Sources of Health Insurance Coverage in California
Source: California HealthCare Foundation. SNAPSHOT California’s Individual and Small Group Markets on the Eve of Reform, 2011.
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California Health Benefit Exchange
Rising Spending: National Health Spending as a
Share of Gross Domestic Product (GDP)
Source: California HealthCare Foundation. California Health Care Almanac: Health Care Costs 101, April 2010.
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California Health Benefit Exchange
The Patient Protection and Affordable Care Act
President Obama Signed Into Law Landmark Health Care
Reform Legislation
“Today, after almost a century of trying. Today, after over a
year of debate. Today, after all the votes have been tallied,
health insurance reform becomes law in the United States
of America…We are a nation that faces its responsibilities and
faces its challenges. Here in this country we shape our own
destiny…That's what makes us the United States of America.”
– President Obama
March 23, 2010
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California Health Benefit Exchange
Health Insurance Market Reforms
Taking Effect January 2014
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Guaranteed issued
Guaranteed renewability
Prohibition on preexisting condition exclusion
Restrictions on rating variations in premiums
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Family structure
Geography
Actuarial value of benefit
Age (3:1 ratio)
Tobacco use (1.5:1 ratio)
• Prohibitions on waiting periods longer than 90 days
• Small group and individual plans must offer “essential health
benefits package”
• Limitations on cost-sharing
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California Health Benefit Exchange
Shared Responsibility for Health Care: Individuals
• Individuals must maintain minimum essential coverage beginning in 2014
• Annual penalty for individuals without coverage
• 2014: the greater of $95 or 1% of income
• 2015: the greater of $325 or 2% of income
• 2016: the greater of $695 or 2.5% of income
• Exemptions from penalty
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Those for whom the lowest cost plan options exceeds 8% of income
Those with incomes below the tax filing threshold
Religious objections
American Indians
Those without coverage for less than 3 months
Undocumented immigrants
Incarcerated individuals
California Health Benefit Exchange
Affordable Coverage Choices
• Refundable premium tax credits for individuals purchasing on
Exchange who have incomes between 138% and 400% of Federal
Poverty Level (FPL)
• Reduced cost-sharing limits for individuals purchasing on
Exchange with incomes between 138% and 400% of FPL
• Small business tax credits through 2015
• Fewer than 25 FTE employees and average wages under
$50,000
• Full credit available if 10 or fewer FTE employees and average
wages under $25,000
• Employer must pay at least 50% of premium cost
• 2010-2013: Credit up to 35% (25% if tax-exempt employer)
• 2014-2015: A credit is available to small business for the first 2
years it offers employee a plan through an Exchange
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California Health Benefit Exchange
Shared Responsibility for Health Care:
Employer’s Participation
• Employers with 200+ employees must auto-enroll all new fulltime employees
• Employers with 50+ full-time employees that do not offer
coverage and have at least 1 employee who receives a
premium assistance tax credit (income up to 400% of FPL)
must pay a penalty of $2000 per full-time employee
• If employer does not offer coverage but 1+ employees
receives tax credit, must pay a penalty that is lesser of $3000
for each employee getting credit or $2000 per full-time
employee
• First 30 employees are exempt from penalty
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California Health Benefit Exchange
Expansion of Public Programs
• Medicaid eligibility expanded to 138% FPL
and to all non-elderly, non-pregnant
individuals (states may include more)
• Federal assistance for the added coverage
• Medicaid eligibility will use the same tests as
Exchanges – modified AGI with no asset tests
• Expanded federal support for CHIP
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California Health Benefit Exchange
Timeline for California Health Benefit Exchange
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California Health Benefit Exchange
California Health Benefit Exchange
Vision and Mission
The vision of the California Health Benefit Exchange
is to improve the health of all Californians by assuring
their access to affordable, high quality care.
The mission of the California Health Benefit Exchange
is to increase the number of insured Californians,
improve health care quality, lower costs, and reduce
health disparities through an innovative, competitive
marketplace that empowers consumers to choose the
health plan and providers that give them the best
value.
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California Health Benefit Exchange
California Health Benefit Exchange
Values
Consumer-focused
Integrity
At the center of the Exchange’s efforts are
the people it serves, including patients and
their families, and small business owners and
their employees. The Exchange will offer a
consumer-friendly experience that is
accessible to all Californians, recognizing the
diverse cultural, language, economic,
educational and health status needs of those
we serve.
