Presentation to Advisory Council

Boston, MAAugust 25, 2011

2

Review research framework and provide updates on progress

Meeting Purpose

Introduce Manatt/Mercer

Discuss next steps

3

Manatt Health Experience

$$

States

Payers

Providers

Foundations and Other Stakeholders

$$

4

Mercer Health Experience

Health Exchange

Uninsured

Health Plan Reviews

Actuarial Rate Setting

$$

55

Transition Planning

Leverage the Commonwealth’s strong foundation

Ensure compliance with ACA requirements

Facilitate integration between MassHealth and the Connector

Strengthen the role of the Connector in the Insurance Market

Leverage the Commonwealth’s strong foundation

Ensure compliance with ACA requirements

Facilitate integration between MassHealth and the Connector

Strengthen the role of the Connector in the Insurance Market

The Strategic Plan must:The Strategic Plan must:

. . . to successfully support health care delivery system reform in the Commonwealth. . . to successfully support health care delivery system reform in the Commonwealth

The Commonwealth seeks to evaluate the options for providing subsidized coverage, Exchange (i.e., Health Connector) structure, and operations in light of federal health reform.

Massachusetts is operating major elements of federal health reform and today operates a mature and successful health benefit exchange (HBE).

6

Transition Goals and Priorities

• Comply with or, seek waiver from, specific ACA

requirements related to coverage and eligibility

• Maximize continuity of coverage from as-is to to-be

– Minimize harm to transitioning populations

• Maximize continuity of coverage among to-be coverage

options

• Leverage federal dollars to provide state fiscal relief

• Leverage purchasing power of the Connector and MassHealth

• Identify and optimize administrative simplification

opportunities

7

High Level Timeline

Exchange must be operational – January 1

Exchange must be operational – January 1

Fu

nd

ing

O

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ort

un

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sFu

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ing

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ort

un

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sR

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em

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ey F

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era

l D

ate

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ey F

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era

l D

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M

ilesto

nes

Sta

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Milesto

nes

HHS Exchange Establishment

Grants awarded – May 23

HHS Exchange Establishment

Grants awarded – May 23

CMS to issue initial Exchange and Medicaid eligibility regulations – July, August

CMS to issue initial Exchange and Medicaid eligibility regulations – July, August

HHS Approval that Exchange will be operational by 1/1/14 – January 1

HHS Approval that Exchange will be operational by 1/1/14 – January 1

State must spend grant funds -

September 30

State must spend grant funds -

September 30

Early Innovator Grant Awards – February 15(Applications due 12/22/10)

Early Innovator Grant Awards – February 15(Applications due 12/22/10)

Early Innovator Grant period ends – February

Early Innovator Grant period ends – February

Exchange must be self-

sustained – January 1,

2015

Exchange must be self-

sustained – January 1,

2015

HHS Exchange Establishment Grants RFP –

February

HHS Exchange Establishment Grants RFP –

February

Final report & Federal Financial Report due – 90 days within project end date

Final report & Federal Financial Report due – 90 days within project end date

Project Kick-Off –June 13

Project Kick-Off –June 13

Quarterly report – January

Quarterly report – January

Quarterly report – April

Quarterly report – April

Quarterly report – July

Quarterly report – July

Exchange must be “soft-launched” – July 1

Exchange must be “soft-launched” – July 1

Quarterly report – October

Quarterly report – October

CMS to issues second set of Exchange regulations –September

CMS to issues second set of Exchange regulations –September

HHS Exchange Establishment Grants Level 1

and Level 2 deadline –

September 30

HHS Exchange Establishment Grants Level 1

and Level 2 deadline –

September 30HHS Exchange Establishment

Grants Level 1 and Level 2 deadline –

June 30

HHS Exchange Establishment

Grants Level 1 and Level 2 deadline –

June 30

HHS Exchange Establishment Grants

Level 1 and Level 2 deadline –December 30

HHS Exchange Establishment Grants

Level 1 and Level 2 deadline –December 30

HHS Exchange Establishment Grants

Level 2 deadline – June 29

HHS Exchange Establishment Grants

Level 2 deadline – June 29

HHS Exchange Establishment Grants

Level 2 deadline – March 30

HHS Exchange Establishment Grants

Level 2 deadline – March 30

2014Jan2011

Feb2011

Mar 2011

Apr2011

May2011

Jun2011

Jul2011

Sept2011

Oct2011

Nov2011

Dec2011

Aug2011 2012 2013

ACA Sec. 1321(e) provides that HHS will provide assistance to existing Exchanges for coming into compliance with the ACA

and a presumption of compliance after this process

8

Research Approach

• Analyzed State statute, regulations, and administrative guidance:

• Analyzed Federal statute, regulations, and guidance

• Developed preliminary gap analysis

• Conducted key informant interviews

• Identified policy questions/issues for further research

• Developing high-level transition roadmap and assessment

• Developing modeling framework and assumptions

June July August September

• Conduct additional federal and state statutory, regulatory, and administrative guidance research

• Conduct modeling

• Evaluate transition options

• Conduct gap analysis

• Assess coverage options balancing the interests of multiple stakeholders

• Present findings and recommendations to Subsidized Insurance Workgroup, Advisory Council, Executive leadership, and stakeholders

9

Individual CoverageTransition Options

10

Findings: As-Is Takeaways

Coverage of 98% of Commonwealth residents has been achieved through a patchwork of programs.

