Calendar

Wednesday, March 30, 2016
Post-Legislative Session Panel
Organizations: Impact Hub Salt Lake City/Alliance for a Better Utah
Location: Impact Hub Salt Lake City
Address: 150 S State Street, Salt Lake City, Utah 84111
Time: 6:30pm-8pm
Panelists include Rep. Rebecca Chavez-Houck, D-Salt Lake City; Spencer Stokes, lobbyist and former Sen. Lee Chief of Staff; and ABU's very own Chase Thomas, Policy and Advocacy Director.
Facebook event (link)
RSVP (link)

Friday, April 1, 2016
Panel: How Did Utah Women Fare This Legislative Session?
Organization: Utah Women’s Coalition
Location: Hinckley Caucus Room (OSH 255)
Address: Univ. of Utah
Time: 12pm-1pm
Panelists: Reps. Becky Edwards, Angela Romero, Carol Spackman-Moss, and Sen. Jani Iwamoto.
Moderator: Dr. Susan Madsen, Director of the Utah Women and Leadership Project
Facebook event (link)

Monday, April 4, 2016
USIM End of Life Care Summit: “End of Life Care: Are You Ready?”
Organization: HealthInsight
Location: University Park Marriot Hotel
Address: 480 Wakara Way, Salt Lake City, UT 84108
Time: 8am-3:30pm
RSVP (link)
We will address end of life care issues in UT and encourage community member input on planning conversations, policy change, and fostering alliances between patients and providers.

Tuesday, April 5, 2016
Free screening of Donut Hole: Life in the Medicaid Coverage Gap
Organization: Salt Lake Community College Students for Choice
Location: SLCC South City Campus
Address: 1575 S State St, Salt Lake City, Utah 84115
Time: 7pm
Facebook event (link)

Wednesday, April 11, 2016
First Annual Community Health Worker Conference
A pre-conference event for the 2016 Public Health Association Conference of Utah
Location: Sheraton Salt Lake City Hotel, Canyons Conference Room
Address: 150 W 500 S, Salt Lake City, UT 84101
Time: 8:30am-3pm
RSVP (link)
To provide Community Health Workers statewide access to resources, training, networking and continuing education/professional development.

Friday, April 27, 2016
Utah Regional Healthcare Innovation Day
Organization: HealthInsight
Location: Rice Eccles Stadium, University of Utah
Address: 451 South 1400 East SLC, UT 84112
Time: 8am-4pm
RSVP (link)
The Utah Regional Health Care Innovation Day will bring together health care professionals, payers, health care organizations, and state and federal government officials to discuss innovations to transform health care.

May 17, 2016
UHIN 3rd Health Info Technology Conference
Location: Salt Lake Community College Miller Free Enterprise Center
Address: 9750 S 300 W, Sandy, UT 84070
Time: 8am-12:15pm
RSVP (link)
At the third annual Utah Health Information Technology Conference, education sessions for providers, administrators and HIT professionals will explore how technology enables secure, connected care for a value-based world! This free event will feature an in-depth privacy and security panel, and breakout sessions highlighting how technology is revolutionizing diabetes care in communities of color; end-of-life care planning; and behavioral health care coordination.

May 19, 2016 
UHPP Power Breakfast
Location: Salt Lake Community College Miller Free Enterprise Center
Address: 9750 S 300 W, Sandy, UT 84070
Time: 8:30am-10:30pm
This event will get you and your organization up-to-speed on the latest health policy developments in Utah, including updates and forecasts on the Affordable Care Act (ACA), and Medicaid Expansion/Healthy Utah.

Who’s Covered Under Utah’s Medicaid Extension?

Close to 16,000 Utahns could gain coverage under HB 437. But who are they and how do they qualify? 

