Catastrophic Health Insurance and Medical Assistance Reform Act-S. 2513/H.R. 14079 (SENATORS RUSSELL B. LONG, ABRAHAM RIBICOFF/REPRESENTATIVE JOE D. WAGGONNER A. General Approach A national program of catastrophic health insurance for all persons covered by the social security system, their spouses and dependents, would be administered by Social Security and would supplement existing private health insurance protection for basic benefits. A uniform national program of medical benefits for low-income persons, administered by the Social Security Administration, would replace the existing medicaid program. A voluntary Federal certification program for basic private health insurance would be established to encourage private insurers to make adequate basic coverage available in all areas to all citizens at reasonable premium rates. No insurer could serve as a medicare or low-income plan carrier or intermediary who did not offer such coverage. B. People Covered Under the catastrophic health insurance plan, all persons fully or currently insured under social security, their spouses and dependents, and all social security beneficiaries would be eligible for protection. "Buy-in" agreements for State and local governmental employees not covered by Social Security. The Medical Assistance Plan for low-income persons would be available to all individuals and families having an annual income at or below the following levels: $2400 or an individual; $3600 for a twoperson family; $4200 for a three-person family; $4800 for a four-person family; and $400 additional for each additional family member. No assets test would be applied in determining eligibility. Income eligibility levels would be linked to a "spend-down" provision under which an individual's or family's income would be reduced by their incurred health expenses. Voluntary certification plan-estimated number unknown. C. Scope of Benefits Catastrophic insurance would cover the same kinds of services as currently provided under Parts A and B of medicare, except that there would be no upper limitations on hospitals days or home health visits. Benefits excluded from medicare would also be excluded under this program. However, unlike medicare which provides basic coverage, the catastrophic health insurance program would provide hospital and extended care benefits only after an individual had first been hospitalized for a total of 60 days in one year; and medical benefits only after a family had incurred medical expenses of $2000 for physicians' services, home health visits, physical therapy services, laboratory and X-ray services and other covered medical and health services. For continued services thereafter, the beneficiary would be responsible only for coinsurance amounts (subject to a ceiling of $1,000 per family) equal to: (1)% of the medicare inpatient deductible at that time, for each additional day of hospitalization; (2)% of the medicare inpatient deductible for each day of posthospital institutionalization in an extended care facility; and (3) 20% of medical expenses exceeding $2,000. The Medical Assistance Plan for the low-income would cover the following benefits, generally without deductibles or coinsurance except as noted below: (1) 60 days of inpatient hospital services during a benefit period (catastrophic coverage picks up 61st and subsequent days). (2) All medically-necessary skilled nursing facility care, intermediate care, and home health services. (3) All medically-necessary medical and other health services. (including physician's services, laboratory and X-ray services)$3 per visit copayment for each of the first 10 outpatient physicians' visits per family. (4) Pre-natal and well-baby care (no $3 copayment for wellbaby visits). (5) Family planning counseling services and supplies (no $3 copayment for family planning visits). (6) Periodic screening, diagnosis, and treatment for children under age 18. (7) Payment of the Part B medicare premium for eligible individuals. (8) Payment of any coinsurance required under the catastrophic insurance plan for eligible individuals; for persons not eligible for catastrophic insurance, payment for benefits covered under that plan. (9) Routine immunizations. (10) Inpatient mental health care consisting of active care and treatment in an accredited institution; outpatient care in a qualified community mental health center; outpatient psychiatric services limited to 5 visits related to "crisis" intervention, plus additional visits when authorized in advance. D. Payment to Providers Payments made to practitioners and providers of services under both the catastrophic insurance plan and the Medical Assistance Plan would be subject to the same reimbursement controls as under medicare. Reimbursement controls would include the payment of audited "reasonable costs" to participating institutions and agencies, and "reasonable charges" to practitioners and other suppliers. However, payments made under the Medical Assistance Plan, along with any required copayment, would have to be accepted by providers and practitioners as payment in full for the services rendered, and no person accepting such payment could charge additional amounts. Quality, health and safety standards, and utilization controls used in the medicare program would also apply. 