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It's a busy month on the essential health benefits front!  As we've noted, one option for states under the proposed approach for state-defined EHB packages is to use one of the state's three largest small group plans as a benchmark.  It's been difficult to evaluate this proposal because we didn't know which plans were the three largest in each state--even state insurance commissions don't always have this information.

Well, on Wednesday, HHS released a list of what it believes to be the three largest small group plans for every state.  It relies on data insurers submitted to Healthcare.gov from June of 2011.  The list comes with many disclaimers, so we can't take it as the official small group choices for states, but it's a start.

This info is useful to have, but we still need to know more about these plans to fully evaluate the EHB proposal.  We need to know exactly what the plans cover and what they exclude.  The list of plan names from HHS at least gives us a place to start in digging up that information. 

We have been offering our insights on essential health benefits through a series of blog posts.

This post is to alert you that Georgetown CCF has drafted a letter in response to the Bulletin issued by HHS in December.  We raise a number of concerns with the Bulletin's approach to essential health benefits and ask that HHS made a number of changes to better protect benefits for children and their families.  The letter asks HHS to:

* Ensure children's needs are taken into account--The benchmark plans identified in the bulletin are predominately employer-based plans.  We think states should have an option to choose a benefit package that has been designed with children's developmental needs in mind, like Medicaid's EPSDT benefit.

* Define pediatric services as including but not limited to oral and vision care--While the Bulletin discusses only oral and vision care for kids, we believe there are other services, like speech therapy or more frequent durable medical equipment, that Congress intended children to receive under this category of services it included as a requirement for the EHBs.

* Define medical necessity--Since a determination of medical necessity will affect whether a child can access the essential health benefits, we believe it is crucial for the Secretary to set a standard definition of this concept that insurance plans must follow.

* Limit insurer flexibility--The Bulletin suggests that insurers would have the authority to alter the essential health benefits.  We believe this will take away a key feature of exchange--apples-to-apples comparisons between plans.

* Assure a transparent process of benchmark selection and updating--Ensuring meaningful opportunities for public participation will be key to protecting the interests of children, families, and all insurance consumers. 

We plan to submit the letter by the date for responses provided in the Bulletin:  Tuesday, January 31.  We encourage other organizations to provide comments, as well, and if you would like to use our letter for inspiration or outright copying, please do so!  Remember, too, that since HHS explained its approach in a Bulletin rather than a formal proposed rule, it can still consider comments that come in after the January 31 date.  But don't wait too long as there will be no shortage of health reform guidance and rulemaking filling all of our inboxes in the months ahead.

There are people in my family who think I am unduly obsessed with Tom Brady.  They might even accuse me of co-authoring a paper on states at the forefront of covering our nation's children that features Massachusetts just so I could say "Just as Tom Brady is in a league of his own when it comes to quarterbacking, the Commonwealth of Massachusetts is the clear national leader when it comes to covering children." But, the honest-to-goodness truth is that the new paper we issued yesterday with the Kaiser Commission on Medicaid and the Uninsured, "Secrets of Success: An Analysis of Four States at the Forefront of the Nation's Gains in Children's Health Coverage," grew out of a discussion that CCF and Kaiser Commission on Medicaid and the Uninsured staff had together last spring.  It took place long before Tom Brady beat Tim Tebow and the Denver Broncos (soundly, I must add) and resulted in a paper that examined Massachusetts, but also three other states -- Alabama, Iowa and Oregon -- that are at the forefront of covering children.

Here is how it started.  We were discussing the news that Massachusetts had achieved a 99.5 percent coverage rate among children in 2010 and commenting on the extraordinary nature of this achievement.  Tricia Brooks with CCF, Samantha Artiga with the Kaiser Commission on Medicaid and the Uninsured, and I decided to jump in and try to untangle how the state got there.  At the same time, we didn't want to leave it just at Massachusetts.  While it is in a league of its own, states around the country have made enormous strides in covering kids.  Indeed, as we've pointed out repeatedly at CCF, the nation now has the lowest uninsured rate of children on record despite sharp jumps in child poverty and lots of other dire economic news.  So, we selected a diverse group of four states - one state from each region of the country at the forefront of covering kids: Alabama, Iowa, Massachusetts and Oregon - to investigate the "secrets" to their success.

