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CCH® BENEFITS — 02/12/09

State Health Care Reform Update

from Spencer’s Benefits Reports: For the last few years, states have been leading the way toward more comprehensive health care coverage to ensure that more people have or can obtain health insurance. Because of the potential impact of this ongoing activity on employer-provided health insurance benefits, Spencer’s Benefits Reports provides regular updates about state health care reform.

Arkansas. Gov. Mike Beebe recently called for more options for outpatient care, increased funds for community health centers, and more resources and equipment for mental health services in schools. He also called for the establishment of a statewide trauma system, increased efforts against cancer, expansion of preventive care services at health education centers, research into treatment options for children with autism, increased dental insurance, and expanded access to flu vaccinations. Mr. Beebe believes that this can be paid for with a 56-cent increase to the state’s cigarette tax. For more information, visit http://www.governor.arkansas.gov/.

California. On January 1, California became the first state to implement a mandatory interpreter law for commercial health plan members. Patients who have primary languages other than English can request that their health care plans provide interpreters when they make appointments at doctors’ offices, clinics, or hospitals. More than 80 health plans were required to gain approval of their language assistance programs, detailing which languages are spoken by their members, how language assistance services will be provided, and what staff training is needed. According to the Ventura County Star, the California Department of Health has only received five calls from patients who wanted help getting interpreters. For more information, visit http://www.dhs.ca.gov/.

Connecticut. Although consensus has been building to move the state toward universal health care, the state faces a $6 billion budget gap over the next two years. These conflicting pressures have resulted in lawmakers beginning to work on cutting more than $100 million from the current-year budget in addition to several groups proposing health care reform plans that move the state closer to universal coverage. In 2006 and 2007, Connecticut had approximately 325,000 uninsured individuals, and some believe that the continued cost of the uninsured is actually more than it would cost the state to move toward universal coverage. One plan would begin enrolling the uninsured in 2011, with the aim to cover 98% of the state’s population by 2014. While this plan does not include a price tag, it focuses on cutting costs through digitizing medical records and boosting preventive care and health education. For more information, visit http://cthealth.server101.com/.

Iowa. Several state legislators are supporting a measure that would allow small businesses, local governments, and nonprofit organizations to buy into the state employee health care coverage program. While many business owners previously had resisted efforts to expand health care coverage, they are reconsidering their positions as the price of health insurance continues to increase, according to state Sen. Jack Hatch. For more information, visit http://www.jackhatch.org/.

Maryland. According to the Maryland Health Care Commission, 15.4% of Maryland’s nonelderly residents, approximately 760,000 people ages 65 and younger, were uninsured between 2006 and 2007. The rate was higher than the 14.9% rate for the 2004-05 period, but lower than the national uninsurance rate of 17.5%. For more information, visit http://mhcc.maryland.gov/.

New York. The New York State Insurance Department recently issued a letter indicating that all insurers licensed to do business in New York must rewrite or amend their policies to recognize same-sex marriages legally performed in other jurisdictions. The letter stated that a same-sex spouse legally married outside of New York state is entitled to the same health insurance coverage as any opposite-sex spouse of an employee. According to the insurance department, an insurer’s refusal to extend health or other insurance coverage on an equal basis to same-sex and opposite-sex spouses may constitute an unfair act or practice under New York state insurance law. However, under the federal Defense of Marriage Act, a same-sex spouse will not be treated as a spouse for Internal Revenue Code purposes. Therefore, a same-sex spouse is not entitled to the favorable tax treatment generally applicable to spouses, and the value of benefits provided to same-sex spouses is includible in the employee’s gross income. For more information, visit http://www.ins.state.ny.us/.

Utah. According to a recent poll from the Salt Lake Tribune, 55% of Utah residents would support an individual mandate requiring everyone in the state to have health care coverage, if the premiums were affordable. If Utah were to implement a mandate, nearly half of its 287,200 uninsured would be required to enroll in programs that they already are eligible for, such as Medicaid, the State Children’s Health Insurance Program, and the Utah Comprehensive Health Insurance Pool. For more information, visit http://www.sltrib.com/.

Wisconsin. Governor Jim Doyle has proposed taxing hospital revenue, which would attract nearly $1 billion in federal funds in its first three years, including nearly $300 million for hospitals in the Milwaukee area alone. Under the proposal, the state would impose a tax on the revenue of most of the state’s hospitals, which would generate about $275 million in the first year. The state would use about $196 million of that to increase its funding for BadgerCare Plus and other Medicaid programs, while the remainder would be used to reduce the state’s budget deficit. The additional funding for state health programs would draw about $281 million in matching federal dollars. The state would increase what its health programs pay hospitals, which would recoup the $275 million they paid in taxes, plus an additional $202 million through higher payments. The proposal, while bringing in an estimated $925 million in federal money to the state, would come at the expense of federal taxpayers and add to the federal budget deficit. However, this holds more political appeal in the state than raising state taxes to increase funding for Medicaid programs. Twenty-three states have similar taxes. For more information, visit http://www.jsonline.com/news/statepolitics/38310214.html.

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