Senate Completes Work on Health Insurance Reform; Menendez Hails Protections for N.J. Families, Seniors, Small Businesses, State Gov't and Federal Budget

Press Release

U.S. Senator Robert Menendez (D-NJ) today helped complete the Senate's work on the new health insurance reform law, voting to help pass a set of improvements that will make insurance even more affordable for middle class families and will produce greater federal deficit reduction. Highlights of benefits of the final law for New Jerseyans include (EXPANDED LIST OF N.J. IMPACT LATER IN RELEASE):

* Ensuring affordable coverage options for 1.5 million New Jerseyans who are uninsured and 326,000 New Jerseyans who purchase health insurance through the individual market.
* Immediate, guaranteed insurance coverage for an estimated 130,793 uninsured New Jersey adults who have a pre-existing condition.
* Elimination of the Medicare Part D prescription drug coverage "donut hole" for 1.3 million New Jersey seniors and lower Medicare premiums for 1.1 million New Jersey seniors not enrolled in Medicare Advantage.
* Tax credits for up to 854,000 New Jerseyans to help make health insurance more affordable, bringing $13.9 billion in tax credits for working families to purchase health insurance into New Jersey during the first five years of the health insurance Exchange.
* Tax credits for up to 107,000 New Jersey small businesses to help them afford insurance coverage for their employees.
* The federal government will cover all of the state government's costs for adding low-income, childless adults to Medicaid over the first three years and never less than 90% of those costs after that.
* Federal budget deficit reduction of $143 billion over the first ten years of the law and $1.3 trillion over the next ten, as estimated by the non-partisan Congressional Budget Office

"What was already an important and historic new law to establish common sense in the health insurance system has been made even better by lowering costs further for families, seniors and the nation," said Menendez. "New Jersey families should know that the new protections will ensure that their insurance will be there when they need it most. New Jersey seniors should know that the prescription drug coverage shortfall will be filled and that preventative care will be free. Small businesses should know that tax credits will be available for them to provide relief for the cost of insuring their employees. We will fight tooth and nail to ensure that these new rights, protections and cost-savings will not be taken away from middle class families, seniors and small businesses."

The Benefits of Health Reform
In New Jersey

Together, the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act will ensure that all New Jerseyans have access to quality, affordable health insurance. The Congressional Budget Office has determined that these two bills are fully paid for, will bend the health care cost curve, and will reduce the deficit by $143 billion over the next ten years with further deficit reduction in the following decade. The Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act will reduce the cost of health care for the middle class, ensure health security to seniors, and provide tax credits to small businesses and individuals to further reduce the cost of health coverage.

Key Benefits for New Jersey

* Provide tax credits for up to 107,000 New Jersey small businesses to help make coverage more affordable. [HealthReform.gov, accessed 3/20/10]
* Prohibit insurance companies from excluding coverage of pre-existing conditions for the 2 million children in New Jersey, starting this year. [U.S. Census Bureau, 1/7/10]
* Close the "donut hole" and improve other Medicare benefits for 1.3 million New Jersey seniors. [HealthReform.gov, accessed 3/20/10]
* Reduce Medicare premiums for the 1.1 million New Jersey seniors who are not enrolled in Medicare Advantage and will no longer subsidize these private insurance plans. [Senate Finance Committee]
* Ensure affordable coverage options for 1.5 million New Jerseyans who are uninsured and 326,000 New Jerseyans who purchase health insurance through the individual market. [HealthReform.gov, accessed 3/20/10]
o Ensure immediate access to affordable insurance options for as many as 130,793 uninsured New Jerseyans who have a pre-existing condition. [staff estimate using Agency for Healthcare Research and Quality (AHRQ), 4/09 and HealthReform.gov, accessed 3/20/10]
o Provide tax credits for up to 854,000 New Jerseyans to help make health insurance more affordable, bringing $13.9 billion in premium and cost-sharing tax credits into New Jersey during the first five years of the health insurance Exchange. [HealthReform.gov, accessed 3/20/10; Senate Finance Committee]
o Reduce family health insurance premiums by $1,860 - $2,660 for the same benefits, as compared to what they would be without health reform by 2016. [Senate Finance Committee estimate based on CBO, 11/30/09]
o Provide access to Medicaid for 476,277 newly-eligible New Jerseyans, and provide $9 billion in federal funding for the cost of their coverage. [Urban Institute, 1/25/10; Senate Finance Committee]

* Create 16,200 - 25,900 jobs by reducing health care costs for employers. [U.S. Public Interest Research Group, 1/20/10]
* Allow 758,000 young adults to stay on their parents' insurance plans. [U.S. Census Bureau, 1/7/10]
* Provide more federal funding for 134 Community Health Centers in New Jersey. [National Association of Community Health Centers, 2009]