Gov. Herbert signs HB 437 while (L-R) Gail Miller,
owner of Larry H. Miller Group; Mayor Jackie Biskupski;
Rep. Jim Dunnigan; Joseph Miner, MD, director of Utah
Dept, of Health; Pamela Atkinson, homeless advocate;
Jon Pierpont, director of Dept. of Workforce Services;
Rep, Steve Eliason; Rep. Eric Hutchings; David
Patton, president of Molina Healthcare of Utah, look on.

Earlier this year the Utah legislature passed HB 437, Rep. Jim Dunnigan’s ground-breaking bill to extend Medicaid to approximately 16,000 people previously ineligible for coverage.

And ever since then, UHPP has been fielding questions about who qualifies for this new Medicaid extension, and who will remain in Utah’s coverage gap. People in the coverage gap earn too little to receive marketplace subsidies, and earn too much or do not qualify for Medicaid.

Not surprisingly, the answer is complex.

And that’s because the eligibility requirements in HB 437 are extremely technical.

This article will walk you through the eligibility rules for HB 437 to answer the following three questions:

1) Who is eligible for HB 437’s new Medicaid coverage?

2) Who will remain in the coverage gap?

3) When will people be allowed to enroll?

First, HB 437 creates new eligibility requirements for both parents with dependent children, and adults without dependent children (i.e. childless adults).

An estimated 3,800 parents with children will gain Medicaid coverage because the Department of Health (DOH) is authorized to raise the federal poverty level criteria from about 40% of the federal poverty level (FPL) to 55% FPL . This means a family of three can earn up to $11,088 a year and qualify for Medicaid, where previously they couldn’t earn more than $8,064 a year 

(See chart with Annual and Monthly income limits at right and download as pdf). 

HB 437 Eligibility Categories by FPL

Remember that premium subsidies on the Utah insurance marketplace start at 100% FPL ($20,160 for a family of three). Note: All numbers reference 2016 FPL guidelines.

Another 12,500 adults without children (i.e. childless adults) will gain 12-month continuous Medicaid coverage if they meet a series of eligibility requirements:

1. At the time of enrollment the individual’s annual income is 0% of the FPL;
2. The individual meets the prioritized eligibility criteria established by HB 437 and defined by DOH:

• Chronically homeless individual;

• If funding is available, an individual involved in the justice system through probation, parole, or court ordered treatment; and

• If funding is available, an individual in need of substance abuse treatment or mental health treatment.

What does this mean?
It means that enrollment priority is given to chronically homeless adults with no earnings. Why? Because addressing Salt Lake City’s homeless problem dovetails with current policy and legislative priorities that helped HB 437 gain support from a diverse constellation of business and advocacy groups.  Creating access to health insurance will definitely help Utah’s homeless population. However, as the leaders of the Fourth Street Clinic wrote in a recent op-ed, an insurance card is one of many things homeless people need to get back on their feet, with access to reliable shelter and food often being more important.

If funding is available, the next group eligible to sign up will be recently incarcerated Utahns leaving state or county corrections.

Why do they get prioritized?

Because the cost to treat this group is currently being covered by county and state budgets with only a small number of available treatment slots. Enrolling recently released individuals in Medicaid increases the number of treatment slots and allows federal government to pay for 70% of their medical costs, including substance use and behavioral health treatments. Investing in criminal justice reform is an underfunded mandate recently embraced by the Utah legislature.

How long until these two sub-groups—childless adults and parents with dependent children—can start enrolling in Medicaid?

The answer is many months.

The state and federal waiver process require certain time periods for public hearings, meaning the earliest date for federal approval of Utah’s Medicaid extension plan is August 2016. However, we don’t expect enrollment to begin until January 2017. 
See UHPP’s complete HB 437 waiver and approval calendar here (pdf)

So now that we know who is prioritized for Medicaid coverage under HB 437, and when enrollment will likely begin, let’s review who will gain coverage once the plan is put in place.

Not Covered: Dianna a single person from Ogden who’s in her early 20s and working part-time through a temp agency due to health issues. She is ineligible for coverage because she doesn’t have children, is not homeless, is not being released from prison, and doesn’t suffer from a behavioral health illness.

