New Mexico’s HRSA State Planning Grant

1. New Mexico’s HRSA State Planning Grant Insure New Mexico! Council September 29, 2004

2. Objectives for Today’s Presentation • Overview of the HRSA State Planning Grant – the uninsured initiative • Status of activities – expected deliverables • National/State Initiatives

3. HRSA State Planning Grant – Overview • Provided to Most States on Competitive Basis – Just awarded grants to 8 more states, almost all are now covered • Limited to Data Analysis and Planning re: Uninsured • Cannot use to address access issues • Cannot use to look at issues of underinsurance • Research to understand the issues and problems of uninsurance • Help inform the development of options to address the gaps in coverage • Grant Awarded September 2004 -- $905,000 • Budget Approved and Staff Hired – February 2004

4. Staff Analyses/Roles • Project Leadership • Contract Management and Oversight • Develops Reports to HRSA • Budget and Financial Reporting • Survey and Data Collection Coordination • Work to provide information and data (LHHS, HCCA, MAC, Insure NM!) • Economic and Data Analysis on healthcare issues • Benefit Plan – Cost and Benefit Analysis after Mercer creates the Actuarial Analysis • Model Assist in Analysis and Presentation of Policy Options

5. Resources • Interagency Team Including HPC, HSD, DOI, GSD, LCS, DOH • Builds on the Governor’s Health Care Coverage and Access (HCCA) Task Force and the HHS Committee’s Recommendations • Analysis of Existing Survey and Census Data Re: Uninsured (What We Know and Don’t Know About the Uninsured) • National Resources Through HRSA Used For Instrument Development, Ideas From Other States, Data Development, Presentations, etc.

6. Income Age Gender Family Composition Health Status Employment Status Race/Ethnicity Availability of private coverage Availability of public coverage Immigration Status Geographic Location Duration of Uninsurance Final Report on Quantitative Data

7. Final Report on Qualitative Data • What is affordable coverage? • Why do uninsured not participate in public programs? • How might the uninsured be influenced by subsidies, tax credits, etc.? • Why do uninsured not participate in ESI? • What other barriers prevent take up? • How do the uninsured get their medical needs met?

8. 1. Division of Insurance Data • Mining of DOI Data To Increase Understanding of Private Sector Insurance Market ($2,000) • Completed in March • Found that the data was insightful, but in spite of our hopes, it would not generate an effective way to examine DOI data and proved largely unrelated to the HRSA goals without significant change in data reporting requirements for insurance companies

9. Fiscal/Economic Analysis of VariousHealth Insurance Packages ($298,000) • For individuals under 65, who have lived in NM for one-year and have been without insurance for 6 Months and/or businesses who have not offered insurance for at least 12 months (to avoid crowd-out) • Cost of insurance package and likely take up • Affect on business and the number of uninsured • Plus recommendations on possible structures to provide coverage to uninsured • Mercer will re-configure results when additional data is gathered • Preliminary report planned for Nov. 4th Meeting

10. Actuarial Analysis continued… • Benefit Packages • State Coverage Initiative (SCI) package • (SCI) with increased cost sharing • Current NM state employee point of service plan administered by BC/BS • Current BC/BS plan with high deductibles • Catastrophic plans with: • High deductibles and limited benefits • High deductibles and prevention rider • High deductibles and Rx rider • High deductibles and lower lifetime limit

11. Household Survey to Augment PreviousData Collection Efforts ($300,000) • Conducted by Research & Polling, Inc. • Contracted with NMSU • Management of RPI, Socio-Economic and Academic-Based Analysis of the Data By NMSU Faculty • To Determine: • characteristics of NM uninsured to assist in policy decisions • Plus answer some of the questions outlined in previous presentation – why do they not take up Medicaid?, etc… • Instrument being programmed for implementation • Somewhat behind schedule, but will have results in time for Insure NM! Council to consider

12. 4. Survey of NM Non-Profits ($5,000) • With NGO New Mexico and NM Community Foundation • Will Mirror Some of HPC’s Small Employer Survey • Will Assess: • Why Not Offering Insurance (With Probes) • What Would It Take to Offer Insurance • What Type of Benefit Package Appeals to Them • What Administrative Barriers Prevent Them From Exploring or Offering Healthcare Coverage • Draft Instrument Ready for Comment • Preliminary report planned for Nov. 4th Meeting

