Small Business Insurance Exchange First Year Results

Small Business Insurance Exchange First Year Results-Where Does Your State Stand?                                  

Now that first year data for enrollment in Small Business Insurance Exchanges is available, The Commonwealth Fund, a nonprofit health systems research group, sponsored a webinar  for SHOP results.[1]This article reviews nine states which chose to participate in the Small Business Insurance Exchange program, reveals information on enrollment and some surprising innovations for these quasi-governmental insurance marketplaces which was gleaned from that presentation as well as other sources including state legislative sites.

Statewide Performance

Several states created incentives or mandates for the local insurance industry to participate in the SHOP exchanges. The difference in approach between Maryland and Washington is stark, one set a clear standard and mandated participation, sort of “you will suffer together equitably approach” versus Washington’s “who wants to play approach. Colorado, New York, and Oregon decided to implement waiting periods for insurers who chose not to participate in the small business exchange program initially.[2]This does not appear to be much of a disincentive, because the cost to establish the programs, would be borne by the insurers, and create a competing component for their existing insurance programs.Waiting to participate may be viewed as prudence,  but with the risk for market share loss.

California

California’s Small Business Health Options program has been plagued by enrollment glitches, but it is expected to succeed over time. When I navigated to their site from the healthcare.gov site, it suggested that employers had to mail their completed application materials.

Colorado

Colorado’s health insurance exchange web site, called Connect for Health Colorado clearly indicates the employer category, which the end user can follow to locate plan information and insurance broker or government assistance.

District of Columbia

The District of Columbia was able to get its Small Business Exchange open in a mere nine months and it includes; Aetna, Carefirst (a Blue Cross/Blue Shield plan), Kaiser, and United Health Care. According to the D.C. Health Exchange Director, only one group with fifty employees enrolled in their SHOP, but they found robust participation from the small businesses it was meant to serve. Of program enrollees 83% had fewer than five employees and 50% of those enrollees chose the platinum or most comprehensive health care plan, and 28% chose the gold plan. It appears that adequate health care coverage is of more concern to these business owners than the lowest price plan.

Florida

Florida has been successful with its Small Business Health Options Program and its web portal was clear and easy to follow.

Maryland

Originally Maryland mandated that insurance companies with state revenues in excess of 20 million of insurance premiums participate in the small business exchange.[3] Maryland further incentivized private insurance companies to participate in its SHOP CO-OP program by exempting them from paying premium tax on small business health insurance plans within the SHOP program. As of May 2014, Maryland has decided to abandon plans to run its own Small Business Exchange, because of the high cost, instead opting to rely on the insurance broker community to market it. This means that qualifying employers will still be able to obtain government tax credits for purchasing insurance, which have been available since 2010, but only through the federal exchange starting this year.

New York

In New York State, most major insurance carriers were interested in participating in the small business exchange.  But New York has a robust marketplace with many carriers and several of their Medicaid carriers were interested in entering the SHOP marketplace. This would seem to be a prudent move, allowing diversification of risk, a stabilizing factor for managing a population.

Oregon

Oregon, which is now infamous for accepting over 130 million dollars in federal money to set up an exchange, including 48 million for “early innovation”, and ultimately was unable to enroll a single individual it it’s web portal.[4]For more information on federal money given to states for the insurance exchanges go to Chapter 13, of Unraveling U.S. Healthcare-A Personal Guide, published in July 2013, by Rowman and Littlefield.  Oregon found, like Washington, that only a single insurance company wanted to participate in the SHOP program. As of March 17, 2014, Oregon has been unable to enroll a single individual on its small business exchange program.[5] To further entice small business to enroll in the small business exchange program Oregon has reduced premiums by 13.1%, which is a significant regression.

Rhode Island

Rhode Island has successfully launched its Small Business Exchange program, with a greater percent of small business participation than any other state. Rhode Island’s web site for SHOP is integrated into the general health exchange web site which I was able to navigate through easily. Way to go Rhode Island!

Washington

Washington State chose not to participate in the small business exchange in the inaugural year, primarily because only one insurer indicated an interest in bothering with the exchange process.

Federal Marketplace Information

The Center for Medicare and Medicaid (CMS) has also stipulated that insurers with a 20% or greater share of the individual exchange market must offer the small business exchange as well.  The deadline for small business exchanges has been moved to 2015. CMS has created a tool for employers to use to calculate full time employee equivalents, in order to determine eligibility for SHOP exchanges, in addition to the tax credit estimator. Follow the links to see for yourself.

 https://www.healthcare.gov/fte-calculator/

https://www.healthcare.gov/small-business-tax-credit-calculator/

 Employers are slated to receive a bundled monthly billing even if employees have five different provider and plan choices, by 2015.  The federal small business insurance market place will include an agent/broker portal, so businesses can designate a representative and that party will receive some stipend. In order for a small business to receive the federal tax credits for health insurance purchasing, the plan must be part of the Small Business Health Exchange Option, which mandates standards for coverage and plan administration protocols.

