Great News for the People of Illinois...Now What?

Yesterday, Governor Quinn announced that Illinois was awarded a $115 Million grant for its Health Insurance Marketplace (the online portal to enroll over a million adults and children into quality health plans). A large portion of this federal funding will pay for outreach activities and consumer assistance during the push to enroll the uninsured beginning on October 1 of this year.

This is great news for the people of Illinois.

With October 1 less than six months away, we need these federal funds to help get the word out about the availability of new insurance coverage options. According to Enroll America's research findings, the  majority  of  uninsured Americans  don’t  know the  health  reform  law  will  help  them:

• 78% of  the  uninsured  don’t  know  about  the new  health  insurance  exchanges  
• 83% of  people  who  could  be  eligible  for  the new  Medicaid  expansion  don’t  know about  it.  

Tremendous amount of work needs to get done to tell people about the new options and enroll them into a plan. 

Here's a timeline of what needs to happen to be ready by October 1, 2013. Since Illinois is running its exchange/marketplace in partnership with the federal government, we need to be mindful of activities by both the feds and the state:

Already Happened:

• Illinois Marketplace Team Selects Training Vendor (UIC/Public Health)
• Marketplace Team Releases Outreach & Education Plan & Conducts Outreach to Encourage Navigator & In Person Assister (IPA) Applications. (Read this fact sheet to learn about the different Consumer Assistance Entities needed).
• Marketplace Team Receives Establishment Grant Funding
• Illinois Marketplace Team Releases RFP for Media and Marketing Outreach Strategy.
• CMS Releases Proposed Standards for Navigators and In Person Assisters (see here for a good summary)
• Federal Government Releases Navigator RFP (Just released today, April 9, 2013; due June 7,
  2013; Expected Award Date - August 15, 2013). 
• Advocates create the Illinois Consumer Assistance Matchmaking Spreadsheet to find partners in either the federal Navigator grant or the (yet to be released) Illinois Assister RFP.

Spring 2013:

• Marketplace Team Issues RFP/Grant Application for IPA entities
• Marketplace Team Approves IPA Training Materials
• Marketplace Team selects firm for Media and Marketing Outreach Strategy (UPDATE: On 7/12/13 Fleishman Hillard is selected)

Summer 2013:

• Federal Government Selects Navigator Entities (Due date for application: June 7, 2013)
• Marketplace Team Selects IPA entities (see list here) 
• Federal Government Takes Applications for Certified Application Counselors (sign up here)
• Navigators, IPAs, Certified Application Counselors (CACs) Receive Training and Certification.
• Media placement begins

October 2013 and beyond:

• Navigators, IPAs & CACs Assist Consumers during Open Enrollment
• Navigators, IPAs & CACs Provide Post-Enrollment Assistance & Assistance during Special Enrollment Periods
• Program Oversight Conducted By Marketplace Team and Federal Gov’t.

The timeline is tight and we need all types of entities (community based organizations, hospitals, health departments etc.) to help with enrollment.

If you have any questions about  what this means for you or your organization, please don't hesitate to contact us at info@illinoishealthmatters.org.

Stephani Becker
IHM Project Director

Sign On in Support of SB 34 - A State Run Exchange in Illinois

Illinois Senate Bill 34 establishes a robust, pro-consumer and pro-small business Health Insurance Marketplace in Illinois. The Health Insurance Marketplace will be the one-stop insurance shop for more than a million Illinoisans. SB34 ensures that the Marketplace is governed by a diverse board that represents women, small businesses, communities of color, labor, public health, people with disabilities, and consumers.  It is scheduled to be heard in subcommittee of the Senate Executive Committee today.

Please help signal broad support for this important health care bill by taking these 2 actions:

1. Sign on to the list of organizations supporting SB34

Click here to add your organization to the list of supporters for the passage of SB34.

2. Call the toll-free Marketplace Action line, 1-888-801-4426, and ask your state senator to cosponsor SB34!

If your state senator is already a cosponsor, please call him or her to thank them for their support. Here are the current co-sponsors:


David Koehler, Heather A. Steans, Don Harmon, Toi W. Hutchinson, William Delgado, Jacqueline Y. Collins, Michael Noland, Emil Jones, III, Julie A. Morrison, Steven M. Landek, Dan Kotowski, Patricia Van Pelt, Iris Y. Martinez, Mattie Hunter, Kimberly A. Lightford, Daniel Biss, Ira I. Silverstein, Thomas Cullerton, Terry Link, Melinda Bush, Donne E. Trotter, Bill Cunningham, Kwame Raoul, Napoleon Harris III

Please especially ask Senators Trotter and Clayborne and members of the Senate Executive Committee to pass SB34 out of committee.