Even though these four states have dramatically different political and policy cultures, we heard a number of common themes when interviewing state officials and advocates from each of the four states: 

* At least one political leader in the state - and, in most instances, a number of political leaders over time - made coverage of children a top priority.

* Expansive eligibility levels for children and adoption of a broad range of simplification strategies have been key elements of achieving progress. All four states have expanded eligibility for children to 300% of the federal poverty level and have taken up many of the opportunities to streamline and simplify enrollment and renewal processes for families.

* Community partners and providers play a vital role in helping families to enroll in coverage. We heard this in each of the four states, but perhaps most strongly in Massachusetts.  Interestingly, Massachusetts lags somewhat in the extent to which it has simplified its application and enrollment process, but makes up for it in no small part by relying heavily on community partners to help people enroll in coverage.  (Hey, even Tom Brady has someone weakness - a poor running game - but he also makes up for it in other areas.)The state and advocates have a robust relationship in which they exchange information on emerging issues and ideas about how to improvement enrollment.  It also has the advantage of a strong culture of coverage, which can be directly linked to its passage of broad health reform in 2006. 

* Strong coordination between Medicaid and CHIP aid in outreach and enrollment efforts and smooth transitions between programs. Each of the four states has taken steps to promote close alignment between Medicaid and CHIP, with Massachusetts and Oregon fully unifying the two programs. 

We also talked to each of the states about where they see their remaining challenges, and what they are working on now.  In a sure sign of why they are at the forefront of covering kids, each of them had a long list of challenges they were actively working to tackle, such as the need to improve retention, to cope with ongoing growth in enrollment amidst diminishing administrative resources; updating decades-old eligibility systems; and improving communications with families and obtaining better enrollment data.  Just like Tom Brady and the New England Patriots, they do not rest on their laurels and, instead, start each week looking ahead and figuring out how to continue to get better and better.

So my previous blog on this topic talked about how the CHIP/Essential Health Benefits analogy has its limits - still it is interesting to look at the choices that states have made for their benefits packages in separate state CHIP programs.

According to data collected and released by NASHP from mid-2008, the most popular choice by states was to use "Secretary approved coverage" - an option that would not be available under EHB. 

Eighteen out of 40 states picked this option. Most states were using this option to provide a Medicaid look-alike package so as to simplify coordination between the two programs - an interesting finding. The second choice was to base CHIP benefits on state employee coverage - again, something with which states are familiar. Only one state has selected the federal employees benefit option - suggesting that few states will pick up this option in EHB.

Four states selected benchmark equivalent coverage.  In two of those states,  South Carolina and Utah,  the benchmark was tied to their state employee coverage and in the other two, Indiana and Wisconsin, the benchmark was tied to the largest commercial HMO.

So a bit of a hodgepodge but it seems to me that the CHIP experience suggests that few states will choose the FEHBP option and are more likely to choose an option that promotes coordination with other aspects of their state coverage picture. This could mean that many states will choose the small group option (so as to have continuity inside and outside of the exchange) or the state employee option.

This is the third in Say Ahhh's blog series on essential health benefits.

By Leigha Basini, National Academy for State Health Policy

The new year brings many new things: new discussions about CCIIO's newly released Essential Health Benefits (EHB) Bulletin and benefit provisions in the seemingly still new Affordable Care Act.  But state CHIP directors may also be thinking about a slightly older benefit provision--the CHIPRA dental mandate.  NASHP, in conjunction with the Children's Dental Health Project, recently completed an issue brief for the National Maternal and Child Oral Health Policy Center on states' dental benefit changes as a result of CHIPRA, and the findings may help state CHIP programs that are still mulling over their options, state officials working on the EHB, and advocates focused on ensuring strong coverage for children.