 It is unclear how insurance agents will be paid for federal insurance exchange enrollments, but since CMS does pay Medicare enrolled agents to market Medicare products, and CMS is the governing agency for the program, this should be manageable. The big difference is Medicare plans have a single 3 month open enrollment window each year, whereas the SHOP plans have a rolling calendar of enrollments depending on the date of inception.

For more information on small business exchanges, an excellent nonpartisan summary is found at the National Center for State Legislation,[6]which was one of my sources for Unraveling U.S. Healthcare-A Personal Guide’s chapter on the Patient Protection and Affordable Care Act.

And this is the healthpolicymaven signing off, encouraging you to explore your options for health care subsidies from your government. Your government is helping you to pay for your insurance, through direct insurance subsidies or indirectly through tax free benefits for individuals and tax deductible benefit plans for employers.

http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

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[1] http://www.commonwealthfund.org/about-us/events/2012/small-business-exchanges

[2] http://www.rwjf.org/content/dam/farm/reports/issue_briefs/2013/rwjf406939

[3] http://marylandhbe.com/wp-content/uploads/2012/10/Maryland_Health_Benefit_Exchange_Act_of_2012_Senate_Bill_238_House_Bill_443.pdf

[4] http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

[5] http://stateofreform.com/news/industry/insurance-plans/2014/03/oregons-health-co-op-targets-small-group-market-lowers-rates-13/

[6] http://www.ncsl.org/research/health/small-business-health-insurance.aspx

State Laws Which Inform the Consumer of Health Care Prices and Quality

Does Your State Help or Hinder Your Access to Quality Health Care?

This article reviews state health care laws impacting clinical care and resourcing in light of the Accountable Care Act and the needs for primary health care. The recent articles in the academic Health Affairs Journal and by the nonprofit advocacy group, The Commonwealth Fund, address the issue of market competition in health care delivery and the impact on services as well as the potential for anti-trust issues. Anti-trust occurs when a single health care entity or a consortium of providers exerts enough control of the market in a given geographic region, to dictate prices, and to be able to perform in an atmosphere where the consumers have fewer choices. In other words, to charge more without offering an improvement in service. Now, with that in mind, some of the state laws that throw a monkey wrench into this idea of a competitive marketplace for health care are; certificate of need requirements, any-willing-provider regulations, and scope of practice limitations. One example of a legislative limitation on the regulation of health care services, as reported in the state-wide surveys in Unraveling U.S. Health Care-A Personal Guide[1], several states outlaw the practice of naturopathy, which limits the number of clinicians for primary health care. There are also administrative limitations which states use to restrict access for clinical training, such as limiting the funding to university programs for nurse practitioners, thereby restricting the number of clinicians available in the health care system. From an economic standpoint this keeps the compensation high for the practitioners, but results in a dearth of clinicians in an area of great societal need.

As Martin Gaynor points out in Health Affairs’ May 2, 2014 publication, Competition Policy, and Markets: Navigating the Enforcement and Policy Maze, health care delivery, inclusive of insurance and health care services is governed by many different and oft times conflicting entities, from federal to state and local governments.[2]This mishmash of regulation does not result in more effective or less expensive health care.

The Patient Protection and Affordable Care Act created the Accountable Care Act mandates for health care organizations, which pays for clinical performance for treatment of targeted diseases. Now that the ACA has been implemented by many health care systems, financial rewards have been paid, and two years of data is available, there has been sufficient time for states to evaluate and modify their health care sector regulations.  One of the consequences of the ACA has been the merger of many hospitals, which has reduced competition and services in some areas. In Washington State, as I have previously written, Providence Health Care acquired Swedish Hospital Group and Peace Health controls many of the markets in smaller cities throughout the state. Though consolidation may benefit these health care behemoths, it does not necessarily improve or reduce the cost of health care for the consumer.

In order to have an effective market place, one must have a willing buyer and a willing seller, in pure economic terms. Health care, because it is so heavily regulated is not a typical consumer good, however, because most of the health care systems in the United States are not government owned, we do essentially have a privatized system of health care delivery, albeit one which is heavily subsidized by government payments.

These states have enacted price transparency laws for health care providers to bolster their consumer marketplace in light of the Accountable Care Act provisions: Arizona, Arkansas, California, Colorado, Delaware, Florida, Illinois, Indiana, Kentucky, Maine, Massachusetts, Minnesota, Missouri, Nevada, New Hampshire, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Texas, Utah, Virginia, Vermont, Washington, and Wisconsin.

Though price transparency is one of the key aspects of an effective consumer market place from which to buy goods and services, it is not optimal unless you also have the quality of the services also disclosed. Medicare has tracked health care outcomes for years and there is information available by procedure for price and quality on its web site. In January 2014, I presented a consumer tutorial on this tool in my Phinney Community Center presentation. It was obvious from that presentation, that consumers still find the availability of health care quality information difficult to understand and access. If we are going to persist in offering a private sector market place for the purchase of health services, we must demand that price and quality information be available. Clinical outcomes, such as hospital readmission rates, infections, and surgical errors, are examples of health care quality measures. Though aggregated information is available on this data, few states have taken the time to match patient outcomes with pricing. As detailed in chapter seven, Patient Safety-Who Reports Medical Errors, in my 2013 book, Unraveling U.S. Health Care-A Personal Guide[3], Minnesota has a state web site that allows anyone to view each hospital’s medical errors in the state.