Covered: A single mother with two kids who earns $10,000 a year. She was previously ineligible for Medicaid because she earned above the 40% FPL threshold. But she is now eligible because HB 437 raised the income threshold to 55% FPL.

Not Covered: Jose is a full-time student at Salt Lake Community College with a part-time job. Jose suffers from back pain, but can’t afford the medical tests to get diagnosed. He’s trying to break the cycle of inter-generational poverty (his father was incarcerated and his mother died from a drug overdose) by working and going to school, but HB 437 can’t help him because he is not homeless or being released from incarceration.

Covered: A single male who recently left incarceration with a history of mental illness who earns under $594 annually.

Not Covered: Marc from Parowan who worked in construction all his life, but has been denied disability Medicaid and SSDI despite his recent diagnosis of a rare blood vessel disorder. He won’t qualify for Medicare until his illness progresses into End Stage Renal Disease, or if he turns 65 first. HB 437 can’t help Marc because he isn’t homeless, leaving incarceration, or dealing with a substance use disorder or mental health illness.

Covered: A single woman with no income, who has been homeless and living on the street for at least one year, or has experienced at least four episodes of homelessness within the last three years.

Partnerships in Action

There are 24 Promise Partner Community Schools

A famous proverb suggests that, “If you want to go fast, go alone. If you want to go far, go together.” This is exactly what the Utah Health Policy Project (UHPP), Take Care Utah (TCU), and the United Way of Salt Lake are doing with the Collective Impact Promise Partnership program.

Begun three years ago, the Promise Partnership effort assigns enrollment assistors to 24 elementary and middle schools (see map here) located within three different Utah counties. These assistors conduct outreach and education to help children and families learn about and sign up for health insurance.

Why is this important? Because Utah has the fifth-highest rate of uninsured children in the nation. And Utah is the worst state in the country for uninsured Hispanic children, with 22.2% of Hispanic children lacking health coverage—a rate that is double the national average.

For the six months from July to December 2015, the partnership reached over 3,393 people leading to 393 enrollments into Medicaid, PCN, UPP, CHIP, and private insurance. Research studies inform us that children who have access to health insurance and receive regular healthcare are more likely to attend school regularly and focus on their learning. Plus, parents with access to affordable health insurance are more likely to keep their kids insured and better support their children.

Operating at schools within the communities of Kearns, Guadalupe, South Salt Lake, Park City, West Valley, Clearfield, and now Midvale, the Promise Partnership staff are aligning services and connecting the dots in the effort to change the odds.

More recently, enrollment assistors from UHPP, UWSL, Midtown Community Health Clinic, Health Access Project, Association for Community Health, Utah Partners for Health, and Comunidades Unidas have formed a task force that meets once a month and shares outreach and enrollment ideas and connections that help to increase the number of children enrolled.
For a map of the 24 Promise Partnership schools, click here (pdf)

Engaging with school communities is the secret to success for Utah’s Promise Partnerships

FAQ on HB437

Utah’s recently passed Medicaid bill (HB 437) did more than just extend coverage to 16,300 newly eligible Utahns. This article explains what’s inside the bill.

2016 marks the year that Utah moved from being a non-Medicaid expansion state to a partial Medicaid expansion state. Utah joins Wisconsin and Virginia in this category.

Because this is not a full Medicaid expansion, Utah is responsible for paying 30% of the costs ($31.2M in FY18) to run the program, while the federal government pays the remaining 70% ($72.8M in FY18). A hospital assessment and other saving mechanisms are built into this bill to help fund Utah’s share of the costs. Health care advocates will continue to push to have Utah join the 31 other states who have expanded Medicaid to all, not just to some of their low-income citizens.

[1] What does HB 437 do?

House Bill 437 (HB437) created by Rep. Jim Dunnigan (R-Taylorsville), and sponsored by Sen. Allen Christensen (R-Ogden) is an extension of Medicaid benefits to 16,300 low-income Utahns.

