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Health Insurance Exchange Summit
Convergence of Medicaid and the Marketplace
May 14, 2014
2The ACA Coverage Continuum
Children’s Health Insurance Program
Qualified Health Plans
Employer‐Sponsored Coverage
Advance Premium Tax Credits (APTC) and Cost
Sharing Reductions (CSR) for Qualified Health
Plans*
0% 100% 138% Federal Poverty Level200% 300% 400%
Medicaid*
*In states not expanding Medicaid, eligibility will vary and there may be gaps in coverage
3Convergence Starts with Coordinated Eligibility Process
Medicaid Marketplace
The ACA requires coordinated eligibility processes:
A single application is used to apply for marketplace coverage and insurance affordability programs (Medicaid, CHIP, Tax Credits/Cost Sharing Reductions)
The application uses a modified gross income test based on federal tax rules to largely align income tests (MAGI) across programs
Application may be filed in Marketplace or Medicaid agency and eligibility determination made for all insurance affordability programs (“no wrong door”)
–
Eligibility information shared through transfers of information or integrated
systems
4… and Moves to Coordinated Eligibility Systems
In the FFM and some SBMs, transfers of information must still
occur between the two; systems are not fully integrated
Medicaid Marketplace
5… and on to Integrated Eligibility Systems
Some SBM states have implemented fully integrated eligibility systems
that do not require transfers of accounts between the Medicaid agency
and the Marketplace
: Healthcare Financial Management Association. Developing a Health Insurance Exchange/Integrated Eligibility System (HIX/IES) under the Affordable Care Act
(ACA): What is an Exchange and what’s happening today? January 18, 2013.
Initial
Eligibility
Screen
Federal Data HUB(SSA, IRS, DHS)
Medicaid
Eligible
QHP
Eligible
Integrated Eligibility System
6…
but Plan Shopping & Enrollment is Rarely Integrated
THROUGH
THE MEDICAID AGENCY
QHP Enrollment
THROUGH
THE MARKETPLACE
Medicaid MCO Enrollment
7Medicaid and QHP Benefits Closely Align
Medicaid Alternative Benefit Plan Qualified Health Plans
• Ten Essential Health Benefits
• Non Emergency Medical
Transportation
• EPSDT for 19 and 20 Year‐Olds
• Ten Essential Health Benefits
8
• Remains mandatory
MEDICAID PREMIUMSMEDICAID CO‐PAYMENTS
Increasing Alignment of Premiums and Cost‐Sharing
• States are implementing co‐payments
consistent with federal Medicaid
limits, generally comparable to co‐
payments for high value silver plan
(94% AV)
• Must be voluntary < 100% FPL
• May impose higher co‐payments (up
to $8) for non‐emergency use of the
ER and for non‐preferred drugs
• Inpatient hospital co‐payments may
be as much as $75 for those < 100%
FPL and 10% of the cost of the hospital
stay for those > 100% FPL
• Premiums of up to 2% of income may
be imposed under a waiver for those
100‐138% FPL. This level of premiums
is consistent with premiums for
individuals with the same income in
the Exchange.
STATE WRAP OF TAX
CREDITS/CSRs
• States are considering providing
additional subsidies for lower income
Marketplace eligible adults.
• Massachusetts providing wrap with
Medicaid dollars pursuant to a waiver.
Reduces premium and cost sharing cliff between Medicaid MCOs and QHPs
9Medicaid Coverage Models Can Spur Convergence
Basic Health Program (BHP)
Bridge Plans
Premium Assistance for Qualified Health Plans
Medicaid Managed Care
10Basic Health Plan (BHP)
States receive value
of tax credits and
costs‐sharing
reductions available
to individuals with
incomes below
200% of the FPL who
would otherwise be
eligible to purchase
coverage through
the Marketplace.
States use the funds
to purchase BHP
coverage through
Medicaid MCOs or
QHPs for consumers
with incomes below
200% FPL who are
not Medicaid
eligible.
Minnesota and New York are pursuing a BHP; Washington
and Oregon have pending state legislation to explore
financial viability/implementation of a BHP.
BHP facilitates continuity across plans and providers as
individuals’
incomes fluctuate above and below
Medicaid levels.
Enrollees must receive the same or better benefits and pay
no more in premiums and cost‐sharing than they would in
the Marketplace. In states that implement a BHP, consumers
with incomes below 200% FPL may not enroll in a QHP.
11Bridge Plans
Bridge plans are
Medicaid MCOs
that are certified as
QHPs; they are
open only to
individuals
transitioning
between Medicaid
and the
Marketplace and
their family
members, allowing
individuals to stay
with the same
issuer and
providers.
The bridge plan concept was originally developed by the
State of Tennessee.
California is awaiting approval from CMS to offer Bridge
Plans to an estimated 670,000 individuals.
Bridge plans enable continuity of coverage and reduces the
cost‐sharing cliff as individuals transition between Medicaid
and the Marketplace.
12Premium Assistance for Qualified Health Plans
States may
purchase QHP
coverage for
Medicaid‐eligible
individuals. State
must wrap missing
benefits and cover
the cost of
premiums and
cost‐sharing
beyond Medicaid
limits. States must
obtain a waiver in
order to require
Medicaid‐eligible
consumers to
enroll in QHPs.
Arkansas is purchasing QHP coverage for all childless adults
and for parents 17‐133% FPL. Iowa is purchasing QHP
coverage for newly eligible adults 100‐133% FPL. New
Hampshire will purchase QHP coverage for all newly eligible
adults in 2016.*
Since individuals remain in their plan for a longer period
of time, QHP plans have a better ability to manage care,
influence outcomes, and save money.
Enables individuals to stay with their same plan and provider
network as their incomes change. Provider reimbursement
rates consistent does not change as subsidy program and
level change. Medicaid no longer a “bad”
payer or outlier.
Other states, including Pennsylvania and Virginia, are
considering premium assistance.
w Hampshire, a “bridge”
option will provide coverage beginning in 2014 through existing
Medicaid MCOs until the premium assistance program can be
operationalized.
13
19 Expansion States have Issuers Serving Both Medicaid and
QHP Enrollees*
Michigan
California
Nevada
Oregon
Washington
Arizona
Utah
Idaho
Montana
Wyoming
Colorado
New Mexico
MaineVermont
New York
North Carolina
South
Carolina
Alabama
Nebraska
Georgia
Mississippi Louisiana
Texas
Oklahoma
Pennsylvania
Wisconsin
Minnesota North Dakota
Ohio
West
Virginia
South Dakota
Arkansas
Kansas
Iowa
Illinois Indiana
Alaska
Tennessee
Kentucky Missouri
DelawareNew JerseyConnecticut
Massachusetts
Virginia Maryland
Rhode Island
Florida
Hawaii
New Hampshire
States Expanding
through MCOs (21 + DC)
States Not Expanding
at this Time (23)
As of 4/3/2014
KEY
States Expanding
Medicaid, but not
through MCOs (6)
*Source: Avalere Health. In 30 States, Plans Serving Medicaid Beneficiaries Also Offer Exchange Coverage, Improving Continuity of Care. October 21, 2013.
14Regulatory and Market Dynamics Push Toward Convergence
Medicaid Marketplace
15
Marketplace/StateInsurance Dep’tMarketplace/StateInsurance Dep’t
MedicaidMedicaid
Convergence across Medicaid and the Marketplace
Lower Costs
Improved
Outcomes
BenefitsProvider Network
and Contracting Value‐Based
Payment
Methodologies
Quality
Standards
and Metrics
Cost‐Sharing
Contracting Requirements
