Achieving single, integrated marketplace for individual, Medicaid health plans faces initial difficulties

Section 1413(c)(1) of the Patient Protection and Affordable Care Act requires each state to “develop for all applicable State health subsidy programs a secure, electronic interface allowing an exchange of data …that allows a determination of eligibility for all such programs based on a single application.” That means state health benefit exchanges must operate as integrated marketplaces offering both commercial insurance plans (referred to as Qualified Health Plans or QHPs) as well as Medicaid coverage for those whose household incomes meet their state’s Medicaid eligibility guidelines. The policy rationale – known as “no wrong door” and “one touch and you’re done” – is to reduce the ranks of the medically uninsured by simplifying the process of getting health coverage and removing roadblocks to enrollment.

Implementing that Affordable Care Act mandate, however, has been challenging from IT integration standpoint given the variety of legacy state computer systems that manage their Medicaid programs and state rules governing them, including those of the three dozen states using the federal marketplace, healthcare.gov.

That’s also been the case in California, where enrollment elegance has proven elusive. “I think we’ve oversold simplicity,” said Frank J. Mecca, executive director of the County Welfare Directors Association of California. Mecca made that observation today at a California Healthcare Foundation (CHCF) briefing in Sacramento on early consumer experiences with enrollment in the Golden State’s exchange, Covered California.

Mecca described the IT interface between the California Healthcare Eligibility, Enrollment and Retention System (CALHEERS) and the IT system that manages Medicaid eligibility and enrollment, the Statewide Automated Welfare System (SAWS) as a “clogged highway.” Consequently, Mecca noted, a large backlog of potential Medicaid enrollees remain stuck in the system. Mecca credited Covered California and the California Department of Health Care Services (DHCS), the state’s Medicaid administrator, for their efforts to remedy the backlog and improve the interface between the two IT systems. “It’s not an easy thing to fix,” Mecca added. “Things have improved tremendously, but we still have a long way to go.”

Both Mecca and another panelist at the briefing, Sonya Vasquez, policy director of the community-based health advocacy and policy organization, Community Health, said greater emphasis should be placed on marketing both Covered California QHPs as well as Medi-Cal, the state’s Medicaid program, particularly given Medi-Cal does not have set enrollment periods. They also said more effort should be made to make consumers aware in-person assistance is available for those seeking to enroll in coverage, including welfare department staff who can sign up applicants for either Covered California QHPs or Medi-Cal. (California is among those states have expanded Medicaid eligibility to 138 percent of federal poverty guidelines).

Consumers participating in focus groups conducted in early 2014 by PerryUndem Research/Communication were mostly uninsured and had substantial knowledge gaps for both Medi-Cal and QHP coverage and advance tax credit subsidies for the latter for households with incomes between 138 and 400 percent of federal poverty. (Click here for the full report on the findings presented at today’s CHCF briefing.)

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Double digit individual plan premium hikes seen for 2015

A senior executive of WellPoint predicts plan year 2015 premiums in the individual market could go up by double digits in some areas of the United States.

Larry Levitt, senior vice president at the Kaiser Family Foundation, predicts 2015 premiums could rise by 10 percent, based on a  5 to 6 percent medical services cost trend plus the effect of a reduction in payments to plan issuers under the Patient Protection and Affordable Care Act’s Premium Stabilization Programs to $6 billion in 2015.

via Will Premium Spikes Cause Another Round of Obamacare Bashing? – NationalJournal.com.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Healthcare Town Hall » Insurers adjust to paradigm shift

Milliman’s Tom Snook

via Healthcare Town Hall » Insurers adjust to paradigm shift.

Milliman’s analysis suggests the key to keeping the individual market actuarially viable isn’t only about getting enough so-called young invincibles into individual market state risk pools. It’s also about bringing in older people in good health — and keeping them healthy.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Short, long term changes could bode well for small group market

The small employer group market will be changing over the short and long term. Both changes could bolster the market segment as well as the Small Employer Health Options Program (SHOP) within the state health benefit exchange marketplace, which is seen by some as facing competition from the individual plan exchange marketplace.

