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Post-Election Activity

The November 7 election brought many changes at the national and state levels. Bills that were introduced toward the end of 2006 to address health care issues are likely to be reintroduced. In mid-January, a bipartisan group of lawmakers unveiled legislation that would provide federal funding for state initiatives to provide health care coverage to the uninsured. The House and Senate bills would provide grants to regions within states, individual states, or groups of states to fund initiatives such as tax credits, expansions of Medicaid or SCHIP, or other efforts to expand access to care.

A number of states elected governors who ran on platforms in which health care was the number-one priority. The following discussion highlights a small selection of these states and their new executives' agendas.

California: Reelected Governor Arnold Schwarzenegger (R) announced a comprehensive proposal to cover all California residents, including undocumented residents and temporary workers. Key features are: an individual mandate, employer "pay or play," expansion of Medi-Cal and Healthy Families (California's Medicaid and State Children's Health Insurance Program, respectively), a new Insurance Subsidy Pool, insurance market reforms, and prevention/wellness initiatives.

Based somewhat on Massachusetts' reform plan passed last year, Schwarzenegger's proposal is designed to spread the cost of coverage across stakeholders. All residents are required to obtain coverage, but those with income up to 250 percent of FPL would receive public coverage or subsidies toward private insurance through a new purchasing pool or premium assistance. Employers with at least 10 workers who do not provide coverage to workers would have to contribute a 4 percent payroll tax to help fund subsidized coverage. And Medi-Cal and Healthy Families would be expanded to cover children in families with income up to 300 percent of FPL (regardless of residency status), adults with income up to 100 percent of FPL, and pregnant women with income up to 200 percent of FPL.

A state purchasing pool operated by the state's Managed Risk Medical Insurance Board would be available for the approximately 1 million adults living between 100 and 250 percent of the FPL. These individuals would contribute between 3 and 6 percent of their gross income, based on a sliding scale, with the remainder of the premium subsidized by the state. Finally, the state plans to provide county-based coverage and safety net options for the approximately 1 million uninsured, undocumented individuals living in the state who are not able to obtain public or private insurance.

Other provisions of the proposal include guaranteed issue and new rating rules in the individual insurance market; an increase in Medi-Cal reimbursement rates; a 4 percent assessment on hospitals and a 2 percent assessment on physicians; and a redirection of $2 billion in medically indigent care funding toward supporting the coverage expansions and subsidies.

Connecticut: Though Connecticut's Governor Jodi Rell (R) is not newly elected, she recently announced two proposals to ensure that all children and adults have access to health coverage in the state. The Healthcare for UninSured Kids and Youth (HUSKY) Health 2007 initiative targets uninsured newborns and school-age children. Currently, the state's HUSKY plan serves children based on a sliding fee scale, and is open to uninsured newborns. The new initiative would waive premiums for the first two months following birth, improving the chances that parents will keep children enrolled afterward. Also, the initiative would require parents to inform schools whether their children have health insurance at the start of every school year (currently such notification is required only in kindergarten and sixth grade). Additional outreach funding would train school staff in educating parents of uninsured children about the HUSKY Plan and referring them for enrollment.

Under Rell's second proposal, private insurers would be encouraged to offer a "Charter Oak Health Plan," which would provide basic health insurance to uninsured adults (age 19–64) regardless of income or preexisting conditions. Premiums would be community-rated and not exceed $250 per person per month. Cost-sharing would be structured to encourage primary and preventive care. The state would not subsidize the coverage, but would help connect uninsured individuals to the plans through an "Infoline" service and some marketing/administrative support. Maintaining affordable rates would depend upon broad enrollment, including large numbers of healthy members.

Pennsylvania: In January, reelected Governor Ed Rendell (D) announced a proposal to expand access to health care to all state residents. The "Prescription for Pennsylvania" would help uninsured adults obtain coverage through private insurers, with premiums determined based on income. Residents with income over 300 percent of the FPL would be required to obtain coverage, and businesses that do not offer health insurance would be subject to financial penalties. The proposal also includes provisions to promote care provided by nurses, midwives, and other non-physician providers, and to curb use of emergency departments for non-urgent care. The reform plan has a number of additional provisions designed to address the quality and efficiency of care, along with coverage.

Insurers would be required to offer plans enabling parents to cover their children up to age 30, and to spend a certain percentage of the premiums for small group plans on medical services. When setting premiums for group plans for small businesses, insurers would not be allowed to consider factors other than age, location, and family size.

A number of other newly elected governors placed a high priority on health care reform in their campaigns. States to watch include:

Arkansas: Mike Beebe (D) took over the governor's seat from long-time Governor Mike Huckabee in January. Health care issues are at the forefront of his agenda, including expanding affordable insurance options for small businesses through the Arkansas ARHealthNet program, exploring the use of federal Earned Income Tax Credits to subsidize employer-sponsored insurance premiums, promoting the use of preventive care, and expanding school-based health centers.

Iowa: Newly elected Governor Chet Culver (D) ran on a platform that included expanding the Hawk-I coverage program to families with income up to 200 percent of the FPL, as well as a Hawk-I buy-in program that would allow residents of all income levels to purchase coverage for their children through the program with a sliding scale premium.

Maryland: Newly elected Governor Martin O'Malley (D) has pledged to implement a number of programs in response to the rising uninsurance rate in the state, lack of access to care, and disparities in care. Examples include a small business health insurance pool and tax credits for small businesses, expanding SCHIP coverage for children, and increasing funding to community health centers.

New York: Newly elected Governor Eliot Spitzer (D) is expected to release a proposal in late January that would expand access to coverage for 500,000 children in the state. The plan will target the thousands of children who are eligible for either free or subsidized coverage through Medicaid or Child Health Plus but not enrolled. The proposal will focus on administrative simplification, and will also include strategies for enrolling and funding the entry of 900,000 Medicaid-eligible adults into the program over the next four years.

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