BCBS Legislative Report

For the Week Ending February 10, 2012 

The House Health Care Committee last week made two key decisions on the design of a health insurance exchange but deferred a third decision on an “off-exchange” market to this week as committee members continue to seek answers to their unanswered questions about benefit options and prices within the exchange when it becomes operational in 2014.

The committee agreed to limit the exchange to individuals and employers with less than 50 employees on a preliminary vote of 10-0-1 rather than including employers up to 100 employees as allowed by federal law and proposed in H.559. The federal Affordable Care Act requires exchanges to include employers with up to 100 employees in 2016 but allows states to opt for the less than 50 employee standard as a temporary transition period. The committee’s preliminary vote followed a high profile news conference led by Governor Peter Shumlin and backed by House and Senate leadership that endorsed the less than 50 employee small group definition and also called for including a “bronze” plan among the benefit options to be offered on the exchange. Many employers attending a public hearing argued for a lower-cost bronze option to ensure that popular HSA (health savings account) plans will continue to be available to them. The committee endorsed the bronze plans on an 8-2-1 preliminary vote, reversing a decision the committee made last year in Act 48 that called for benefits options of at least a “silver” level or above.

Whether the exchange will be the only source of coverage options for individuals and small employers or whether they will be able to purchase coverage through an “off-exchange” market will be decided this week. Key business groups went before the committee last week to ask why employers should be required to purchase on an unproven exchange and not be allowed to purchase coverage in an off-exchange market. Committee members openly expressed concern that their own questions have not been answered sufficiently and they are finding it hard to give clear responses when pressed for answers from their constituents and local businesses.

The exchange is the linchpin in the governor’s long-term health care reform plan. The administration hopes to use federal funding to design an exchange that consolidates risk pools, standardizes administrative functions, and begins to decouple health benefits from employment. The exchange then could be the foundation to launch the Green Mountain Care universal coverage single-payer plan in 2017.

The House committee is also considering additional amendments to H.559, including the feasibility of requiring employers to offer Section 125 “cafeteria” plans — even if they

don’t offer health benefits — to enable their employees to use pre-tax dollars to purchase benefits as an individual through the exchange. And other provisions in the bill need committee resolution, including a proposal to limit prescription drug out-of-pocket costs.

Meanwhile, a Senate bill that would remove a loophole in the state’s requirement for children to be vaccinated before enrolling in school is under consideration in the Senate Health and Welfare Committee. The bill would preserve an exemption for religious reasons but remove an exemption for “philosophical” reasons. The proposal has sparked a huge response from parents and others opposed to mandatory vaccinations who are peppering lawmakers in both chambers with emails and calls.

Also this week, the Senate Health and Welfare Committee is continuing its review of H.630, the House-passed community mental health reform proposal that includes replacement of the state mental health hospital with regional solutions and a new facility in Central Vermont.

If you are interested in this week’s Legislative Committee Meeting schedules, agendas, and a listing of other meetings and activities, please visit the Vermont Legislature’s website at http://www.leg.state.vt.us/Committee01.cfm Committee meetings are normally updated daily, and are subject to change without notice. If you plan on attending, you may want to call ahead to verify the agenda.

For more information on legislative proposals, visit the Blue Cross and Blue Shield of Vermont website at www.bcbsvt.com or call Leigh Tofferi at (802) 223-6131 or Kathy Parry at (802) 371-3205. If you wish to discontinue receiving these updates or know of anyone else who would like to receive it, please call Kathy Parry or send an e-mail to [email protected]