The Prevention and Public Health Fund

Healthcare Policy Expert, Robin Scott, is a contributing blogger for Protestants for the Common Good. 

America spends more on health than other nations – almost $2.5 trillion in 2009 – and yet scores less than other wealthy nations on life expectancy, infant mortality and other indicators of population health.  The bulk of U.S. health expenditures (75 percent) are spent treating chronic diseases, many of which are preventable. (Chronic diseases include obesity, diabetes, high-blood pressure, heart disease, and cancer.)  A mere fraction of U.S. health expenditures (3.1 percent) is spent on prevention.  An Institute of Medicine report released in 2012 concluded that the federal government’s public health investment ($11.6 billion in 2009) should be doubled to begin to fund public health efforts at a level that would address current needs.

The Affordable Care Act makes public health and the prevention of chronic disease a United States priority for the first time by establishing mandatory funding for the Prevention and Public Health Fund.  Fifteen billion dollars over 10 years was set aside for the Fund.  The Fund already has provided $1.25 billion for prevention and public health activities: $500 million in FY 2010 and $750 million in FY 2011.  Another $1 billion has been allocated in FY 2012 and is in the process of being distributed.  

The Fund is anticipated to be used for programs at the local, state, and federal level.  Illinois has been awarded more than $31 million in Prevention Fund grants.  Funding is intended for community prevention, clinical prevention, public health workforce and infrastructure, and research and tracking.  Community prevention includes tobacco prevention and obesity prevention and fitness.  Public health workforce and infrastructure includes supporting training of public health providers.

The Prevention and Public Health Fund is intended to supplement not supplant existing federal commitments for public health and prevention.  However, the Affordable Care Act allows Congress to use money from the fund to spend on existing prevention or health promotion programs that met the goals of improving health and restraining growth in costs.  Also, Congress can still pass laws to reduce the amount of money allocated to the Fund.  Congress can even amend the Affordable Care Act to eliminate the Fund.  Funding of the Prevention and Public Health Fund has already been cut by $6.25 billion over nine years to help postpone a cut in Medicare physician payments.  

The Fund remains at risk. Earlier this year, Congress passed the Sequestration Act which would make across-the-board cuts in defense and nondefense discretionary programs in January 2013 if a deficit reduction plan was not passed and signed into law.  So far, a deficit reduction plan has not been enacted.  According to an OMB report released mid –September critical programs that protect the public’s health face an 8.2 percent cut.  (The Prevention and Public Health Fund would be subject to cuts of 7.6 percent.)

Some useful websites for more information:

http://www8.nationalacademies.org/onpinews/newsitem.aspx?RecordID=1326

http://www.healthaffairs.org/healthpolicybriefs/brief.php?brief_id=63

http://www.apha.org/NR/rdonlyres/D1708E46-07E9-43E7-AB99-94A29437E4AF/0/PrevPubHealth2012_web.pdf

http://www.healthcare.gov/news/factsheets/2011/02/prevention/il.html

 

Closing the Dreaded Donut Hole

Healthcare Policy Expert, Robin Scott, is a contributing blogger for Protestants for the Common Good. 

You have probably heard about the dreaded donut hole.  That refers to a problem that affects people receiving Medicare health coverage, even those who have also enrolled in Medicare Part D Prescription Drug Plans.  As everyone knows, prescription medicines are expensive, especially if you have a chronic illness.  I have heard stories of people skipping doses, sharing medicine with spouses, and skipping medicine altogether because of price.  

For Medicare beneficiaries, you have the option of purchasing a Medicare Part D Prescription Drug Plan.  Initially, you may have to pay a deductible of a little more than $300 and an average of 25% of the cost of your medication until you reach the $2,930 drug coverage limit. (The dollar amount to reach the $2,930 coverage limit includes what you pay and what the plan pays.) Then you hit a coverage gap or donut hole where the costs of your co-payments increase until you reach catastrophic coverage.  Then you pay 5% or $2.60 for generics and $6.50 for brand-names whichever is greater. 

 

Before health reform (or the Affordable Care Act), you would have had to pay 100% of out-of-pocket costs before getting out of the donut hole. (The donut hole for 2012 was $2,930 to $6,658.) See illustrations for 2012 and 2013 respectively at: http://familiesusa2.org/assets/pdfs/medicare-part-d/Prescription-Drug-Benefit-Illustration-2012.pdf  and  http://familiesusa2.org/assets/pdfs/medicare-part-d/Prescription-Drug-Benefit-Illustration-2013.pdf.  Not surprisingly, it was difficult for people to pay the costs of medicine during the donut hole so many of them never even reached catastrophic drug coverage.  Some beneficiaries stopped filling their prescriptions and others never reached the dollar amount in drugs to get out of the donut hole.

But thanks to health reform, in 2012, beneficiaries receive an automatic 50% discount on brand-name drugs and 14% discount on generics while in the donut hole. The brand name and generic drug discounts gradually increase every year until 2020 when the donut hole is phased out.  Then you will once again pay an average of 25% of the cost of your medication until you reach catastrophic coverage.