SB34 must first pass out of the Governmental Operations Subcommittee and then the Executive Committee before going to a full vote.

Advocacy Materials:

You can find these materials and many others on our Health Insurance Marketplace page:

•     SB34 Fact Sheet
•     Health Insurance Marketplace Q&A
•     State Senator Co-sponsorship Form
•     Template for Co-sponorship request letter to senator
•     Template for Co-sponorship thank you letter
•     Multiple briefing resources

Jim Duffett
Campaign for Better Health Care

The HHS Secretary Visits Chicago

This week, U.S. Health and Human Services Secretary Kathleen Sebelius visited Chicago to speak about the Illinois Health Insurance Marketplace, a key provision of the Affordable Care Act.

Secretary Sebelius, accompanied by Governor Pat Quinn, announced on Wednesday that the Illinois Blueprint Application for a State-Partnership health exchange had been accepted by the federal government. The exchange will run as a federal-state partnership model until 2015, when the state may take over operations, depending on the State Legislature’s ability to pass a state exchange bill. Enrollment in the partnership exchange/marketplace opens in October, only eight months (229 days!) away.

Secretary Sebelius speaks to a full house at the Chicago Cultural Center

On Thursday, Sec. Sebelius spoke at the Chicago Cultural Center. Preceding her was Bechara Choucair, Commissioner of the Chicago Department of Public Health, who presented an overview of the Healthy Chicago program and its impact thus far. Sebelius delivered a call to action to those in attendance, citing the need for affordable, accessible health insurance for all as a crucial step in the national public health strategy. With only eight months before the state health marketplace is open for enrollment, and ten months before it is fully operational, promoting awareness of the health insurance exchange is the focus of HHS. 

Navigators, Assisters, and Counselors, Oh My!

By now we know that upwards of 30 million Americans will have new, more affordable health coverage options available to them by January 1, 2014. But what many don’t realize is how incredibly difficult it can be to understand and choose the right health insurance on your own.

The Wizard of Oz’s Dorothy had guides along the way, and the Affordable Care Act (ACA) provides some as well – hopefully, with fewer pitfalls. But not everyone can counsel people about health insurance. There are complex public and private systems to navigate, and most people who will likely get insurance in the new Health Insurance Exchanges, or Marketplaces, will be more racially diverse, less educated, and earn lower income than people in private insurance now. Most will have a high school education or less, and as many as one in four speak a language other than English at home. So it matters that the people who guide consumers along the path to coverage are trusted members of the community and understand their circumstances.

Luckily, the ACA provides different options for guides along yellow brick road.

Navigators are outlined in the ACA as helpers for people to enroll in coverage through the Exchange, and refer or assist with Medicaid enrollment. Navigators are funded through Exchanges, and regulations from the Department of Health and Human Services (HHS) are clear that anyone who gets payments from insurance companies cannot be a Navigator. Navigators also must meet cultural competency standards and go through training and certification. States running their own Exchanges are developing Navigator programs now and must fund these with state Exchange dollars. For Federal Exchanges and Partnership Exchanges, HHS has said that it will fund Navigators directly through an upcoming RFP process. Be on the lookout for this announcement in the next few weeks.

To add even more help on the ground, HHS recently outlined in regulations another program,Assisters (or, In-Person Assistance). Like Navigators, Assisters must meet training and conflict of interest standards. They could fill in gaps in areas that need more enrollment assistance, or provide outreach and education about the ACA’s new options. Funding for Assisters is a key difference from Navigators. States running Exchanges or opting for the Consumer Assistance Partnership can apply for funds for Assisters through their Exchange Establishment grants. A number of states are applying now for these funds. Unfortunately, Assisters currently are not an option for Federal Exchanges.

And when you thought there were enough new health-related terms, HHS regulations added yet another helper to enroll people, Certified Application Counselors. Every Exchange must have a Certified Application Counselor program, with similar training and privacy standards as Navigators and Assisters. A difference in this program is that there is no funding mechanism. It is unclear who will serve this role – although the regulation suggests it could be community-based organizations or health care providers. Stay tuned for further clarification on this new option.

But even these multiple types of help will not be enough to spread the word about the ACA. Helping people understand and choose the right health plan, especially given the amount of misinformation in the media and elsewhere, is going to be a huge task. Nevertheless, these resources in the ACA provide a foundation to start building greater understanding of health care options to get people into the right coverage.

