Utah had been on my list of highly probable Medicaid expansion states for a while now. They’ve been in talks with Health and Human Services (HHS) for a 1115 waiver and their discussions have been wide ranging. Last Friday, it looks like the outlines of a deal have been agreed to:
“They are giving us more flexibility than has been given to any other state in America. We are breaking some new ground,” Herbert announced in his monthly press conference on KUED.
Herbert said he soon will send to the Obama administration a letter outlining the agreement they’ve reached on Utah’s alternative, his Healthy Utah plan…
The governor expects to share details of his plan with legislators in mid-November, and there will be a 30-day comment period for the public as well….It provides “more individual responsibility, to have people take care of their own health care,” and has them pay part of their premiums, he said.
I want to see the deal. My bet is that it will be closer to Healthy PA than the pure Arkansas private option, as some of the buzzphrases are irrelevant to premium support models.
So when can we expect to see people covered? My bet is enrollment starts in March with coverage starting in April 2015, assuming the plan is approved in November.
Medicaid expansion is coming in many different flavors, and each flavor has different lead times.
As I’ve mentioned before, I’ve gamed out expansion plans with my colleagues at Mayhew Insurance over a very long weekend waiting for the claims system to be updated. None of our speculation is official, and it was pizza and Mountain Dew fueled but the people involved in the conversation were the team leads, expert plumbers and system architects that would be in charge of Mayhew Insurance expanding Medicaid in our state if the assholes in charge got their sadism shits and giggles taken care of with consenting partners instead of the general population.
Straight up expansion of either Medicaid Fee for Service or Medicaid Managed Care is the easiest ramp up. It is slightly more complicated than ordering more ID card paper stock and bringing in a large cohort of customer service reps, but not much more. The major challenges for a Managed Care expansion for a managed care state would be rewriting the financial back-end of claims and accounting systems as well as expanding the medical management regime. The state would need to rewrite their eligibility determination rules in their software. Networks would be tweaked and fees may be slightly increased, but it is a series of marginal changes. Straight up expansion could see people sign up in forty five days and claims start to pay in sixty days. Several key things would need to be made retroactive or magic astericked for reporting purposes, but it is a straightforward challenge. Most MCOs that have been involved in rolling launches could handle this without breaking a sweat.
The Arkansas Model of giving premium subsidies and cost sharing subsidies to people on Medicaid is eaiser for enrollment and membership purposes but harder on the back-end. The enrollment system is already built at either Healthcare.gov or the state Exchange. A few state specific business rules would be changed. The big problem with using the Exchange is modeling of the risk pool. If Utah went to the Arkansas model, the risk pools assumed for 2015 rates just got blown up. I don’t know if they’ll be better, worse, or just different, but they will be different. The actuaries will be crying for a very long time. The big problem on the configuration end of an Arkansas model is matching subsidies to individuals as there are now multiple subsidy streams for multiple purposes. This is not too hard, it is just time consuming to get it right. Membership could probably be enrolled in two months with claims ready to go in three months. The financial back-end could take a year or more, especially if the private carriers aren’t used to dealing with Medicaid reporting requirements.
Indiana’s proposed HIP 2.0 is the next flavor. It would take a pre-exisiting program, make significant changes to the skeleton and then add in some serious new enrollment of a different population. If the changes are merely benefit changes (ie Service code XYZ now gets a $5.00 co-pay instead of a $2.00 co-pay) those changes are fairly rapid if the claims systems are reference table and date span based. The big challenge for HIP 2.0 is the interaction of the health savings account, deposits, charges and deductibles. Those interactions are complex for most claims systems. If the claim system is hard coded, tweaking plan designs are painful.
The major delay in launching a revised HIP would be the network. Most provider contracts have clauses in them that say a provider will take Rate Y for Program X as long as there are no material changes. A Medicaid Expansion through a legacy program is a material change. Providers will need to be signed up this network. Rate negoatiations will occur, and multiple iterations of the network may be filed with the state. That would be the big delay. Again, the back-end could take a while to bring Medicaid reporting capability to private carriers. People could sign up in three or four months with coverage a month after sign-ups start.
The last major model is the reinvent the wheel model in Pennsylvania. Pennsylvania was already a managed care state. Healthy PA is a managed care HMO model. However Pennsylvania is not using their current Medicaid managed care entities to run expansion. Instead, new entities (including some from the same managed care providers) are being built from scratch to run Healthy PA. New networks have been built, new benefit designs are approved by CMS/HHS, and new parrallel reporting is required. This is a four to six month lead time before enrollment process depending on whether or not the state also wants to reinvent fire at the same time.
These lead times are lead times from a standing start. Mayhew Insurance is located in a non-expansion state. There is a small team three cube rows to my right constantly writing scenarios for expansion and plans in reaction to the political winds. I know Pennsylvania started building out capacity for expansion several months before HHS approved the 1115 waiver. I know at least one insurer in Indiana has devoted significant resources to prepping for a possible expansion. I know Utah’s insurers have devoted a few FTEs to survey and prep work. Most insurers in potential expansion states won’t start from a standstill; they’ll start from a light jog.
But again, the simplest, fastest expansion is to just expand current Medicaid. Everything else is a work around to enable some Republicans to avoid getting teabagged.