15 E. Administration F. Financing The catastrophic plan would be financed by a Federal payroll tax on employers, employees, and self-employed (0.3% in 1975-77, 0.35% in 1978-81, 0.4% in 1982 and thereafter). Trust fund for Federal Catastrophic Health Insurance would be completely separate from other trust funds operating under Social Security programs. The Medical Assistance Plan would be financed from general revenues, just as the Federal share of the current medicaid program is now financed, and also with State funds. A ceiling would be placed on the amount of State contributions. States would contribute a fixed amount equivalent to their total expenditures from State funds under medicaid for the types of benefits covered under the Medical Assistance Plan during the year prior to the effective date of this program. In addition, a State would also pay 50% of the estimated amount that the State and local governments have expended in that same base year for provision of these types of services to people not covered under medicaid who would, however, be covered under the new Medical Assistance Plan. G. Cost Estimates Sponsor estimates cost of catastrophic plan to be $3.6 billion in the first full year of operation (effective July 1, 1974). Sponsor estimates cost of Medical Assistance Plan to be $5.3 billion in general revenues above present Federal-State expenditures for medicaid (effective July 1, 1975). H. Other Major Provisions A voluntary certification program would be set up at the Federal level for private health insurance covering basic benefits. Certification would be based upon criteria such as adequacy of coverage, conditions of eligibility, reasonableness of premiums to benefits, etc. Three years after the effective date of this provision, no private insurer could serve as a medicare carrier or intermediary unless it offered one or more certified policies to the general public in each geographic or service area in which it did business. 15 Health Rights Act-S. 2756 (SENATORS HUGH SCOTT AND CHARLES PERCY) A. General Approach Establishes two separate health insurance programs to supplement existing private health insurance protection-1) a Federally-administered inpatient plan designed to cover costs of catastrophic illness; 2) an optional outpatient health maintenance plan administered by private insurers under contract to the Government. Inpatient plan would pay for covered benefits when a family's or individual's medical expenses exceeded a "health cost ceiling." Outpatient plan would pay for covered services above a specified deductible. Would replace medicare and repeal the Federal Employees Health Benefits program and Retired Federal Employees Health Benefits program; medicaid would pay only for services not covered under inpatient plan. B. People Covered All U.S. residents and aliens admitted for permanent residence. would be entitled to benefits. Reciprocal agreements could be arranged to cover aliens temporarily residing in U.S. and employed by foreign countries. C. Scope of Benefits а Inpatient plan would pay 1) all costs for covered services (listed below), once a family's or individual's medical expenses exceeded "health cost ceiling," based on family income and size, and 2) 50% of costs of covered services when such expenses exceed ed1⁄2 of the health cost ceiling. (For example, a family of 4 with income of $10,000 would have a health cost ceiling of $545. Once medical expenses reached $272.50, the inpatient plan would pay 50% of additional medical expenses up to $545, then 100% of costs beyond that.) Inpatient plan would cover following services: (1) Inpatient hospital services. (2) Inpatient tuberculosis hospital services. (3) Inpatient psychiatric hospital services-60 days per year, with individual lifetime maximum of 180 days. (4) Secondary care services. (5) Post-inpatient home health services. Outpatient plan would pay for all covered services above an individual deductible of $50 per year, with lower deductibles for the poor. An additional $25 deductible would be applied to covered dental services. Outpatient plan would cover the following: (1) Physicians' services, including diagnostic exams, limited physical exams, pre-natal care, 2 well-child care exams per year for children between birth and age 4. (2) Outpatient physical therapy. (4) Up to 26 outpatient psychiatric visits per year, with a lifetime maximum of 104 visits. (5) Dental services (exclusive of most orthodontia) for children under age 11. (6) Long-term maintenance drugs. Benefits would become effective July 1, 1975. D. Payment to Providers Provides that payment to providers of services under inpatient plan would be in accordance with regulations of the Secretary of HEW. For outpatient plan, insurance carriers or other administrative intermediaries who have contracted with the Government to administer the plan within a particular region would reimburse providers of services, in accordance with HEW regulations. E. Administration An Office of Health Care would be established in the Department of HEW to administer, through its regional offices, the Government's inpatient plan. Private carriers under contract to HEW would be assigned responsibility for administering the outpatient plan within a particular region or subregion. A National Professional Standards Review Council would review the operations of PSROS in each State and would also review overall administration of the health benefits program, develop minimum national standards for participating health personnel and organizations, compile a generic list of drugs for use by participating institutions and HMOs, etc. Providers would be required to have a utilization review program. HEW could contract with health maintenance organizations to provide all services covered under both inpatient and outpatient plans. F. Financing Inpatient plan would be financed in part through the present health insurance portion of Social Security payroll taxes and in part through general revenues. Supplementary outpatient plan would be financed through individual premium payments which would be supplemented in whole or in part with Federal payments for poor families. Employers could agree to pay part or all of their employees' premiums for the supplementary plan. G. Cost Estimates Sponsors estimate cost of the proposal to be "under $20 billion a year." H. Other Major Provisions Authorizes Federal grants and loans for planning, development, and construction of health maintenance organizations, with special grant provision for HMOs in physician shortage areas. |