Members of a Medicaid study commission are exploring shifting the state’s Medicaid expansion population onto a managed-care model, a potentially transformative proposal intended to address predicted future premium spikes.
At a meeting Wednesday, the commission, chaired by Senate Majority Leader Jeb Bradley, heard from executive directors of local managed care organizations and deliberated on whether New Hampshire should join other states in adopting the model.
Managed care is a system by which states contract with specialized providers – MCOs – to accept Medicaid patients at a fixed rate per patient. The providers administer medical services within a network of hospitals and physicians, much like insurance.
If adopted, the system would represent a vast change. Currently, Medicaid expansion recipients in New Hampshire are handled through the Premium Assistance Program, allowing them to buy health insurance through the individual market.
But that market, established by the Affordable Care Act, is facing trouble.
A report last week by Gorman Actuarial found that those in the individual market who don’t receive subsidies – about a quarter of the market – could see a 52 percent spike in premiums next year. That increase could cause between 5,000 and 13,000 consumers to depart the market, according to the report.
Speaking last week, Bela Gorman of Gorman Actuarial described the situation as a “death spiral.”
Now legislators and health care stakeholders are looking for a way to stem the price spikes. By moving those with higher medical costs onto managed care plans, New Hampshire could save money and better meet the needs of high-risk patients, some commission members said.
Addressing the commission, Lisabritt Solsky, executive director Well Sense Health Plan, a nonprofit that offers managed care plans, made a pitch for the efficiencies of the system. Managed care programs have a projected annual rate of increase of 3.8 percent; are more communicative with patients, ensuring better relations and less “churn”; and would bring down the premiums of those in the separate individual market, Solsky argued.
Solsky characterized the coordinated services provided, which include transportation, addressing substance use disorder and behavioral health needs, as “one-stop shopping.”
“That is not the same on the premium assistance side,” she said. “The member has much more responsibility to do that coordination on their own, particularly around transportation.”
The model was received favorably by many on the commission. But so far, it’s a loose sketch. Among the key questions facing the commission: whether to eliminate the Premium Assistance Program and move the full Medicaid expansion population onto managed care, or focus on only the high-risk, high-cost patients.
“Whether we do a partial split with more MCOs for medically frail, or whether we do away with PAP is a pretty fundamental issue,” Bradley said, saying there were advantages and disadvantages to both systems.
He added that further actuarial analysis should be completed on both approaches by the next meeting, Oct. 25.
The commission, which features legislators, providers and insurance representatives, has until Dec. 1 to produce a report on its findings. The timeline is tight: New Hampshire’s Medicaid program “sunsets” in December 2018, before which the Legislature must reauthorize it. And the program faces funding issues – after the Centers for Medicare and Medicaid Services challenged the state’s present contribution model, which relies on insurer and hospital contributions, legislators are scrambling to find a fix.
Speaking after the meeting, Bradley said that, given the approaching report deadline, the committee will likely punt the funding questions to the Legislature, which reconvenes in January.
But addressing the stabilization of the insurance market, the commission was not short on ideas. Members discussed improving the designation system for the “medically frail” – those on the Premium Assistance Program who could qualify for Medicaid due to physical or emotional issues that impair everyday activities. Jennifer Patterson, health policy legal council at the New Hampshire Insurance Department, floated the creation of a reinsurance program funded through savings made through waivers.
Two hours into the meeting, Bradley pointed out that most of the legislators on the commission, having voted to reauthorize Medicaid expansion in 2014, will likely support its extension.
“That being said, we’ve got to convince others that the program is working,” he said, alluding to the likely legislative fight ahead. “And that’s the point I’m making: (We’re) trying to make it as efficient as possible. And protect taxpayers as much as possible.”
(Ethan DeWitt can be reached at email@example.com, or on Twitter at @edewittNH.)