Innovative State Programs Donald Cohn Associate, AcademyHealth Adequate Health Care Task Force December 7, 2005

Presentation Overview 1.Populations at risk? Adults Small Business 2.Using Medicaid 3.Innovative State Programs Creating a new product Converting safety net money into coverage

Medicaid Enrollment and Eligibility Milestones, Recession and State Fiscal Crisis ( ) Millions of Medicaid Beneficiaries during year SOURCE: Kaiser Commission on Medicaid and the Uninsured analysis of data from the Centers for Medicare and Medicaid Services, CBO March 2005 Medicaid Baseline. Medicaid Enacted (1965) SSI Enacted (1972) Medicaid Eligibility Expanded to Women and Children ( ) Section 1115 Waivers Expand Medicaid Eligibility ( ) AFDC Repealed (1996) SCHIP Enacted (1997) 58 Million Beneficiaries

States Providing Medicaid or Other Coverage to Childless Adults: 2005 OR WA CA NV UT ID MT ND SD WY NE CO AZ NM TX LA MN IA MO KS OK AR WI MI IL IN OH KY FL TN VA NC SC MSALGA PA NY ME VT NH RI AK HI WV Source: SCI Coverage Matrix ** Some programs are small and/or capped enrollment

Using Medicaid Pros: 1.Federal Financial Participation 2.Flexibility allowed in the waiver process Cons: 1.Categorical eligibility = A Waiver is required 2.Budget Neutrality must be demonstrated

Policy Goals Reduce the uninsured Support or reinforce the private market Increase the employer offer rate Slow the decreasing employer offer rate Avoid crowding- out or replacing private dollars with public dollars

What Problem are you trying to solve? Different problems require different solutions… Problem: Coverage offered by employer but worker does not buy Solution: Subsidize employee premium -or- Problem: Employer doesnt offer coverage at all Solution: Create affordable product targeting employers and workers

For low-income working uninsured, problem is both offer and take-up SOURCE: Kaiser Commission Medicaid and Uninsured, Key Facts, December 2003

Goal of New Mexicos State Coverage Insurance (SCI) Program New Mexico Human Services Department Address New Mexicos high rate of uninsured and low rate of employer sponsored health care Create a public/private partnership Offer affordable health care coverage to low-income working adults through an employer-based system Goal #1 Goal #2 Goal #3 9

SCI Is Funded Through a Public/Private Partnership FINANCING: New Mexico Human Services Department 10 $355 estimate per person

Sliding Scale Co-Pays Cost Sharing Provisions Designed To Encourage Access – Most co-pays $0, Inpatient stay - $0 per admission 0-100% FPL % FPL Most co-pays $5, Inpatient stay - $25 per admission – Most co-pays $7, Inpatient stay - $30 per admission % FPL – RX - $3 per prescription – maximum monthly Rx co-pay $12 – Cost Sharing Maximum – limited to 5% countable household income New Mexico Human Services Department 11

Oklahoma Employer/employee Partnership for Insurance Coverage (O-EPIC) HIFA Waiver, tobacco tax financing Goal to cover 50,000 uninsured workers Open to workers and spouses under 185% FPL who work for small employers and those seeking work Voucher for small businesses to provide coverage –Employers pays 25%; employee pays 15%; state & federal funds 60% Safety-net option for workers with employers unwilling to participate

IowaCare Section 1115 Waiver Medicaid Expansion that will cover approximately 30,000 adults (19-64) < 200 % FPL Different from traditional Medicaid: leaner benefit package, smaller provider network, requires health assessment and premium The program is a capped, non-entitlement Iowa eliminated: the Indigent Care Program, and all inter-governmental transfers (IGTs)

IowaCare: Financing Old systemNew System Total = $275 millionTotal = $275 million $66M IGT $100M Indigent Care $110M Federal Match $66M Federal Match $33M State $110M Federal Match $66M State Federal Matching Funds

IowaCare: Hospital Trust Fund New Hospital Trust Fund Allocation Title XIX (Medicaid) Expansion = $35.1 M Disproportionate Share Hospital (DSH) = $19.5 M Indirect Medical Education (IME) = 18.2 M 100 % State Only Funds = $20.1 M