This post originally appeared on Health Policy Hub's the Community Catalyst Blog. 

Written by Christine Barber, Senior Policy Analyst

What is the Illinois Partnership Health Insurance Marketplace?

The Affordable Care Act requires each state to have a health insurance marketplace (otherwise known as a "health insurance exchange"). Originally, the plan was for each state to establish its own health insurance marketplace, or default to a federally-run exchange. After the ACA passed, the federal government offered a new “partnership exchange” model, which is to relieve some of the administrative burden on the state by providing federal assistance. Illinois sent the federal government a blueprint application in November 2012 to establish a state-federal partnership exchange in 2014, with plan to transition to a state based exchange after 2015. The state is waiting for final approval of the blueprint.

On January 3, 2013, the federal Center for Consumer Information and Insurance Oversight sent out guidance on how a partnership health insurance exchange will work. The guidance allows states like Illinois who plan to transition to a state based exchange to take on as much responsibility as possible for exchange activities such as administration, plan selection, and consumer assistance. This model is referred to as a State Plan Management Partnership Exchange.

A key role of a state exchange is to provide consumers assistance in enrolling in the exchange, understand their options for insurance coverage, make decisions about coverage, and coordinate with community based organizations. This consumer help will be provided by two programs, In-Person Assisters (IPA) and Navigators, which will be separate but closely coordinated. The Navigator program will be run by the Federal government, and Illinois will develop the IPA program. Since Illinois has historic connections in the community and their understanding of the state-specific insurance, Medicaid and supplemental state health programs, the IPA program will be the primary contact for consumers and for insurance companies.

Community Based Organizations, consumer assistance organizations, medical and social service providers will all play an important role in ensuring that the Illinois state federal partnership exchange is efficient and accessible. Consumer advocates should work cooperatively with the state and federal governments to ensure that whichever agencies are responsible for administering parts of the exchange, that the end result is a coordinated system that works well for the people who need insurance coverage, including the small employers who need to purchase insurance for their employees.

Stephanie Altman
Programs & Policy Director
Health & Disability Advocates

What Happens to the Pre-Existing Condition Plans on Jan. 1, 2014?

This post is the first in a series on the Illinois State Partnership Exchange Blueprint Application, which is pending approval by the Federal Government. 

For years, health insurance carriers refused to sell coverage to individuals with pre-existing medical conditions. The Affordable Care Act (ACA) created federally funded high risk pools across the country, including the Illinois Pre-Existing Condition Insurance Plan (IPXP) so that people denied for that reason would not have to go without health insurance. Starting on January 1, 2014, the ACA bans insurance companies from denying coverage based on pre-existing conditions. As a result, IPXP will no longer be needed, and coverage under the plan will be terminated.

So what happens to the enrollees of IPXP on January 1, 2014? 

The ACA dictates that anyone currently enrolled in IPXP will be transitioned into a private insurance plan via the state health insurance exchange. This transition process will happen at the end of 2013. According to the Illinois State Partnership Exchange Blueprint Application, the state has mechanisms in place to prevent lapses in health coverage, as follows:

• Illinois will send at least three letters to IPXP enrollees containing information on the transition process;
• The state will conduct proactive outreach to IPXP participants and update the IPXP website with relevant information; and
• The Illinois health insurance exchange will have extra personnel at the call center specifically to assist with the IPXP transition.

IPXP will only extend coverage for health services until December 31, 2013, which means that all current IPXP enrollees will need to find an alternative health plan before January 1, 2014.  Claims dating from before December 31, 2013 will need to be filed in the close-out period, which will run until June 30, 2015. If deferral funding for the IPXP program has run out, however, even claims filed before that date will not be payable.

Open enrollment into the state health insurance exchange will begin on October 1, 2013, with insurance coverage beginning on January 1, 2014. If current IPXP enrollees purchase a plan during open enrollment, there should be no gaps in their health coverage. Since Illinois is still in the process of establishing its health insurance exchange, check back here for details on how and where to enroll in a health insurance exchange plan, as well as future updates on the IPXP transition process. If you have questions now, contact IPXP at (877) 210-9167, or e-mail your question directly to IPXPInquiry@healthalliance.org

Five Reasons Why States Should Act Quickly to Set Up Health Insurance Exchanges

Now that the Supreme Court has upheld the Affordable Care Act, we know that insurers will no longer be able to deny people coverage or charge them more based on their health status or gender, subsidies will be available to help people with low and moderate incomes afford coverage, and a state or federal exchange will be operating in every state in 2014.