First, HB 437 creates new eligibility requirements for both parents with dependent children, and adults without dependent children (i.e. childless adults).

An estimated 3,800 parents with children will gain Medicaid coverage because the Department of Health (DOH) is authorized to raise the federal poverty level (FPL) criteria from about 40% FPL to 55% FPL. 

HB 437 Eligibility Categories by FPL

(See chart with Annual and Monthly income limits at right and download as pdf). 

Another 12,500 adults without children (i.e. childless adults) will gain 12-month continuous Medicaid coverage if they meet a series of eligibility requirements starting with an income of 0% FPL:

• Chronically homeless individual;
• If funding is available, an individual involved in the justice system through probation, parole, or court ordered treatment; and
• If funding is available, an individual in need of substance abuse treatment or mental health treatment.

For more details on who receives coverage under HB 437, and who is left in the Utah coverage gap, read Who’s Covered Under Utah’s Medicaid Extension? elsewhere in this newsletter.

The bill creates an option for geographic areas of the state to opt-in to a pilot program to integrate physical and behavioral health care services within Utah’s Accountable Care Organizations (ACOs), as well as authorizes a preferred drug list (PDL) for psychotropic drugs with an override for dispense as written. UHPP considers HB 437 a good first step, and certainly better than nothing at all.

[2] How did it pass?

The bill started in the House Business and Labor Committee where it passed out with a favorable recommendation (9-4-1) with the Democrats on that committee split. Then the bill moved to the House Floor for a vote, after a few amendments were made, where it passed with a favorable vote (55-17-3) with no Democrats supporting the bill on the floor. Next the bill moved to the Senate Health and Human Services committee where it passed out 5-1 on party lines to go to the Senate for a full floor vote where it passed 19-8-2 with no Democrats supporting the bill. Utah Democrats articulated their position on HB 437 in a press conference covered here.

[3] Who supported HB 437?

While HB437 didn’t garner the 70+ organization and individual supporters who rallied behind Healthy Utah, there were about 30 organizations who signed on in support of this extension of benefits.

[4] Can the eligible requirements change?

HB437 was written in a way that left the DOH with flexibility. The DOH can adjust the FPL guidelines up or down (covering more or less Utahns) dependent on program costs and appropriations. The DOH is also directed to study options to maximize use of employer-sponsored coverage for current Medicaid enrollees, and strategies to increase participation of currently Medicaid eligible, and uninsured, children.

[5] When will people be able to sign up?

Because of the state and federal waiver process—both of which require certain time durations and public hearings—the earliest date for federal approval of Utah’s Medicaid extension plan is August 2016. However, we don’t expect enrollment to begin until January 2017. See the complete HB 437 waiver and approval timeline here (pdf)

[6] Where are the savings reinvested?The bill establishes a “Medicaid Expansion Fund.”  The hospital assessment of $13.6M will be deposited into this fund (which can ultimately be raised to cover 33% of the state’s total cost of expansion if we fully expand Medicaid); 

Any savings determined by the DOH attributable to:

• The health coverage improvement program; 
• The inclusion of psychotropic drugs on the PDL;
• The services provided by the Public Employee’s Health Plan;

Any gifts, grants, donations, or any other conveyance of money that may be made to fund from private sources; and additional amounts as appropriated by the legislature. This fund shall earn interest and all interest earned on fund money shall be deposited back into the fund.

[6] Informational Links:

• Consolidated Motions for House Bill 3 (link)
• HB437 Fiscal Note (link)
• HB437 Bill Language (link)
• UHPP Bill Tracker (link)
• Support for HB437 (link)
• Where states stand on Medicaid expansion (link)
• 16-02-29 House B&L Vote 9-4-1 (link)
• 16-03-04 House Floor Vote 55-17-3 (link)
• 16-03-08 Senate HHS Vote 5-1 (link)
• 16-03-08 Senate Floor Vote (link)
• New FPL Ceilings for HB 437 eligibility categories (link)

Latest on the ACA in Utah

UHPP has tracked the ACA in Utah since day one.
Here is our latest report and analysis.

