percent hike.

Sharfstein noted in a brief interview after his remarks that rates proposed by insurers are being reviewed and could be significantly lower in some cases when made final. "There's a multi-step process," he said. "The proposed rates are pretty variable," he said. He added that there will be more plans offered next year in the individual market than there are now.

"At this point really our key message is that they're being reviewed," Sharfstein said concerning the rates. "Everybody should just take their own pulse and see how this all plays out."