Author: Lucien Wulsin

Open Letter on the Next Section 1115 Waiver

California’s next §1115 waiver provides an important opportunity to improve health outcomes for over 10 million Californians. We wanted to share our thinking on possible directions. We have completed our nine regional workgroups throughout the state and our stakeholder convenings in Southern California counties. So these comments are informed by the diverse, passionate and interesting ideas we heard, the discussions we have held and reactions we have received to the California waiver outline and the CMS approved New York DSRIP waiver.

We would encourage a large and transformative waiver as opposed to a small, targeted one. Just as the Bridge to Reform set California on the path to early and successful enrollment, we would urge that the next waiver focus on dramatically improving patient outcomes now that we have the expanded Medi-Cal coverage and managed care platforms in place to do so.

Download the letter here.

Based on our workgroups, there is a great deal of support at the local level for improving the care and outcomes of care to the newly insured. There is agreement that waiver renewal is a terrific opportunity to improve the functioning of Medi-Cal managed care, which has expanded greatly in terms of covered lives and the complexity of the medical conditions covered, and now needs to focus on further improving health outcomes. With the next round of the §1115 waiver our goal can and should be to achieve excellent outcomes for all the newly insured enrolled with all the participating safety net providers. There is widespread doubt that significant cost savings can be achieved given the already low levels of Medi-Cal spending, but wide consensus that improved outcomes and better quality care are achievable.



California’s Implementation of the 2010 DSRIP Waiver

Summary of California’s Implementation of the 2010 DSRIP Waiver – 3rd Year

California Health Care Safety Net Institute, Aggregate Public Hospital System Annual Report in California’s §1115 Medicaid Waiver’s Delivery System Incentive Program Demonstration Year 8 (December 31, 2013)

Public hospitals, including the five UC hospitals, were eligible for $3.3 billion in federal matching funds over a five-year period. The California Health Care Safety Net Institute has summarized the first three years of implementation. The five categories for improvement were: 1) infrastructure development, 2) innovation and design, 3) population focused improvement, 4) urgent improvements in care and 5) HIV transition projects.

Infrastructure development included the following: moving from episodic reactive visits to data-driven population health management. It included more primary care capacity, disease management registries and electronic health records.

Innovation and design included: transforming primary care clinics into medical homes, and moving from silos to integrated seamless systems integrating primary care, specialty care, behavioral health and hospital based services.

 Read the rest of the summary here: DSRIP Waiver Summary


Just off the Covered California bus after two great days in the Bay Area and Central Valley. Carolina Coleman is on the bus today, then John Connolly on Thursday, and Chauntrece Washington on Friday. They hope to see you if you are at one of the bus stops.

Open enrollment begins this Saturday at 12:01 am online and the call centers will open at 8:00 am. This year, there will be 200 brand new storefronts, manned by application assisters, more call center employees, and an improved online enrollment. The plans have increased the doctors in their networks. Let us know how it’s working and what needs improvement.

This year, the open enrollment is shorter: three months as opposed to six months last year.

Remember that 3.4 million Californians enrolled last year, cutting the state’s uninsured rate in half, so we need to help new people to enroll for the first time and help existing people who will be renewing their coverage.

Thanks for everything you do. We’re in.


Prepared by: Lucien Wulsin, ITUP, 11/12/14

We’re in!

ITUP is on the Covered California 23-city bus tour to mark the start of this year’s open enrollment. We started at 6:45 from the Covered California headquarters, then to the Capitol Steps, Petaluma Health Center, Martin Luther King Memorial in San Francisco and Yerba Buena High School in San Jose, and slept over night in Gilroy. Today, we head for Merced, Fresno and Bakersfield – a great way to celebrate Veteran’s Day.

3.4 million Californians were covered in year 1 of the Affordable Care Act (ACA). That’s cut our state’s uninsured rate in half in just 12 months. This is what I signed on for as a young lawyer forty years ago. One of my early clients was a Vietnam vet who had been unemployed and just got a full time job in Boston, MA. His employer did not offer coverage, and he got a notice that he was losing Medicaid because he was working. I told him, “This must be a mistake, we cannot have a stupid system like that in America where you get a job and lose your coverage. I’ll try to get that taken care of.” After poring over the law books, I had to tell him that this was in fact the crazy system we had, and I’d try to get it fixed.” He said, “Don’t worry about me. I can get my care at the local VA. It’s coverage for my wife and kids that I’m really worried about.” Being fresh out of law school, I thought that might take a few months for legislators and program administrators to repair this unjust omission.