Prior to CHIPRA, all states voluntarily offered some level of oral health benefit, but benefits varied widely by state.  CHIPRA leveled the playing field by requiring all states to offer dental coverage that meets a minimum level.  Although regulations are still forthcoming, CMS guidance gives states two options.  States may offer a state-defined benefit package with coverage of services in ten distinct categories such as diagnostic and preventive care and orthodontics.  Or, similar to the options the federal government gave states with CHIP and the EHB package, states may offer a benchmark plan.  Benchmark options include:

1. The Federal Employee Health Benefits Program dependent dental coverage that employees selected the most frequently in the past two years;

2. State employee dependent dental coverage that employees selected the most frequently in the past two years; or

3. The state dental plan with the largest commercial, non-Medicaid enrollment.

 

However, unlike CHIP benefit packages and EHB, benchmark plans must truly be equivalent and not just actuarially equivalent.  States may add benefits to the benchmark plans, but they may not subtract or alter the benefits that the benchmark plan provides.  On the flip side, if the benchmark plan does not cover a certain service, such as orthodontics, the state is not required to cover it in its CHIP plan. 

 

Of the nine states with CMS-approved State Plan Amendments (SPAs) at the time the brief was written, seven of nine chose to offer state-defined dental benefit packages as opposed to benchmark packages.  This is perhaps surprising because states opting for state-defined coverage must cover costlier services such as orthodontics that may not be required with a benchmark package.  Also, these states must cover medically necessary care that is in excess of annual benefit maximums.  However, it may actually be less costly for states to provide a state-defined package, since the benchmark packages generally require hefty cost sharing, and CHIP cost sharing is limited to five percent of a family's income, including non-dental services, too.  So, it could be rather costly for a state to provide a benchmark plan with very limited cost sharing.

 

The new EHB guidance gives states two options for providing pediatric dental coverage--the Federal Employees Dental and Vision Insurance Program dental plan with the largest enrollment or the benefit package in the state's CHIP program.  While we don't yet know the nuances of what this means, the apparent possibility of overlap in kids' dental benefits across CHIP and EHB coverage gives state agencies a great opportunity to collaborate and ensure a level of consistency across coverages.  For states that haven't yet selected a CHIP dental benefits package, the EHB bulletin provides an incentive for collaboration, and for CHIP programs that have already implemented their CHIP dental benefits, it gives state officials working on the EHB a great resource to call on!

 

Benefits are only one part of improving children's dental health, and states are looking forward to the release of the State Health Official letter regarding CMS' oral health strategy to improve utilization rates.  But CHIPRA's dental benefit is a great start for children in CHIP, as it ensures that all CHIP kids have a base level of comprehensive oral health benefits needed for strong dental and physical health and well-being.

As soon as rumors started flying about what would be in the essential health benefits guidelines I thought hmmmm that sounds a lot like CHIP. At first blush the new guidance does sound like the CHIP model - indeed the guidance says as much (p. 8). But as HHS officials and others have pointed out, there are ways in which this new guidance is quite different from CHIP.

As my colleague Joe Touschner blogged about before Christmas, states will now have a choice of choosing from a number of benchmarks that mirror the choices in CHIP i.e. an FEHBP equivalent product, a state employee package or coverage offered through the largest commercial HMO. The Essential Health Benefits (EHB) guidance specifies that any of the three largest state or federal employees plans by enrollment would be acceptable.

But the EHB guidance offers a new option - the three largest plans (by enrollment) in a state's small group market. This option has caused some concern since coverage in the small group market is generally not as good as on the large employer side.

According to the guidance, small group coverage is actually very similar to large group coverage - and indeed all of the listed benchmarks according to the guidance (p. 4) - in terms of benefits covered.  Where significant differences may occur it would be more likely to be in the area of cost-sharing - and the EHB guidance does not address the issue of cost-sharing.

We hope that HHS officials will share the data they have on this important question since there are many reasons why states may wind up choosing a small group package as its benchmark. (More on this in a later blog.) And finding out what the top 3 plans are in your state is top of the 2012 to do list for many state readers I suspect. But for now back to the CHIP analogy....

Of course one obvious difference is that the CHIP program allows states to choose to do a Medicaid expansion or a separate state program with a benchmark package. For kids, this means that they have access to the Medicaid EPSDT benefit - which according to the Academy of Pediatrics is the gold standard for kids -- if the state goes the Medicaid route. For EHB, states don't have the option of going the EPSDT route for kids.

