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Federal Health Care Reform

The Department of Managed Health Care has a significant role in implementing many parts of the federal health care reform proposal. Many of the changes in the federal law such as guaranteed coverage, cost controls, and prevention goals were also part of the Governor’s 2007 reform proposal.

On April 29, 2010, the Governor announced his intention to contract with the federal government to operate a temporary health insurance program for currently uninsured individuals with pre-existing medical conditions. California has operated a similar program, known as a “high-risk pool”, since the early 1990s. The new program, the Pre-existing Conditions Insurance Program (PCIP) is now accepting applications for people who have not been able to get coverage in the individual market and have been uninsured for at least six months. For more information, click here.

Below is initial information about the federal health care reform program. Information will be added as it becomes known. The DMHC Help Center is also available to answer questions at 1-888-466-2219.

Frequently asked questions about health care reform can be found at http://www.healthcare.ca.gov/NewsInformation/FrequentlyAskedQuestions.aspx, http://www.healthreform.gov/about/answers.html or at http://www.naic.org/index_health_reform_section.htm.

DMHC awarded federal rate review grants

On September 20, 2011, the DMHC was awarded $2,162,121 under Cycle II of the U.S. Department of Health and Human Services (HHS) Health Insurance Rate Review Grants. The California Department of Insurance was awarded the same amount. These grants will give California much needed resources to build on its role of reviewing proposed health insurance premium increases and to hold insurance companies accountable for unjustified premium increases. California was one of 28 states and the District of Columbia receiving awards. It is anticipated that HHS will award additional funds to other states in 2012.

The DMHC will use the funds to:

  • Expand scope of rate review: Increased data collection will allow for a more in-depth analysis and reporting on rate data submitted by health plans.
  • Improve rate filing requirements: A new actuarial evaluation process for rate increases, which was a result of SB 1163, effective on January 1, 2011, will now be used by the DMHC.
  • Improve transparency and consumer interfaces: The DMHC will continue to work to get meaningful input from consumers and stakeholders on rate filings and post comments on its Web site. Funds will be awarded through a competitive bid process to a consumer advocacy group to provide consumer input on rate review filings and to assist the DMHC in developing long-term strategies for the solicitation of individual public comments on rate review increases.
  • Improve Information Technology: The DMHC will continue to build on existing program infrastructure using additional resources to collect, analyze, and report critical information about rate review decisions and trends to the federal government.

Award letter

Notice of Award

On August 16, 2010, the DMHC was informed by the US Department of Health and Human Services Office of Consumer Information and Insurance Oversight that it had been jointly awarded $1 million with the CA Department of Insurance under the Health Insurance Premium Rate Review grant program. The grant money is to be used to retain actuarial services and necessary information technology upgrades.

Award letter

Press Release

DMHC Interim Director Heidig makes presentation to Health Benefits Exchange Board.

On May 24, 2010, Interim Director Ed Heidig made a presentation to the Health Benefits Exchange Board about current DMHC functions and how it has been involved in policy development and implementation regarding health care reform issues. The purpose of the presentation was to inform Board members about the role of the DMHC in helping craft health coverage product designs, assisting consumers with problems, and analyzing the reasonableness of health premium rate increases. A copy of the presentation is available here.

Director's Letters provide guidance for health plans about health care reform provisions

The DMHC has provided the following Director's Letters for health plans to provide guidance for implementing the new provisions in the federal health care reform regulations.

  • May 24, 2011 - 9 - K: Additional Guidance to Implement AB 2244
  • May 24, 2011 - 8 - K: Guidance related to Premium Rate Filings
  • May 12, 2011 - 4 - K: Implementation of AB 2244
  • December 2, 2010 - 2 - K: Notification of Federal Temporary High Risk Program

The following are draft Director’s Letters for which the DMHC is soliciting public comments:

Number Subject Draft Date Comments Due By
None Pending

Final Director’s Letters can also be found at http://www.dmhc.ca.gov/aboutthedmhc/gen/gen_cfd.aspx.


DMHC awarded $4.1 million to reach out to consumers about health care reform changes

In the fall of 2010, the DMHC received a $4.1 million consumer assistance program grant under federal health care reform. The focus of the program is to provide assistance to consumers with enrollment into health coverage, filing complaints and appeals of health plan decisions, and to provide consumers with educational materials and information about health coverage and health care reform. The DMHC is using these funds to enhance the capacity of its Help Center, coordinate with existing state consumer assistance resources, and contract with community-based organizations that will assist consumers in identifying coverage options and understanding health care reform provisions.

Original grant application.

Supplemental application

Revised application to re-allocate grant funds, and award letter

DMHC hosts conference call on new provisions of health care reform

Federal Legislation

More information on federal bills (H.R. 3590 and H.R. 4872)

http://www.ncsl.org/Default.aspx?TabID=160&tabs=831,139,1156#1156

Summaries of the federal health care reform legislation

Kaiser Family Foundation’s "Summary of Coverage Provisions in the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010"
http://www.kff.org/healthreform/upload/8023-R.pdf

House Energy and Commerce Committee
http://docs.house.gov/energycommerce/SUMMARY.pdf

Various Resources

Events, news, summaries, and updates are available:

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