Idaho, Partial Medicaid Expansion and the 400% FPLers

Medicaid is primarily health insurance for poor people or very sick people.

Idaho’s legislature is monkeying around with the voter approved straight-up Medicaid expansion to 138% of the Federal Poverty Level (FPL).

 

This will harm middle class Idaho families who need community rated, guaranteed issue insurance from the individual market.

How does that work if Medicaid is health insurance for poor people?

Cost Sharing Reduction (CSR) work-arounds of Silverloading and differential morbidity matter.

Adrianna MacIntyre and I argued in a Health Affairs blog that full expansion has two paths to decreasing premiums for people earning over 400% FPL that are not available if a state elects and receives a waiver for a partial expansion to only 100% FPL.

 evidence found that Medicaid expansion improved the risk pool of state individual markets, suggesting that the population between 100 and 138 percent FPL is sicker and more expensive, on average, than other exchange enrollees. Insuring this cohort through Medicaid is associated with a seven to eleven percentage point decrease in individual market premiums. …

household incomes between 100 percent and 150 percent FPL, those that would be eligible for 94 percent AV silver plans.  This income bracket overlaps the Medicaid expansion income group significantly.  States that fully expand Medicaid end up with far fewer people in the most generous CSR bucket, as they have moved the 100-138 percent population to Medicaid

CSR 94 Enrollment by all APTC receiving enrollees 2018 Healthcare.gov

Keeping a cohort that is more expensive than the rest of the ACA individual market risk pool in the risk pool raises premiums. Pulling the 100-138% population out of the ACA risk pool lowers market premiums as long as this group is more expensive than average. Furthermore while Idaho has engaged in the Silver Switcheroo, Silverloading increases premiums for folks who want a Silver plan and buy it on Exchange either because they don’t know if they will be just over or just under the subsidy cut-off point of 400% FPL or they can’t access an off-Exchange plan that meets their requirements.

Full Medicaid expansion reduces the premium pain of the middle class. Partial expansion continues the pricing pain for the middle class.








Single insurer plan offering choices and implications

I contend that monopolistic insurers in the ACA market are able to shape their risk pool. They have multiple means to implement a strategy. They can use networks. They can use benefit design. They can use formularies.

Starfish made a good comment:

In Mississippi, you cannot play a lot of the games that can be played with a healthy pool in other places. Is a narrow network going to eliminate your town’s only hospital? Are people really driving to Children’s Hospital if they do not live near it or have a child with cancer or some other major issue that can only be addressed there?

Really good comment, and I want to highlight one strategy an insurer can use. They can play spread games. I will make the simplifying assumption that actuarial value correlates to premium level and we’re using a single unified actuarial value scale instead of metal specific scales. I am also assuming a single network and the same plan type for all plans (it could be an EPO, HMO or a PPO, does not matter). I am isolating on plan designs.

The first strategy is a low AV and low spread strategy.

Here the benchmark Silver Plan is near the bottom of the allowable actuarial value range for Silver plans. The cheapest Silver is barely below the benchmark while the insurer is only offering a single Bronze plan. Since we are looking at a monopolistic insurer, there is no competetive pressure that dictates these choices. These choices result in high out of pocket costs for everyone, and since subsidized premiums are predicated on premium spreads, the lowest actuarial value plans won’t be too much cheaper than the benchmark. The healthy and risk embracing won’t see too many good deals.

The other strategy stretches everything out.

Here, the benchmark Silver is near the top of the allowable range. The cheapest Silver is near the bottom of the allowable range. There is a big spread here which means the Silver Gap is large. More importantly, the carrier is offering two Bronze plans. One is still near the top of the Bronze range. The other is near the bottom of the Bronze range. This means that there is a huge actuarial value gap between the cheapest plan offered and the benchmark. Consequently, the healthiest and most risk taking folks will see very low to no dollar premiums if they qualify for subsidies.

It does not matter if the insurers are Silver Loading or Broad Loading their CSR response. It does not matter if they are offering an HMO or a PPO. It does not matter if they are in a high cost state or a low cost state. A single insurer state can strategically choose the premium spreads between the benchmark and least expensive Silver and non-Silver plans.

Wyoming has chosen a big spread strategy. Mississippi has chosen a small spread strategy. These are deliberate choices.

 

2019 Premium Spread from Benchmark to least expensive plan in each metal band 40 year single non-smoker
StateCountyMetal LevelMaximum Benchmark Spread
MSNeshobaBronze($60.00)
MSNeshobaSilver($59.00)
MSNeshobaGold$93.00
WYLaramieExpanded Bronze($265.00)
WYLaramieBronze($236.00)
WYLaramieGold($136.00)
WYLaramieSilver($6.00)







Oh, So WV Is in the News Again

Awesome:

Angry arguments broke out in the West Virginia statehouse on Friday after the state Republican Party allegedly set up an anti-Muslim display in the rotunda linking the 9/11 terror attacks to a freshman congresswoman from Minnesota.

One staff member was physically injured during the morning’s confrontations, and another official resigned after being accused of making anti-Muslim comments.

The display featured a picture of the World Trade Center in New York City as a fireball exploded from the one of the Twin Towers, set above a picture of Democratic Rep. Ilhan Omar, who’s a Muslim.

“‘Never forget’ – you said. . .” read a caption on the first picture. “I am the proof – you have forgotten,” read the caption under the picture of Omar, who is wearing a hijab.

The display was set up as part of “WV GOP Day,” which the party advertised on Facebook as a day when “Republicans Take the Rotunda.”

The Sergeant at Arms was involved in one of the fights and she has now submitted her resignation.








