Health Care Reform Updates at the Federal and State Level

Federal

Health insurance firms organized  meetings with the Federal government to discuss the pending HHS program to waive the annual limit requirements under PPACA for certain qualifying plans. Without such a waiver, limited benefit plans will be discontinued beginning on September 23, 2010.

States

CALIFORNIA: The California Department of Insurance (CDI) announced an e-mail notification system that will alert consumers when new individual health insurance rate filings are submitted.

NEW JERSEY: Following enactment of Governor Chris Christie’s budget, the Democrat-controlled legislature passed supplemental bills to restore $24 million in funding for state’s uninsured health coverage program known as FamilyCare, and $7.4 million in aid for women’s health and family planning programs. The FamilyCare restoration, if signed into law, would have allowed adults with income between 134 to 200 percent of the federal poverty level to remain in the program. Despite bipartisan support in the Senate, Governor Christie vetoed the legislation, saying that the state has reset spending to a level that taxpayers can afford. Legislative leadership has indicated they may try to override the governor’s veto. Overriding the governor’s veto would require a two-thirds majority in both houses.

NEW MEXICO: The Public Regulation Commission (PRC) has appointed John G. Franchini as the new Superintendent of Insurance, a position that has been vacant since the May 4 resignation of his predecessor, Morris Chavez.  Franchini was selected from among five finalists and will assume his new duties in mid-August.

OHIO:  The Strickland Administration advised state agencies to begin planning for the next two years at both current levels and with a 10 percent cut in funding. The Budget Planning and Management Commission has held hearings for Ohio’s budget adoption. The current budget ends June 30, 2011 and is billions in the red. Testimony before the Commission focused on increasing efficiencies by combining certain administrative functions of local and state governments and utilizing performance audits to determine if tax dollars are being spent efficiently. The Center for Community Solutions suggested to legislators that principal stakeholders in Medicaid (such as managed care companies and hospitals) be given budget targets and be asked to come up with ways to slow the growth of Medicaid. Conversely, the Health Policy Institute of Ohio guided legislators to the possibility of Ohio “rebalancing” its long-term care spending to shift utilization from long-term care facilities to home and community-based services.

While PPACA-related budget priorities will take place after the next biennial budget is adopted, it was previously determined that the federal expansion of Medicaid eligibility as part of health care reform will cost the state $190 million in 2014rising to $332 million by 2019. Absent any federal law changes, annual costs will rise substantially in 2020 and beyond, as the federal government’s match for new enrollees will drop to 90 percent of the total cost.

The total state cost of Medicaid expansion from 2014 to 2019 is projected to be $1.45 billion.

OKLAHOMA: Oklahoma was the only state to request an open enrollment period for the PPACA provision requiring coverage of children under 19 for individual insurance.  HHS decided open enrollment periods will be permitted at the discretion of insurance companies.  The Oklahoma Supreme Court scheduled oral arguments on August 4 in a lawsuit filed by Commissioner Kim Holland, on behalf of Department of Insurance (DOI), challenging the constitutionality of a new 1 percent claims-paid fee passed by the legislature in late May.  The bill is scheduled to take effect August 27, unless there is court intervention. The DOI announced last week that a final contract for a new temporary high-risk pool has been signed and sent back to HHS.  The DOI is in the process of drafting the application that will be used with the pool.  Oklahoma was awarded $60 million for use over 40 months.  Candidates are being interviewed to be the High Risk Pool Manager.  Open enrollment will begin August 1 with an effective date of September 1.

Michael F. Arrigo

Michael Arrigo brings four decades of experience in the software, financial services, and healthcare industries. In 2000, Mr. Arrigo founded No World Borders, a healthcare data, regulations, and economics firm with clients in the pharmaceutical, medical device, hospital, surgical center, physician group, diagnostic imaging, genetic testing, health IT, and health insurance markets. His expertise spans the federal health programs Medicare and Medicaid and private insurance. He advises Medicare Advantage Organizations who provide health insurance under Part C of the Medicare Act. Mr. Arrigo serves as an expert witness regarding medical coding and medical billing, fraud damages, as well as electronic health record software for the U.S. Department of Justice. He has valued well over $1 billion in medical billings in personal injury liens, medical malpractice, insurance fraud cases. The U.S. Court of Appeals considered Mr. Arrigo's opinion regarding loss amounts, vacating, and remanding sentencing in a fraud case. Mr. Arrigo provides expertise in the Medicare Secondary Payer Act, Medicare LCDs, anti-trust litigation, medical intellectual property and trade secrets, HIPAA privacy, health care electronic claim data Standards, physician compensation, Anti-Kickback Statute, Stark law, the Affordable Care Act, False Claims Act, and the ARRA HITECH Act. Arrigo advises investors on merger and acquisition (M&A) diligence in the healthcare industry on transactions cumulatively valued at over $1 billion. Mr. Arrigo spent over ten years in Silicon Valley software firms in roles from Product Manager to CEO. He was product manager for a leading-edge database technology joint venture that became commercialized as Microsoft SQL Server, Vice President of Marketing for a software company when it grew from under $2 million in revenue to a $50 million acquisition by a company now merged into Cincom Systems, hired by private equity investors to serve as Vice President of Marketing for a secure email software company until its acquisition and multi $million investor exit by a company now merged into Axway Software SA (Euronext: AXW.PA), and CEO of one of the first cloud-based billing software companies, licensing its technology to Citrix Systems (NASDAQ: CTXS). Later, before entering the healthcare industry, he joined Fortune 500 company Fidelity National Financial (NYSE: FNF) as a Vice President, overseeing eCommerce solutions for the mortgage banking industry. While serving as a Vice President at Fortune 500 company First American Financial (NYSE: FAF), he oversaw eCommerce and regulatory compliance technology initiatives for top ten mortgage banks and led the Sarbanes Oxley Act Section 302 internal controls IT audit for the company, supporting Section 404 of the Sarbanes Oxley Act. Mr. Arrigo earned his Bachelor of Science in Business Administration from the University of Southern California. Before that, he studied computer science, statistics, and economics at the University of California, Irvine. His post-graduate studies include biomedical ethics at Harvard Medical School, biomedical informatics at Stanford Medical School, blockchain and crypto economics at the Massachusetts Institute of Technology, and training as a Certified Professional Medical Auditor (CPMA). Mr. Arrigo is qualified to serve as a director due to his experience in healthcare data, regulations, and economics, his leadership roles in software and financial services public companies, and his healthcare M&A diligence and public company regulatory experience. Mr. Arrigo is quoted in The Wall Street Journal, Fortune Magazine, Kaiser Health News, Consumer Affairs, National Public Radio (NPR), NBC News Houston, USA Today / Milwaukee Journal Sentinel, Medical Economics, Capitol ForumThe Daily Beast, the Lund Report, Inside Higher Ed, New England Psychologist, and other press and media outlets. He authored a peer-reviewed article regarding clinical documentation quality to support accurate medical coding, billing, and good patient care, published by Healthcare Financial Management Association (HFMA) and is published in Healthcare IT News.

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