A number of states are well on their way to establishing their own exchanges. But many other states instead have dragged their feet, citing uncertainty prior to the high court’s ruling (see map). With last Thursday’s decision, however, states can no longer use that excuse as grounds to avoid implementing the law. States that have said they prefer to operate their own insurance exchanges (rather than have the federal government run the exchanges for them) must act quickly.



Five reasons why states should start or resume planning activities immediately:

1. Deadlines are approaching – quickly. States must officially notify the Department of Health and Human Services (HHS) by November 16, 2012 – that is, in less than five months – of their intention to operate a state-based exchange and submit an application for federal approval of the exchange’s design and operations.

2. Applications alone won’t be enough. States seeking approval of their exchange proposal have to demonstrate sufficient progress to HHS by January 1, 2013 in order to prove that their state does not need a federally run exchange.

3. Operations will start before 2014. Exchanges – whether state- or federally run – will have to start enrolling individuals, families, and small businesses by October 1, 2013. States operating an exchange will also need to ensure they can determine eligibility for federal premium and cost-sharing subsidies available to individuals with low and moderate incomes who will buy coverage through the exchange. They also must be able to coordinate with their state Medicaid and CHIP programs. This means that new and improved information technology systems must be developed and tested.

4. Key policy decisions will take time. States must decide how they’ll approach and implement a wide variety of policies, such as financing operations of the exchange after 2014, selecting health plans to be sold in the exchange, conducting outreach and education to consumers, and developing services to attract small businesses.

5. Federal grant funds are available to fully fund states’ exchange set-up costs. States can apply for and receive federal funds that will finance all costs related to the design and launch of their exchanges. The funds can be used to conduct research on their insurance market, develop or upgrade their IT systems, hire and train staff, as well as support all operating costs for the exchange’s first year. The grants will be provided through 2014, as long as funds are available. But the sooner states access the funds, the sooner they can put them to work – and increase their chances of meeting all of the important implementation deadlines.

Despite these factors, leaders in several states responded to the Supreme Court decision by continuing to delay their own decisions on whether to move forward and create a state-based exchange. Because of the time crunch, this foot-dragging could effectively be a decision in itself – to forgo any chance of operating an exchange themselves and instead default to an exchange set up by the federal government.

Dave Chandra
Center on Budget and Policy Priorities

(Original post can be found here on the Off the Charts Blog)

How Quinn can save the day on health care

There is plenty of confusion and debate about the Affordable Care Act. One element of the 900-plus-page legislation is crystal clear, however: Each state must establish an insurance exchange or the federal government will step in to fill the void.

The insurance exchange is the cornerstone of the ACA. It is an online marketplace for consumers to shop for insurance just as they shop for an airline flight. Those who qualify for federal health care subsidies will be able to use them only to purchase plans offered on the exchange. This will attract relatively healthy individuals and help drive down premiums for everyone shopping there.

When the spring legislative session adjourned recently in a welter of debate over pension funding, the possibility of bipartisan design of the Illinois' exchange vanished. Reasoning that part or all of the ACA could be stricken down by the Supreme Court this month, our legislators decided to delay action. But they're taking a grave risk: If the exchange-related parts of the ACA survive, Illinois will need to provide a detailed blueprint of an exchange by November. We have been awarded $38 million toward exchange planning. There's just one glitch—our legislators haven't authorized the establishment of an exchange.

If Illinois is to have any chance of a state-designed exchange, Gov. Pat Quinn immediately must issue an executive order to establish one.

The authority operating the exchange (an entity our state should design) would ensure that only plans providing the full range of benefits required by the ACA participate. A state exchange could take a more active role, limiting participation, for example, to the lowest-cost and highest-quality plans.

The broker industry is rightly concerned that exchanges will put them out of business, just like Orbitz and Expedia decimated the travel agent industry. Once the insurance market becomes transparent, individuals and small groups will need the services of brokers less and less, and insurers will not be willing to pay their high commissions. Cutting brokers out of the equation should reduce premiums by 5 to 7 percent—no small feat given how hard it is to cut health care costs.

We have $38 million in hand, and more funding is available if we apply by the end of the month. Illinois will be responsible for financing the exchange regardless of whether we operate and design it ourselves. Should we not seize the opportunity to use these funds to craft something that suits our circumstances and tastes?

The Legislature has effectively cut itself out of the picture. The question now is: Will the governor move in time to protect the public interest?

