The new Health Care Reform law is being studied by interim legislative committees so that we can be prepared for the next legislative session. There are many federal mandates that will require state laws to be changed, and it is important to know what they are and what the timetable is that the federal government has set. The new law spreads implementation of mandates out from 2010 to 2020.
Reimbursement for the large hospitals in the state will increase so that the payments are more in line with other states. However, reimbursement for physicians' services will be reduced. Congress is now considering what is called the "doc fix" to appropriate additional funds to make up for the cuts in fees to physicians. The concern here is that physicians will quit taking new Medicaid and Medicare patients, if reimbursement is reduced.
Employers need to learn about new requirements concerning part-time employees and seasonal workers. What about people with two jobs? Insurance policies, either new or renewed for plan years after September 23, 2010, must comply with the deadline concerning prohibition of lifetime limits on health insurance coverage for certain treatments, expanding coverage to dependents up to the age of 26, elimination of co-pays on certain preventive services, and federal review of what it considers unreasonable rates, to name a few.
The Class Act provision will require another payroll withholding of what we are being told will be approximately $100/month after age 18 to apply towards need for skilled care and home and community-based services later in life. Employees can opt out of this and should consider that option carefully.
Pre-existing conditions cannot be a reason to be denied insurance coverage. This is more complicated than it sounds, because it is conceivable that people would drop their insurance coverage, until they get sick and then go and purchase a policy. Without a broad pool of insured people, many of whom are healthy, the cost of the premiums will increase, because only sick people will buy insurance. North Dakota has a high-risk pool which makes insurance available to people who have been denied coverage by insurance carriers. However, the federal law calls for different standards than what N.D. has, so we will have to see how this all evolves.
Other immediate requirements include limits on what factors can cause premiums to vary, guaranteed renewability of coverage, 90-day maximum waiting periods, and limited policy options. The federal rules will determine what a qualified plan is.
Children's Health Insurance Program (CHIP) as currently set up in N.D. will disappear in about 5 years as those children are absorbed into a federally mandated plan. North Dakota, when determining qualifying income for CHIP, has over 40 items which are disregarded or deducted, when calculating net income. For example, taxes and child care costs are deducted from gross income. The idea is to provide coverage for working families and to provide broad coverage for those who need it most. North Dakota will, in the future, no longer be able to use our net income formulas, but will have to follow the federal formulas.
Beginning in 2014, individuals will be required to have health insurance. Failure to do so will result in penalties.
It is very important to note that the states and the insurance providers cannot respond to the requirements until the federal government sends out the rules, and many of those have not yet been released. Rules concerning grandfathering in insurance policies that people currently have were just released a few minutes before this report was written today.
This is only a handful of the hundreds of provisions in this law, and your legislators are working their way through them so that we can respond appropriately during the next session. If you have any questions, you can reach us at: Senator Judy Lee, firstname.lastname@example.org, 282-6512; Rep. Kim Koppelman, email@example.com, 282-9267; and Rep. Alon Wieland, firstname.lastname@example.org, 282-9470.