Marti Lolli, Priority Health’s senior vice president of commercial markets, said managed care organizations initially declined a state invitation earlier this summer to participate in the private health insurance option because of uncertainty over the Medicaid waiver program.

But after several months of discussions with the state and some tweaking of the program, Priority, Meridian, Total and McLaren agreed to offer two benefit plans each in the Lower Peninsula’s 68 counties where they are licensed to operate. However, the state still needed coverage in the 15 counties of the Upper Peninsula. Blue Cross agreed to participate, giving the state coverage of all 83 counties.

Lolli said MDHHS eased some administrative rules and allowed greater price flexibility to encourage plans to participate to cover the small former Medicaid population.

Priest said health plans had some reservations early in planning, but changes in the program structure led to all five health plans participating.

“There are a lot of challenges in the individual market and moving more business there,” Lolli said. “It is very concerning to not know how many people, what their health conditions are and whether they would engage with a health plan.”

Lolli said Priority and the other health plans became comfortable with the state’s plans and signed on. She said, however, the population of Healthy Michigan members the state is targeting have been historically one of the most difficult of all because while they signed up for coverage they have not engaged in a healthy behavior.

“We have done a lot of enrollment education and contacting primary care doctors to get members into their offices,” Lolli said.

Priority Health covers about 120,000 Medicaid members and expects 2,000 to 3,000 of those will end up moving to the individual market.

Kathy Kendall, president of McLaren Health Plan, said McLaren agreed to participate to help the state meet the waiver requirements, protect the Healthy Michigan program and ensure the health care delivery system is stable.

“At risk was the Healthy Michigan plan ending and 600,000 return to uninsured” with emergency departments clogged up, Kendall said.

McLaren, which has 60,000 members in Healthy Michigan, was approved by the state for 45 of the 68 counties in lower Michigan, but with the help of new health system partners, Kendall said McLaren now has Medicaid benefit plans in 64 of 68 lower Michigan counties.

Helen Stojic, spokesman for Blue Cross, said Blue Cross agreed to cover individuals in 15 UP counties who will transition from Healthy Michigan to PPO marketplace coverage. Blue Cross has about 83,000 Medicaid members covered through its subsidiary, Blue Cross Complete.

“We’re pleased that several health plans in addition to Blue Cross have stepped in to help these individuals with coverage,” Stojic said.

Stojic said Blue Cross plans to offer Medicaid members a variety of ways to complete a healthy behavior, including offering free preventive services, annual check-up, online office physical and behavioral health visits and a variety of other online tools to receive information on wellness care and managing chronic conditions.

Sean Kendall, president and COO of Meridian Health Plan of Michigan, said the state’s largest Medicaid HMO with more than 560,000 members has been trying to contact members who have still not complied with the healthy behavior requirement. Meridian has about 8,500 covered in a private insurance product on the exchange.

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Some on Medicaid must adopt a ‘healthy behavior’ or lose coverage – Crain’s Detroit Business