insurered person can access, to pay, or to pay part of their cost associated with the insurance. and what this does in the minimum standards, is that it gives the employer, if the minimum standards and these minimum standards have to last two years, even as the market changes and so in case, the employer for whatever reason or reasons, is really having a struggle finding a health plan, and maybe it is just a one thing, and it is the out of pocket maximum that is $500 too high. and for what we say that the minimum standards have to be and then the employers can get a $500, dollar, hra or hsa and pay for it that way, and on behalf of the employee and the main question that we asked around that a lot and really made sure was that a burden on the employee could be the employee be caught with the special cost that we don't know about, and could the employees, healthcare privacy be in any

way, lost in that exchange, and we felt very, very, certain at the end of it, that this was a fair and good idea. and to keep these minimum standards, but just want to talk more about that later, just want to make sure that we have got some definitions of these terms. so, this gives you just the high points of the current minimum standards and you will see more in detail in your report, there is a table, that shows the old minimum standards but these are kind of the big picture and the big ticket items in any health plan and so, the minimum standards do include the premium cost and who pays the premium. and the minimum standards have always required that the employer pay 100 percent, of the premium costs. and the employee pays zero. and the out of pocket max was presently today, and it was a

current minimum standard is $4,000, and it must include all types of cost sharing and that means. the deductible and really anything that that employee is putting toward their healthcare. >> and the deductible maximum is $2,000. and the hsa, hra account is load and in relation to the medical deductible only. and go insurance, if there is go insurance in the plan, is the most the employee can be required is 20 percent, in network. and 50 percent out of network. and the co-payment is at $30, in that network, for provider visits like primary care and things like that. and of course the preventive care we know is free. >> so now i am going to get into the recommendations, and i am going to grab my water and, my throat is really dry and so if you can excuse me. for one second. i am so sorry.

>> thank you. >> so the first recommendation that i want to share with you is one that is sort of just a housekeeping one more than anything. and the affordable care act, of course, i am sure that you have heard quite a bit about the ten essential health benefits and i will ask you to disregard the pediatric one, and the services would not be included in this because i have not mentioned this yet. but the minimum standards do not cover the dependant care we will talk more about that but they traditionally have not and still do not. >> and so, but all of the other ten benefits what we wanted to do was align the current minimum standards the way that they are shown and discussed and the language used around them is now matching, with the

ten essential health benefit and then for the actual really sort of nitty gr. ritty of the detail, i am the one in the department that will get the calls from the employers who are saying that i am looking at this plan and do i have to cover this thing, or that thing? and so, i now, i will be able to look it up, on the covered california bench mark plan which then, as what they do is they have to take the ten essential health benefit and then take a plan that is in the coverage california, network of plans, and select, one that shows to the great detail, what must be covered and what does not have to be covered. and so, that allows myself, and anyone else to look at the website, and see an old, and a list of benefits that, will always be very accessible on-line and so we have more information on out there and it makes the things quite a bit

easier from what we have done before because it is hard to list every single thing and there are issues of interpretation and that that is really improved by doing it this way and we lost nothing, and i talked about more in this report and there is nothing that is not covered under this recommendation, that was cover befored. and if anything, there may be more things covered. particularly with the new language around sort of the rehab taiive services that the people are sort of defining and california has a very broad and ininclusive definition of. so that is our first recommendation. the second one is around dependent coverage and what happened this time around was that there was interest on and among several of the work group members, to cover dependents and that has come up some years ago. and it sort of it is something that we have explored and just a bit here and there and given

all that we had to deal with, the group had a consensus around this decision to wait two years and give the health department time to really explore this option and see how we can bring the dependant coverage into the minimum stan aders and that is not something that we have done before and so it will give us time to share with the advisory group, kind of the pros and cons, and the ideas of how it can be done, and that kind of thing. so we are just deferring that to 2016, but we did promise the group that we will put this up front to the health commission and make a promise around that in writing. >> recommendation number three, is around the hra and hsa options and so, what we have done here, and this is something that also, the group agreed on, fully, is that we will allow hsas and hras to be

used in case of not just a medical detuktable but also out of pocket maximums and so the employer has a little more flexibility around choosing a plan, that may have a higher out of pocket kind of like i described before. and they could secure that plan, and it would be paid through this account, on behalf of the employee and the funding would come from the employer, and be fully employer funded. the next one is something that when we went in to the advisory group, i think that we thought a lot about tying it to a tier and we would say, well, maybe we will just say that the minimum standards are tied directly to the goal plan, or the silver plan and that was something that was talked about with the health commission, two years ago in a colleague of mine brought this report to the commissioners. and you know, we kind of

