October 2009 Archives

Yesterday the House Leadership released its merged health reform bill, The Affordable Health Care for Americans Act of 2009. It includes some noteworthy changes with respect to kids and families from the previous version of the bill.  Here are some highlights:

• Raises the mandatory Medicaid threshold from 133% to 150% FPL.  CBO estimates that by 2019, 15 million new individuals will receive Medicaid as a result of the expansion.  Also maintains current state Medicaid eligibility levels above 150% (which also now includes children in CHIP-funded Medicaid expansions).

• Continues full federal funding up to 150% FPL for all adults and newly eligible parents in 2013 and 2014--but, starting in 2015, the percentage will decrease to 91%. In a significant move for states, it extends (from the end of 2010 until June 30, 2011) the ARRA provision that increased Medicaid's federal matching rate for states.

• Still allows CHIP to expire at the end of 2013 (with states maintaining current coverage levels until that time.) States with separate CHIP programs will shift children at income levels below 150% FPL to Medicaid, for which they will receive their current CHIP-enhanced match.
  

• Expects remaining CHIP children will be enrolled in Exchange the day after CHIP expires on December 31, 2013. Also revises language that originally precluded this transfer until children received comparable coverage. Now the Secretary of HHS will report to Congress on how to ensure that the Exchange coverage (benefits and cost sharing) is comparable to an average CHIP plan and that appropriate transfer procedures exist.
  

• Continues to provide subsidies to people up to 400% FPL and establishes new out-of-pocket caps. But decreases the subsidy levels across the income levels. For example, a person at 250% of FPL will now contribute up to 8% of their income, instead of 7%.

• Maintains increases in Medicaid's payment rates for primary care services. Starting in 2012, rates would rise to those for Medicare with the federal government covering most of the increased costs.
  

Look out for our new summary of the legislation in the coming days.

Judy Waxman, Vice President for Health and Reproductive Rights, 
National Women's Law Center  

This week, we released a new report, Still Nowhere to Turn: Insurance Companies Treat Women Like a Pre-Existing Condition, uncovering the latest data on the disparities women face in health care coverage. Some of our findings included:

• The extent of gender rating -- in which insurance companies charge women more than men for the  same coverage -- has remained abysmal since we issued our landmark Nowhere to Turn report last year. A full 95 percent of the best-selling plans in the individual insurance market practice gender rating in 2009, compared to 93 percent in 2008.

• Gender rating of premiums also occurs in the group market; insurance companies in most states are allowed to charge a business more for coverage of its female employees. Although some states have protections against this discriminatory practice, these protections are typically limited to small groups - such as businesses with 50 employees or less. Moderate-sized and larger businesses are subject to gender rating in all states except Montana.

• We found even more egregious examples of gender rating among 25-year-olds in 2009, using the same random sampling methods as in 2008.  At this age, some women are charged up to 84 percent more than men for individual health plans that exclude maternity coverage.

• To further examine the arbitrary nature of the current individual market system, NWLC looked at premiums charged 40-year-old female non-smokers versus 40-year-old male smokers. In most states, it often costs more to be a woman than to be a male smoker; more than 60 percent of best-selling plans charged 40-year-old female non-smokers more than 40-year-old male smokers.
  

To find out more about women and health reform and to find out how you can take action, visit our new campaign website, Being a Woman Is Not a Pre-Existing Condition.


The views expressed by Guest Bloggers do not necessarily reflect the views of the Center for Children and Families.

In the past few months, opponents of health reform have made many false claims about various aspects of legislation moving through Congress.  The most recent example that comes to mind are the charges made about Medicaid during mark-up of the Senate Finance Committee bill.  Opponents slung a lot of mud at the Medicaid program and tried to make the argument that expanding Medicaid coverage would reduce access to care.  Here's a quick fact sheet that helps set the record straight.

CMS released the latest in a series of state health official letters providing guidance on CHIPRA implementation. This seventh letter focuses on the new mandatory dental provisions for separate CHIP programs, as well as the option these states have to provide a stand-alone dental plan to children who are insured or underinsured but would otherwise qualify for CHIP. Both provisions are effective October 1, 2009. These provisions do not impact states that provide CHIP coverage through a Medicaid expansion program.

The addition of dental standards is considered one of the victories in CHIPRA since receiving dental care is without a doubt critical to the healthy development of children. With tooth decay as the most prevalent childhood infectious disease, the omission of mandated dental coverage in CHIP has been a significant oversight.

Although all states provided some level of dental services in CHIP there were often service or dollar limitations. Now states must provide "coverage of dental services necessary to prevent disease and promote oral health, restore oral structures to health and function, and treat emergency conditions." States have two options for providing this coverage:

• States can translate this requirement into a defined set of benefits that includes medically necessary services within specific categories. This may prove a bit tricky as the burden is on states to demonstrate that their package meets the intent of the statute.

• Alternatively, states can provide benefits equal to one of three benchmark plans: either the dental coverage in the most popular federal or state employee plan, or the state commercial plan with the highest non-Medicaid enrollment. Note that there is no option for proving actuarial equivalence (as there is for CHIP medical benefits).
  

Regardless of the option chosen, the cost-sharing requirements must meet CHIP rules. States cannot impose cost-sharing for preventive and diagnostic services and the cost-sharing for both medical and dental services can be no more than 5% of family income.  

States also now have the option to provide a stand-alone dental plan for children who are income-eligible for CHIP but who have private medical coverage that has limited or no dental benefits. States that elect to offer this coverage must offer the same (and not more favorable) dental benefit plan as is provided to CHIP enrollees. For children with some dental coverage, this plan can serve as a "wrap," filling in gaps as a secondary payer to their private coverage. In order to offer a stand-alone plan, states must not maintain a waiting list or set a numerical limitation on the number of children enrolled in CHIP. In addition, the 5% cost-sharing cap on total medical and dental services also applies, which may represent a challenge since the state may not have access to information about a family's cost-sharing in their private insurance. As such, this may present a sizeable administrative barrier.

