State Roundup: Big developments in Colorado, Oklahoma, Hawaii and North Carolina
2018 MIDTERM ELECTION
Time: D H M S
While I've been embroiled in the sturm und drang at the national level, Louise Norris of healthinsurance.org has been reporting on some important stuff happening at the state level:
As of 2017, Hawaii no longer has a SHOP exchange for small businesses. The State Department of Labor and Industrial Relations has an FAQ page about this.
...Hawaii’s waiver aligns the ACA with the state’s existing Prepaid Health Care Act. Under the Prepaid Healthcare Act, employees who work at least 20 hours a week have to be offered employer-sponsored health insurance, and can’t be asked to pay more than 1.5 percent of their wages for employee-only coverage (as opposed to 9.69 percent under the ACA in 2017).
Short version: Hawaii already had a state employer coverage mandate law on the books which is far more robust and successful than the ACA's provision, so there's really no need for a SHOP exchange (which has always had anemic enrollment nationally anyway, and in Hawaii was even smaller).
Far more significantly, however...
Lawmakers consider bill to preserve ACA in Hawaii, expand Medicaid to 250% FPL
With all of the uncertainty around the future of the ACA, Hawaii lawmakers have been considering legislation (H.B.552) that would preserve the ACA’s primary provisions, regardless of what happens on the federal level (Hawaii’s legislature is overwhelmingly Democratic, with 45 Democrats and six Republicans in the Hawaii House of Representatives, and 25 Democrats and zero Republicans in the Senate).
H.B.552 would preserve
- The individual mandate
- Minimum essential benefits requirements
- Dependents allowed on parents’ health plan until age 26,
- The ban on preexisting condition exclusions and gender-based premiums.
OK, so it would bake in the main ACA protections even if the federal law is killed off; good for them. But here's the really exciting part:
That version passed the House in early March. The Senate passed H.B.552 on April 11, but with additional amendments (SD2) that go further than what the House had proposed. The Senate’s amendments would:
- Create a Medicaid Plus program that would provide coverage to Hawaii residents with income between 138.5 per cent and 250 per cent of the federal poverty level (the federal poverty level is higher in Hawaii; for an individual, 250 percent of the poverty level in Hawaii in 2017 is $34,650, and for a family of four, it’s $70,725). This program would be designed to cover adults only, as children in Hawaii are already eligible for Medicaid with household income up to 300 percent of the poverty level.
- Create a trust fund to reimburse insurers for the costs of providing minimum essential insurance benefits.
- People with household income up to 250 percent of the poverty level would be exempt from the state’s individual mandate.
As of April 13, the bill had been returned to the House and the House disagreed with the Senate’s amendments. The bill was sent to a House Conference on April 17, for further consideration.
Assuming the full Senate version passed, this would amount to expanding Medicaid from 138% FPL to 250% FPL or their own version of the BHP program, depending on how you wanted to label/market it. Either way, it sounds like the state would have to provide a chunk of the additional funding. If it went through successfully, this would make the whole CSR issue completely irrelevant for the state, while moving Hawaii one step closer to universal single payer.
OKLAHOMA: Norris reported on this a few weeks ago, but I didn't have a chance to check it out until now. The level of irony here is stunning:
Oklahoma prepares for 2018; considers allowing out-of-state insurance sales
...Also in late March, the Oklahoma Senate passed S.B.478, by a wide margin (39-4); the bill is now with the House. If enacted, S.B.478 would allow the state to enter into compacts with other states so that health plans domiciled in those states could be sold to Oklahoma residents without having to obtain an Oklahoma certificate of authority or comply with Oklahoma-specific insurance regulations (note that this is allowed under ACA Section 1333).
This one is stupid, but probably harmless: It amounts to the "SELL ACROSS STATE LINES!!" mantra that the GOP is absolutely obsessed with. The problem with this idea is that the ACA already allows states to do this if they wish (as long as the plans are all fully ACA compliant)...but the carriers simply aren't interested in doing so, because they can simply open up a new subsidiary in each state if they want to anyway and putting together a full network of doctors and hospitals in a brand-new state is a royal pain in the ass.