actually realized pretty early on that with the group, that it was a lot more complex than we had sought given the fact that these plans rely on the actual value and, what the actual value does, and it says, kind of the, and it allows you to see that as the cost sharing, between the employee, and the insurance company, and in broad terms and it sort of put a number on that and in each tier has a actual value amount, and i am sure that have you heard about that in other contexts, but what we worry about that was that it could really plans could really put a lot of highs sort of up front costs of a lot of high costs on things like your provider visit and while tweaking other areas, and that was not something that the really the employees or the people representing the

employees or the people representing the employers were comfortable and they just offered, too much, variation and thought that it could cost, out some of the employees that would be needing, you know, sort of a basic, plans, but could not afford it because we have a lot of low wage workers in these jobs. and honestly it was just really hard to choose a tier and we could not agree on would it be gold or would it be silver? and it was trying to get to the consensus that i cannot live with that moment, on both sides of the equation and we had to move on from that and what we decided to do, was then to just essentially tweak around the edges with the areas that have really seen the changes in the health insurance market which brings us to the recommendation of number five. and what we have here, then, is the out of pocket maximums that have really gone much higher

than the average plan sort of for a couple of years ago and also, when they set the $4,000 two years ago, they had every reason to believe in the word on this the street was that the affordable care act and coverage california, i should say was really going to set their out of pocket maximum, maximums at $4,000, and it turned out that they set it at 6350 and so a lot of the plans have gone up to that amount and that made the $4,000 difficult to stick with. and so we decided to change it to what we saw most of the plans going to. so just to let you know our methodology was that we looked at about 157 plans on this small business market. and did an analysis, of what those plans look like, and how many would fit under the different scenarios or how many will be available to the employer under the different

scenarios of the minimum standards and we ended up because of a lot of it and a lot of the changes, from this year to the last time that we did this, we usually looked at 20 and 30 plans but we looked over 100 this time to just to be sure that we understood what was happening in the market. and the next change under this recommendation number five, and would be to lighten the decrease the maximum allowable deduckeds from $2,000 to $1500, we saw quite a few plans going to that lower amount and would meet that lower amount and, so we decided go with that as a group and so these were 134 of the sticking points among the advisory group that we really did finally get to, if not, full con census and walk out of the door with the full consensus and we definitely got the agreement among the players and i know that there are some people here today who will speak to their experience with

that. and you know, have in your report, on page 12, you will see a table that shows the changes, and also, on page 13, we kind of talk about how many more plans are compliant with the new rec ditions that we are bringing to you today. so in conclusion, what we were looking at before, we were to do nothing, today, about 24 percent of the 157 plans that we analyzed, would meet the current minimum standards. and if we take the recommendations that were asking you, to look at today, we would increase that to, 50 percent, and the employers would have about half of the plans that we looked at would just automatically be in compliance and available to them to offer to their employees and still be

incompliance under the healthcare accountability ordinance. >> and so, in conclusion, i do think that it was a, and we had a great advisory group, and a lot of really thoughtful people that cared a lot about making sure that health insurance is available to these employees, and to make it as affordable as possible. and the challenges that insurances are getting awfully, and expensive, and on all sides of the equation. and so it is not easy work, but we think that, what we are bringing you today, is the best possible minimum standards that we can give you. after giving it really a lot of thought, and analysis, and intake from the stake holders that will be living this. and so, that, really brings me to the end of my presentation. and i am more than happy to

take your questions. and clarify any points that i may not have explained quite well enough, so thank you for your time. >> thank you, commissioners, there is a resolution associated with this item for your review. >> yes. 1414. >> yes. >> in the packet. >> and so we do have several public speakers and we will take their comments first. each of them will have two minutes and karl kramer, ray fort, debbie verm an and emma gurul. >> yes, commissioners you don't have to accept the whole resolution as a package. i am asking specifically not to accept the raising the out of

pocket mum from 4,000 and $650,000 that is a maximum under the affordable care act. this was, and there was no agreement in the work group, and the reason that the meetings went from four to six, was that is a sticking point and at the last meeting was declared and not in agreement, the health department was proceeding on its own on recommending that. and this is a bad precedent and i have been involved in each of these processes since the beginning and this is the first time that this has been done. and the 800-pound gorilla in the room, and make it clear, was enterprise, car company and they attended only one meeting, the first meeting, and they made it ear that they wanted, the minimum standards to be changed to allow, to align with their national plan. and they just wanted a different standard in san francisco. four years ago, enterprise was the one that pushed for allowing a high deductible plan and we have had a high