Here we are 40 years later. Massachusetts finally fixed that problem in 2006 with its historic RomneyCare legislation. The nation passed and President Obama signed the Affordable Care Act in 2010, and California is “all in.”

With all the frustration of the first year’s rollout, let’s remember, 1) its taken 100 years to get here, starting with the leadership of President Teddy Roosevelt, 2) California has already covered nearly 3.5 million in its first year, and 3) there are many stories of returning veterans and their families trying to get coverage and basic health care, just like my early experience. We have a lot to appreciate and reflect on in the leadership of American’s veterans as we all face the future together.

Thank you Covered California. We’re in!

Lucien Wulsin, ITUP, 11/11/14

Rate of Health Spending Falls

CMS’ Office of the Actuary reports in Health Affairs on the increases in health spending. For the period 1990-2008, health spending grew at 7.2% annually or 2% higher than GDP growth. For the five-year period 2008-2013, the rate of health spending fell by more than 50% and grew at the same rate as the overall economy (GDP). The slow down was due to the recession and the slow but steady rate of recovery combined with the ACA reforms in Medicare spending. For the next ten years, the rate of growth in health spending is projected to be 5.7% or 1.1% greater than the rate of economic growth (GDP). The reasons for the increase are: 1) a faster rate of economic growth and 2) increasing baby boomer retirements into the Medicare program.

Screenshot 2014-11-04 14.30.01

The rate of Medicare spending growth will be highest between 2019 and 2023 due to boomer retirements and the aging of Medicare eligibles; the ACA reforms will moderate the growth in Medicare. The rate of increase in Medicaid spending will spike in 2014 as the ACA’s Medicaid expansions financed by the federal government take effect, then the increases fall to normal levels. The rate of private insurance spending will grow as more people are covered through the Exchanges, then slow beginning in 2019. The growth in private insurance is primarily due to more people covered through the Exchanges, mitigated by the ACA’s caps on the tax expenditure growth of high cost plans beginning in 2018. The rate of individual out of pocket spending will fall significantly as more of the uninsured move into the Exchanges and Medicaid, then increase to keep pace with the rise in GDP beginning in 2019.

Flat Premiums for Employment-Based Coverage

The Kaiser Family Foundation/Health Research and Educational Trust reports on its study on employment based coverage in 2014. Premiums for individual coverage are essentially flat – a 2% increase and premiums for family coverage are up by 3%. The employee shares of premiums are unchanged – 18% for individual coverage and 29% for family coverage. Cost sharing (i.e. copays, co-insurance and deductibles) is unchanged. The percentages of employers offering (55%) and the percentage of employees taking up their employers offer were unchanged. Only 25% of employers offer retiree health benefits – a figure that is also unchanged.

There are some changes at the margins. Twenty three percent of large employers reduced their waiting periods for coverage of new workers and 10% of small employers reduced their waiting periods. Six percent of large employers made more of their workers eligible for coverage while 2% made fewer workers eligible; the rest made no changes.

For the coming year, employers may be looking to narrower and or tiered networks of higher performing providers, tiers for generic or preferred drugs, risk assessments and employee wellness programs, private Exchanges for their employees, and public Exchanges for their retirees. A few (less than 10%) will not cover spouses if they have an offer of coverage from their own employer.

Thoughts On Financing Care And Coverage For Those Who Are Uninsured and Ineligible for Covered California and Full Scope Medi-Cal Due To Their Immigration Status

At least half of California’s undocumented residents are uninsured, while the others are covered through their employers, and to a lesser degree, through state limited benefit programs. The undocumented are ineligible for Covered California, and eligible only for limited scope Medi-Cal that covers genuine emergencies and maternity care. This report examines alternatives to covering and caring for the undocumented in California.

The challenge for California is to assure care to an undocumented working population that is not evenly distributed throughout the state, but rather most heavily concentrated in the Central Valley, the Central Coast and Southern California counties. There are several approaches to financing care and coverage for the undocumented. First, their care could be covered by California’s county safety nets. Second, they could be covered by the state of California. Third, they could be covered by their employers or by private individually purchased coverage. Fourth, their care could be partially funded by the federal government. Lastly, we could consider hybrid programs and shared responsibility.

Download the brief here.