Leemore S. Dafny
Associate Professor of Management and Strategy
Kellogg School of Management, Northwestern University


(Original article posted here at Crain's Chicago Business, June 21, 2012)

Do What’s Best for Illinois

The dispute in Washington, D.C. over health-care reform is stirring debate everywhere. Opinions on what aspects of reform matter to many puts us at risk of losing sight of what matters to all — quality, affordable health care. Regardless of what the Supreme Court decides, Illinois lawmakers should ensure that Illinoisans see lower costs, better quality and more stability in their health coverage.

They can start by creating a health insurance exchange program that allows individuals and small businesses to pool their buying power and negotiate for better prices for health-care coverage. Smart economic decisions are based on ample choice and price comparison. The more health-care options, the better the cost and access to primary care. An exchange program would provide consumers the opportunity to be in control of their own health coverage.

More than 8,000 of our patients are uninsured and do not qualify for Medicaid or Medicare. An insurance exchange program could secure affordable coverage for their primary health-care needs and keep them from seeking routine care in a hospital emergency room. As a Federally Qualified Health Center, we know the importance of primary care for not only promoting better health, but preventing diseases. Illinois should do what is best for its residents, not for big insurance companies.

Warren J. Brodine, CEO,

Chicago Family Health Center 

Originally published in the Chicago Sun Times on April 4, 2012

What’s Next for Health Care Policy in Illinois?

The past two weeks were a non-stop affair for health care policy—the ACA saw its 2nd anniversary right before the Supreme court heard oral arguments for the historic case against the law, and here at IHM we premiered our data visualization tool. However, health care reform news has not stopped. Here’s a brief overview of what the next few months have in store for health care in Illinois:

Health Insurance Exchange: State legislators made little progress towards votes on the establishment of a competitive health care marketplace, though negotiations on HB 4141 are underway. Legislators still have time to establish an exchange, but the Federal deadlines are looming closer, and to miss deadlines could cause Illinois to lose out on important Federal grant money. If the group waits to move forward with the exchange until the Supreme Court announces its decision on the ACA case -- a prospect that interests some legislators -- , there may not be enough time to set up a functioning exchange. Governor Quinn has said that he would establish the exchange via an executive order if necessary.

Potential Cuts to Medicaid: The Illinois Medicaid program faces a $2.7 billion deficit in the coming fiscal year. In order to deal with that budget, the Department of Healthcare and Family Services has proposed a list of possible cuts to Medicaid services in order to balance the budget. As legislators go into the upcoming spring sessions, many advocates are calling for other methods of fixing the Medicaid budget deficit that do not compromise important health care services that the program provides.

The Illinois General Assembly starts its April sessions on the 17th.. Follow the progress of these health policy issues with IHM!

States Taking the Lead in Strengthening Consumer Protection

Recently, five more States strengthened their laws protecting consumers in disputes with their health insurance plans. The District of Columbia, Massachusetts, New Hampshire, Ohio and Wisconsin have bolstered their laws surrounding the part of the appeals process known as “external review.”  These five States join 33 others that provide these State-based external review protections that ensure consumers have a voice. The remaining States’ consumers are protected by a Federal process.

The strengthened appeals rights are one of several common-sense consumer protections and insurance market reforms established by the Affordable Care Act. Having a meaningful appeals process ensures that you actually receive the benefits that your insurer has promised.

So, what exactly is an external review? 

It means having an independent third party review your insurer’s decision, no matter where you live, thanks to the Affordable Care Act. Often, you can resolve disputes with your health plan by asking your insurer to reconsider its decision, in a process known as an “internal appeal.” But if, for example, your insurer still denies payment after the internal appeals process, you now can ask for an external review by an independent review organization to decide the matter.  Insurance companies must accept the outcome of this external review.  This means that your insurance company no longer gets the final say, and that patients and doctors get a greater measure of control over health care decisions.

These protections are important because when an insurer refuses to pay for a covered health care service, consumers could be faced with a large unplanned bill, and may not be able to afford the care their doctors say they need.

The Affordable Care Act sets these new important appeals standards for consumer protections and encourages States to take the lead in ensuring their own residents benefit from them.  Where States have not yet passed laws implementing these consumer protections, HHS has set up a process to ensure that consumers in these States also benefit from the same protections and standards.  If a State changes its external review process in the future, the State may request a new determination at any time. 

Having DC, Massachusetts, New Hampshire, Ohio and Wisconsin step up to the plate to ensure consumers’ external review rights is a perfect example of how the Affordable Care Act empowers States to protect consumers.