98% Programs vary in:

Eligibility levels and requirementsBenefit packagesCost-sharing Funding sourcesResponsible agencies/entities

1

2

3

4

5

11

Findings: As-Is Takeaways

400%400%

FPL

FPL

300%300%

200%200%

100%100%

Children

< 1

(35,185)

Children

< 1

(35,185)

PopulationPopulationChildren

1 – 18

(449,687)

Children

1 – 18

(449,687)

Parents

(191,060)

Parents

(191,060)

Preg.

Women

(pending)

Preg.

Women

(pending)

BCCTP

(351)

BCCTP

(351)

Childless Adults

MH

(12,511)

Childless Adults

MH

(12,511)

Childless Adults

LTU

(88,283)

Childless Adults

LTU

(88,283)

HIV+

(1,262)

HIV+

(1,262)

Indiv.

Unempl. Comp

(pending)

Indiv.

Unempl. Comp

(pending)

Small Biz

Empl.

(5,226)

Small Biz

Empl.

(5,226)

Imm. 5 yr Bar

(15,474)

Imm. 5 yr Bar

(15,474)

Imm. GF

(pending)

Imm. GF

(pending)

Indiv Inelig

for MassHealth

(195,984)

Indiv Inelig

for MassHealth

(195,984)

Disabled

Adults & Children

(20,419)

Disabled

Adults & Children

(20,419)

Non- qual

Aliens

(58,365)

Non- qual

Aliens

(58,365)

Non- qual

Aliens

Children

(26)

Non- qual

Aliens

Children

(26)

MassHealth Standard MassHealth Standard

Family Assistance

Family Assistance

Medical Security

Plan

Medical Security

Plan

MassHealth Essential

MassHealth Essential

MassHealth Basic

MassHealth Basic

Common wealth

Care Bridge

Common wealth

Care Bridge

Common wealth

Care

Common wealth

Care

Common wealth Choice

Common wealth Choice

MassHealth CommonHealth

MassHealth CommonHealth

Family Assistance

Family Assistance

MassHealth Limited

MassHealth Limited

Children’s Medical Security

Plan

Children’s Medical Security

Plan

Health Safety Net

Health Safety Net

Insurance PartnershipInsurance

Partnership

12

Findings: To-Be Takeaways

• Transition offers the opportunity to dramatically simplify the patchwork, benefiting consumers and the Commonwealth.

MassHealth BasicMassHealth Basic

MassHealth EssentialMassHealth Essential

Family Assistance (CHIP)Family Assistance (CHIP)

MassHealth StandardMassHealth Standard

Medical Security PlanMedical Security Plan

Insurance PartnershipInsurance Partnership

Commonwealth CareCommonwealth Care

Commonwealth Care BridgeCommonwealth Care Bridge

Commonwealth ChoiceCommonwealth Choice

MassHealth BenchmarkMassHealth Benchmark

Family Assistance (CHIP)Family Assistance (CHIP)

MassHealth StandardMassHealth Standard

Basic Health Plan (option)Basic Health Plan (option)

Qualified Health PlanQualified Health Plan

Health Safety NetHealth Safety Net

13

Transition from As-Is to To-Be:First Level Assessment

As-Is To-Be

2014 Benefit Change

Consumer Cost Sharing Change

Federal Financial Participation

State Financing

First level assessment

14

Transition from As-Is to To-Be:Second Level Assessment

As-Is To-Be

Connector Financial

Sustainability

Robust ConnectorMarketplace

Efficient Administration of

Subsidized and Non-subsidized Insurance

OptionsLeveraging Paymentand Delivery SystemReform

Second level assessment

15

In Summary

Effective administration of preferred options is the final question

Implications for Connector

scale and sustainability

Implications of the

potentially divergent delivery

models in MassHealth (MCO, PCC)

and the Connector delivery model

(health plans)

Balancing scope of benefits, consumer

cost-sharing, access to federal

financing, and impact

on state expenditures

Balancing the advantages,

disadvantages and risks

Final Transition Decisions will be Informed by:

Delivery Model

Basic Health Program

Cost - Benefit Analysis

Connector Sustainability

Optimizing to advance

payment and delivery system reform

Purchasing Leverage

16

• Conduct additional federal and state statutory, regulatory, and administrative guidance research

• Conduct modeling

• Evaluate transition options

• Conduct gap analysis

• Assess coverage options balancing the interests of multiple stakeholders

• Present to Subsidized Insurance Workgroup, Advisory Council, Executive leadership, and stakeholders

Next Steps