West Virginia Teacher Strike

A work action has been initiated today in West Virginia, and all county schools (save one) are closed because of a really bad education bill that the Senate is trying to ram through:

A little less than a year since the start of West Virginia’s first statewide public school workers strike, leaders of the state’s three major school employee unions called Monday evening for another strike to begin, starting Tuesday, over the education overhaul bill.

All but one of West Virginia’s 54 countywide public school systems canceled school Tuesday. The outlier was Putnam County, which is among West Virginia’s wealthier counties and is near the state Capitol.

“We are taking action,” said Fred Albert, president of the West Virginia branch of the American Federation of Teachers union. “We are left no other choice, but, as of tomorrow, we are calling a statewide strike.”

He briefly referenced that he’s been told there’s support in the House of Delegates for a version of the bill that the unions oppose.

Long story short, the Republican led legislature in the state, which did not even mention “comprehensive education reform” as a legislative priority before the session started, has been up to their usual bullshit. Sen. Majority Leader Mitch Carmichael, who is as wingnutty as they come, was dead set on retribution for last year’s strike, so some heretofore relatively unknown Senator introduced a piece of ALEC written legislation with all sorts of nonsense, to include charter schools, union-busting, and a whole sort of stuff that had no chance in the House of Delegates.

The Senate, being the Senate, passed it anyway despite the fact that Republicans in the House said they hated it, the Republican governor said he would veto it as is, and virtually everyone who has ever worked in or works in education said the bill is horrible. It then went to the House of Delegates, which promptly stripped most of the crap (you can get a good look at the changes here) and passed it with a bipartisan majority. It was then sent back to the Senate.

Once back in the Senate, they promptly went back to putting all the crap back into it, including jacking up the number of charter schools, removing a provision that said legislators can not profit off charter schools, and reincluding measures to punish unions and prohibit striking. The Senate Republicans refused to allow the minority party to see the bill, and wanted to rush a vote for last night, but there was so much outrage that the votes were postponed until today. It’s a bad bill, but these are Republicans and don’t give a shit. My Senator, William Ihlenfeld (you might remember I volunteered for him and we fundraised for him) put it this way:

Last night, the comprehensive education reform bill was amended by a 18-16 vote and now will go back to the House of Delegates for consideration. Changes from the most recent House version include the increase of charter schools from 2 to 7 and putting ESAs back in after they had been removed. The amendment (130+ pages worth) was worked on all weekend by the majority without any input from the minority, and then provided to everyone 10 minutes before we were asked to vote. This is not how government is supposed to work but it is how the West Virginia Senate operates in 2019.

I voted against the Senate Amendment because of the expansion of the charter schools provision, the addition of ESAs, the uncertainty of what else was in the amendment (even the lead sponsor admitted she hadn’t read all of what was being proposed), the lack of real input from West Virginians, and the oversized influence from outside interests like ALEC and the the Koch brothers-funded Institute for Justice. We don’t need outsiders to tell us how to run our system of education in West Virginia but that’s what has happened with SB 451.

The House Version that was passed last week wasn’t perfect but it was much better than the mess of a bill that the Senate passed out originally. What the House sent back to us was a gift and Senate leadership should have accepted it and said thank you. Instead, they refused it, and added back in much of the garbage that the House had removed.

I’m hearing that the House of Delegates may have the votes to pass the Senate version but that the margin is very slim. I encourage you to contact your representatives to let them know how you feel. Make sure that your voice is heard as you may be able to persuade those who are on the fence.

If you are an educator and will be in Charleston today, please stop by my office in W-229 and say hello. If you need a place to put your jacket, charge your cell phone, or fuel up (I have lots of candy), my office is your office. I hope to see many of you today at the Capitol, and despite what the Putnam superintendent did, we are still #55Strong.

We’ll see what happens next. Now we have to watch as the legislature tries to ram through campus carry over the objection of every educator and educational establishment in the state.








Good news for Texas Medicaid

Texas is thinking about doing something very smart.  They want to expand the current mandatory categorical eligibility for Medicaid for pregnant women that currently expires at sixty days after birth to a full year of eligibility after birth.

The Dallas Morning News has details:

To combat maternal mortality and morbidity, several Democrats and at least one Republican have proposed extending Medicaid coverage to one year after a woman gives birth or has an involuntary miscarriage.

“This is a really important bill because there is a gap in treatment, and this will ensure Texas women will continue to receive Medicaid coverage for 12 months,” said Rep. Shawn Thierry, D-Houston, who filed a bill to extend coverage. “I believe that this will reduce the maternal deaths.”

In 2016, Texas gained national attention for having the “highest maternal mortality rate in the developed world,” based on data from 2012 that was published in a study. Last year, the state found that inaccurate reporting inflated the data, but officials have continued efforts to lower the numbers.

Medicaid requires states to cover income qualified pregnant women for the pre-natal period and for sixty days after birth.  The theory is that work is difficult in this time period, the baby needs intensive parental attention and good healthcare for the mom will lead to better health and development outcomes for the baby.  Income restrictions are much higher for this adult population than many other adult eligible populations.  In Texas, a woman can earn roughly $32,000/year to qualify as a pregnant woman with a single child.  After sixty days, the current income cut-off for the same family to get the mom Medicaid qualified is $2,400 per year.   Texas transitions women to a limited benefit plan if they don’t qualify for low income Medicaid sixty days after birth.

That is a huge cliff. And many women will fall off that cliff. If they are earning over 100% FPL, they are eligible for a subsidized exchange plan. If they earn under 100% FPL (~$16,480 for a family of two) they get no exchange subsidies and most likely earn too much to qualify for low income Medicaid. A lot of people fall off the cliff.

New Jersey is considering a similar change to their Medicaid program. They are a Medicaid expansion state but Medicaid expansion cuts off at 138% FPL while low income pregnant woman eligibility cuts off significantly higher. It would promote continuity of care.

This is interesting and potentially good news from Texas and New Jersey.