This post was originally published on The HealthCare Blog on November 22, 2011
By Eliza Bangit, Acting Director of the Consumer Support Group

Latest Developments in the implementation of an Illinois Health Benefits Exchange: Senate Bill 1313

Back in the spring, the Illinois General Assembly passed a bill enacting the intent to create a health benefits exchange, a state-wide marketplace called for by the federal Affordable Care Act that will act as a tool to aid consumers to shop for insurance. The exchange has the potential to create a competitive and regulated environment that will keep health insurance costs at reasonable levels, and thus more available to individuals and small businesses, while also making the process of shopping for insurance more straightforward and manageable. In order for the health benefits exchange to operate this way, it is important that the exchange is created with the needs and protection of consumers and small businesses in mind. Earlier this fall, the study committee on the exchange released a report on their findings.  This past week, during the Illinois General Assembly Fall veto session, steps were taken to establish the exchange. State Representative Mautino introduced his amendment (House Amendment 2) to SB 1313, a bill which dictates the makeup of the health benefits exchange governing board.

Decisions that have been made in SB1313, House Amendment 2:

The composition of the health exchange governing board has been outlined in the amendment to SB 1313 in a way that supports a board that is likely to take interest in consumers and small businesses. The board, as outlined in the amendment, will be made of 9 members:

·         2 from the Attorney General’s office

·         1 small business owner

·         1 employee of a small business

·         1 consumer representative

·         1 community-based health care provider who primarily serves individuals under 200% of poverty

·         1 health actuary or economist

·         1 member of organized labor

·         1 individual who qualifies for Medicaid

None of the seats on the board will go to legislators, brokers, or insurers. There are also pieces in the amendment that support the creation of a racially and geographically diverse board, as well as clauses that protect against board members who have conflicts of interest in the governing of an exchange board.

Decisions not made in SB 1313:

The amendment puts the board in charge of deciding how the exchange will be financed.  There are many options outlined in the amendment, some that support the interest of the consumer, such as a fee levied on insurance companies, and some that are less supportive, such as a fee to users of the exchange.

What will happen next:

Now that the bill has been filed, it needs to be approved. On November 8^th, the House Insurance Committee will be holding a hearing to discuss SB 1313.   The Committee has 11 Democrats and 9 GOP members.  In order for the bill to pass the House, it will need to get support from 71 votes, opposed to the normal 60, due to rules of the veto session. If you want to see a health benefits exchange that supports the interests of individuals and small businesses, call your state representative and tell them to vote Yes on SB1313.

Making the Grade: A Scorecard for State Health Insurance Exchanges

According to the Illinois Department of Insurance, health insurance premiums have risen on average 181 percent since 2005. This could be the week action is taken in Illinois to fix our health insurance marketplace for Illinois families and small businesses.

Lawmakers are expected to consider legislation that would create an Illinois health insurance exchange that, if designed right, would help increase choices and lower costs for Illinoisans purchasing health insurance.

There’s no need to start from scratch though. Many states have already taken action to create health exchanges to deliver better value for consumers, and Illinois should follow their lead.

In fact, a report recently released by Illinois PIRG, "Making the Grade: A Scorecard for State Health Insurance Exchanges," closely examines the 12 states that have already created exchanges and rates them according to how accountable they will be to consumers and the public, how much they can do to lower premiums and improve the quality of care, how friendly they will be to consumers, and how stable they will be.

Not all exchanges are created equal.  That’s why it’s important to evaluate the policies that will matter most to consumers, including whether the exchange will be protected from insurance industry influence, and if it will negotiate with insurers for better rates.

Among the important policies to consider to make an Illinois exchange consumer-friendly include:

• Giving it the power to leverage enrollee’s buying power to negotiate with insurers for higher-value, more affordable coverage. 
• Barring insurers and other industry representatives from serving on the exchange board, so it will be more accountable to the public and to consumers.
• Making sure consumers will have an easier time shopping for coverage through easy-to-use tools and comparisons between plans.

For the sake of our pocketbooks, let’s hope Illinois lawmakers do their homework and ensure that our exchange makes the grade.

Brian Imus, Director
Illinois PIRG

Making Progress Toward a Health Insurance Exchange in Illinois

Last week was an important one for Illinois consumers and small businesses as lawmakers inched closer to establishing a state-run Health Insurance Exchange.  