Another way in which the EHB guidance is different from CHIP is that the Affordable Care Act included a list of 10 benefits that must be covered. This list includes "pediatric services, including oral and vision care" - so these benefits will need to be added if not covered by the benchmark package. The list of benefit categories may constrain some of the flexibility in the benchmark options that states have in CHIP. On the other hand the EHB guidance may offer more flexibility than the CHIP standard in some respects -- another topic for a future day - what kind of insurer flexibility is really floating around in the EHB guidance?

Finally, unlike CHIP, the ACA includes anti-discrimination provisions with respect to age, disability and expected length of life.

So lots to think about as we all work to prepare comments on the federal proposal AND as states start to think about their choice of benefits package. As with much else in the implementation of the ACA, state action will be critical here. Stay tuned!

Editor's Note:  This is the first in a series of forthcoming blogs focusing on essential health benefits from the perspective of children and families.  We welcome guest bloggers to submit entries on this topic.  Please contact Say Ahhh! editor Cathy Hope if you would like to submit a blog.

For nearly a year now, we've been tracking the process of defining the essential health benefits.  The EHB package will define the minimum set of benefits to be covered by insurance plans in the individual and small group markets as well as benchmark Medicaid plans and Basic Health Programs.

On Friday afternoon, HHS released a bulletin to give some indication of its approach to defining the essential health benefits and to request continued comment.  The bulletin indicates that rather than one national standard, each state will have a choice of how to define which health benefits are deemed essential for its residents.  Under this approach, states would tie their EHB package to the benefit package offered under one of several benchmark options:

• One of the three largest small group products in the state
• One of the three largest state employee health plans
• One of the three largest federal employee health plans
• The largest HMO plan in the state

Once the benchmark is selected, the package still must comply with the ACA's requirement that the EHBs cover ten required categories of services.  So if the selected benchmark does not cover all ten categories, those services must be added to the package.  The state's EHB package must also comply with additional ACA requirements that prevent discrimination based on age and disability and mandate consideration for the needs of certain populations, among them children.

What does this mean for the benefits kids will receive under the ACA?  Unlike what many had expected, it means there is less likely to be a strong federal minimum benefit standard--instead benefits will be tied to the existing insurance offerings in many states, which can certainly leave a lot to be desired in many cases.  A key point yet to be determined is how services under the ten categories will be added to benchmark packages that lack them.  "Pediatric services, including oral and vision care," is one of the ten categories that must be covered, but the bulletin seems to indicate that HHS will interpret this category to mean only oral and vision care for kids, not other needed pediatric services.  Further, habilitation services is another of the categories and is important for many children, but is usually excluded from the types of plans identified as potential benchmarks.  The bulletin suggests some possible ways to add these services, but the details are sketchy.  It's also unclear how the ACA's provisions preventing discrimination and requiring consideration of children's needs will be applied--these could become key protections if they are the only standard for assuring kids get what they need.

Where do we go from here?  The process for defining EHBs is still very much underway.  HHS put out the bulletin to let us know the direction it is moving, but it still has yet to formally propose regulations that define EHBs.  It has requested further comments on the ideas in the bulletin to further inform the rulemaking process, which will later include its own comment period.  But if the scheme in the bulletin remains in place, publishing federal regulations will not be the last step in defining EHBs.  Each state will have to choose which benchmark to adopt and how to augment it, so advocates for kids will need to weigh in to make sure those choices are good ones for children.

By Laura Summer, Georgetown University Health Policy Institute

(Editor's Note:  Given the increasing interest in Medicaid managed care among states eager to achieve cost-savings, we asked our colleague Laura Summer to blog for us on her latest report on managed care. Her report focused on long-term care services but it provides some helpful insights into broader managed care proposals.)