Over the immediate short term, small group plans will be able to be sold with higher deductible limits under legislation signed last week by President Barack Obama. Section 213 of H.R. 4302 repeals a provision of the Patient Protection and Affordable Care Act at Section 1302(c)(2) limiting small group plan deductibles to $2,000 for individuals and $4,000 for families. The repeal is effective April 1, 2014 and is available to all plan year 2014 small group plans. The deductible limits presented a challenge to health plan issuers wishing to offer small group plans with bronze metal tier actuarial value that on average pay 60 percent of covered medical services.

The Employers Council on Flexible Compensation (ECFC), which said it joined forces with several other organizations to successfully lobby for the repeal of the provision, said the repeal of the limit will allow small employers to continue to provide affordable medical insurance to their employees, including flexible compensation options such as FSAs, HRAs, and HSAs while enabling employees to set aside tax advantaged dollars to help pay for their health care out-of-pocket and deductible expenses. Click here for the ECFC’s news release.

Over the longer term, the small group market will in all states be uniformly defined as plans sold to employers with up to 100 employees beginning with plan year 2016. For plan years 2014 and 2015, Section 1304(b)(3) of the Affordable Care Act gives states the option to define their small group market as plans sold to employers of 50 or fewer employees.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Primary care medicine on retainer may offer better value than richer insurance plans

Check out this article on the trend of having a primary care physician on retainer published in the current issue of Sacramento-based Comstock’s Magazine. For people who need to consult a doctor frequently when they need to (such as parents of young children, those with complex, chronic conditions, and individuals making a major health-related lifestyle change), combining this arrangement with a high deductible insurance plan could be a better value than an all-inclusive plan that factors frequent doctor visits into premium rates. Such as, for example, individual health plans rated “gold” or “platinum” that have lower cost sharing for frequent users of medical services but come with the tradeoff of higher premiums.

There is a concerning aspect to the trend as author Jeff Wilser points out in his piece. Primary care physicians who work on a retainer basis manage to get more time to devote to patients (great for those types of aforementioned patients who need more time and attention) by substantially reducing the size of their patient panels. That’s counter to the projected growth in demand for primary care doctors due to insurance market reforms of the Patient Protection and Affordable Care Act — at the same time there are fewer primary care docs providing services due to economic incentives to specialize and growing retirements.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Analysis: First year enrollment churn could be nearly half of QHP enrollees, quarter of Medicaid beneficiaries

In health insurance, “churn” refers to people moving between various forms of coverage as their life and economic circumstances change. Those in employer-sponsored plans who are dismissed or leave their jobs move into the individual market, COBRA, Medicaid or go uninsured. Those on Medicaid can earn off eligibility if their household income rises above their state’s cut off point. People move back to employer-sponsored coverage when they or their partners are employed by an entity that offers health coverage either on its own or as required starting next year in the case of large employers.

As well as these forms of coverage, the Patient Protection and Affordable Care Act adds a new category this year: those eligible for advance tax credit-subsidized coverage in the state health benefit exchange marketplace. Like Medicaid, eligibility for this form of coverage is means tested and can change as household income rises above 400 percent or falls below 138 percent of federal poverty.

An analysis of the nation’s largest state health benefit exchange marketplace, Covered California, finds churn over a 12 month period could amount to nearly half of those enrolled in subsidized qualified health plans (QHPs) and a quarter of those enrolled in Med-Cal, California’s Medicaid program. Click here for the report by the UC Berkeley Center for Labor Research and Education.

The churn among QHPs has implications for the exchange marketplace insofar as exchanges are financially reliant on health plan issuer participation fees assessed on QHP premiums starting in 2015 when federal establishment grant funding will no longer be available. In that vein, the report concludes Covered California (and by implication other state-based exchanges) must devote ongoing attention to enrollment throughout the year outside of open enrollment periods including outreach, web portal, in-person and call-center assistance.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Eight Senate measures amend, build on ACA insurance reforms

Democratic senators have new ideas for health care law | Washington Watch | McClatchy DC.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Individual market could turn into SHOP’s biggest competitor

In a post last December, I characterized small group as the most voluntary – and consequently the most vulnerable – health insurance market segment notwithstanding Patient Protection and Affordable Care Act reforms designed to improve it. Whether these reforms will ultimately help shore up this distressed market segment remains to be seen, I wrote at the time.