Why is this important? As Timothy Jost, exchange expert writes in a Commonwealth Fund blog: “The health insurance exchange is the centerpiece of the private insurance reforms in the Affordable Care Act (ACA). If the exchanges function as planned, they will expand coverage to more Americans, reduce insurance costs, and improve the quality of coverage and perhaps of health care itself.”  However, if designed poorly, “experts warn, healthy people could avoid the exchanges, leaving them to sicker people with rising premiums."

First, some background:

On July 14, 2011, Senate bill 1555 was passed and signed by Governor Quinn, which created the Illinois Legislative Health Insurance Exchange Study Committee to aid in going forward with the establishment of a health insurance exchange (also known as the competitive insurance marketplace) in Illinois. The legislative study committee held five meetings, and commissioned two reports, one from Deloitte Consulting on the current state of healthcare in Illinois, and the second from HMA/Wakely Consulting Group, on the possible options and directions the exchange could take. On September 27, 2011, the Committee released a draft report of their findings from the five meetings and the two consultant reports. Although no definite decisions were made in the report, it is still the most substantive picture of the Illinois exchange to date.

Response to the Report:

Most of the report focused on the possibilities that Illinois must consider and decisions that must be made regarding the type of governance and the financing of the exchange. Many organizations weighed in with written comments in response to the report. Below are some of the issues and concerns that have been raised over the policy options outlined in the report:

·         The HMA/Wakely report listed two options for the operating model of the exchange: either as a “market organizer” or “market developer.” The market organizer approach means that the exchange would simply certify any health insurance plan that met the requirements for the exchange, relying on the competition of the marketplace to keep the cost of insurance down. The market developer style would have the exchange taking a more active approach to use their leveraging power in order to get the best possible value of plans from insurance agencies. Much support has been shown for the market developer option, aligning the exchange model with the interests of consumers for quality, affordable insurance.

·         Out of the three options presented for the governmental structure of the exchange, the overwhelming majority of opinions expressed have been in favor of a “quasi-governmental” model, as opposed to the “state-run” and “non-profit” models. The quasi-governmental model would keep the exchange in connection with other state-run agencies that it may need to coordinate with and promote a high level of transparency and accountability, while remaining a higher level of political neutrality.

·         The membership of the exchange governing board is one of the hot button topics in the report. The report underscores that members of the board should be well versed in the domain of health care, but should not have conflicts of interest, specifically noting that insurers, agents/brokers, HMOs, Prepaid Service Providers and other individuals with an interest in the Exchange should not be voting members of the board, though they could be members of an advisory committee. Some groups are advocating for a list of constituencies that must be represented on the board (for example, more representative of minority populations who are over-represented among the uninsured), while others think that a list of that nature would cause more problems for the board than it would solve.  Another major concern is whether or not legislators should be allowed on the board. Many groups have expressed their disapproval of legislators holding seats on the board – so that the exchange could be truly independent, non-partisan, and non-political — although some see their presence as non-voting members as a possibility. 

·         To finance the exchange, there are many options on the table, including charging consumers a fee to access the exchange, assessments on health plans offered in the new marketplace, assessments on all Illinois health insurance companies, the use of state general revenue, levying a fee on all health care stakeholders in the state (a list that could include prescription drug and medical supply companies, providers, hospitals, etc.), or assessing a progressive surtax on the revenues of all insurance providers. Many advocacy groups are against the idea of a fee to consumers, as the exchange targets those who are currently uninsured, who typically tend to have lower incomes, and could be put off or prevented from using the exchange if there is a fee. However, there are doubts that a funding option like the insurance revenue surtax would be approved. Some groups have stated that the best option might be for the enacting legislation to leave open the description of funding, so as to allow for multiple sources. 

Stay tuned! The final report will be issued this week and we’ll let you know if there are any changes.

It’s Finally Happening

A legislative taskforce is working right now on ways to increase competition in the Illinois health insurance marketplace, and they’ll make recommendations by September 30th. Insurance lobbyists have come to Springfield to prevent anything that might mean more competition and better choices for Illinois consumers. 

Specifically, a Springfield legislative taskforce is considering setting up what is known as an insurance exchange. Done right, this will pool the buying power of hundreds of thousands of Illinoisans so all of us can get a better deal on health care. Done wrong, the exchange will be an ineffective website with the same expensive plans and spotty coverage.

Don't let the insurance industry undermine reform: Tell our state leaders to stand strong for Illinois consumers.

Done right, the exchange will level the balance of power between you and the health care industry — driving the industry to cut the waste and prioritize high quality, bang-for-the-buck care.

Done right, the exchange will also cut through the confusing clutter and allow you to compare different health care plans in a simple, apples to apples way. You'd even be able to take your plan from one job to another.