Affordable Coverage Options for New Jersey Small Businesses
Small businesses make up 80.3 percent of all New Jersey businesses, yet just 59.6 percent of these small businesses are able to offer health insurance to their employees. [AHRQ, accessed 3/20/10; AHRQ, accessed 3/20/10] Starting this year, up to 107,000 New Jersey small businesses will be eligible for tax credits for a percentage of their contribution to their employees? health insurance. [HealthReform.gov, accessed 3/20/10] Small businesses of the size that qualify for these tax credits employ 617,783 New Jerseyans. [AHRQ, accessed 3/20/10]

Protecting Children
Recognizing the special vulnerability of children, health reform prohibits insurance companies from excluding coverage of pre-existing conditions for the 2 million children in New Jersey. This takes effect six months after enactment and applies to all new plans. [U.S. Census Bureau, 1/7/10]

Strengthening Medicare for New Jersey Seniors
Health reform improves Medicare benefits for the 1.3 million Medicare beneficiaries in New Jersey. [HealthReform.gov, accessed 3/20/10] Each year, 227,000 New Jersey seniors hit the Medicare Part D „donut hole.? [HealthReform.gov, accessed 3/20/10] Starting this year, seniors who hit this gap in their prescription drug coverage will receive a $250 check, and the „donut hole? will be completely closed by 2020. The 1.3 million Medicare beneficiaries in New Jersey will see other improvements to the program, including a free, annual wellness visit and no cost-sharing for prevention services. Finally, by gradually moving to a more fair payment system for private insurance companies who participate in Medicare Advantage, health reform will lower Medicare costs for the 1.1 million New Jersey seniors not enrolled in Medicare Advantage, by as much as $45 in premium costs each year. [Senate Finance Committee]

Affordable Coverage Options for New Jerseyans
The Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act contain several provisions to expand affordable coverage options for millions of Americans. First, health reform will provide immediate access to quality, affordable health insurance for as many as 130,793 uninsured New Jerseyans who are unable to obtain health insurance because of a pre-existing condition. [staff estimate using AHRQ, 4/09 and HealthReform.gov, accessed 3/20/10] This new $5 billion program will take effect 90 days after enactment of health reform.
Second, health reform will ensure that the 1.5 million uninsured New Jerseyans and 326,000 New Jerseyans who purchase health insurance through the individual market have access to affordable health insurance options through state-based health insurance Exchanges. [HealthReform.gov, accessed 3/20/10] By reforming the insurance market and forcing insurance companies to compete for business through the Exchange, health reform will reduce family health insurance premiums by $1,860 - $2,660 for the same benefits. [Senate Finance Committee estimate based on CBO, 11/30/09] In addition, 854,000 New Jerseyans will receive premium tax credits to help make health insurance even more affordable. [HealthReform.gov, accessed 3/20/10] During the first five years that the health insurance Exchange is operational, New Jerseyans will receive $13.9 billion in premium and cost-sharing tax credits to further reduce the cost of health insurance. [Senate Finance Committee]
Finally, health reform will open access to Medicaid for 476,277 newly eligible New Jerseyans, by expanding eligibility to non-elderly parents, childless adults, children and pregnant women with income up to 133 percent of the federal poverty level. [Urban Institute, 1/25/10] The federal government will fully fund the cost of covering these newly eligible individuals for three years and will pay 90 percent of these costs after 2020, compared to the current contribution in New Jersey of 50 percent of costs. In total, New Jersey could receive $9 billion in federal funding during just the first five years of this coverage expansion. [Senate Finance Committee]

Affordable Coverage Options for New Jersey Young Adults
According to the National Conference of State Legislatures, "Young adults often lose their health insurance if covered under a parent?s or guardian?s policy at age 19 or upon graduation from high school or college." [NCSL, accessed 3/20/10] Starting this year, 758,000 young adults in New Jersey will be able to remain covered by their parent?s insurance policy until age 26. [U.S. Census Bureau, 1/7/10] In addition, once the health insurance Exchanges are operational in 2014, 1.2 million New Jerseyans under age 30 will have access to less costly catastrophic-only health insurance plans. [U.S. Census Bureau, 1/7/10] These plans will also be available to others who are exempt from the individual responsibility policy.

