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CCH® BENEFITS — 04/02/09

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.

Dental care. In February, President Barack Obama signed the Children’s Health Insurance Program (CHIP) Reauthorization Act of 2009. Under the old CHIP law, states had the option of providing dental services to children under CHIP; however, the reauthorization act requires that states provide dental services to enrolled children starting Oct. 1, 2009. The new law imposes a number of reporting requirements on states, which now must count the number of enrolled targeted low-income children who receive any preventive or restorative dental care under the state plan.

Arkansas. The Arkansas house approved a bill that would expand eligibility for ARKids First, the state’s version of CHIP, to children in families with incomes up to 250% of the federal poverty level (FPL). The current income threshold is 200% of the FPL. The measure will be funded with a state tobacco tax increase, which is expected to generate $86 million. Under the bill, an additional 8,000 children would become eligible for the program. For more information, visit http://www.arkidsfirst.com/home.htm.

Colorado. The Colorado senate has given preliminary approval to a bill that would repeal a program created to provide low-income state residents access to affordable prescription drugs. The Colorado Cares Rx Program was created in 2007 and was supposed to help more than 250,000 state residents. However, when the program was rolled out in 2008, it was found that many of the drugs available through the program also were available for lower prices at chain pharmacies. Much of the money allocated for the program was never spent, and eliminating the program would save the state about $3.9 million annually. For more information, visit http://www.colorado.gov/coloradocaresrx.

Idaho. The Idaho senate has voted to cut $10.4 million from the state’s Medicaid budget in 2010, saying that the state faces a budget deficit, even with the additional funding from the federal economic stimulus package. The bill, which already has passed in the house, freezes nursing home rates and discontinues transportation services for Medicaid beneficiaries to nonemergency appointments. For more information, visit http://www.healthandwelfare.idaho.gov/Default.aspx.

Iowa. The Iowa senate has approved a bill that would extend health insurance to 30,000 children and set up a commission to help residents obtain affordable coverage. Approximately 40,000 children in the state are uninsured, and most of those children already qualify for Medicaid. The bill would increase efforts to identify those children, and would increase the income eligibility limit to 300% of the FPL. The bill would cost about $8 million annually with federal funding. For more information, visit http://www.ime.state.ia.us/.

Louisiana. Gov. Bobby Jindal submitted a $26.7 billion budget to the Louisiana legislature that includes a 5% decrease in health care spending. This decrease is approximately $413 million, or 9.8% from the current year. The cuts will apply to hospitals, nursing homes, physicians, and others that provide services to low-income, elderly, and uninsured individuals. For more information, visit http://www.dhh.state.la.us/.

Maryland. Maryland lawmakers have outlined a $1.6 billion plan that would achieve near-universal health care coverage in the state. The plan would require state residents to have insurance and require employers to provide it, and it would help more than 760,000 uninsured state residents. The legislation would build on a plan approved in 2007 that expanded Medicaid eligibility, and extended funding to small businesses to compensate for the cost of providing coverage. The bill would provide a health insurance plan for state residents with premiums of approximately $250 per month, in addition to sliding-scale funding for low-income individuals who do not have access to Medicaid or Medicare. Residents without health insurance would be taxed an additional $1,800 annually, while low-income residents would be exempt from this tax penalty. Legislators are hoping this plan will be approved during the 2010 legislative session. For more information, visit http://mlis.state.md.us/2008RS/billfile/hb1125.htm.

Montana. State lawmakers negotiated a budget deal that includes $35 million for a CHIP expansion initiative, which would expand the CHIP income eligibility threshold from families with incomes up to 175% of the FPL to those with incomes up to 250% of the FPL. The budget also would require the state to launch a campaign to enroll eligible children in the programs through schools, hospitals, public health agencies, youth sports programs, and other entities. For more information, visit http://chip.mt.gov/.

Oklahoma. The Oklahoma house approved a bill that would authorize the state’s insurance commissioner to allow health insurance companies to offer low-cost, mandate-free coverage to residents younger than age 40. Approximately 60% of the state’s 600,000 uninsured are between age 18 and 40, and this bill is designed to provide this group with an affordable health coverage option. For more information, visit http://www.okhouse.gov/.

Oregon. Oregon house Democrats are working to expand health care coverage to more than 150,000 people. The plan would be partially funded by higher provider taxes on hospitals, which would raise approximately $700 million in the next two years. This could expand state-supported care to 80,000 children and as many as 75,000 low-income adults. Another source of funding would be an increase of 60-cents-per-pack in the cigarette tax, which state Democrats plan to push for during the legislative session. For more information, visit http://www.leg.state.or.us/house/houseset.htm.

Pennsylvania. Gov. Ed Rendell has proposed redirecting millions of dollars for health care and other programs to help families affected by the economic recession. Mr. Rendell plans to immediately extend adultBasic coverage to an additional 16,000 people on the waiting list for the program, which provides health insurance to lower-income adults. Adding the 16,000 beneficiaries to the program would cost about $19 million over the next 15 months, according to the administration. For more information, visit http://www.ins.state.pa.us/ins/cwp/view.asp?a=1278&q=527068.

Utah. Workers in Utah soon will be able to choose between the health care plans that their employers offer or to take their employers’ contributions to the cost of coverage and use them to buy individual insurance through a state-run Web site. The measure, signed into law by Gov. Jon Huntsman, allows insurers to sell low-cost health insurance policies that exclude some state-mandated benefits, have high deductibles, and limit coverage for preventive care services. Insurers issuing these policies will not be permitted to base rates on medical history, though rates may be based on an individual’s age, place of residence, and family composition. The legislation also creates the Utah NetCare plan, a low-cost health benefit plan that employees can choose as an alternative to federal COBRA coverage, state-based COBRA coverage, or any conversion products that are offered to them by group insurers when their employment is terminated. This program will become available to small employers on Jan. 1, 2010, and to large employers on Jan. 1, 2012. For more information, visit http://www.utahnetcare.com/.

Washington. The Washington state senate has approved a measure to offer same-sex domestic partners the same rights and benefits that the state offers married couples. The bill would expand on previous domestic partnership laws by adding references to partnerships alongside all remaining areas of state law where currently only married couples are mentioned. For more information, visit http://www.leg.wa.gov/senate.

West Virginia. According to a recent poll from West Virginians’ Campaign for a Health Future, 78% of West Virginians want to see changes in the state’s health care system. Currently, there are several bills that have been introduced relating to a health care overhaul, but many hinge on the passage of an increase in the tobacco tax to receive funding. The poll found that 63% support a tax increase from 45 cents per pack to $1. For more information, visit http://www.wvhealthyfuture.com/.

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