Currently, a number of states are contemplating a shift to covering new populations and long-term service and support benefits through capitated payments to traditional risk-based managed care organizations (MCOs). Particularly in light of pressures to balance state budgets, the approach is touted as a means to deliver services in a more cost-effective manner. Other advantages cited include the potential to change the balance of care in favor of community-based services and to promote better service coordination and integration as compared to the traditional fee-for-service delivery model. A managed care approach may be one means of providing higher quality care in a more efficient less costly manner, but before embracing the approach, states should take time to evaluate the likely outcome of program changes. Establishing a high quality program is a complex process that requires initial investments to ensure that new arrangements will be effective and viable over the long term.

Experience with and evidence about the impact of Medicaid managed long-term service and support programs (MLTSS) is limited.  Relatively few states currently use capitated models to manage care for the elderly or individuals with disabilities, the populations most likely to require LTSS.  Research to date indicates that relative to fee-for-service programs, MLTSS programs reduce the use of institutional services and increase access to home and community-based services, but there is little definitive evidence about whether the model saves money or about how it affects outcomes for consumers.

Program design is an important component of state MLTSS initiatives. The extent to which MLTSS programs cover institutional services, medical care, or behavioral health services, in addition to community-based LTSS, affects MCOs' ability to coordinate services and manage costs effectively. Other significant program features to consider are whether enrollment in Medicaid MLTSS plans is mandatory or voluntary and whether the MCO is sponsored by a commercial, non-profit, or governmental entity.  In light of budget shortfalls, and particularly if government downsizing is occurring, states may have diminished capacity to develop, implement, and monitor new MLTSS initiatives. Planning and start-up periods should be long enough to allow state agencies to collaborate to make complex program design choices, to work with CMS to obtain the authority to operate new programs, and to consult with stakeholders, including consumers, providers, and MCOs.

Community-based organizations play a vital role in ensuring an adequate supply of long-term services and supports, and it is important to consider their role in a managed long-term care system.  These entities often have long-standing ties with consumers by making LTSS referrals or providing services.  In a managed care environment, community-based organizations in some states function as MCOs or participate in MCO provider networks. 

Strong state oversight of MCOs is essential, and quality measures are needed.  When states delegate functions to MCOs, they cannot cede responsibility for management and guidance, especially for the very vulnerable populations that require LTSS. Significant components of effective oversight include explicit contract language about plans' responsibilities, early attention on the part of states to determining how performance will be measured, and ongoing feedback from consumers and providers to help monitor program operations.  A major challenge is that few quality measures for LTSS have been developed or tested.

Certain program features promote a shift to more community-based and better-coordinated services.  The array of services for which MCOs are responsible and at risk may affect their ability to coordinate services effectively or achieve diversions from institutions or transitions from institutions back to the community. The switch to managed care also raises questions about who bears responsibility for and has the capacity to address the lack of affordable accessible housing alternatives and inadequate pools of qualified formal caregivers, which continue to be significant barriers to keeping people who need LTSS in the community.  

Efforts to improve the quality of services and deliver them in a more efficient manner are worthy goals, but if MLTSS programs are to succeed, careful design should be based on a thorough understanding of the strengths and needs of the various populations that use them. It is important also to retain aspects of current home and community-based service programs that are considered effective. The vision and responsibility for Medicaid MLTSS programs rests with states. It is essential for states to have time, expertise, and financial resources to consult with stakeholders, shape programs, attend to administrative details, clarify expectations, and monitor program operations so that they can strike the right balance between managing care and managing costs.

Even as unemployment and child poverty has grown, the uninsured rate for children has decreased by 14% nationwide, according to the report we just released today at back-to-back Capitol Hill briefings.  It was great to share this good news at House and Senate briefings with overflowing crowds.  The briefings were sponsored by the "Children's Health Group", a coalition of nearly 40 national organizations. 

Dr Marion Burton, past president of the American Academy of Pediatrics, Mark Wietecha, President and CEO of the National Association of Children's Hospitals and Dianne and Carissa Malley, a family from New Jersey, joined me at the podium.  Carissa, a 15-year-old girl with Downs Syndrome, stole the show with her charismatic personality as her mother explained how their family would be bankrupt if Medicaid had not helped them meet the high cost of her medical care.