The Exchange will earn the public’s trust
through its commitment to accountability,
responsiveness, transparency, speed, agility,
reliability, and cooperation.
Affordability
The Exchange will provider affordable health
insurance while assuring quality and access.
Catalyst
The Exchange will be a catalyst for change in
California’s health care system, using its
market role to stimulate new strategies for
providing high-quality, affordable health care,
promoting prevention and wellness, and
reducing health disparities.
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Partnership
The Exchange welcomes partnerships, and its
efforts will be guided by working with
consumers, providers, health plans,
employers and other purchasers, government
partners, and other stakeholders.
Results
The impact of the Exchange will be measured
by its contributions to expanding coverage
and access, improving health care quality,
promoting better health and health equity, and
lowering costs for all Californians.
California Health Benefit Exchange
Exchange Governance
Independent Public Entity
Board Members
Diana Dooley, Board Chair and Secretary of the California Health and Human Services
Agency, which provides a range of health care services, social services, mental health
services, alcohol and drug treatment services, income assistance and public health services to
Californians
Kim Belshé, Senior Policy Advisor of the Public Policy Institute of California, former Secretary
of California Health and Human Services Agency, and former Director of the California
Department of Health Services
Paul Fearer, Senior Executive Vice President and Director of Human Resources of
UnionBanCalCorporation and its primary subsidiary, Union Bank N.A., Board Chair of Pacific
Business Group on Health, and former board chair of Pacific Health Advantage
Robert Ross, M.D., President and Chief Executive Officer of The California Endowment,
previous director of the San Diego County Health and Human Services Agency from 1993
to 2000, and previous Commissioner of Public Health for the City of Philadelphia from 1990 to
1993
Susan Kennedy, Nationally-recognized policy consultant, former Deputy Chief of Staff and
Cabinet Secretary to Governor Gray Davis, former Chief of Staff to Governor Arnold
Schwarzenegger, former Communications Director for U.S. Senator Dianne Feinstein, and
former Executive Director of the California Democratic Party
California Health Benefit Exchange
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Visions for California’s Health Benefit Exchange
Price Leader
Change Agent
The Exchange drives lower premiums;
it is a cost-focused store and offers
the most competitively priced health
plans.
The Exchange is catalyst of finance and
delivery reform; establishing incentives to
encourage innovation and improvement in
the cost, quality, and efficiency in health
care delivery.
Service Center
The Exchange is a consumer
destination; it is a consumer-friendly,
one-stop shop with broad choices on
plan design, accessible information,
and strong customer service.
Public Partner
The Exchange is closely aligned with
Medi-Cal and Healthy Families partnering
to adopt an array of policies that align to
improve the health status and health care
outcomes of low-income, high-need
individuals.
Source: “California’s Health Benefit Exchange: The Future Envisioned,” California Healthcare Foundation, August 2011.
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California Health Benefit Exchange
Major Issues before the California Health Benefit Exchange
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Business, Operations, and Financial Sustainability
Enrollment & Information Technology
Stakeholder Consultation
Research and Analysis
Communication Support; Research and Marketing, Outreach,
and Education
Assisters Strategy
Health Plan Management and Delivery Reform
Small Business Health Options Program (SHOP)
Essential Benefits
Basic Health Plan
…and many more
California Health Benefit Exchange
Qualified Health Plans
Affordable Care Act Requirements
• Qualified Health Plans will be certified by
Health Benefit Exchanges
• Must provide Essential Benefit Package
• Insurer must offer at least one plan at Silver
level and one at Gold level
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California Health Benefit Exchange
Uninsured, by Employment Status and Firm Size
Total Uninsured: 7.2 Million
Source: California HealthCare Foundation. SNAPSHOT California’s Individual and Small Group Markets on the Eve of Reform, 2011.
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California Health Benefit Exchange
Individual Purchasers, by Employment Status
and Firm Size
Total Individual Purchasers: 2.2 Million
Source: California HealthCare Foundation. SNAPSHOT California’s Individual and Small Group Markets on the Eve of Reform, 2011.
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California Health Benefit Exchange
Individual California Enrollment by Carrier
Source: California HealthCare Foundation. SNAPSHOT California’s Individual and Small Group Markets on the Eve of Reform, 2011.
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California Health Benefit Exchange
Timeline for California Health Benefit Exchange
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California Health Benefit Exchange
For More Information:
Visit our website at
http://www.hbex.ca.gov
And join our listserv
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California Health Benefit Exchange