State Legislative Conference

1. Blue Cross Blue Shield Association is an association of independent Blue Cross and Blue Shield companies.
AAFP State Legislative
Conference - Healthcare 2.0
Kim Holland, VP, State Affairs
Office of Policy and Representation
November 3 , 2017

2. 2
Agenda
• Looking through our rose-colored glasses
• The good, bad and ugly of healthcare coverage and cost
• A summer of discontent
• What’s next
• Ending up where I started

3. 3
Ensure viable private insurance market
Ensure viability of government programs
Ensure level playing field
Ensure effective political positioning
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2
3
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BCBSA 2017 Strategic Goals

4. 4
11%
33%
20%
17%
3%
12%
4%
Source
U.S. health care spending grew 5.8 percent in 2015, reaching $3.2 trillion or $9,990 per person. As a share
of the nation's Gross Domestic Product, health spending accounted for 17.5 percent.(cms.gov)
US Health Expenditures Report
4

5. 5
U.S. Health Care Coverage*
Group
Individual Market:
= 6%
Medicare
Medicaid
Uninsured
*Note: Numbers are estimates and do not account for variation in reporting dates, dually eligible Medicare/Medicaid enrollees or other sources of health insurance coverage

6. 6
ACA Impact on the Individual Market
20 million individuals
covered under the ACA
9% uninsured rate
(lowest in history)
But… individual market is
in real trouble in most states
CHOICEPREMIUMS DEDUCTIBLES

7. 7
• Issuer participation: 132 from 167
• Average number of issuers 3 from 4
• Only one issuer in state 8 from 5
• Average premium 2nd lowest cost silver 37%
• Average APTC 45%
*http://aspe.hhs.gov 10.30.2017
2018 Exchange Participation Trends*

8. 8
First Attempt: ACA Repeal/Replace
HOUSE
Narrowly passed American Health Care Act
(May 4)
VOTE: 217-213
SENATE
Narrowly defeated Health Care Freedom
Act (July 27)
VOTE: 49-51

9. 9
Key provisions:
• Funds CSRs through 2019
• Short term stability fund (reinsurance)
– $15B/year for 2018 & 2019;
$10B/year for 2020 and 2021
• Long term stability fund (multi-use)
– $62B phased out over 8 years
• Age, income and geography adjusted tax credits for
2020+
Key hurdles:
• Congressional Budget Office estimated 20+million more
uninsured
• Unreachable consensus on Medicaid,
– States, moderate Republicans: more $$
– Conservatives: faster cuts and work requirements
• Similar challenges with tax credit proposal
– Moderate Republicans: need adjustments for low
income, older people
– Conservatives: oppose as “Obamacare-lite”
Second Attempt: Better Care Reconciliation Act
Senate failed, shy 3 votes

10. 10
• Retroactively repealed individual and employer mandates
• Provided short term stabilization fund (reinsurance)
• Gave states mega block grants (Medicaid, tax credits, cost sharing reductions) but significantly less
money
• Repealed medical device tax but not others (health insurance tax, others)
Third Attempt: Graham Cassidy
Senate could not muster needed votes, possible Spring comeback?

11. 11
• Executive order
– Instructs DOL to propose regulations to expand access to Association Health Plans
– Instructs tri-agencies (HHS, Labor, Treasury) to consider proposing regulation to expand availability of
short-term limited duration policies
– Instructs tri-agencies to increase usability of HRAs
• Discontinuation of CSR funding for 2017
– State AGs intervene; take case to DC Circuit to lift abeyance
• Notice of Benefit and Payment Parameter
– Returns flexibility/authority to states in establishing benchmarks for essential health benefits, QHP
review responsibilities
Administrative Actions

12. 12
Alexander-Murray bipartisan bill
• Restores CSRs through 2019 (with consumer benefit)
• Funds enrollment outreach
• Streamlines 1332 Waiver process to expedite applications and approvals at both state and federal levels
• Expands catastrophic plan eligibility
• Prompts issuance of interstate compact regulations
Hatch-Brady bill
• Same on CSRs but eliminates individual and employer mandates
Current Efforts to Stabilize Individual Market
Action unlikely until end of FY17

13. 13
KEY YEAR-END PRIORITIES
Congress
• Tax reform
• DACA
• Border Wall
• FY2018 Budget Reform (i.e., overall
discretionary spending)
BCBSA
• CSR Funding
• Individual mandate
• Short-term limited duration policies
• Association Health Plans (AHPs)
• Health Insurance Tax (HIT)

14. 14
OPIOIDS: A NATIONAL CRISIS…
Source: 2016 National Survey of Drug Use & Health; 2015: CDC Report
IMPACTED BY
OPIOID USE
470,000
ADDICTED
TO HEROIN
2.1MILLION
ADDICTED
TO OPIOID
PAIN RELIEVERS
4x
+2.5MILLION
PAIN
PATIENTS
1999-2013
OVERDOSE
DEATHS
OPIOID
IN
1 3FAMILIES
A presentation of the Blue Cross and Blue Shield Association. All rights reserved. Proprietary and Confidential.

15. 15
Health insurance should
be available to everyone, regardless
of pre-existing conditions with broad
based funding for the highest cost
individuals.
Healthcare must be more affordable for
patients, families
and taxpayers, and key protections – such as
equal rates for women and men, no lifetime caps
on benefits and allowing young people to stay
on their parents’ plans until age 26 – should
remain in place.
States should be empowered
to meet the needs of their communities,
because they know their local healthcare
systems and their citizens’
needs best.
BCBSA Principles for the Future of U.S. Healthcare