deductible plan since then and on the september second, the new york times, had an article about high deductible plans that are linked with high out of pocket maximums and the new york times called it a trend among corporations comparing it to the getting rid of pension plans and to have individual retirement accounts and i think that san francisco can do better. we stop that trend here in san francisco, with not watering down these minimum standards, and this is going to, the key word, and was that this is going to effect a lot of low wage workers. new york times pointed out that it does not sake much of a medical crisis that you meet that out of pocket. >> thank you. >> the next speaker, please? >> hi, my name is ray ford and i am the chief operating officer, at youth service and i

was a member of the hcao, working group as well and i want to applaud francis for the difficult work that they did too in trying to build a consensus in that group, and it was con synthesis at time and we did have more meeting and i think that what you have before you, is a solid solution from in an employer's perspective, and it really is important in given the passage of the affordable care act, which is still effecting us and will continue to effect us as different parts of that are rolled out in the future, that employers have access to plans, and that are required to implement the plans that we actually have the access to and that exist in the market place and i think that aligning for the deductible. and in the ways that we did as francis as alluded to, and the plans that actually the employers can, and acquire, and that can comply with, the

minimum standards and also, strongly, i appreciate the concept of we will continue to look at this, if there is such a revision, in the market place, due to the affordable care act or other factors that would reduce the number of plans available. and so, i urge you to go ahead and pass this at this time. >> thank you. >> thank you. >> next speaker, please? >> thank you, commissioners, debbie, and i am with the san francisco human services network. and i have also, serviced on this working group ever since the first one. somewhere around ten years ago. first of all i too would like to thank francis for really going above and beyond, in trying to seek the consensus in holding the tra meetings and trying to get us there. and the affordable care act really did complicate things this time around and i appreciate all of the data, and information that we were able to consider, during this process. and as employers, and as non-profit employers, we must

have access to affordable, and available, healthcare plans, to meet these standards and we have always, used an estimate that about half of the plans on the small business market should be compliant and that is where we ended up again, this time. and we have to look at the realities of the market place. and as far as the affordablebility, if we were to drop the significantly the out of pocket maximum, compared to what is out there on the market these days, and the premiums will be so (inaudible) that they could exceed the fee for employers with an aging workforce. and it would also potentially require us to cut services and in order to pay for the increased cost of our healthcare for our workers. but at the same time, as non-profits, we are also concerned that the insurance and that is out there, be affordable for our workers to use, and be affordable for the people that we serve, who are working and that they are able to actually use the insurance, that we get, and so we are

looking to strike a balance, and we believe that this proposal, does that, and at the end of the day, when we could not reach the consensus, i think that the words were can you live with this and ultimately, yes, this is the balance, and we can live with it and we hope that you approve it today. thank you. >> thank you. >> i will take your place. >> good afternoon, my name is emma and i am with sgiu, 1021 and i am also speaking on behalf of tim pal son from the labor counsel and i was part of this working group and i could say that yes, we can live with it and we ask you to support this, although, we were not happy with the increase in out of pocket, and amount, and we were very happy with the reduction of the high deductible because, for us, that is a reality that our employees have to pay that deductible, and the studies have shown over and over that

those with the high deductible plans don't go to the doctor especially young folks, we represent the non-profit workers in the city and county of san francisco and, we see, a lot of people who really want to stay at her jobs who love their jobs and have small children and need to go elsewhere in order to pay pay for their healthcare and so we are very excited to have the conversation in two years about really looking at dependant healthcare because the reality is that our employees love to do their work. but they deserve good healthcare for themself and for their families. thank you. >> thank you. >> if there are any other public speakers, i have no other slips and we will always proceed with our discussion, commissioners? >> yeah, commissioner? >> i am sorry i have three small questions, one is that i am the new commissioner and so i am trying to get the scope.

with regard to what is covered under the chao act and the hca, how to quantify what is capturing with the hco and verses what is not. already being covered under the mandate and i think ta we are going to be missing small employers; is that correct?? and that is a very, very small employers at that. >> could you reword that? >> yeah. >> hco and the hca mandate and i am trying to get a capture of how big of an impact that where we are, and we are putting all of this work in to keep the hcao in place, verses what there with the hca and the affordable care act and could you quantify, what addition and capturing a population, and demographic of who we are additionally covering with the hcao that we are not covering under the rule. >> do you mean by the numbers

like how many employees? >> i know that you can't do the percentage and the numbers and it is just the employer's side,; is that correct?? >> the very small employers. >> we are not actually because a very small employers are exempt and so in the report, i tell you kind of who is exempt. >> and that is plenty. and, i have to look at it and i forget the numbers and it differs and our requirements, here it is, and so, 20 or fewer for the profit is exempt and 50 or fewer non-profit. >> which are the same as the aco and requirements in terms of who is excluded from the small group and exemptions, right? >> and i am just trying to figure out the additional benefit of having the separate guidelines of what the aca mandated and just lining up with the tier and they are looking at efficiency and picked these points and i am not a fan of the high detukt able plans and i know that they

