This story appeared in June 18, 2014, edition of the Arkansas Democrat-Gazette.
|Publication: Arkansas Democrat-Gazette;||Date: Jun 18, 2014;||Section: Front Section;||Page: 1|
Private option enrollees to chip in under proposal ANDY DAVIS ARKANSAS DEMOCRAT-GAZETTE
A proposal being designed by Arkansas Medicaid officials would require many people covered under the state’s so-called private option to make monthly contributions, ranging from $5 to $25, to help pay the cost of their medical care.
In return, participants in the expanded Medicaid program will be able to accumulate up to $200 in an “independence account” that they could use to pay the premium for private coverage if they leave the private option, the officials told state lawmakers Tuesday.
Robin Arnold-Williams, a partner with the Leavitt Partners consulting firm, told legislators with the Arkansas Health Insurance Marketplace Oversight Committee that the proposal is designed to educate participants about health care costs and insurance, promote personal responsibility and reduce the potential “cliff” of reduced benefits that participants could face upon switching from the private option to another form of coverage.
Enrollees in the private option do not pay premiums now, and those earning less than the poverty level are not required to contribute any money toward the cost of their medical care.
Enrollees with incomes of 100 percent to 138 percent of the poverty level are charged copayments — $8 for a doctor’s visit or $10 for a visit to a specialist’s office, for instance.
Those out-of-pocket charges are capped at $604 for the year.
Although other states are pursuing similar initiatives, Arkansas Surgeon General Joe Thompson said the independence account program would be the first of its kind in the country.
“I think we’re pushing the envelope on testing different strategies that other states have not done,” Thompson said.
Act 1498 of 2013, which created the private option, requires the state Department of Human Services to put such a program into operation next year.
Special language included during this year’s fiscal session in legislation that authorized funding for the state’s expanded Medicaid program, including the private option, requires the state to submit drafts of the independence account program for public comment by Aug. 1 of this year.
The legislation requires the state to apply to the U.S. Department of Health and Human Services for approval of the program by Sept. 15.
The legislation prohibits the state from continuing the private option after Feb. 1, 2015, if the independence account program is not in operation by then.
Thompson said he expects the state to apply for federal approval of the program next month.
The initiative could help reduce the cost of providing coverage under the Medicaid program, although that is not the goal, he said.
“It’s an educational opportunity,” Thompson said.
Approved by the Legislature last year, the expansion of the state’s Medicaid program extended eligibility to adults with incomes of up to 138 percent of the poverty level: $16,105 for an individual or $32,913 for a family of four.
As of May 31, more than 187,000 Arkansans had been approved for coverage under the expanded Medicaid program, including more than 152,000 who had enrolled in the private option.
Under the private option, most people who qualify for coverage under the expanded program receive coverage through private plans on the state’s federally run insurance exchange, with the Medicaid program paying the premium.
Those whose health needs are considered exceptional are assigned to the traditional Medicaid program.
For those in the private option, the Medicaid program also makes additional payments to reduce or eliminate any required out-of-pocket spending for medical care.
The independence account program, which will be required for private option enrollees with incomes of at least 50 percent of the poverty level, will charge copayments for the first time to enrollees with incomes of 50 percent to 100 percent of the poverty level, Thompson said.
Those with incomes in that range will be expected to contribute $5 a month toward their accounts, while those with higher incomes will be expected to contribute $10 to $15, depending on their incomes.
The state will match each monthly contribution with a $15 contribution into the account. Enrollees will be allowed to accumulate up to $200 of the state contributions in their accounts, which can be used to pay a premium for a non-Medicaid plan on the health insurance exchange when the enrollee leaves the private option.
Enrollees who leave the private option and gain coverage through an employer can also use the account balance to pay the premium for an employer-sponsored plan.
Making a contribution will also earn participants an additional benefit: They will not have to pay out of pocket for medical care as long as they pay their contributions on time for a given month.
Those with incomes above the poverty level who fail to contribute to their independence accounts will have to pay any required copayments, as they are now required, if they seek medical care.
Those with incomes below the poverty level who fail to make contributions into the accounts will still not be required to make copayments in order to receive care.
However, the company hired to administer the program will bill the individual for the copayment, and it will be deducted from any balance in the independence account the person has accumulated. If the account does not have a balance, the participant would owe the amount of the unpaid copayment to the state.
That was troubling to Sen. Linda Chesterfield, D-Little Rock.
“You run the risk of criminalizing … the inability to pay what they probably can’t pay in the first place,” Chesterfield said.
Arnold-Williams said it will be up to the Legislature to decide whether the state attempts to collect the money.
Thompson said participants also will receive account statements with information about their coverage.
Educating the participants about the initiative will be crucial, he said.
“For most of these people, the only place they’ve been able to access care is the emergency room,” Thompson said.
As of May 31, 81 percent of those who had been approved for coverage under the expanded Medicaid program had incomes below the poverty level, according to the Human Services Department.
Thompson said he didn’t have information Tuesday on how many enrollees had incomes between 50 percent and 100 percent of the poverty level.