|
|
State Health Reform Proposals
California
The following is a summary of Health Care Security
and Cost Reduction Act (AB X 1 1). To review its status, click
here.
The Health Care Security and Cost Reduction Act ensures that
all Californians have access to health coverage.
Assembly Bill X1 1, the Health Care Security and Cost Reduction
Act:
-
Requires that all Californians take responsibility
for their health coverage (individual mandate).
-
Guarantees that no Californian will be turned
away from buying insurance based on their age or medical
history (guarantee issue).
-
Spreads responsibility across individuals, government,
hospitals and employers (shared responsibility).
-
Makes coverage more affordable for individuals
and families through tax credits and subsidies.
-
Helps keep hospitals and emergency rooms open
by increasing Medi-Cal reimbursement rates.
-
Allows individuals to choose their health coverage
and keep their current insurance.
The Health Care Security and Cost Reduction Act ensures that
all Californians take responsibility for their health care.
This legislation establishes a variety of options
to achieve this: It provides assistance to low- and middle-income
families; creates a purchasing pool that allows individuals to benefit
from affordable rates; expands eligibility for
programs such as Medi-Cal and the Healthy Families Program; and
increases access to community clinics and
county-based health care programs; and other measures.
Everyone who already has insurance can keep it.
No one will be forced to change insurance plans under the Health
Care Security and Cost Reduction Act. Californians who currently
have health insurance will be able to keep the insurance they
have, and will have more options should they choose to change.
The Health Care Security and Cost Reduction Act lowers costs
and expands choice.
Like the current health care system, the Health Care Security
and Cost Reduction Act is market-based and competitive. The fundamental
difference is that now insured Californians will no longer be
forced to cover the uninsured and all Californians will be able
to buy insurance.
The Health Care Security and Cost Reduction Act guarantees that
everyone can get insurance.
Under this legislation, Californians who want to buy insurance can,
regardless of their age or medical history.
-
When fully implemented, insurers will only be
able to vary rates based on age, family size and geography.
New rating rules will be phased in over a four-year period. During
this time, limited variations based on
medical history will be allowed and reforms will limit how much
older people are charged.
-
The plan also brings greater transparency to the
insurance market by requiring insurers to spend at least 85 percent
of every premium dollar on patient care.
The Health Care Security and Cost Reduction Act puts affordable
coverage within everyone’s reach.
This legislation increases affordability for everyone and controls
rising medical costs by expanding coverage, improving access to
preventive care and reducing costly, unnecessary emergency room
visits. It:
-
Provides affordable coverage. The state
will create a new purchasing pool that will provide access to
subsidized, affordable coverage to individuals and families
with incomes between 100-250 percent of the
poverty level. As a result, low-and-middle income people will
be able to buy an affordable health insurance plan. The Act
limits how much Californians will contribute toward the cost
of their premium
based on income.
-
100-150 percent of poverty: No contribution
-
151-250 percent of poverty: Premium limited
to no more than 5 percent of income
-
Protects middle-income Californians. The
Act protects working families with higher incomes as well.
-
It provides a tax credit: Those earning
between 250-400 percent of poverty will receive a tax credit
if the cost of buying insurance exceeds 5.5 percent of income.
The Act also calls for an
additional tax credit to make health care more affordable
for early retirees.
-
It helps people pay their premiums: Anyone
with an income above 250 percent of poverty who works for
an employer who doesn’t offer coverage will get a contribution
toward their premium.
-
Expands Medi-Cal. This legislation makes
Medi-Cal available to childless adults with incomes up to 100
percent of the poverty level.
-
Expands the Healthy Families Program. The
legislation expands Medi-Cal and the Healthy Families. Program
to provide no/low-cost comprehensive health coverage to all
children with family incomes below
300 percent of the federal poverty level. This means that more
low-income children will be able to go to the doctor instead
of going to an emergency room.
-
Provides a strong community clinic safety
net. The legislation increases funding for the Early Access
to Primary Care Program to provide cost-effective clinic services
to low-income Californians who aren’t eligible for other
state subsidized coverage.
-
Allows affordability and limited hardship
exemptions. The legislation recognizes that some lower income
people who aren’t eligible for state subsidized coverage
(coverage through the pool, Healthy
Families, Medi-Cal) may not be able to afford to buy insurance.
-
So, to ensure that these people are
getting primary care but not misusing our emergency
rooms, the Act provides them with low-cost ways to get
care through clinics and county-based services.
Specifically, the legislation:
-
Provides an exemption to people
with incomes below 250 percent of poverty, whose
cost for the required coverage exceeds 5 percent
of their income, to opt out of the individual requirement
to purchase insurance.
-
Allows Managed Risk Medical Insurance
Board (MRMIB) to grant limited temporary or
permanent exemptions to people who demonstrate that
they are facing significant financial hardship or
otherwise cannot afford coverage.
The Health Care Security and Cost Reduction Act gives working
Californians and employers tax breaks.
The legislation requires employers to let employees pay their
health insurance premiums on a pre-tax basis
through IRS Code Section 125 plans. This will bring significant
tax savings to middle-income Californians and
their employers. By paying for health care benefits on a pre-tax
basis, employees and employers will save
approximately $2 billion dollars in state and federal income
taxes and federal payroll taxes. The expected cost to
an employer to establish a Section 125 plans is $200 or less.
The Health Care Security and Cost Reduction Act protects
patients, providers and the state budget.
-
Requires that insurers spend no less than
85 cents of every premium dollar on your medical care.
-
Increases access and promotes affordable care
by reforming regulations, expanding the use of nurse
practitioners and physician assistants, enhancing retail clinics,
and other measures.
-
Promotes the use of health information technology
and requires that all health providers have the
capacity to e-prescribe by 2012.
-
Promotes quality improvements and increases
access to price and quality information through a
significant transparency initiative and pay-for-performance
efforts.
-
Reduces pressure on California’s General
Fund by securing new federal funds that will raise Medi-Cal
reimbursements to doctors and hospitals.
The Health Care Security and Cost Reduction Act promotes
prevention, wellness and personal
responsibility to keep Californians healthier and costs lower.
The legislation rewards healthy choices and tackles chronic
conditions, like obesity and diabetes, to promote
better health and contain costs. AB X1 1:
-
Structures health benefits to promote prevention,
wellness and healthy lifestyles.
-
Requires health plans and insurers to offer
benefits packages that reward individuals who meet certain
health goals.
-
Creates diabetes, obesity and smoking cessation
initiatives to improve the lives of Californians and keep
down medical costs.
|
|