Download a PDF slideshow of this information here (pdf)

Enrollment

Utah ACA Enrollment (2013-2016) 

Facts: Utah enrollment in ACA health plans continues to 
grow overall, and especially in Utah and Washington Counties. Sign-ups reached 175,637 at the end of the open enrollment period on January 31. This represents a 25% increase from the prior year. Utah was the second-highest state in the nation for growth in ACA enrollment (behind Oregon). However, enrollment in AC A declined in 2015-16 in several rural counties, including Grand and Carbon counties.
Analysis: This rural county decline was likely due to the withdrawal of Arches Health Plans, the co-op insurer that the Utah Insurance Department shut down in October 2015. Arches was a popular plan choice in rural counties due to their low premiums, innovative offerings (no accident deductibles), and provider and hospital networks that extended to Grand Junction, CO.

ACA Marketplace Plans (2014-2016) 

Facts: Utah's marketplace lost three insurers in 2016 
(Arches, Altius, and Bridgespan), and gained one insurer (University of Utah Health Plans). The number of marketplace insurers varies by county. For 2016 Salt Lake County has four marketplace insurers offering a total of 74 plans, a decline from six insurers offering 101 plans in 2015. This year residents of Washington County and 19 rural counties have only one marketplace insurer (Select Health) offering 40 plans.
Analysis: Utah’s population is concentrated along the Wasatch Front, where residents have a choice of three to four marketplace insurers. However, the loss of Arches reduced choice for rural residents. Fortunately, premiums were not affected because Arches exited the marketplace after 2016 rates had been set. UHPP has confirmation from the Utah Insurance Department that new insurers plan to offer plans in Utah’s rural counties in 2017, increasing the competition and choice for consumers.

Utahns Receiving ACA Subsidy (2016) 

Facts: 85% of Utahns selecting a plan on healthcare.gov 
receive a premium subsidy to reduce their monthly 
premiums. The average monthly subsidy in Utah covers 68% of premium costs. According to the Kaiser Family Foundation’s 2015 Employer Health Benefits Survey, workers with job-based- health insurance receive pre-tax contributions from their employers equal to an average of 82% of their premiums for single coverage, and 71% for family coverage. [Kaiser Family Foundation; 2015 Employer Health Benefits Survey; Summary of Findings, page 1; http://kff.org/report-section/ehbs-2015-summary-of-findings/]
Analysis: The premium subsidies created by the ACA mimic the employer contributions that most private and public sector employees receive. In Utah, ACA subsidies cover a smaller percentage (68%) of insurance premium costs than the average employer single and family contributions (82%, 71%).

Facts: 59% of Utahns selecting an ACA plan earn under 200% of the federal poverty level. 21% of Utahns earn between 200% and 250% of the poverty level. Nationally 15% of enrollees earn between 200% and 250% of the poverty level

ACA Subsidies & Enrollment by FPL 

Analysis: Utah has a much higher percentage of moderate income enrollees earning between 200% and 250% of the poverty level. Any children of this sub-group are enrolled in ACA insurance because they earn too much to qualify for Medicaid or CHIP.