Job Creation
A recent analysis found that slowing the growth rate of health care costs will make it more profitable for businesses to expand employment, leading to estimated job gains nationwide of 250,000 -- 400,000 per year for the next decade as a result of health reform. [Center for American Progress, 1/10] For New Jersey, this could mean 16,200 - 25,900 new jobs each year. [U.S. Public Interest Research Group, 1/20/10]

Support for New Jersey Community Health Centers
Community health centers provide critical health care to New Jerseyans, regardless of their ability to pay. Health reform makes an immediate and substantial investment in the 134 federally-funded health centers in New Jersey. [National Association of Community Health Centers, 2009]

MENENDEZ PROVISIONS INCLUDED IN THE LEGISLATION

Provisions included during Finance Committee work
* Medicare reimbursement costs sharing for hospitals -- will generate approx. $70 million per year in savings for New Jersey hospitals (top priority of the New Jersey Hospital Association). Current law ensures that hospitals in highly-urban states, like New Jersey, are protected from receiving unfairly low Medicare reimbursements. Provision would ensure that the costs associated with this protection are shared fairly by hospitals nationwide.

* AUTISM -- Requiring insurance plans to provide behavioral health treatments. Plans in the exchange must cover behavioral health treatments as part of the minimum benefits standard. For example, applied behavior analysis is a behavioral health treatment for people with autism. Unless behavioral health treatment is explicitly spelled out as a covered benefit, people with autism are not likely to receive comprehensive healthcare.

* Support, education, and research for postpartum depression. Provides support services to women suffering from postpartum depression and psychosis and helps educate mothers and their families about these conditions. In addition, supports research into the causes, diagnoses and treatments for postpartum depression and psychosis.

* Tax credit for critical biotechnology research performed by small firms. Creates a credit that would encourage investments in new therapies to prevent, diagnose, and treat acute and chronic disease, lower health care costs.

* Out-of-pocket cost limit for families between 300-400 percent of the federal poverty level -- IMPORTANT FOR HIGH COST OF LIVING STATES. For those between 300-400 percent of FPL, within the same actuarial value, the benefit will include an out-of-pocket limit equal to two-thirds of the Health Savings Account (HSA) current law limit.

* Excluding more middle-class families, seniors from excise tax on high-value insurance plans -- IMPORTANT FOR HIGH COST OF LIVING STATES (joined Sen. Kerry on amendment). Successfully fought to raise tax thresholds for retirees and high-risk workers so that their additional health needs could be recognized. Successfully fought to raise the indexing of the high premium excise tax threshold to save millions of family policies from being hit.

* Urban Medicare Hospitals. Some urban hospitals are highly dependent on Medicare payments because they serve high proportions of Medicare patients, but, unlike many otherwise similar hospitals, they do not receive any special add-on payments. This would provide for a study for a special add-on payment to be afforded this select group of hospitals that could be designated as urban Medicare-dependent hospitals.

* Guaranteeing consumers a fair appeal for a denial of coverage. Requires that each health care plan and health care insurance issuer offering coverage in the exchange must provide an internal claims appeal process and each state must provide an external review process for plans in the individual and small group markets.

* Require private insurers to fully reimburse Federally-Qualified Health Centers in the exchange (offered amendment with Sen. Lincoln). This amendment would ensure that FQHCs, which are a primary health care option for millions, would not lose revenue when treating newly insured patients gaining coverage through the new health insurance exchanges.

* Women's Medical Home (included in bill prior to markup). Legislation creates an Innovation Center within CMS to test and evaluate different structures to increase patient care and lower cost. The center is required to test a number of different models, including a "medical home that addresses women's unique health care needs."

* Child-only insurance option and subsidies in the exchange. Ensures that minor children qualify as exchange eligible individuals and would also provide for the availability of child-only health insurance coverage in the exchanges.

* Consumer protection for emergency services. Requires that each health care plan and insurance issuer offering coverage in the exchange must provide enrolled individuals coverage for emergency services without regard to prior authorization.

* Ombudsman assistance with internal appeals. Allows policyholders to access the ombudsman created in the legislation for help with internal appeals.

* Ombudsman assistance with tax credit appeals. Allow policyholders to access the ombudsman for assistance in resolving problems with their premium and cost-sharing credits, and with assistance in filing appeals as needed.

* Value-Based Purchasing for Hospital Acquired Infections. This measure includes healthcare-associated infections, as measured by the prevention metrics and targets established in the Department of Health and Human Services' HHS Action Plan to Prevent Healthcare-Associated Infections or any successor plan.

Provisions included during full Senate debate

* Clarification and strengthening of provision guaranteeing consumers a fair appeal for a denial of coverage. All health insurers would be required to implement an internal appeals process for coverage denials, and states will ensure the availability of an external appeals process that is independent and holds insurance companies accountable.

* Clarification and strengthening provision expanding access to health care through community health centers. Private insurers would be required to fully reimburse Federally-Qualified Health Centers in the insurance exchange. This amendment would ensure that FQHCs, which are a primary health care option for millions, would not lose revenue when treating newly insured patients gaining coverage through the new health insurance exchanges.

* Holding health insurance companies accountable. The Government Accountability Office would conduct a study on the rate of denial of coverage and enrollment by health insurance issuers and group health plans.

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