by Stephen Issacs and Paul Jellinek

Recently two consultants who have helped with our group benefit plan -- Stephen Isaacs and Paul Jellinek -- provided an analysis of how the current debate could affect us.  Their report follows and originally appeared in the Foraker Group September newsletter.

When they return from summer vacation, members of the House of Representatives will consider a bill, known as the Tri-Committee Plan or Tri-Committee Bill, that represents the thinking of the three House committees with jurisdiction over the issue (Ways and Means, Education and Labor, and Energy and Commerce—which has issued a number of amendments to the Tri-Committee Plan to satisfy Blue Dog Democrats) and members of the Senate will consider a bill proposed by the Health, Education, Labor, and Pensions (HELP) Committee, chaired by Senator Edward Kennedy. Still to come is the bill of the Senate Finance Committee, though many of its views are known from its policy statements and interviews with the committee’s chairman, Senator Max Baucus.

Some of the elements of the pending bills pertinent to the Foraker Group Benefit Plan are outlined below.

Individual mandate. Both the Senate HELP and the House bills require individuals to have health insurance or pay a penalty. Those falling below certain income levels will be eligible for premium subsidies. The Senate Finance Committee is likely to issue a bill with a similar provision.

Employer mandate. Similarly, the Senate HELP and the House bills require all businesses above a certain size (Senate HELP bill: 25 employees; House bill: depends on payroll) to contribute a significant percentage toward premiums or pay a penalty. Some small businesses (based on number of employees and average wages) will be eligible for a tax credit. The Senate Finance Committee has indicated that its bill, too, will contain an employer mandate.

Central insurance pooling body. The two plans on the table include establishment of a central body—called the Gateway in the Senate HELP bill and the Exchange in the House bill—to serve as an intermediary, pooling those who need premium subsidies and linking them with certified health insurance plans. In both plans, states would be permitted to create their own insurance pooling body. The Senate Finance Committee is likely to adopt a similar provision.

The Public Option. Both the House and Senate HELP bills propose creation of a new public health insurance option to be offered through the Gateway or Exchange. The Senate Finance Committee has been cool toward a public option, preferring, according to press reports, the creation of very large purchasing cooperatives.

Medicaid and the Children’s Health Insurance Program. Both the Senate HELP and the House proposals would raise eligibility levels for these two programs.

Benefits. The benefits are not specified in either of the two bills that have been reported out of committee; each calls for a “comprehensive” package. The Senate HELP bill proposes a temporary, independent commission to advise the HHS Secretary on the essential benefit package. The House bill suggests creation of a Health Benefits Advisory Council to make recommendations on the benefit package and cost-sharing levels.

Insurance exclusions. Both bills require guaranteed issue and renewability, prohibit denial of coverage based on pre-existing conditions, and allow rating variability based on limited factors (The Senate HELP bill states that variability can be based only on family structure, geography, the actuarial value of the plan benefit, tobacco, and age. The House bill restricts variability to age, premium rating area, and family enrollment).

Prevention and wellness. Both plans emphasize prevention and wellness and encourage insurers to follow suit. The Senate Finance Committee is expected to report out a bill with similar emphases. The House plan proposes eliminating cost-sharing for proven preventive services in Medicare and increasing payments for certain [unspecified] preventive services. The Senate HELP bill proposes increasing the allowable premium discount to employees participating in wellness programs.

Quality of care. Both plans propose a variety of measures to improve the quality of patient care, including establishing a federal center to evaluate comparative effectiveness, testing different approaches to improving quality, and increasing public reporting.

Cost containment. The Senate HELP proposal does not really deal with cost containment, perhaps because that lies largely within the jurisdiction of the Senate Finance Committee. The House bill contains a number of recommendations, including simplifying health insurance administration, testing ideas such as medical homes and accountable care organizations, encouraging health information technology, bundling acute and post-acute payments, reducing payments for unnecessary hospital readmissions, and reducing Medicare Disproportionate Share Hospital payments (though not until 2019).

Commentary. This commentary must be preceded by a mild disclaimer. Since nobody knows what the final bill will look like when it emerges from a House-Senate Conference Committee (or, given strong Republican opposition and conservative Democrat doubts, whether any bill at all will emerge from Congress), the comments below are speculation, albeit informed speculation.

The overall direction that health reform is likely to take is known from the plans already on the table and the papers issued by the Senate Finance Committee. Essentially whatever is passed (if something is passed) will look a lot like the Massachusetts plan, with individual and employer mandates and an outside authority to pool buyers and link them with health plans, plus a strong emphasis on prevention/wellness and cost containment. Important details and key elements—such as whether to have a public plan and how to pay for insuring an additional 46 million individuals—are still to be worked out and will depend as much on politics as on sound policy making.

Though it may be premature for the Foraker Group to make plans around what might transpire, it might keep in mind the following: (a) there will probably be a large number of previously uninsured people who will now need to buy health insurance; (b) a lot of employers will be looking to sign up for a health plan; (c) wellness, which the Foraker Group is already encouraging, will be heavily promoted. If the Foraker Group can offer competitive rates, it might have a leg up in the new health care marketplace.