Despite the recent guidance, some questions remain. For example, must cost-sharing above any aggregate or maximum cap on benefits (as are common in commercial plans) be counted toward the 5% maximum cost-sharing? While the provisions are effective October 1, 2009, are states with pre-existing managed care plans required to modify their current contracts to come into compliance immediately or at contract renewal? As is common with federal policy, we continue to peel back the multiple layers of intepretation in search of definitive answers states need to fulfill the promise of CHIPRA.

As a shared federal-state program, the distribution of financing in Medicaid has long been an area of debate. Whenever changes in the program are discussed (or as in the debate over the stimulus package, increases are considered), distributional questions come up. How much should the federal government pay versus the states? How much of the pie will each state get? What formula will be used to divide up the funds?

There has been much buzz surrounding the issue in recent days, with some going so far as to call the proposed expansion of Medicaid in the health care reform bills "an unfunded mandate."  To be sure, states have legitimate gripes with the federal government in some areas of Medicaid financing - like the lack of a coherent long-term care policy, which has resulted in Medicaid being tapped to fill in the void. But when the rumors are flying, it is always a good time to sit back and look at the facts. Here's our reality check:

Under current law, the federal government matches state spending in Medicaid on an open-ended basis. The federal matching rate can range from 50% to 76%, depending on a state's per capita income (states with higher per capita incomes have a lower federal matching rate).
 
Under the Senate Finance Committee Mark, beginning in 2014, additional Federal financial assistance would be provided to all states to defray the costs of covering "newly-eligible" beneficiaries. Basically, the Federal government would pay a greater share of the costs for adults below 133% of FPL who were not previously eligible or who were eligible through a capped waiver, but were not enrolled. The amended mark would also provide 100% federal funding for five years to "high-need states," defined as states with low per capita Medicaid enrollment and a high unemployment rate.

So what does this mean for states? Well, for four states (Michigan, Nevada, Oregon, and Rhode Island) the increased cost of the proposed expansion would be paid in full by the federal government. For the remainder, the federal government would pick up between 77% and 95% of the additional expense in the first year (2014).

Let's look at just one state, Texas (since it has the largest number of expected newly-eligible new enrollees) to see what it means, in reality. (Estimates used during the markup provide a state-by-state breakdown of the 11 million newly eligible adults that are projected to enroll in coverage.) In Texas, the average per capita spending on adults in Medicaid is $2,510. If, as estimated, 1.5 million newly-eligible people enroll, the cost will be roughly $3.9 billion dollars. No small change. However, with the feds picking up 95% of the tab, the state of Texas would be expected to pay $195 million. Still, no small change, but when you look at how much the state spends in Medicaid, it's about a 3% increase in spending to cover an additional 1.5 million people.

Seems like the states are getting a pretty good deal.
 

Today, three more states moved forward with their plans to expand affordable health coverage to more uninsured children, implementing expansions they passed earlier in the year. These three states are among the twenty-three that improved child and family health coverage this year.

Starting today:

• Uninsured Alabama children in families earning up to 300% of the federal poverty level (FPL) will be eligible to enroll in All Kids. That is up from 200% of the FPL.

• The Healthy Montana Kids Plan will open its doors to children in families earning up to 250% of FPL, expanding eligibility from 175% of the FPL.

• In Oregon, children in families earning up to 200% of the FPL will now be eligible for the Healthy Kids, an increase from 185% of the FPL. The state will further expand coverage in January.
  

In this time of economic uncertainty more and more families are finding it difficult to secure affordable health insurance. Those who have lost a job are facing the hard decision of how to pay for health coverage given the other bills piling up. Those with an offer of employer coverage are increasingly facing rising health care costs and steeper, unsustainable premiums. Many states understand this struggle facing families and have moved to meet their needs by expanding Medicaid and CHIP income eligibility levels.

As Congress continues to debate health reform, key questions on affordability and the role of public programs remain unanswered. Members would be wise to look to the states - recognizing that affordable coverage is out of reach for far too many and building on the key ingredients of successful Medicaid and CHIP programs.

Yesterday, Secretary Sebelius awarded $40 million to 69 grantees in 41 states and the District of Columbia to find and enroll children who are uninsured but eligible for Medicaid or CHIP. This is the first round of outreach and enrollment grants funded through the Children's Health Insurance Reauthorization Act (CHIPRA), which was signed by President Obama in February 2009. CHIPRA provides $10 million each for a national enrollment campaign and outreach to American Natives. In addition to the $40 million in grants awarded yesterday, there is an additional $40 million that will be awarded in future grant rounds to states and other qualifying organizations.

Projects targeting outreach to children in families with limited English proficiency and other ethnic and cultural barriers were the big winners in this first round of CHIPRA grants, accounting for nearly one-third of the grants. Initiatives focused on school-based outreach, activities coordinated by community health centers and projects targeting rural children were also popular.

Notably, the majority of grantees are community-based organizations or coalitions, with only ten grants awarded to state agencies with primary responsibility for administering Medicaid and CHIP. Awards ranged from $69,102 to $988,177 for the two-year grant period with more than one third of the grantees receiving more than $900,000 each.

The projects promote strong community-based strategies targeting vulnerable populations. What is less clear is whether these efforts will result in the policy simplifications and systemic changes that are known to reduce paperwork and remove administrative barriers to enrollment and retention. Grantees are required to demonstrate with data the extent to which their strategies result in enrollment and retention. Best practices and lessons learned will be documented and shared with other states and organizations committed to ensuring that all children eligible for Medicaid and CHIP receive the health care they need.