Madam Speaker, I rise to share a letter written to the Department of Health and Human Services Secretary Kathleen Sebelius last week. In this letter, copied below, the CEO for the California Public Employees Retirement System, CalPERS,…
Madam Speaker, I rise to share a letter written to the Department of Health and Human Services Secretary Kathleen Sebelius last week. In this letter, copied below, the CEO for the California Public Employees Retirement System, CalPERS, details several key ways the health reform law is already helping their members.
CalPERS is the largest non-federal purchaser of health benefits in the country outside of the Federal Employees Health Benefits Program, FEHBP. They highlight expanded coverage for young adults, removal of lifetime limits on benefits, and assistance with the costs of retiree health benefits as three key ways reform is already making a difference.
Republicans refuse to look at the benefits of health reform and are continuing to insist they will ``repeal ObamaCare.''
President Obama should be proud to have the right wing label health reform with his name. As this CalPERS example shows, health reform is expanding and improving health coverage already. As time moves forward, the benefits to working families, small businesses, and large companies only increase.
Executive Office, CalPers,
Sacramento, CA, December 10, 2010.
Hon. Kathleen Sebelius,
Secretary, U.S. Department of Health and Human Services,
Washington, DC.
Dear Secretary Sebelius: As the nation's largest non-
federal purchaser of health care, the California Public
Employees' Retirement System (CalPERS) has a keen interest in
national health care reform. From the beginning, CalPERS
supported the reform necessary to contain costs for employers
and their employees while maintaining quality health care.
Many health care elements we have championed, such as
guaranteed issue policies; eliminating co-pays for preventive
services; bans on pre-existing conditions; stabilizing health
premiums; supporting innovative delivery system reforms; and
patient protection against medical bankruptcies are now major
components of health care reform.
We believe that key elements of national health care reform
represent a fundamental and positive shift in the way health
care will be purchased and delivered in the United States.
Together, they will dramatically shape the future of health
care in our country and ultimately benefit everyone.
During our recent open enrollment period, CalPERS
emphasized the benefits of many health care reform
provisions--including extension of dependent coverage,
elimination of lifetime limits, and the Early Retiree
Reinsurance Program. We are writing to share some of our
implementation successes.
(1) Extension of Dependent Coverage to Age 26
In recognition of young adults' need for health care
coverage, CalPERS launched a massive communication effort to
educate and inform employers and members of the extended
dependent coverage benefit. We developed special enrollment
teams, published communication materials, posted information
on our website, and issued press releases highlighting this
new health care reform provision.
Our efforts successfully resulted in more than 27,000 young
adults being added to their parents' health plans effective
January 1, 2011. Best of all, adding them to our program
resulted in a 2011 health insurance premium increase of less
than 1 percent. Families can now rest easier in these
uncertain economic times knowing their dependents, regardless
of marital status, can be covered up to age 26.
(2) Removal of Lifetime Limits
Most CalPERS health insurance plans have never included
lifetime limits on the dollar value of benefits. Further, we
proactively monitored our members who were enrolled in the
few health plans that did include lifetime limits, so we
could work with them to change plans when they approached
these limits.
As a result of health care reform, CalPERS has removed
lifetime limits from all our plans that had included them,
and now our members enjoy more health plan options and less
financial risk.
(3) Early Retiree Reinsurance Program (ERRP)
For years, CalPERS health plans have included wellness and
disease management programs that promote prevention and
manage chronic conditions. These programs, now required of
ERRP participants, mitigate the on-going fiscal impact of
caring for an older population. It's encouraging that these
programs can reduce costs.
Notwithstanding this success, approximately 24 percent of
our non-Medicare medical and pharmaceutical costs are
associated with early retiree health liability. Recognizing
this, the Affordable Care Act included much needed provisions
for relief from these costs. CalPERS 2010 health premium
rates reflected the lowest increase in 14 years.
In anticipation of the Department of Health and Human
Services certifying our ERRP application, CalPERS proactively
negotiated 2011 health plan contracts that reduced premium
increases by more than 3 percent for our non-Medicare plans.
We estimate ERRP will provide premium savings of
approximately $200 million based on reimbursement related to
more than 115,000 early retirees and their spouses, surviving
spouses, and dependents.
We thank you for expeditiously implementing important
health care reform provisions and we are committed to being a
collaborative partner in ensuring the smooth and successful
implementation in the months and years ahead.
If you have any questions regarding our program, please
contact me.
Sincerely,
Anne Stausboll,
Chief Executive Officer.