A key ACA reform to create market power on the buy side to help drive down rising premiums – small employers identify high premiums as the biggest barrier to covering their employees – is the mandate each state health benefit exchange establish a voluntary small employer purchasing pool known as the Small Business Health Options Program (SHOP). However, experts have recently suggested that in the eyes of potential small employer SHOP enrollees, SHOP’s biggest competition could come from the individual marketplace as they cease providing employer-sponsored coverage.

Ezekiel J. Emanuel, who helped draft the Affordable Care Act as a health policy adviser to the Obama administration, had this to say to The New York Times small business blog You’re the Boss:

I’ve always been a bit perplexed by the idea of setting up a SHOP exchange, since I don’t understand why it’s just not better if you’re a small business to say, all right, everyone, I’m just going to give you X amount of dollars and let you shop in the individual market. That seems to me to be a way to go – why should a small business set up a lot of machinery around it? Why should exchanges set up a lot of machinery? And it would be better for exchanges to have these workers in the individual exchange.

As small employers who early renewed plan year 2013 plans late last year migrate to ACA-compliant plan year 2015 plans, a quarter of small group plan members could end up moving to individual coverage from November 2014 through January 2015, estimates health insurance industry veteran and consultant Michael Lujan. Lujan is former SHOP director at California’s exchange, Covered California.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

California exchange seeks alternative options for online individual market

Covered California, California’s state-operated health benefit exchange marketplace, is seeking information on alternative options for its individual market web portal to determine potential benefits relative to increased enrollment, feasibility and costs.

The exchange issued a Request for Information (RFI) on March 18 seeking information relative to an “online consumer-facing retail agent” or a platform enabling independent agents to offer online quotes for individual coverage. Last month, Covered California delayed until fall 2014 the launch of the web portal for small group coverage sold through its Small Business Health Options Program (SHOP).

Responses to the RFI are due March 28.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

Gruber warns of increased tendency toward cost shifting between health and workers’ compensation systems

The trend toward less generous employer-sponsored health coverage and increased employee cost sharing has increased the exposure of the workers’ compensation system to cost shifting, warns Jonathan Gruber. Gruber was the architect of the Massachusetts Health Connector a decade ago that served as the template for the health benefit exchange and individual and small group market reforms of the Patient Protection and Affordable Care Act. Cost shifting between the two systems occurs when, for example, an employee who sustains an injury or illness over the weekend and then files a workers’ compensation claim on Monday, asserting that the injury or illness originates in the workplace.

Heightening the tendency toward cost shifting is the difference in provider access between health and workers’ compensation insurance, Gruber notes, arguing that the two forms of coverage require greater harmonization. “If the workers’ compensation system stays behind, it will have the broadest possible network and the lowest possible cost-sharing, and it’s going to have people migrating into it more and more,” Gruber said in remarks to the Workers Compensation Research Institute (WCRI) in Boston reported by the Insurance Journal.

In 2007, then-California Gov. Arnold Schwarzenegger proposed as part of his health care overhaul (based on Gruber’s Massachusetts’s model) a “24-Hour coverage” pilot program that would have combined the medical treatment component of workers’ compensation with group health coverage. State and local government employees would obtain medical care through the same providers used in a state run managed care program for work and non-work-related health care, with an option for private employers to participate on a limited basis.

According to a report prepared that year by the California Commission on Health and Safety and Workers’ Compensation, at least 10 states adopted legislation permitting 24-hour care pilots but only two — Oregon and California – implemented them. Merging medical treatment coverage for care needs arising out either vocational or non-vocational circumstances can potentially reduce frictional costs and achieve administrative efficiencies, but has proven problematic due to various legal, institutional and cultural impediments.

 


The ACA health insurance market reforms are at hand. Need help understanding and preparing for the new regulatory landscape and the health benefit exchange marketplace -- and explaining them to your key stakeholders?  Pilot Healthcare Strategies can help with expert analysis and clear communications. For a free initial consultation, email me at fpilot@pilothealthstrategies.com or call 530-295-1473. 

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