Facts: In addition to premium subsidies, Utahns earning between 100% and 250% of the federal poverty level receive cost-sharing assistance to reduce the burden of co-pays and deductibles for their insurance. These tax credits and cost-sharing reductions are only applied to Silver, Gold, and Platinum-level plans. For instance, the annual deductible for a benchmark Silver plan purchased by a 30-year old Salt Lake City resident would normally be $3,800 without cost-sharing reductions. But if the same individual earned 175% of the poverty level, not only would that person receive a monthly tax credit of $135, but their deductible would be reduced to $900.
Analysis: One of the major criticisms leveled against the ACA is that consumers can only purchase high-deductible insurance. Facing these high deductibles, consumers are less likely to actually use or retain their coverage. However, deductibles have been rising in individual market and employer-based insurance for over a decade. In 2006, 10% of all employers offered insurance plans with deductibles more than $1,000 for single coverage. By 2012, two years before the implementation of the ACA, that percentage had risen to 34%. As of 2015, 46% of all firms offered insurance plans with deductibles more than $1,000 for single coverage. Similar trend lines occurred in private market insurance. The ACA offers a diverse choice of insurance options for consumers—ranging from HSA-qualified, high-deductible, lower-premium Bronze plans, to low-deducible, higher-premium Gold and Platinum plans. The choices for a 30-year old in Salt Lake County range from a Bronze plan with a HSA-qualified $5,000 deductible ($205 per month), to a Platinum plan with a $250 deductible ($436 per month).


Demographics


Facts: 24% of Uthans signing up for an ACA plan are children age 0-18, representing 42,000 children. Utah's child enrollment rate is 2.67x the national average. 

ACA Enrollment by Age (2016) 

Analysis: Utah's under-18 population is 7.7 percentage points (or 1.33x) higher than the national average. Yet Utah's under-18 ACA enrollment percentage is 15 percentage points (or 2.67x) higher than the national average. This means that Utah’s under-18 population is enrolled in ACA health insurance at a higher rate than predicted by the state’s younger skewed population. In addition, most of the Utah children enrolling in ACA insurance come from middle and upper-income families earning between 200% and 400% of the federal poverty level. That's because children in families earning under 200% of poverty are enrolled on Medicaid or CHIP. In real dollar terms, the range of 200% to 400% of the poverty level represents $56,000 to $113,640 for a family of five.

Facts: 71% of Uthans signing up for an ACA plan are under 45 years old. Nationally, 51% of enrollees are under 45 years old.

Snapshot of ACA Coverage In Utah 

Analysis: Utah has the youngest population of any state. Still, Utah's under-45 enrollment is much higher than is predicted by Utah’s demographic characteristics. Younger Utahns are signing up for ACA insurance at a higher rate than other states.

Geography
Facts: Utah ZIP Codes with the highest number of plan selections are in Lehi, South Jordan, American Fork, Pleasant Grove, and St. George. Utah ZIP Codes with the fastest enrollment growth between 2015-16 are in Spanish Fork (+24%), Orem (+24%), Riverton, (+23%), Provo (+22%), and Herriman (+20%).

ACA Enrollment by Utah ZIP Code (2016) 

Analysis: Utah County has led the state's enrollment growth for the last two years. The epicenter of ACA enrollment has steadily moved southward from West Valley City and South Jordan (2014) to Lehi and American Fork (2015) and now to Orem and Spanish Fork (2016). St. George experienced a surge in ACA enrollment (+50%) in 2015 that subsided to a moderate 10% increase in 2016. Based on reports from local navigators, the Utah county enrollment surge is fueled by married students (BYU, UVU), self-employed workers and their families, start-up employees, sales and commissioned-based workers. Enrollment in Utah County is dominated by middle-income families who sign up together for the same plan and receive significant premium subsidies. Enrollment in Weber, Davis, and Salt Lake counties reached a saturation point in 2015 and is now governed by normal churn and is less dynamic.

Fallen Arches: An FAQ on the Failure of Utah’s Co-Op Insurer

Why did Arches, Utah’s dynamic co-op insurer, collapse?  

When did Arches fail?

Arches Health Plan was placed into receivership by the Utah Insurance Department in October 2015 because the state’s insurance commissioner concluded Arches lacked sufficient cash reserves to cover future claims. As a result of this decision, Arches ceased offering individual market plans in 2016 but continued some small group plans until their renewal dates in 2016. Co-ops health plans also collapsed in Arizona, Colorado, Iowa, Kentucky, Louisiana, Michigan, Nevada, New York, Oregon, South Carolina, and Tennessee.