13. 5. Survey/Analysis of NM State Employees($5,000) • With GSD/RMD • Will Assess • Why some employees do not take the offered insurance • Whether an increase in employer contribution affects take-up rate – before July cost-sharing change around 5,000 employees did not take up, now only 1,915 left – cost is a significant issue • Instrument being prepared, but quick implementation expected

14. New State Efforts – Comprehensive Reform • Maine – Dirigo Health Insurance (DHI) • Voluntary program addressing cost, quality and access • Offered to small businesses (<50 workers), self-employed, workers without offered coverage, low-income in large firms • Include Medicaid expansion (MaineCare) • 200% FPL for parents; 125% FPL for childless adults; sliding scale subsidies to 300% FPL • Benefit package to be offered through insurance broker – Anthem BC/BS won bid • Includes employer mandates and cost containment • CON moratorium • Voluntary limits on operating margins • Required electronic claims submission by 2005 • Price disclosures

15. New State Efforts – Comprehensive Reform • Maine – Dirigo Health Insurance (DHI) continued… • “Savings offset payment” on carriers (capped at 4%), basically savings in uncompensated care by hospitals and health systems are costed into plan utilization • Maine Quality Forum created • Enrollment begins this Fall, with anticipated start date January 1, 2005 • California – SB2 or “Pay or Play” • Requires purchase of coverage by employers or pay fees to a state fund • Employers >200 must provide coverage for workers and dependents by Jan. 1 ’06 • By 2007 – Employers with 50-199 workers must provide coverage • <20 workers – law does not apply • State referendum, under litigation by businesses.

16. New State Efforts – Reinsurance • State subsidization via individual stop-loss mechanism • HealthyNY pays 90% of annual claims between $5,000 and $75,000 for each enrollee (subsidy represents about 15% of premium) • HealthyNY example includes: • Single, consistent benefit package (pared down to keep low premiums) • Reliance on HMO model, in-network only • Extensive state administrative support and oversight • HealthyNY results so far: • Steady enrollment growth for 3+ years • Participants are very satisfied, 70% say they would not have coverage if HealthyNY did not exist • Because of large public subsidies, premiums 30%-40% less than small group, & 60%-70% less than individual

17. New State Efforts – Leveraging state purchasing power • Allowing others to enroll in state health plan • CT, IN, W. VI • CT example - recent law (PA 03-149) allows the comptroller to arrange group health coverage under the state employee health plan for employees of small employers, creating a separate risk pool • West Virginia example • Help small businesses provide coverage for their employees • Open to 2-50 employees, with minimum employer contribution of 50% • 75% of eligible employees must participate • Anticipate 20%-25% savings for employers/employees

18. Making private insurance more reasonable • Growing interest in scaled-back benefit plans • Review state regulatory reform • Addressing niche populations • I.e. young adults through mandated college coverage or extending parental coverage past 18 • Association Health Plans • Self-insured plan where employers pay only for actual claims made rather than monthly premium (as well as admin costs) • Small employer education/Administrative simplification • Rate guides, consumer friendly clearinghouse of private plans • Insurance fairs • Toolkits

19. How to formulate reasonable policy • Focus on Small Businesses/Non-Profits and Employer-Sponsored Insurance • Use of State’s Buying Power In Some Appropriate Fashion • Policy Recommendations for 2005 Legislative Session • Leadership and commitment from the top • Employer willingness to partner with public sector • Solid data and policy analysis • Willingness to look at new benefit designs • Willingness to be open to possibilities • Setting priorities for smaller coverage gains as part of a bigger plan (incremental steps)

20. Incremental Steps example • Define the problem you are trying to solve because different problems require different solutions • Problem: Coverage offered by employer but not taken up by worker • Solution: Subsidize employee premium or shift cost-sharing (like State cost sharing example) • Problem: Employer doesn’t offer coverage at all • Solution: Create affordable product targeting employers and workers and decrease any “hassle factor”

21. Finally • The HRSA State Planning Grant for the uninsured • Will provide data collection results as they come in on in state surveys • Can provide data analysis and continue to monitor other developments (what other states are doing, National data sources) • Basically, we are here to help you! • Go to www.hrsa.state.nm.us