The Foraker Group has announced the addition of a third option to its innovative health benefit plan. Foraker, along with the Rasmuson Foundation, unveiled the program in October 2008, which is designed to create a healthier nonprofit sector in Alaska.

Originally the program offered two options to help expand coverage to underinsured individuals and families, or those who currently have no insurance – a high deductible plan ($1,500 deductible) with a Health Savings Account (HSA), or a catastrophic standard plan ($2,500 deductible). Both plans offer options for preventive care.

The new option, a high deductible health plan (HDHP) with a Health Savings Account (HSA), allows for greater cost savings in the monthly premiums. The new $3,000 deductible HDHP with HSA will become effective July 1, 2009. It also offers options for preventive care. All three options are available through Premera Blue Cross Blue Shield of Alaska.

Enrollment in The Foraker Group Benefit Plan has steadily increased since it began six months ago. According to Barbara Dubovich, executive director of Camp Fire USA Alaska Council, the program "is a proactive health management plan that provides more control to each employee and will, we believe, result in lowered premium costs in the future."

Over the next two months, Foraker in conjunction with Wallace Group Services will hold meetings around the state to provide further details about the third plan option, discuss updates in participation requirements, and review the status of becoming an association plan. Names of preferred brokers who are familiar with the benefit plan will be announced as well. Nonprofit leaders and brokers are encouraged to attend.

A meeting schedule and registration is available at www.forakergroup.org, click on calendar, then special briefings. For more information, call Rebecca Savidis at The Foraker Group, 907-743-1200.

The Rasmuson Foundation is supporting the Foraker initiative through Health Savings Account incentives and an enhanced comprehensive Health Risk Management (HRM) program. The HSA incentive consists of a $250 contribution per enrolled employee for the first two years ($500 total) and is available to the first 2,000 employees enrolled in a Health Savings Account. The HRM assists employees in evaluating their own health risks and helps employers manage the effectiveness of the insurance plan.

For more information, contact Rebecca Savidis, 907-743-1200.

The Foraker Group, along with the Rasmuson Foundation, unveiled a new health insurance program in October of 2008 that is designed to create a healthier nonprofit sector in Alaska. The program offers two options that will help expand coverage to underinsured individuals and families or those who currently have no insurance.

We are making great progress with the plan. Partners are signing up to take advantage of this new program which puts employees in charge of their health care, helps increase productivity, and will reduce the rise in future health care costs.

Already 24 nonprofits are part of the plan. The leaders of these organizations recognize the value of this approach to health care and have taken action to bring it to their staff. We thank them for their long-term commitment to the well being of their employees and their willingness to step forward, especially during challenging economic times. Right now it can be easier to look inward, stick with the familiar and be unwilling to try something new. Congratulations to those of you who have maintained focus and understand that we’re all in this for the future – of our mission and our organizations.

Since December, the plan has more than doubled the number of enrollees. The growing participation is due, in part, to the incentives for those who enroll early. Just to recap, the Rasmuson Foundation will cover contributions into employee’s Health Savings Accounts (HSA) for two years along with funding the Health Risk Management (HRM) program for three years for enrolled employees. We thank Rasmuson for that generous support which demonstrates the foundation’s steadfast vision of a thriving nonprofit sector in Alaska.

We also recognize and appreciate the hard work of Premera Blue Cross Blue Shield of Alaska, the Wallace Group and the insurance brokers who have embraced this innovative benefit plan. Without their guidance and support, we wouldn’t be as far along as we are today. They have been diligent in their work, which allows us to offer this competitive, long-term benefit package to our Partners.

As we know, during difficult economic times the health of our staff can suffer. Employees work longer and harder, under more stress, to serve the community. The emphasis the Foraker plan places on health and wellness has never been more needed. For enrolled groups to learn more about this part of the plan, we have partnered with Premera Blue Cross Blue Shield of Alaska to offer training sessions on proven workplace wellness strategies. We encourage you to take advantage of these sessions.

For more information on the benefit plan, or a list of preferred brokers, please call Rebecca Savidis at The Foraker Group, 907-743-1210.

What our Partners say about The Foraker Group Benefit Plan

From Barbara Dubovich, Executive Director, Campfire USA Alaska Council

Camp Fire is in the process of moving to Foraker’s HSA plan this year. After enduring radical increases in health insurance premiums for several years with the latest at 50%, we look forward to the potential of having more predictability in increases.

The Foraker HSA Plan through Premera Blue Cross is a proactive health management plan that provides more control to each employee and will, we believe, result in lowered premium costs in the future.

The added incentive offered from the Rasmuson Foundation really helps our employees to build their HSA Accounts.

The Foraker Group Benefit Plan
The Foraker Group in cooperation with Premera Blue Cross Blue Shield of Alaska (PBCBS) will provide an update on The Foraker Group Benefit Plan. This will be an excellent opportunity for Q and A. 

This is a free session but please sign up today.

Upcoming briefings:

Sept 5
10:00am - 11:00am
Anchorage, Camp Fire

Sept 8
11:00am - 12:00pm
Palmer, AT&T Sports Center

Sept 11
3:00pm - 4:00 pm
Anchorage, Camp Fire

Sept 12
9:00am - 10:00am
Fairbanks, Food Bank