How many people had Arches coverage?

35,000 Utahns had purchased individual market insurance plans from Arches that were discontinued at the end of 2015. Another 31,000 Utahns were covered by the co-op’s small group plans. Many of the small group customers were able to keep their coverage into 2016 and until their plans reached their renewal date.  Arches sold both individual market insurance and small group insurance in all 29 counties in Utah and their plans were especially popular in Grand and Washington counties.

Why did Arches fail?

In October 2015 Arches was expecting almost $9 million in “risk corridor” payments to compensate the insurer for spending more than they anticipated on insurance claims in 2014, the first year of ACA coverage. Instead, Arches received approximately 12.6% of their expected risk corridor payments, leaving the insurer with an overall $27 million shortfall heading into the third open enrollment period in 2016. This debt caused the Utah Insurance Department to place Arches in receivership.

What are risk corridors?

Risk corridors were set up by the ACA to protect insurers from the unpredictable costs associated with enrolling previously uninsured and less healthy populations. Risk corridors were designed to operate for the first three years of the ACA, from 2014 to 2016. If an insurer set premiums too low and or incurred unexpectedly high claims from new customers, the risk corridor program would cover a sliding scale percentage of the insurer’s loses. Risk corridors were noncontroversial when the ACA was debated and passed. They had previously been included in the Medicare Modernization Act of 2003, which established coverage of prescription drugs through Medicare Part D. The risk corridors in Medicare Part D plan are still operating.

How do risk corridors work?

Each premium for an insurance plan has a target amount that is equal to the premi­um price minus administrative costs such as taxes regulatory fees, adminis­trative costs, and profit. If an insurer had claims that were between 103% and 108% of their premium’s target amount (thereby incurring a loss), the insurer would be reimbursed for 50% of their losses within that range. And if insurers had claims that were more than 108% of their target amount, they would be reimbursed 80% percent of those losses. For example, if a plan’s target amount was $500, but an insurer actually spent $550 on claims, its ratio would be 110%. As a result, the insurer would receive 50% reimbursement for its losses between 103% and 108% ($12.50) and 80% for expenses above 108% ($8.00), for a total reimbursement of $20.50 on an overall $50 loss. Likewise, if insurers spent less than expected on claims, they would contribute a corresponding percentage of their gains to the risk corridor pool.

How much was the risk corridor program expected to pay out?

Risk corridor payments for the first year of the ACA enrollment (2014) were scheduled to be paid to insurers in the fall of 2015. By mid-July 2015 struggling insurers were requesting $2.9 billion in reimbursements from the risk corridor program, while profitable insurers contributed only $362 million to the payment pool.

Why was the risk corridor program so short of funds?

Future payouts from the risk corridor program were hamstrung by a little-noticed provision inserted into the December 2014 “Cromnibus” spending bill that required the program to be “budget neutral.” This provision restricted HHS to use only the incoming funds collected by profitable insurance plans and no other funding sources or trust funds. This restriction limited the eventual risk corridor payouts to $362 million or 12.6% of the total amount requested.

Does the failure of Arches mean that the federal government can’t be trusted to fully fund Medicaid expansion?

Some people have argued that the lack of funding for risk corridors—which led to Arches’ collapse—is a reason to doubt the enhanced federal funding for Medicaid expansion (90% federal funds and 10% state funds, compared to the current 70/30% match rate for Utah). However, the funding mechanisms and history between risk corridor payments to insurers and Medicaid payments to states are completely different and not comparable.

Arches failed because the risk corridor program could not access the necessary funds to pay the reimbursement requests made by insurance companies. Other HHS funds were available to pay the risk corridor program, but Congress passed a law that prohibited the agency from using those additional funds in a move calculated to hurt the program. Since Congress hamstrung the risk corridor program before it had collected any funding from insurers, there was no evidence available how this change would affect future payments.