As revealed in the National Conference of State Legislatures’ April 2014  article, Transparency and Disclosure of Health Costs and Provider Payments: State Actions, Minnesota is also the state which has created a commission to link health care quality and pricing information in a consumer friendly model, to enhance the effectiveness of its health care market place.[4]This level of transparency is the gold standard and is something consumer driven health care advocates should demand.

Nevada also has an interesting law which mandates health care providers must charge everyone the same price for the same service, in other words they can’t charge higher prices to the uninsured or for those on different health plans. This too, is an interesting approach to a market place correction, because if all prices for the services are set and transparent, then the health care providers must compete on quality, which is really, the most important aspect of health care.  It will be interesting to see how this plays out in Nevada.

And of course, Maryland has had a mandate for level pricing for hospital services on the books for thirty years, and it has been effective in keeping health care costs down, as reported in my December 2013 article on hospital price transparency.

Stay tuned for more information on initiatives to improve consumer information on health care quality and price thus enabling individuals to make informed health care decisions. And this is the healthpolicymaven signing off, encouraging you to share this article with anyone who may benefit.

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[1] http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

[2] http://content.healthaffairs.org/content/early/2014/05/13/hlthaff.2013.0810

[3] http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

[4] http://www.ncsl.org/research/health/transparency-and-disclosure-health-costs.aspx#Legislation

Health Care Laws That Impeed Health Care Delivery For Your Family

For the past eighteen months my son has been recovering from a traumatic brain injury and throughout the plethora of doctor's visits and CT scans, I have regularly been prevented from obtaining appropriate health care for my son by the health insurer, Community Health Plan of Washington. Apparently Washington State has a law which treats anyone fourteen years or older as an adult when it comes to health care. I find this amazing, when they aren't allowed to drive without drivers training and a licensing test, until age sixteen and can't vote until eighteen, but at fourteen they can legally make adult health care decisions. Upon researching what regulation the health plan gatekeepers were referring I learned there are many laws in Washington concerning age-of-consent and health care emancipation.
A minor is considered emancipated at age fourteen under RCW 70 24 330 and 70 24 0147 for HIV testing, under RCW 9 02 100 for abortion, and for obtainment of birth control services under WAC 388 15 240 and WL 168466. Alarmingly, emancipation is considered to be age thirteen for treatment of chemical dependency  under RCW 70 96A 095, and mental health services under RCW 71 34 030. (1)
Community Health Plan has chosen to interpret the plethora of regulations above as applying to any health care service including; consent for immunization, verification of the required health plan referral to a specialist for brain injury evaluation, and obtainment of counseling services. The result of  this legal morass is my son, who received his head injury while skateboarding without a helmet at age sixteen, has refused his flue shot and refused to go to counseling. I have also been unable to verify medical referral information for his head injury, which is a plan requirement in order to see another specialist at Seattle Children's Hospital.
As an analyst I took a look at what other states have deemed an acceptable age of consent for individually driven health care treatment and here is what I learned. Oregon has age fifteen as the age of consent for medical treatment and Alabama has age fourteen, according to an article published in MedScape- Minor's Rights Versus Parental Rights: Review of Legal Issues in Adolescent  Health Care.(2) Most states still require parental consent to provide health care to a minor, so Washington appears to be an outlier here.
Though I certainly respect someone's right to privacy, the key to emancipation is to be of  sound mind and I don't think we have to do much imagining to question the soundness of a thirteen or fourteen year old's mind. In fact, I recall one of my son's buddies prattling on about emancipation and running away to Florida with his girlfriend's family while in the tenth grade, and eventually coming back with his tail between his legs. Shouldn't we at least have some test to certify soundness of mind? The courts don't consider anyone under the age of eighteen competent to make financial decisions.
Even more confounding, I am constantly reminded of my limitations by my son, who is now seventeen, while I haul him around to doctor's appointments, attempt to assure treatment compliance, and hope he graduates from high school on time. So, I am legally still responsible for my son, in terms of his poor judgement and fiscal needs, but I seem to have no purview over his health care. This situation is even worse for parents whose teens fall under the spell of drug abuse as the addicts are required to consent to drug treatment, which is laughable given the maturity factor at age thirteen or fourteen. And of course the parent is still judged by the success or failure of her children. All I can say is I have laid blood on the tracks in my best effort and ultimately it appears I have no control over this emancipated individual, so I hope the courts will keep that in mind the next time he does something stupid.
This is the healthpolicymaven signing off. Feel free to share this article liberally, especially with your legislative representative. For more information on national health care laws and state by state surveys, read  http://www.amazon.com/Unraveling-U-S-Health-Care-Personal/dp/1442222972

(1)Washington State Law Survey of Minor's Right to Consent to Treatment.pdf
(2) Ann Maradiegue, C-FNP, MSN, J Midwifery Womens Health. 2003;48(3)