The bill would create a new Title XXII in the Social Security Act, establishing AmeriCare, to provide coverage to all residents of the U.S. Benefits would be similar to Medicare but modified to include additional benefits for children and pregnant women, and more coverage of preventive and mental health services and substance abuse treatment. and could be provided by private insurers under rules similar to those governing the Medicare Advantage program. Coverage of prescription drugs and cost sharing would differ from current Medicare. Individuals would obtain coverage through AmeriCare or could opt out if they had equivalent coverage provided through their employer. AmeriCare would be financed through contributions from employers, individuals, and states. Premiums, deductibles, and coinsurance would be subsidized for lower-income individuals.
Name of new program
AmeriCare.
Target population(s)
All residents of the U.S.
Eigibility
All residents of the U.S. would be eligible for coverage under AmeriCare. Children (under age 24), pregnant women, and individuals with incomes under 300% of the federal poverty level would be eligible for special benefits and subsidies. (Coverage of non-residents would be available to the extent that the Secretary determined that such benefits would be available to U.S. nationals in the non-resident’s country of origin.) An individual could opt out of AmeriCare if the individual could demonstrate that he or she had coverage under a group health plan that was at least equivalent to coverage under AmeriCare.
Type of coverage
AmeriCare would provide Medicare’s current benefits (Parts A and B) with expanded benefits for mental health, coverage of preventive benefits for children including early, periodic, screening, diagnostic and treatment services, family planning services, and pregnancy-related services for women. Unlike Medicare, a unified deductible would apply of $350 for an individual ($500 for a family). Benefits for prescription drugs and biologicals would also be available. Drug benefits would have to be at least equivalent to those in the 2008 Blue Cross Blue Shield Standard Option plan offered through FEHBP. Preventive services recommended by the U.S. Preventive Services Tax Force would be covered without the application of any deductible or coinsurance. Benefits for mental health services and substance abuse treatment would have to be made available in the same manner as benefits were made available for medical and surgical services. Medicare’s benefit package would be conformed to the benefits made available under AmeriCare.
In general, enrollee coinsurance would be 20%. Coinsurance would apply up to an annual out-of-pocket maximum of $2,500 for an individual ($4,000 family). Once the out-of-pocket maximum was reached (i.e., the catastrophic limit), no coinsurance would apply. Any premium, deductible and coinsurance could not exceed 5% of modified gross income for individuals and families with modified gross incomes between 200% and 300% of poverty and 7.5% of income for individuals and families with incomes between 300% and 500% of FPL. Cost-sharing and out-of-pocket maximums would be indexed to the CPI after 2009.
Special rules relating to cost-sharing would apply to some populations. No deductible or coinsurance would apply to services provided to children, nor to prenatal care, inpatient labor and delivery services, and postnatal care for pregnant women. Individuals with incomes below 200% of the federal poverty level would not face deductibles or coinsurance for inpatient hospital care, vision exams, eyeglasses, hearing exams, or hearing aids.
In addition to the maximum out-of-pocket limits on cost-sharing described above, the coinsurance for individuals with income between 200% and 300% of the federal poverty level would be subsidized. Individuals below 200% of poverty would not be required to pay deductibles or coinsurance.
Payments for services covered by AmeriCare would generally be the same as under Medicare, and providers could not bill patients for amounts above any applicable deductibles, copayments or coinsurance. Payments would be established for new services (e.g., obstetrics, will-child care, etc.) and Medicare payments adjusted for new populations. The Secretary would be required to establish a global fee for obstetrical services, with a 5% bonus paid to providers for treating women presenting for prenatal care during their first trimester. The Secretary also would be required to establish a fee schedule for the payment for outpatient prescription drugs and biologicals under both AmeriCare and Medicare, and to negotiate with pharmaceutical manufacturers with respect to the purchase price of such products.
AmeriCare would cover low-income children, women, and others who are currently enrolled in Medicaid and SCHIP, but States would remain responsible for long-term care for eligible individuals. States could provide additional benefits to AmeriCare enrollees at state expense.
The FEHBP would be prohibited from providing benefits for which any payment would be made under AmeriCare. The Secretary would be required to conduct a review of the feasibility of applying a similar policy to additional federal programs, such as TRICARE, and make recommendations to the Congress by January 1, 2011.
Standards (including consumer protections) for private supplemental health insurance policies would be established. States could establish more stringent standards applicable to insured (i.e., state-regulated) policies.
The provisions of the legislation are not intended to affect obligations for health care benefits under group health plans in effect on the date of enactment or limiting the additional benefits that could be provided under group health plans.
Premiums
Each enrolled individual would be required to pay a premium established by the Secretary based on the cost of AmeriCare coverage (determined on a state-by-state basis and taking into account administrative costs) and class of enrollment (i.e., individual, couple, family). Premiums would be reduced for low-income individuals. Individuals receiving equivalent coverage through their employer could opt out of AmeriCare and, therefore, would not pay AmeriCare premiums. Employed individuals would pay 20% of the premium for AmeriCare or equivalent coverage offered by their employer. Employers would be required to pay 80% of the AmeriCare premium or equivalent coverage for full-time employees (defined as working at least 40 or more hours per week) and their families. The Secretary could impose an additional liability for employers to the extent necessary to prevent adverse selection. Employer contributions for part-time employees would be reduced. The Secretary of the Treasury would be required to establish a process for a non-enrolling employer to reimburse the enrolling employer in the case of a married couple that worked for different employers but chose to enroll in the same plan.
Goverrnment subsidies
Individuals with incomes under 200 percent of poverty would be fully subsidized, and premiums and cost-sharing would be phased in for those with incomes between 200-300 percent of poverty.
Financing
An AmeriCare Trust Fund would be established, similar to the Hospital Insurance Trust Fund for Medicare. All premiums, general revenues, and state payments would be deposited into the Trust Fund and used to support program operations. States would be required to pay to the federal government a maintenance of effort amount each year, equal to the amount that the state spent in 2008 for Americare benefits provided under Medicaid and SCHIP. These state payments would be used to offset the costs of AmeriCare in providing subsidies for low-income individuals. The state maintenance of effort payment would be a condition of coverage under AmeriCare for residents of that state.
Effective date
Benefits and premium requirements would become effective as of January 1, 2011. The requirement on employer premium contributions for employers with fewer than 100 employees would become effective January 1, 2013.
Administration
The Secretary would be required to provide for the offering of benefits under AmeriCare through enrollment in a private health benefit plan that met the same or similar requirements as the requirements that apply to Medicare Advantage plans (other than the requirements relating to Medicare prescription drug benefits). Private plans would be paid by the government using the same adjusted average per capita cost (AAPCC) payment rate methodology that is used to pay Medicare Advantage plans.
Other provisions in bill
The Secretary would be required to establish an electronic AmeriCare entitlement verification system to verify an individual’s entitlement to benefits, the extent to which the individuals fulfilled cost-sharing requirements and enrollment of qualified providers within 12 months of enactment.