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Rockefeller Coverage Amendment #7 to America’s Healthy Future Act Rockefeller Amendment #C7 to Title I, Subtitle C (Making Coverage Affordable) Short Title: Establishment and administration of a public health insurance option as an exchange-qualified health benefits plan (Sections 221, 222, 223, 224, 225, and 226 of H.R. 3200, America‘s Affordable Health Choices Act of 2009) Description of Amendment: Sec. 221. Establishment and administration of a public health insurance option as an Exchange-qualified health benefits plan. Requires the Secretary of Health and Human Services to develop a public health insurance option to be offered starting in 2013 as a plan choice within the Health Insurance Exchange. It participates on a level playing field with private plan choices. Like private plans, it must offer the same benefits, abide by the same insurance market reforms, and follow provider network requirements and other consumer protections. Sec. 222. Premiums and financing. Premiums for the public option are geographically-adjusted and are required to be set so as to fully cover the cost of coverage as well as administrative costs of the plan. This includes a requirement that the public option, like private plans, include a contingency margin in its premium to cover unexpected cost variations. In order to establish the public option, there is an initial appropriation of $2 billion for administrative costs and in order to provide for initial claims reserves before the collection of premiums such sums as necessary to cover 90 days worth of claims reserves based on projected enrollment. These start up funds are amortized into the premiums for the public option to be recouped over the first 10 years of operation. The plan must be self-sustaining after that initial funding. Sec. 223. Payment rates for items and services. The Secretary of HHS establishes geographically-adjusted provider payment rates for the public option. For the first three years, those rates are based on Medicare rates with a 5% add-on for practitioners who also participate in the Medicare program. This increase also applies to practitioners, like pediatricians, who do not typically participate in Medicare. After the first three years, the Secretary is granted greater flexibility in setting rates, but the general rule is that overall spending should remain consistent with the initial levels. Flexibility is provided to the Secretary to create payment rates for services 13