More importantly, however...
In March 2017, Oklahoma’s Secretary of Health and Human Services published recommendations for a 1332 waiver. The state’s goals are ambitious, and would involve Oklahoma taking a much more hands-on approach to health care reform.
- The state would assume regulatory control over rates and plans, instead of deferring to the federal government for rate review (this would align with what nearly every other state already does).
- The state would also begin to focus on quality measures, value-based payments, and care coordination in an effort to decrease costs and improve quality.
- Oklahoma would allow a wider range of age-based premiums. The ACA caps the ratio at 3:1 for older versus younger enrollees. The AHCA, which was pulled before it reached a vote in the U.S. House, would have increased that ratio to 5:1. Oklahoma wants to implement something similar on a state level.
- Switch from HealthCare.gov to the Insure Oklahoma platform (Insure Oklahoma is a state-run program currently used for low-income residents; more details below)
Yes, that's right: Oklahoma could potentially become the 2nd GOP-controlled state to move off of the federal exchange onto their own full platform (after Idaho; Kentucky doesn't count because kynect was created by executive order under a Democratic governor, and they were on their own platform from the start anyway).
- Establish “consumer health accounts” that would be similar to HSAs.
- ...The ACA’s metal level designations would be eliminated, and replaced with two standardized benefit designs: either a robust, traditional plan, or a high-deductible plan that works with the consumer health accounts.
This doesn't really sound too bad...it basically amounts to a single Bronze and a single Gold (or Silver?) plan being available from each carrier. Right now just about everyone on the exchanges chooses either a Silver or Bronze plan anyway, so that shouldn't be too big of a deal, depending on how "robust" the plans really are.
- The state would “re-evaluate and reduce” the ACA’s essential health benefits requirements.
- ...Subsidies (standardized based on age and income, so presumably not tied to the cost of insurance in a particular area) would be available to offset the cost of insurance for people with income in the 0-300 percent of federal poverty level range. Currently, ACA subsidies are available to those with income between 100-400 percent of federal poverty level. The 1332 recommendations note that nearly 40 percent of Oklahoma’s uninsured population has income under the poverty level, and are thus not able to take advantage of the ACA’s subsidies; the 1332 waiver would allow them access to affordable coverage (it’s worth noting that the ACA called for covering those residents via Medicaid; the reason they’re not eligible for assistance in Oklahoma is because the state has steadfastly refused to accept federal funding to expand Medicaid. In other words, it’s an Oklahoma decision, rather than an ACA design flaw, that has left those residents uninsured).
- The ACA’s three-month grace period for overdue premiums (for people with premium subsidies) would be reduced to 30 days.
I've actually called for shortening the grace period myself. I'd probably go with 60 instead of 30, but it's not tremendously unreasonable to make sure people pay past-due invoices within a reasonable timeframe.
- Special enrollment period eligibility verification would be tighter (including the SEP that currently exists when an applicant is denied eligibility for Medicaid), and the state might consider changes to open enrollment structure, including tying enrollment periods to consumers’ birthdays (as opposed to enrolling everyone at the same time during the year).
Other people I respect on the subject have suggested changing to a "birthday-based" enrollment system; not sure how I feel about it but it doesn't sound too crazy. And Price's HHS Dept. is already cracking down on SEPs anyway, so that's kind of a moot point.
To me, the biggest eye-opener is Oklahoma being perfectly happy to leave their healthcare exchange totally in the hands of "Barack Hussein Obama!!" as long as he was in office, but suddenly scrambling to take local control over it the moment that he's replaced by Republican administration. Think about that for a moment.
COLORADO: One of the 20 different improvements/fixes for the ACA I've compiled was a pretty simple & obvious one: Bump up the tax credit cut-off line and beef them up beneath it. It looks like Colorado is trying to do exactly that at the state level, although in a far more limited manner than I have in mind:
House passes bill to provide financial relief to people hit by the subsidy cliff, heads to Senate
...But in other parts of the country — including the Colorado mountains — insurance premiums can be more than a quarter of a family’s household income. For people in those areas, a very small increase in income can result in the loss of very significant premium subsidies, a phenomenon known as the “subsidy cliff.”