Newsflash: The Sky is Not Falling

The annual survey of employer health benefits by the Kaiser Family Foundation for 2014 reports the following:

  • The average premium for employee only coverage increased 2%; the average premium for family coverage increased 3%, and the average worker’s wages increased by 2.3%.
  • Covered workers pay 18% on average as their share of individual coverage and 29% of family coverage.
  • The rates of employer offer, and employee take-up are statistically unchanged.
  • 25% of large employers now offer retiree health benefits – statistically unchanged.
  • More employers (a third) are offering wellness programs and incentives, more (19%) are offering high performance tiered networks; more (13%) are considering private exchanges, but only 3% are offering them; more (12%) are offering reference pricing; more (8%) are offering narrow networks.

On the other hand over the last 15 years, employer coverage has been decaying

  • The rate of employer offering has fallen from 68% to 55%.
  • Employee contributions towards coverage have increased at 4 times greater than employee wages.
  • The percent of workers covered through their jobs fell from 70% to 62%.
  • Large employers’ offer rates of retiree health benefits fell from 40% to 25%.

In other words, reform was needed, and to date the ACA appears to be working for the American workers and their employers. These are good building blocks, but it’s far too soon to pop the champagne.

New York’s New DSRIP Waiver & What It Could Mean in California UPDATED

New York state and CMS signed a new DSRIP waiver in April 2014. The goals are transforming the state’s health care system, bending the Medicaid cost curve and assuring quality care for all Medicaid members.

The waiver puts an emphasis on transformation of the safety net, cost reduction and improved outcomes. It is built on collaboration, collaboration, and more collaboration to achieve these goals — a very different model from California’s 2010 DSRIP waiver, which was facility focused. Collaborative partners in New York’s new waiver include: hospitals, health homes, SNF’s, FQHC’s, behavioral health providers and home care agencies.

The state of New York has agreed to reduce the projected federal Medicaid spending by $17 billion over the five years of the waiver and the federal government has agreed to reinvest $8 billion of these projected savings into Medicaid transformation in order to get the actual savings. New York plans to reduce spending on avoidable hospitalizations by 25%.

Read the full brief here.

Summary and Analysis of Burwell v. Hobby Lobby 573 US — (2014)

The Supreme Court held yesterday that a family owned for-profit corporation could invoke the Religious Freedom Act to claim an exemption from offering coverage of contraceptive services to their employees

The Affordable Care Act requires large employers and those small employers offering coverage to cover preventive services that are of proven effectiveness and meet the effectiveness criteria of the US Public Health Services. Exemptions are available for grandfathered firms. Furthermore there can be no copays for effective preventive services.

Contraceptive services are part of the list of demonstrated effective preventive services. Hobby Lobby and the other plaintiffs objected to four specific contraceptive services, essentially IUDs (Intrauterine Devices) and morning after pills, saying they were equivalent to abortion and against their religious beliefs. They argued that they would comply with the rest of the Affordable Care Act, but in their religious conscience could not offer those four contraceptive services due to their religious beliefs.

HHS gave religious exemptions to churches and other comparable religious non-profits who have religious objections to contraception. In order to preserve access to contraception for men and women who work for these exempt employers; they created a work-around so that insurers would offer the services at no cost to these employees. Since the contraceptive services are a cost saver, rather than a cost increaser, the insurers can offer them at no additional premium cost.

The majority opinion says that the 1993 Religious Freedom Act requires HHS to offer the same workaround for the religiously motivated for-profit, family-owned plaintiffs. The dissent says that the majority misreads the Religious Freedom Act. It’s an interesting legal discussion for those interested in statutory construction. Here are some highlights as I see them.

  • The court majority says that corporations are “people” and protected by the RFA while the dissent says that the RFA reaches only real people who go to church and have religious beliefs, not corporations who by their very nature do not go to church or have religious beliefs. The legislative history seems to favor the dissent on that one.
  • The court majority says that HHS must offer the same “least restrictive” accommodations (i.e. the no cost work-around) to for-profit corporations with sole family owners with strong religious beliefs as they make for the churches who teach those beliefs. The dissent says that church exemptions are for genuine “churches” not for the corporations owned and run by people with genuine religious beliefs.
  • Finally the dissent says the majority completely ignores the rights and interests of the men and women employees who also have religious beliefs that may be at complete variance with their employer about the value of contraceptive services. The ACA’s design of covered benefits for all Americans assumes that most Americans will continue to get full scope coverage through their jobs and not through a government program (like Covered California) that is only available to those without an offer of affordable job-based coverage or Medi-Cal that is only available to the poor. The majority opinion reiterates that government can offer the workaround or can expand the Title X, Family Planning Act to reach those men and women employees who cannot afford contraception.