are balancing and the pier level and we are gaining the efficiency of the market place and it looks to me that you actually peged to a bronze level of a plan with the deductible. >> no, just, maybe with the out of pocket max and then we are closer to silver for sure. >> and i just, and i see that we are creating two different systems. >> right. >> we are very, very close and i was just looking for the efficiencies there and you know, there is a lot of work in this and i don't see this taking apart and as we look at questions, and as we are going forward and aca gets more complicated, you know, just looking how we can... >> right, i think that the real sticking point is that there were a few. and a few and definitely one of them was a whole, av thing because the av gives them a lot more flexibility than the insurers much more flexibility than i had understood, and so even though you see, a plan that looks like, oh, this looks

like a, and this is a good silver plan, when you dig into it, the plans, and they do all kinds of switching around because they have to hit that number and they have that calculator on-line and the insurer can put in all of these value and play with the values until they hit that percentage amount of what the av requires for the bronze, silver, cold or platinum level and so you may have a plan that meets silver, level, but, it is just asking for much more than we were comfortable. and and it may be that we peg it to viler and i forget off of the top of my head, but you

will forgive me, 30 for those visits but in reality, it might go up to $50 or 4eds 0 when they reduce something else in the plan. >> and do you understand? does that make sense? >> if sounds like those are really good and we want to keep the offices down and so the last thing is that one of the things about the coverage california that has been nice is that, from a consumer perspective you actually can get in there and you can start to take apart the benefits of trying to figure it out and will our system be kind of transparent, and be able to call to your office and be able to find out, and what am i actually get and thomas is my doctor, and can i see my doctor. >> i get calls from brokers and employers. >> the actual employees are educated through the workplace. and with the requirements through the office of labor standards and enforcement makes as they do the enforcement of the law and so it is their job to make sure that the employer's job to make sure

that the employee knows what they are supposed to be getting. and then that goes through the employee, human relations, kind of process. but, the calls that i get are help me set it out as a broker because i want to offer, a plan for an hcao, coverage group, or an employer that is just trying to figure out some of the knitty gritty and some those are the calls that are usually the osc refer to me and i will get several of those a month and you know, more during the times where the people are doing the open and before the open enrollment. >> but it is the number of people that you would expect under this hcao. >> i have never been able to get that number and there is isn't, a, there isn't a repository of contracts anywhere in the city and so i can't get to that number and i have never been able to get to that number, and i apologize and i have not found that there is a pathway to that. so... >> commissioner singer?

>> >> just to respond to commissioner's question about the overlap with the aca, and so the aca employer requirements start with 50 and the delta from the 20 to 50 employees will be subject to the hcao that are not necessarily subject, and they don't have a mandate under the hca and the other thing to note is that there is one example where san francisco was ahead of the curve and you are right that there was a significant amount of overlap between the aca and the hcao and in the absence of the hcao in 2001 this was a way for the city to encourage the employer encouraged health insurance and we might see more over lap that might point to the direction that you are talking about, which is looking at how the interact with one another. in eand i love san francisco,

focus on promoting, a universal access, now and i think that we have been visionary and we have led the nation and, in fact, and now we have got the certainly and so the gap between the 50 and the 20, and how many people are we actually talking about and how many energy are we spending to try to provide this kind of care, and this is just, sort of a size verses effort kind of thing and i am not saying that it is not worth it, but as the federal legislation evolves, we need to keep looking. >> at that >> and so, certainly, as soon as the employer mandate is actually enforced which is not yet, that will also be relevant. >> okay. >> and it is not just that small number, that you have also got, and you have to think about under insurance and the requirements around that, and so, we are definitely better than a bronze plan, right? >> and what we are asking for, and so we want to protect these employees, from really high out of pocket costs. >> $30 co-pays. and that is a sweet spot and i think that it is supportable for a lot of visits. >> thank you. >> commissioner singer?

>> yeah. observation first. i think that as my questions were, and related to commissioner's questions and i think that one of the challenges that we are going to face going forward is can ditly picking the poison of just saying, if you are above 20 employees you have to comply with the aca. like, anywhere else. above 50 employees. >> and the other groups that want to catch that are not in it, and that poison, verses the poison, of the acao which predates the aca and but create as a system where you can't take advantage of the efficiencies, and it will be confusing for employers, that grow, and it will be confusing and at some point, we might come to the conclusion, like, wow this is complexity and why did we ever go there