I spent the day answering questions from reporters and hill staffers about the report and most wanted to know what was behind the drop in uninsurance rates.  As most Say Ahhh! readers know, the answer is: Medicaid and CHIP.  These two federal-state partnerships are responsible for one of the few bright spots in an otherwise challenging landscape for children and families.  They have continued to fill the void created by a decline in employer-based health insurance, rising unemployment and the increasing cost of private health insurance.

In the report, CCF researchers used newly available American Community Survey data to more closely examine the impact of Medicaid and CHIP on the lives of children on a state-by-state basis.  Here's what we found:

• The vast majority of states, 34 to be precise, saw a decline in the uninsured rate for children.
• Florida made the most progress in reducing the number of uninsured children over the three-year period, but it still has one of the highest rates and largest number of uninsured children in the nation. Just six states (Arizona, California, Florida, Georgia, New York and Texas) account for more than half of the uninsured children nationally.
• Seven states saw an increase in the number of uninsured children but in only one state, Minnesota, was the change statistically significant.  Minnesota's children lost ground with 11,672 more uninsured children in 2010 than in 2008.

(To see how children are faring in your state, please view the table or map in the report.)

While the country made progress in covering children, there are some important differences in coverage levels among demographic groups that are worth noting:

• Hispanic, American Indian and Native Alaskan children remain disproportionately uninsured;
• Older children are less likely to be covered than younger children;
• Uninsurance rates are higher for children living in families earning below 50 percent of the poverty line even though the vast majority of them are eligible for Medicaid coverage.

Kudos to those state leaders who, with strong federal support through Medicaid and CHIP,  have provided some much needed peace of mind to many families struggling to meet their children's health care needs during perilous economic times.  It is important to stay focused as these gains could quickly be reversed if state or federal support erodes.

We've posted in the past about the essential health benefits--the package of benefits that will be the basis for all health plans in the individual and small group markets and for some in Medicaid starting in 2014. Last month, the Institute of Medicine made recommendations to the Department of Health and Human Services on how to choose the essential health benefits, but HHS wants to hear other perspectives, too. The Department is holding ten "listening sessions" across the country to allow anyone to provide input on EHBs. The first session will be this Friday, November 4 in Chicago and the last on November 21 in San Francisco. See the full list here.

What message should advocates for kids and families carry to these meetings? The 100% Campaign in California has provided a strong example in a letter they've already provided to HHS, which was also signed by two dozen other organizations in the state. Their key points (with my additions in parentheses):

• Children have unique health needs (and are often not well served by the typical small employer health plan, the model the IOM identified for the essential health benefits).

• Instead, Medicaid's EPSDT benefit standard should be the model for kids' benefits in the EHB.

• The definition of "medical necessity" is important to assuring kids get all the services they need (especially for kids' developmental and habilitative needs) and again in this area EPSDT provides a stronger model than private plans.

• The essential health benefits represent an opportunity to address health disparities by providing benefits that not only treat disease, but promote and maintain health for those who will be newly eligible for exchange subsidies and Medicaid.

Child advocates will want to emphasize that kids should have access to the services that are medically necessary and that affordability from a family's perspective needs to take into account not just premium costs, but cost-sharing and any costs for services that are necessary but not covered. Those planning to attend may also want to address the questions that HHS has posed for attendees:
 

• In keeping with the title of the Institute of Medicine report "Essential Health Benefits--Balancing Coverage and Cost", how can the Department best meet the dual goals of balancing the comprehensiveness of coverage included in essential health benefits and affordability?

• How might the Department ensure that essential health benefits reflect an appropriate balance among the categories so that they are not unduly weighted toward any category?

• What policy principles and criteria should be taken into account to prevent discrimination against individuals because of their age, disability status, or expected length of life as the Affordable Care Act requires?

• What models should HHS consider in developing essential health benefits?

• What criteria should be used to update essential health benefits over time and what should the process be for their modification?

Once the listening sessions are complete, HHS will write a proposed rule that provides more definition of the essential health benefits. We'll all have a chance to weigh in then in writing before the rule becomes final, but this month is your chance to speak in person to HHS officials on the importance of providing strong benefits for kids. Other stakeholders will surely be making their case, so kids and families need strong representation, too.