In contrast, the federal government has never missed a Medicaid payment to states since the creation of the program in the mid-1960s. In fact, Medicaid payments to Utah recently increased during the 2009-2010 recession. Utah’s current Medicaid match rate is 70% federal, 30% state funding. Other states have different match rates based on the state’s Gross Domestic Product (GDP) and other income factors. For instance, Colorado’s federal match rate was 50% federal, 50% state funds, and Mississippi’s federal match rate is 75% federal, 25% state funds. The federal government has made all of its enhanced match rate payments to the more than two dozen states that have expanded Medicaid since 2014.

  

Ask a Navigator: How is health insurance changing in 2016 and 2017?

Question #1: How big are the fines?

The fine for being uninsured is much bigger in 2016. 

As a certain orange-tinted presidential candidate might say, the fine is “HUUUGGGGE!”

The annual fine can be calculated two ways: 1) On a per-person basis, or 2) Based on overall household income. When you calculate your 2016 taxes next year, you’ll pay whichever fine is higher if you remained uninsured for more than three months. And keep in mind the fine is pro-rated based on the number of months you lacked insurance (i.e. you’ll only pay the fine for the months you lacked health insurance).

Here’s how the annual fine is calculated:

• The per-person fine is $695 per adult, $347.50 per child, up to a maximum of $2,085 per family.
• The income fine is 2.5% of your household income minus the filing threshold (ie. $10,000 per individual, $20,000 per family). So if a family makes $60,000 a year, their fine would be 2.5% x $40,000 or $1,000.
• Earlier this year the brainiacs at the Kaiser Family Foundation calculated that the average family fine would be $969 for 2016.

Before you get your undies in a bundie, remember that many people are exempt from the fine. A recent analysis by TurboTax estimated that 70% of the uninsured qualified for an exemption in 2015. The biggest group exempted from the fine are those who live in the Medicaid coverage gap because they earn below 100% of the federal poverty level and can’t qualify for premium subsidies on the health insurance marketplace. Other exemptions are designed for people who experience a death in the family, eviction, utility shutoffs, medical emergencies, or natural disasters. For a complete list of hardship exemptions, go here. For more information on fines and the exemption, contact an expert enrollment assister at Take Care Utah or call 2-1-1.

Question #2:  When can I sign up for insurance?

We are now in a Special Enrollment Period (SEP), which means you need to experience a “Qualifying Life Event” to trigger a 60-day window to purchase health insurance. These life events including getting married or divorced, having or adopting a child, turning age 26 and leaving your parent’s insurance, moving (even within a state), losing health insurance due to job termination or a schedule change, gaining U.S. citizenship, or being released from incarceration. See Take Care Utah’s handy one-page chart on SEPs here (pdf).

The next open enrollment period—the time when you don’t need a qualifying life event to sign up cover coverage—will begin November 1, 2016 and end January 31, 2017. In subsequent years we’ve learned that the open enrollment period will shrink to 45 days and last from November 1 to December 15. Given how many people signed up for health insurance in the last two weeks of January this year, we are not looking forward to that shortened enrollment period. And remember that enrollment for Medicaid and CHIP is open year-round. Get answers to all of your health insurance and enrollment questions by contacting an enrollment expert at Take Care Utah or call 2-1-1.

Question #3: Will there be more coverage options for rural Utahns in next year?

The collapse of Arches Health Plans last October left 20 of Utah’s 29 counties with only one insurer—SelectHealth—offering plans on the insurance marketplace. While this lack of competition didn’t impact rates in 2016, it could drive up rates next year if more insurers don’t enter those regions and a monopoly develops. Fortunately, we’ve heard that one or two existing Utah insurers are interested in offering plans in these 20 mostly rural counties. As a result, we expect more insurers and more plans to fill the Utah insurance marketplace in 2017. But no matter where you live, from Moab to Brigham City and from Hurricane to Kanab, health insurance enrollment experts are ready to help you by phone or in person. Find your nearest expert by going to Take Care Utah or the web or calling 2-1-1.