Done wrong, the exchange will be merely an online listing of the same over-priced plans and inadequate coverage.

The legislative taskforce will make recommendations by September 30th on how to create the exchange in Illinois. In the meantime, insurance lobbyists don’t want more competition and are working to kill an effective insurance exchange in our state.

Click here to make sure state officials hear from you.

Brian Imus
Illinois PIRG State Director

Common Questions about the Competitive Health Care Marketplace

If done well, proponents say, the Competitive Health Care Marketplace (formerly called the insurance exchange) would make it easier to buy health insurance and lead to lower prices because of increased competition. But, if designed poorly or if this process is controlled by the insurance industry and their friendly allies in the Illinois General Assembly, experts warn, healthy people could avoid the exchanges, leaving them to sicker people with rising premiums.

Here are some common questions:

What is a Competitive Health Care Marketplace, as envisioned by the health law?
It's a marketplace where individuals and small employers will be able to shop for insurance coverage. They must be set up by Jan. 1, 2014. The exchanges will also direct people to Medicaid if they're eligible.

Will all states have Competitive Health Care Marketplaces?
States have the option of setting up their own Competitive Health Care Marketplace, forming coalitions with other states to create regional exchanges - or opting out altogether. In that case, the federal government will run the Competitive Health Care Marketplace for their residents.

Will anyone be allowed to buy from the Competitive Health Care Marketplace?
No. Initially, exchanges will be open to individuals buying their own coverage and employees of firms with 100 or fewer workers (50 or fewer in some states). Most Americans will continue to get insurance through their jobs, not via the Competitive Health Care Marketplace. The Congressional Budget Office estimates 11.5 million people will use the Competitive Health Care Marketplace in 2014 and 27.1 million in 2018. Most will be people who are eligible for subsidies, which will average an estimated $4,600 per person in 2014. Undocumented immigrants will be barred from buying insurance on the Competitive Health Care Marketplace.

What about federal workers?
Members of Congress and their staffs will be required to buy through Competitive Health Care Marketplace if they want coverage from the federal government. Other federal employees won't be required to use a Competitive Health Care Marketplace.

Will exchanges be like travel websites or some existing health insurance sites? In some ways. People will be able to compare policies sold by different companies. Purchasing insurance is complex and can be confusing, so information on the plan benefits will be standardized in an effort to make it easier to compare cost and quality. Plans will be divided into four different types, based on the level of benefits: bronze, silver, gold and platinum.

What will the coverage sold on the Competitive Health Care Marketplace look like?
Plans will have to offer a set of "essential benefits." Those details, still being developed by the Obama administration, will include hospital, emergency, maternity, pediatric, drug, lab services and other care. Annual cost-sharing, or the amount consumers must fork over before insurance payments kick in, will be capped at the amounts allowed for health savings accounts -- currently, nearly $6,000 for individual policies and $12,000 for family plans.

How much will the policies cost?
The premiums will vary by type of plan and location. Insurers won't be able to charge more based on gender or health status. They will be able to charge older people up to three times more than younger ones.

Will the states negotiate premiums with the insurers?
The law doesn't require states to set or negotiate premiums. However, states may have some influence over prices. For example, states can decide whether to open the Competitive Health Care Marketplace to all insurers, or to limit the number. State insurance commissioners will be able to recommend whether specific insurers should be allowed to sell in the Competitive Health Care Marketplace, partly based on their patterns of rate increases.

What if I can't afford the premiums?
People who earn less than 133 percent of the federal poverty level, $14,484 this year, will qualify for Medicaid in all states, under the law. Above that, sliding scale subsidies for private insurance on the exchanges will be available for residents who earn up to 400 percent of the poverty level, about $43,560 this year. Most people will be required to have coverage of some sort beginning in 2014.

Will all insurers have to offer policies through the Competitive Health Care Marketplace?
No. Insurers won't be required to sell through the Competitive Health Care Marketplace.

Will all state Competitive Health Care Marketplaces be the same?
No. States can design their Competitive Health Care Marketplace differently, an issue that's sparking debate in statehouses nationwide. Some states may choose to set additional standards for insurers beyond the federal law. Another important issue: The makeup and power of the governing boards overseeing the Competitive Health Care Marketplace. Some states, such as Maryland, are considering barring insurance industry and sales agents from their governing boards. Others, like North Carolina, have pending legislation that includes representatives from those groups on their governing boards.

Kathleen Duffy
Campaign for Better Health Care