In the first four months of 2012 alone, more than 416,000 people have saved $301.5 million – an average of $724 a person so far this year.   The Affordable Care Act was helping them even before that.  After the Affordable Care Act passed in 2010, those who hit the donut hole received a $250 rebate – with almost 4 million seniors and people with disabilities receiving a collective $1 billion.  In 2011, Medicare beneficiaries received more than $2.1 billion in savings – averaging $604 per person last year – from the 50% discount on brand-name drugs in the donut hole.  http://www.healthcare.gov/blog/2012/05/medicare052412.html (There was also a 7% subsidy for generic drugs purchased in the donut hole in 2011.)

For Medicare beneficiaries, it is the Annual Open Enrollment period for 2013.  It started October 15 and ends on December 7.  If you already have a Part D plan, you should check to make sure that your current plans continues to work for you in 2013 (for example, make sure that all drugs that you take are on the formulary and check premiums and co-payments and co-insurance).  General information about Medicare Part D Prescription Drug Coverage can be found at: http://www.medicare.gov/part-d/index.html

·         (This blog does not refer to people who get “extra help” or the low-income subsidy.)

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Are You Healthy Enough to Get Covered?

Healthcare Policy Expert, Robin Scott, is a contributing blogger for Protestants for the Common Good. 

Do you have diabetes, high blood pressure, or asthma? What about another health problem or condition? If you have a health problem that developed before you join a health insurance plan, you have what a health insurance company calls a pre-existing condition.  It is hard to believe but being pregnant is considered a pre-existing condition.

In the past, in most states, anyone with a pre-existing condition could be discriminated against, meaning they could be denied insurance altogether or their insurance would not cover that condition.   If the condition was covered, they could be charged a higher premium. 

The Affordable Care Act ends discrimination by health insurance plans against people with pre-existing conditions.  Effective September 23, 2010, health insurers are not allowed to deny insurance to children younger than 19 years of age with pre-existing conditions.  This rule applies whether or not the child’s health problem or disability was discovered or treated before you applied for coverage.  (However, this rule does not apply to grandfathered individual health policies.  A grandfathered individual health insurance policy is a policy that you bought for yourself or family on or before the health reform law was enacted.)

Beginning January 2014, health insurers, regardless of whether the plan is grandfathered, will not be able to discriminate against anyone who has a pre-existing condition, including a disability. Not only will they not be able to deny children and adults coverage for a pre-existing condition, they will not be allowed to charge them more for this coverage. 

Millions of Americans are helped by this Affordable Care Act provision. Pre-existing conditions affect people in all age groups, every racial and ethnic group, and every income group.  An estimated 64.8 million (24.9 percent of) non-elderly Americans have been diagnosed with pre-existing conditions that could lead to a denial of coverage. Nearly 2.9 million non-elderly Illinoisans, more than one out of every four residents under the age of 65, have been diagnosed with pre-existing conditions that, absent reform, could lead to a denial of coverage. 

 

Some people have pre-existing conditions now and cannot wait until 2014 to receive help.  Findings from a 2010 national survey found that 36 percent of non-elderly who lost their jobs and benefits and tried to purchase individual health insurance were turned down, were charged more, or had a specific health problem excluded from their coverage.  

What can they do in the meantime?  The Affordable Care Act provides funds for high-risk pools in states for people with pre-existing conditions.  To be eligible, you must meet certain requirements such as being uninsured for six months and be a U.S. citizen or residing in the United States legally.  The pre-existing condition insurance plans cover a broad range of health benefits, including primary and specialty care, hospital care, and prescription drugs.

The federal government runs the PCIP in 23 states and the District of Columbia.  In the other 27 states, the state or a state-designated nonprofit organization runs the program. In Illinois, the Department of Insurance runs the program.  The Pre-Existing Condition Insurance Plan has already provided coverage to at least 82,000 people, including 2,750 people in Illinois (Illinois Pre-Existing Insurance Plan).

 

What if I become sick while I am insured?

Previously, health insurers sometimes rescinded or retroactively cancelled coverage when a person became sick, if the person made an unintentional mistake on their application.  They would state that the person had not listed a pre-existing condition on their insurance application.  The Affordable Care Act changes that – now, insurance companies cannot deny to cover your benefits just because you get sick.  They can only do that in cases of fraud or an intentional misrepresentation of material fact.

An example of an illegal rescission is if the insurance company denies claims for breast cancer treatment when finding out the insured person forgot to mention two visits to a psychologist visit she had six years earlier. http://www.healthcare.gov/law/features/rights/cancellations/

Next to New Mexico, Illinois had the highest rescission rate from 2004 through 2008.  Illinois’ rate was more than 12 per 1,000 certificates or policies from 2004 to 2008.   That’s a total of 5,279 policies/certificates from 2004-2008.  The national rate is 3.7 rescissions per every 1,000 policies or certificates from 2004 through 2008.