In Colorado, H.B.1235, a bipartisan bill, was introduced in March 2017 in an effort to address the problem.
...If enacted, the legislation would provide state-sponsored premium relief on a quarterly basis to people who are currently the hardest-hit by the subsidy cliff. To be eligible for the assistance, people would have to meet the following criteria:
- Live in one of the three highest-cost rating areas in the state (this was an amendment added on March 31; Colorado has nine rating areas; the bulk of the state’s geographic area — but a relatively small segment of the state’s population — is in the three most expensive rating areas: the mountains —including Grand Junction, which is its own rating area — and the eastern plains).
- Household income between 400 percent and 500 percent of the poverty level (that’s between $47,520 and $59,400 for a single individual, and between $97,200 and $121,500 for a family of four; 2016 poverty levels, which are used to determine 2017 subsidies, are available here)
- Ineligible for Medicare, Medicaid, or an affordable employer-sponsored plan
- Enrolled in a bronze, silver, or gold plan through Connect for Health Colorado
- Premium are more than 15 percent of household income
The legislation would provide financial assistance in the form of money to cover the amount of the premium in excess of 15 percent of the individual or family’s household income. The program would be administered by the county, or by the exchange if a given county didn’t opt to administer it.
The legislation would create a special enrollment period (June 1, 2017 through August 1, 2017) during which people could enroll in plans through the exchange to take advantage of the new financial assistance.
The program would run for the remainder of 2017, and throughout 2018. However, the amendments added on March 31 limit total funding to $5.7 million, and stipulate that the end date of the program would be December 31, 2018, or whenever the funding is exhausted, whichever comes first.
In other words, it would only apply to certain areas of the state, only to those within the 400-500% FPL range, only to really high-priced plans (over 15% of your income...for comparison, the ACA's 100-400% APTC program uses 9.69% as the cap for those at 400% FPL), and would be temporary, for one year only.
Still...it's a start.
NORTH CAROLINA: In addition to Louise's stories above, there's something else happening in North Carolina. As you may recall, newly-elected Democratic Governor Roy Cooper tried to push through Medicaid expansion the moment he took office back in January. Unfortunately, the heavily GOP-controlled state legislature had previously passed a law prohibiting the state from doing so, and the last time I checked it looked like Cooper's push was dead in the water.
However, now that Tom Price is in charge of HHS, it looks like the NC GOP is suddenly interested in expanding Medicaid after all...but only because Price is perfectly fine with allowing work requirements to enroll in the program:
About 375,000 uninsured NC adults would be eligible for coverage under proposal
About 375,000 uninsured residents would be eligible for health insurance under a plan four House Republicans filed last week to expand Medicaid.
...Under the House bill, adults with incomes up to 133 percent of poverty level - less than $16,000 for a single person - would be eligible to buy Medicaid coverage, paying premiums equal to 2 percent of their household income. Beneficiaries would be required to work or be looking for work, though some exemptions would be allowed. An assessment on hospitals would be used to pay the state’s costs.
Personally, the "work requirement" provision strikes me as being pretty stupid and unnecessary, as 87% of Medicaid expansion enrollees already work, and furthermore...
Only 13 percent of adults covered by Medicaid’s expansion are able-bodied and not working, in school, or seeking work. Of that small group, three-quarters report they are not working in order to care for family members and the rest report other reasons, like being laid off. A much higher share of overall American adults are unemployed or not in the labor force (28 percent), according to 2015 Census data. Medicaid expansion enrollees are more likely to be working or looking for work than the general public, unless they are burdened by ill health or the needs of their families. Moreover, Medicaid expansions could make it easier for beneficiaries to find work, as reported in Ohio.
But...ok. If that's really what it takes to get the NC GOP to expand Medicaid...fine, I suppose. Humor them. It'll likely cost a fortune to keep track of who's working, who isn't and who's "looking", but whatever.